As filed with the Securities and Exchange Commission on January 25, 1999
Registration Statement No. 333-68587
===========================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-4
AMENDMENT NO. 1 TO REGISTRATION STATEMENT NO. 333-68587
UNDER THE SECURITIES ACT OF 1933
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JONES APPAREL GROUP, INC.
(Exact name of Registrant as specified in its charter)
JONES APPAREL GROUP HOLDINGS, INC.
(Exact name of Registrant as specified in its charter)
JONES APPAREL GROUP USA, INC.
(Exact name of Registrant as specified in its charter)
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Pennsylvania 6179 06-0935166
(State or other (Primary standard industrial (I.R.S. Employer
jurisdiction of industrial classification Identification No.
incorporation or code number)
organization)
Delaware 6179 51-0384507
(State or other (Primary standard industrial (I.R.S. Employer
jurisdiction of classification code number) Identification No.)
incorporation or
organization)
Pennsylvania 2330 23-2978516
(State or other (Primary standard industrial (I.R.S. Employer
jurisdiction or classification code number) Identification No.)
incorporation or
organization
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250 Rittenhouse Circle
Bristol, PA 19007
(215) 785-4000
(Address, including zip code, and
telephone number, including
area code, of Registrants'
principal executive offices)
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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)
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Copy to: Philip J. Boeckman, Esq. Cravath, Swaine & Moore 825
Eighth Avenue New York, NY 10019 (212) 474-1000
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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: [ ]
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CALCULATION OF REGISTRATION FEE
===============================================================================
Proposed
Proposed Maximum
Title of Each Class Maximum Aggregate Amount of
Class of Securities Amount to be Offering Price Offering Registration
to be Registered Registered Per Unit(1) Price(1) Fee(2)
6.25% Senior Notes
due 2001 $265,000,000 100% $265,000,000 $73,670
===============================================================================
(1) Estimated solely for the purposes of computing the registration fee
pursuant to Rule 457(f)(2) under the Securities Act of 1933.
(2) Previously paid. Calculated by multiplying the aggregate offering
amount by .000278.
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The Registrants hereby amend this Registration Statement on such
date or dates as may be necessary to delay its effective date until the
Registrants 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.
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Prospectus Subject to Completion
January 25, 1999
$265,000,000
Jones Apparel Group, Inc.
Jones Apparel Group Holdings, Inc.
Jones Apparel Group USA, Inc.
Offer to Exchange
6.25% Senior Notes due 2001
for any and all outstanding 6.25% Senior Notes due 2001
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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 Our "affiliates" (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 36.
o We do 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.
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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
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As used in this Prospectus, unless the context requires otherwise, (1)
"JAG" means Jones Apparel Group, Inc., (2) "Jones Holdings" means Jones
Apparel Group Holdings, Inc., (3) "Jones USA" means Jones Apparel Group
USA, Inc., (4) "We" means JAG, Jones Holdings and Jones USA, collectively,
(5) "Jones" or the "Company" means JAG and its predecessors and
consolidated subsidiaries, (6) "Sun" means Sun Apparel, Inc. and its
consolidated subsidiaries and (7) "Notes" means both the Restricted Notes
and the Exchange Notes. Italicized terms in this Prospectus indicate
trademarks or other protected intellectual property which Jones or Sun owns
or licenses.
<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, October 2,
1998, January 1, 1999 and January 13, 1999.
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, JAG consummated its acquisition
(the "Acquisition") of Sun, pursuant to an Agreement and Plan of Merger
entered into on September 10, 1998 with Sun and its shareholders. In the
Acquisition, JAG 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 JAG's Common Stock, plus potential future payments based on Sun's
operating performance. JAG also assumed or refinanced $228.5 million of Sun
debt.
Offering of Restricted Notes. On October 2, 1998, JAG 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 (the "Indenture") between JAG and The Chase Manhattan Bank, as
trustee. The Restricted Notes were issued as unsecured senior obligations
of JAG, ranking equally in right of payment with all existing and future
unsecured senior debt of JAG and senior in right of payment to all future
subordinated debt of JAG.
JAG received net proceeds of approximately $263.5 million from the
issuance of the Restricted Notes. JAG 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, JAG 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.
Reorganization
On January 1, 1999, JAG consummated a corporate reorganization (the
"Asset Drop-Down Transaction"), which JAG believes will provide certain tax
benefits. Under the Asset Drop-Down Transaction, JAG transferred all
operations which it had previously directly conducted to a new wholly owned
subsidiary, Jones USA. In addition, JAG formed another new wholly owned
subsidiary, Jones Holdings. Jones Holdings serves as an intermediate
holding company, immediately above Jones USA and immediately below JAG, and
holds the interests, either directly or indirectly, in all of JAG's other
subsidiaries.
As a result of the Asset Drop-Down Transaction:
o JAG is the parent holding company and holds 100% of the equity in
Jones Holdings;
o Jones Holdings is an intermediate holding company and the only
direct subsidiary of JAG;
o Jones Holdings holds 100% of the equity in Jones USA; and
o JAG's other subsidiaries have become either direct or indirect
subsidiaries of Jones Holdings.
<PAGE>
Concurrently with the consummation of the Asset Drop-Down Transaction
and pursuant to the terms of the Indenture, Jones USA assumed the role of
obligor of the Notes under the Indenture, with JAG remaining and Jones
Holdings becoming co-obligors of the Notes. In addition, Jones USA assumed
the role of borrower under the Senior Credit Facilities, with JAG remaining
and Jones Holdings becoming additional obligors. Without in any way
affecting the co-obligation of JAG and Jones Holdings under the Indenture
and the Senior Credit Facilities, it is expected that Jones USA will make
all payments in respect of the Notes and the Senior Credit Facilities.
For a more complete understanding of the Company's organizational
structure following the Asset Drop-Down Transaction, you should refer to
the List of Subsidiaries, which is included as Exhibit 21 to the
Registration Statement that relates to this Prospectus.
<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'
other 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'
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 needs to
successfully integrate Sun's business into its other 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 was Jones'
first acquisition of another company. Jones may not be able to integrate
Sun's operations into its other 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
<PAGE>
instruments, including the Indenture. The additional leverage will also
reduce funds available for operations, capital expenditures, acquisitions
and future business opportunities.
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
JAG 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 our "affiliates"
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 us 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.
We do 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.
<PAGE>
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.
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 we intend 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
JAG 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 JAG 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, JAG
and the Initial Purchasers entered into an Exchange and Registration Rights
Agreement dated October 2, 1998, in which JAG 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.
JAG 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 we fail 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, we believe 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 our "affiliate" (as defined in Rule 405 under the
Securities Act); and
o you are not an Initial Purchaser who acquired Restricted Notes
directly from JAG 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" 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
We will not receive any cash proceeds from the issuance of the
Exchange Notes. As consideration for the Exchange Notes, we 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.
We 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 our outstanding
aggregate indebtedness.
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, we 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, we will issue and deliver $1,000
principal amount of Exchange Notes in exchange for each $1,000 principal
<PAGE>
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 to us 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 our "affiliate" (as defined in Rule 405 under the
Securities Act), 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, JAG 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 us, and to the terms and provisions of
the Exchange and Registration Rights Agreement. See "--Conditions to the
Exchange Offer."
We shall be deemed to have accepted validly tendered Restricted Notes
when, as and if we have 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 us 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 our expense, 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. We 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 we, in our sole discretion, extend the Exchange Offer,
in which case the term "Expiration Date" shall mean the latest date to
which the Exchange Offer is extended. We 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.
We expressly reserve the right, in our 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 us
(if permitted to be waived by us), we expressly reserve the right, in our
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 our oral or written notice thereof
to the registered holders of the Restricted Notes. If we amend the Exchange
Offer in a manner which we determine to constitute a material change, we
will promptly disclose such amendment in a manner reasonably calculated to
inform the holders of such amendment and we will extend the Exchange Offer
to the extent required by law.
Without limiting the manner in which we may choose to make public
announcements of any delay in acceptance, extension, termination or
amendment of the Exchange Offer, we 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 us that, among other things:
o any Exchange Notes to be received by it will be acquired in the
ordinary course of its business;
<PAGE>
o it has no arrangement or understanding with any person to
participate in the distribution of the Exchange Notes; and
o it is not our "affiliate" (as defined in Rule 405 under the
Securities Act), 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 Exchange Agent and us 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 us 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 our "affiliate" (as defined in Rule 405 under the
Securities Act), 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, we recommend that holders of Restricted Notes use an
overnight or hand delivery service. In all cases, you should allow
sufficient time to ensure delivery to the Exchange Agent prior to the
Expiration Date. No Letter of Transmittal or Restricted Notes should be
sent to us.
<PAGE>
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 us, submit evidence
satisfactory to us 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 us in our sole discretion, which determination will be
final and binding. We reserve the absolute right to reject any and all
Restricted Notes not properly tendered or any Restricted Notes our
acceptance of which would, in the opinion of our counsel, be unlawful. We
also reserve the absolute right to waive any irregularities or conditions
of tender as to particular Restricted Notes. Our 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 we shall determine.
Although we intend to notify tendering holders of defects or irregularities
with respect to tenders of Restricted Notes, neither we, 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 us or 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 we determine are not properly
tendered or the tender of which is otherwise rejected by us and as to which
the defects or irregularities have not been cured or waived by us 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.
In addition, we reserve the right in our 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.
<PAGE>
Book-Entry Transfer
We understand 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 we 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
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.
<PAGE>
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 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);
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 us in our sole
discretion and our 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, we 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 our 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;
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 our ability
to proceed with the Exchange Offer.
If we determine that we may terminate the Exchange Offer for any of
the reasons set forth above, we 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
<PAGE>
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 we
determine that such waiver constitutes a material change in the Exchange
Offer, we will promptly disclose such change in a manner reasonably
calculated to inform the holders of such change and we will extend the
Exchange Offer to the extent required by law.
The foregoing conditions are for our sole benefit and we may assert
any such condition regardless of the circumstances giving rise to such
condition or may waive such condition in whole or in part at any time and
from time to time in our sole discretion. Our failure 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 our directions. 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
We 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.
We have 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. We will, however, pay
the Exchange Agent reasonable and customary fees for its services and 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. We
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.
We 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.
<PAGE>
We 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, we will bill the amount of
such transfer taxes 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 our accounting records on the date of the
exchange. Accordingly, we will not recognize any gain or loss for
accounting purposes as a result of the consummation of the Exchange Offer.
We will amortize the expense of the Exchange Offer 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, we 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 us;
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")
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
<PAGE>
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
JAG 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".
In connection with the Asset Drop-Down Transaction, and pursuant to
the terms of the Indenture, Jones Holdings and Jones USA entered into a
supplemental indenture dated January 1, 1999 (the "Supplemental Indenture")
with JAG and the Trustee, pursuant to which Jones USA fully and
unconditionally assumed the obligations of JAG under the Indenture and the
Notes, with JAG remaining and Jones Holdings becoming co-obligors under the
Indenture and the Notes. Without in any way affecting the co-obligation of
JAG and Jones Holdings under the Indenture, it is expected that Jones USA
will make all payments in respect of the Notes.
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, and the
Supplemental Indenture, which is included as Exhibit 4.3 thereto.
The Notes will be unsecured senior obligations of the Credit Parties,
ranking equally in right of payment with all existing and future unsecured
senior debt of the Credit Parties and senior in right of payment to all
future subordinated debt of the Credit Parties.
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 the Credit Parties 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 the Credit Parties, 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 the Credit Parties 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 the Credit Parties,
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
<PAGE>
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
the Credit Parties 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) 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 the Credit
Parties have 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
<PAGE>
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
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 a Credit Party or Subsidiary of a Credit Party 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
<PAGE>
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 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. 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.
By prior agreement, the foregoing provisions were not intended to
apply and did not apply to the Asset Drop-Down Transaction. Pursuant to the
provisions of the Supplemental Indenture executed in connection with the
Asset Drop-Down Transaction, Jones USA fully and unconditionally assumed
the obligations of JAG under the Indenture and the Notes, with JAG
remaining and Jones Holdings becoming
<PAGE>
co-obligors under the Indenture and the Notes. See "The Company
- --Reorganization". In addition, following the Asset Drop-Down Transaction,
JAG and Jones Holdings have agreed not to engage in any activity other than
(a) continuing to own all the Capital Stock of, in the case of JAG, Jones
Holdings, and, in the case of Jones Holdings, Jones USA and subsidiaries of
Jones USA and (b) certain related or other activities incidental thereto.
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 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 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 the Credit Parties of the
default and the applicable Credit Party or Restricted Subsidiary 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 the Credit
Parties 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 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
<PAGE>
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, the Credit Parties 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 co-obligation of any Additional Obligor that would adversely affect the
holders.
Without the consent of any holder, the Credit Parties and the Trustee
may amend the Indenture to cure any ambiguity, omission, defect or
inconsistency, 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 secure the Notes, to add guarantees or
co-obligors with respect to the Notes, to add to the covenants of the
Credit Parties for the benefit of the holders or to surrender any right or
power conferred upon the Credit Parties, 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
the Credit Parties from making material amendments to debt instruments,
including the Indenture, without the consent of a majority of the lenders
under the Senior Credit Facilities.
<PAGE>
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, the Credit
Parties 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 the Credit Parties may require a
holder to pay any taxes required by law or permitted by the Indenture. The
Credit Parties 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 the Credit Parties at any time may
terminate all their 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 the Credit Parties at any time may
terminate their 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").
The Credit Parties may exercise their legal defeasance option
notwithstanding their prior exercise of their covenant defeasance option.
If the Credit Parties exercise their legal defeasance option, payment of
the Notes may not be accelerated because of an Event of Default with
respect thereto. If the Credit Parties exercise their 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 any Credit Party to comply with clause (iii) or
(iv) under "-- Merger and Consolidation" above.
In order to exercise either defeasance option, the Credit Parties 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 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 was
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.
<PAGE>
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
"Additional Obligors" means JAG and Jones Holdings.
"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.
"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.
<PAGE>
"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 JAG, Jones Holdings and Jones USA.
"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.
"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"), the Credit Parties shall
substitute therefor another Primary Treasury Dealer
<PAGE>
and (2) any other Primary Treasury Dealer selected by the Independent
Investment Banker after consultation with the Credit Parties.
"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 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 consequences of 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, we 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. We take no responsibility for these operations or procedures, and
urge investors to contact the relevant system or its participants directly
to discuss these matters.
DTC has advised us 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.
We expect 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. We understand that
under existing industry practice, in the event we request 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 we 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, we
(as the Credit Parties) 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 we 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 we 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) we notify 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) we, at our option, notify
the Trustee in writing that we elect 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 we 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. We have 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, we 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.
We 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, we 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. We have 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., General Counsel of JAG, has passed upon the
validity of the Exchange Notes offered by this Prospectus. With respect to
certain matters concerning Pennsylvania and Delaware 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 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
authorized by us. Neither the
delivery of this Prospectus nor any
sale made hereunder will, under any
circumstances, create any
implication that there has been no Jones Apparel Group, Inc.
change in our affairs since the Jones Apparel Group Holdings, Inc.
date as of which information is Jones Apparel Group USA, Inc.
given in this Prospectus. This
Prospectus does not constitute an
offer or solicitation by anyone in
any 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 solicitation.
-------------------
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
allotments or subscriptions. [Date]
===================================== ==============================
<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 the By-laws of
Jones Apparel Group, Inc. and Section 7.1 of the By-laws of Jones Apparel
Group USA, Inc. provide 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, such By-laws provide that the applicable corporation 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 a corporation 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 a corporation 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.
The Certificate of Incorporation of Jones Apparel Group Holdings,
Inc., a Delaware corporation ("Jones Holdings"), provides that no director
of Jones Holdings shall be personally liable to Jones Holdings or its
stockholders for monetary damages for breach of fiduciary duty other than
as expressly provided in Section 102(b)(7) of the DGCL, which eliminates
liability except (1) for any breach of the director's duty of loyalty to
Jones Holdings or its stockholders, (2) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of
law, (3) under Section 174 of the DGCL or (4) for any transaction from
which the director derives an improper personal benefit. Furthermore, the
Certificate of Incorporation and By-laws of Jones Holdings each provide
that Jones Holdings shall indemnify its officers, directors, employees and
agents to the full extent permitted by the DGCL, and shall pay and advance
expenses for any matters covered by such indemnification.
<PAGE>
Subsection (a) of Section 145 of the General Corporation Law of
Delaware (the "DGCL") empowers a corporation to indemnify any person who
was or is a party or is threatened to be made a party to any threatened,
pending or complete action, suit 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 director,
employee or agent of the corporation or is or was serving at the request of
the corporation as a director, officer, employee or agent of another
corporation, 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 such action, suit 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 action
or proceeding, has no cause to believe his or her conduct was unlawful.
Subsection (b) of Section 145 of the DGCL empowers a corporation 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 suit by or in the
right of the corporation to procure a judgment in its favor by reason of
the fact that such person acted in any of the capacities set forth above,
against expenses (including attorneys' fees) actually and reasonably
incurred by him or her in connection with the defense or settlement of such
action or suit 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 except that no indemnification may be made in respect to
any claim, issue or matter as to which such person shall have been adjudged
to be liable to the corporation unless and only to the extent that the
Court of Chancery or the court in which such action or suit was brought
shall determine that despite the adjudication of liability such person is
fairly and reasonably entitled to indemnity for such expenses which the
court shall deem proper.
Section 145 of the DGCL further provides that (1) to the extent a
director, officer, employee or agent of a corporation has been successful
in the defense of any action, suit or proceeding referred to in subsections
(a) and (b) or in the defense of any claim, issue or matter therein, he or
she shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him or her in connection therewith; (2)
indemnification or advancement of expenses provided for by Section 145
shall not be deemed exclusive of any other rights to which the indemnified
party may be entitled; and (3) the corporation shall have the power to
purchase and maintain insurance on behalf of a director, officer, employee
or agent of the corporation against any liability asserted against him or
her or incurred by him or her in any such capacity or arising out of his or
her status as such whether or not the corporation would have the power to
indemnify him or her against such liabilities under Section 145.
<PAGE>
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
EXHIBIT NO. DESCRIPTION
3.1 Certificate of Incorporation of Jones Apparel Group
Holdings, Inc.
3.2 By-laws of Jones Apparel Group Holdings, Inc.
3.3 Articles of Incorporation of Jones Apparel Group USA, Inc.
3.4 By-laws of Jones Apparel Group USA, Inc.
*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)
4.3 Supplemental Indenture dated as of January 1, 1999, by and
between Jones Apparel Group, Inc., Jones Apparel Group
Holdings, Inc., Jones Apparel Group USA, Inc. and The Chase
Manhattan Bank, as trustee
5.1 Form of opinion of Ira M. Dansky, Esq.
5.2 Form of opinion of Mesirov Gelman Jaffe Cramer & Jamieson,
LLP
10.1 Agreement and Plan of Reorganization dated as of January 1,
1999, between Jones Apparel Group, Inc., Jones Apparel Group
Holdings, Inc. and Jones Apparel Group USA, Inc.
10.2 Master Joinder Agreement, dated as of January 1, 1999, to
the Credit Agreements referred to therein, entered into by
and among Jones Apparel Group, Inc., Jones Apparel Group,
USA, Inc., Jones Apparel Group Holdings, Inc., as Credit
Parties, and First Union National Bank, as Administrative
Agent on behalf of the Lenders
*12.1 Computation of Ratios of Earnings to Fixed Charges
21.1 List of Subsidiaries
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
*Previously filed.
<PAGE>
ITEM 22. UNDERTAKINGS.
(a) Each 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.
(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) Each 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, each 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, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
(d) Each 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, each of the
Registrants 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
JONES APPAREL GROUP HOLDINGS, INC., Registrant
by /s/ Ira M. Dansky
-------------------------------
Ira M. Dansky
President
JONES APPAREL GROUP USA, INC., Registrant
by /s/ Wesley R. Card
-------------------------------
Wesley R. Card
Chief Financial Officer
January 25, 1999
<PAGE>
SIGNATURES
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
JONES APPAREL GROUP, INC.
* Chairman and Director
- ------------------------- (Chief Executive Officer)
Sidney Kimmel
* President and Director
- -------------------------
Jackwyn Nemerov
* Chief Financial Officer
- ------------------------- (Principal Financial Officer)
Wesley R. Card
* Vice President and Corporate Controller
- ------------------------- (Principal Accounting Officer)
Patrick M. Farrell
* Executive Vice President, Marketing, and
- ------------------------- Director
Irwin Samelman
* Director
- -------------------------
Geraldine Stutz
* Director
- -------------------------
Howard Gittis
* Director
- -------------------------
Eric A. Rothfeld
* Director
- -------------------------
Mark Schwartz
*By: /s/ Ira M. Dansky Attorney-in-Fact January 25, 1999
------------------- pursuant to a previously
Ira M. Dansky filed Power of Attorney.
<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
- ------------------------ --------------------------- -------------
JONES APPAREL GROUP HOLDINGS , INC.
/s/ Ira M. Dansky President and Treasurer January 25, 1999
- ------------------------ and Director
Ira M. Dansky (Chief Executive Officer)
/s/ Joseph T. Donnalley Vice President/ Finance and January 25, 1999
- ------------------------ (Principal Financial Officer
Joseph T. Donnalley and Principal Accounting
Officer)
/s/ Norman Shuman Vice President and Secretary January 25, 1999
- ------------------------ and Director
Norman Shuman
JONES APPAREL GROUP USA , INC.
/s/ Sidney Kimmel Chairman and Director January 25, 1999
- ------------------------ (Chief Executive Officer)
Sidney Kimmel
/s/Jackwyn Nemerov President and Director January 25, 1999
- ------------------------
Jackwyn Nemerov
/s/ Wesley R. Card Chief Financial Officer January 25, 1999
- ------------------------ (Principal Financial Officer)
Wesley R. Card
/s/ Patrick M. Farrell Vice President and Corporate January 25, 1999
- ------------------------ Controller (Principal
Patrick M. Farrell Accounting Officer)
/s/ Irwin Samelman Executive Vice President, January 25, 1999
- ------------------------- Marketing, and Director
Irwin Samelman
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
3.1 Certificate of Incorporation of Jones Apparel Group
Holdings, Inc.
3.2 By-laws of Jones Apparel Group Holdings, Inc.
3.3 Articles of Incorporation of Jones Apparel Group USA,
Inc.
3.4 By-laws of Jones Apparel Group USA, Inc.
*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)
4.3 Supplemental Indenture dated as of January 1, 1999, by
and between Jones Apparel Group, Inc., Jones Apparel
Group Holdings, Inc., Jones Apparel Group USA, Inc. and
The Chase Manhattan Bank, as trustee
5.1 Form of opinion of Ira M. Dansky, Esq.
5.2 Form of opinion of Mesirov Gelman Jaffe Cramer &
Jamieson, LLP
10.1 Agreement and Plan of Reorganization dated as of
January 1, 1999, between Jones Apparel Group, Inc.,
Jones Apparel Group Holdings, Inc. and Jones Apparel
Group USA, Inc.
10.2 Master Joinder Agreement, dated as of January 1, 1999,
to the Credit Agreements referred to therein, entered
into by and among Jones Apparel Group, Inc., Jones
Apparel Group, USA, Inc., Jones Apparel Group Holdings,
Inc., as Credit Parties, and First Union National Bank,
as Administrative Agent on behalf of the Lenders
*12.1 Computation of Ratios of Earnings to Fixed Charges
21.1 List of Subsidiaries
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
*Previously filed.
Exhibit 3.1
CERTIFICATE OF INCORPORATION
OF
JONES APPAREL GROUP HOLDINGS, INC.
FIRST: The name of the corporation is JONES APPAREL GROUP HOLDINGS,
INC.
SECOND: The address of its registered office in the State of Delaware
is 1209 Orange Street, in the City of Wilmington, County of New Castle,
19801. The name of its registered agent at such address is THE CORPORATION
TRUST COMPANY.
THIRD: The nature of the business or purpose to be conducted or
promoted is:
To engage in the maintenance and management of intangible assets and
investments and to collect and distribute the income therefrom.
FOURTH: The Corporation shall have authority to issue 1,000 shares of
common stock with a par value of $0 per share, amounting in the aggregate
to 0.
FIFTH: The name and mailing address of the incorporator is as follows:
Name Mailing Address
Karen M. Wolcott 1735 Market Street
38th Floor
Philadelphia, PA 19103-7598
SIXTH: The confrontation is to have perpetual existence.
SEVENTH: The Board of Directors is expressly authorized to make, alter
or repeal the By-Laws of the Corporation.
EIGHTH: The number of directors constituting the initial Board of
Directors shall be one (1), which number may be increased or decreased
pursuant to the By-Laws of the Corporation, but shall never be less than
one. The names and addresses of the initial directors until the first
annual meeting or until his successors are duly chosen and qualified are as
follows:
Name Mailing Address
Ira Dansky 1411 Broadway - 37th Floor
New York, NY 10018
<PAGE>
NINTH: No director of this Corporation shall be personally liable to
the Corporation or to its shareholders for monetary damages for breach of
fiduciary duty other than as expressly provided in Section 102(b)7 of Title
8 of the Delaware Code. It is the intention of this Article NINTH to limit
the liability of directors of this Corporation to the fullest extent
permitted by Section 102(b)7 of Title 8 or by any other present or future
provision of Delaware Law.
TENTH: The Corporation shall indemnify its officers, directors,
employees and agents to the extent permitted by any present or future
provision of Delaware Law. The Corporation shall pay and advance expenses
to directors and officers for matters covered by indemnification to the
full extent permitted by such law, and may similarly pay and advance
expenses for employees and agents. This Article TENTH shall not exclude any
other indemnification or other rights to which any party may be entitled in
any manner.
THE UNDERSIGNED, being the incorporator hereinbefore named, for the
purpose of forming a corporation pursuant to the General Corporation Law of
the State of Delaware, does make this Certificate, hereby declaring and
certifying that this is her act and deed and the facts herein stated are
true, and accordingly, I have hereunto set my hand this 7th day of October,
1998.
/s/ Karen M. Wolcott
--------------------------------
COMMONWEALTH OF PENNSYLVANIA :
: SS
COUNTY OF PHILADELPHIA :
BE IT REMEMBERED that on this 7th day of October, 1998, personally
came before me, a Notary Public for the Commonwealth of Pennsylvania, Karen
M. Wolcott, the party to the foregoing Certificate of Incorporation, known
to me personally to be such, and acknowledged the said Certificate to be
his act and deed and that the facts stated therein are true.
GIVEN under my hand and seal of office the day and year aforesaid.
/s/ Rose A. Peach
--------------------------------
Notary Public
My Commission Expires:
January 23, 2003
Exhibit 3.2
JONES APPAREL GROUP HOLDINGS, INC.
BY-LAWS
ARTICLE I - OFFICES AND SEAL
1.1 Offices. The registered office of the corporation shall be at such
place within the State of Delaware as the Board of Directors may determine,
and the corporation may also have offices at such other places as the Board
deems appropriate.
1.2 Seal. The corporate seal shall have inscribed thereon the name of
the corporation, the year of its incorporation, and the words "Corporate
Seal, Delaware".
ARTICLE II - SHAREHOLDERS' MEETINGS
2.1 Annual Meeting. There shall be an annual meeting of the
shareholders each year, at such time and place as the Board of Directors
may determine. At the annual meeting, the shareholders shall elect
directors, if appropriate, and transact such other business as may properly
be brought before the meeting.
2.2 Special Meetings. Special meetings of the shareholders may be
called at any time for any purpose not prohibited by law or the Articles of
Incorporation by the President, the Board of Directors, or the holders of
at least a majority of the shares outstanding and entitled to vote at the
meeting, by submitting a written request therefor, stating the object of
the meeting, to the Secretary. The Secretary shall fix the time and place
of the meeting, which shall be not later than 60 days after the receipt of
the request. If the Secretary shall neglect or fail so to set the time and
place of the meeting, the persons or entities calling the meeting may do
so. Business
<PAGE>
transacted at all special meetings shall be confined to the objects stated
in the request therefor, and matters directly related and germane thereto.
2.3 Notice. Written notice of every meeting of the shareholders,
stating the place, time and hour thereof, shall be given to each
shareholder not later than five days prior to the date of the meeting or
ten days prior to the day named for a meeting called to consider a
fundamental change. Notice of a special meeting shall state the general
nature of the business to be transacted.
2.4 Quorum. At all meetings of the shareholders, the holders of a
majority of the issued and outstanding shares entitled to vote, present in
person or represented by proxy, shall constitute a quorum. If a meeting of
shareholders cannot be organized because of the absence of a quorum, the
shareholders present in person or by proxy may adjourn the meeting to such
time and place as they may determine. Except as otherwise provided in these
By-Laws, the Articles of Incorporation, or applicable law, the acts of the
holders of a majority of shares entitled to vote, present in person or by
proxy, and voting at a meeting having a quorum shall be the acts of the
shareholders.
2.5 Voting. Each shareholder shall be entitled to one vote in person
or by proxy for each share he or she holds having voting power.
2.6 Voting List. The officer having charge of the transfer books for
shares of the corporation shall prepare, at least 10 days before each
meeting of shareholders, an alphabetical list of the names and addresses of
and shares held by the shareholders entitled to vote at the meeting. The
list shall be kept on file at the registered office of the corporation, and
be
<PAGE>
produced and kept open for inspection by shareholders throughout the
meeting for purposes of the meeting.
2.7 Inspectors of Elections. The Board of Directors may, before a
meeting of shareholders, appoint one or three Inspectors (who need not be
shareholders) for such meeting. If no such Inspectors of Election are
appointed, the chairman of the meeting may, and on the request of any
shareholder or his proxy shall, make such appointment. If Inspectors are
appointed at the request of one or more shareholders or proxies, the
shareholders present and entitled to vote shall determine whether there
will be one or three Inspectors. The Inspectors of Election shall take such
action as may be necessary or proper fairly to conduct the election or vote
and shall report in writing on any matter they determine, executing a
certificate of any fact they find, if requested by the chairman of the
meeting or any shareholder. No person who is a candidate for office shall
act as Judge.
ARTICLE III - SHARE CERTIFICATES
3.1 Form of Certificate. The certificates of shares of the corporation
shall state that the corporation is incorporated under the laws of this
State; the name of the person to whom issued; the number, class, and
designation of series (if any) of the shares represented; and the par value
of each share or the absence of par value, as appropriate. Each certificate
shall be numbered and registered in a share register in the order issued.
3.2 Signature. Each share certificate shall be signed, by the
President or a Vice President and the Secretary or an Assistant Secretary
or the Treasurer or an Assistant Treasurer,
<PAGE>
and sealed with the corporate seal, which may be facsimile. If an officer
who has signed a certificate, personally or by facsimile, ceases to be an
officer before the certificate is delivered, the certificate may be issued
as if the signatory remained in office.
3.3 Lost Certificates. The Board of Directors shall cause the issuance
of a new certificate as a replacement for a certificate claimed to have
been lost, destroyed or wrongfully taken, upon submission of an affidavit
of the person making the claim of the loss, destruction, or wrongful
taking. The Board of Directors may, in its discretion, require as a
condition to the issuance of a replacement certificate that the owner of
the certificate advertise the loss in such manner as the Board may
determine and/or give the corporation a bond in such sum and with such
sureties as the Board may direct as indemnity against any claim that may be
made against the corporation with respect to the certificate claimed to
have been lost, destroyed or wrongfully taken.
3.4 Transfer of Shares. Upon surrender to the corporation or its
transfer agent of a share certificate duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, the
corporation shall issue a new certificate to the person entitled thereto,
cancel the old certificate and record the transaction in its books.
3.5 Determination of Shareholders of Record. The Board of Directors
may fix a record date for the determination of the shareholders entitled to
notice of and to vote at a meeting, to receive payment of a dividend or
distribution, to receive an allotment of rights, or to exercise rights in
respect to a change, conversion or exchange of shares. In such case, only
the
<PAGE>
shareholders of record on the record date shall be entitled to notice of or
to vote at or participate in such meeting or activity or event,
notwithstanding any transfer of any shares on the books of the corporation
after the record date. If the Board of Directors closes the transfer books
during such period, it shall so notify each shareholder in writing. The
record date may not be more than 60 days nor less than 10 days prior to the
meeting, activity, or event to which it relates.
3.6 Registered Shareholders. The corporation shall be entitled to
treat the holder of record of any shares as the holder in fact for all
purposes and shall not be bound to recognize any claim to or interest in
such share on the part of any other person. The corporation shall not be
liable for any improper or impermissible registration or transfer of shares
which are or to be registered in the name of a fiduciary or its nominee
unless the corporation had actual knowledge that the fiduciary or nominee
are committing a breach of trust in requesting such registration or
transfer, or the corporation had knowledge of such facts that its
participation in the registration or transfer amounts to bad faith.
ARTICLE IV - BOARD OF DIRECTORS
4.1 General Powers. The business and affairs of the corporation shall
be managed by the Board of Directors, and all powers of the corporation are
hereby granted to and vested in the Board of Directors, except as otherwise
expressly provided in these By-Laws, the Articles of Incorporation, or by
law.
4.2 Composition and Selection. There shall be not more than nine
members of the Board of Directors. The shareholders shall determine the
number of members of the Board and shall elect directors at the annual
meeting of the shareholders, or at any special meeting called
<PAGE>
for that purpose; provided that the initial Board shall have the power and
authority to determine the number of, and to elect, the members of the
Board which succeeds the initial Board, subject to the right of the
shareholders at any time to change such action and to remove and replace
the directors so elected.
4.3 Term. Directors shall serve for a term of at least one year, as
the shareholders may determine, or until their successors are duly
qualified and seated.
4.4 Regular Meetings. The Board may hold regular meetings at such
times and places as it may determine.
4.5 Special Meetings. Special meetings of the Board of Directors may
be called, at any time, by the President, or a majority of the members of
the Board, by submitting a written request therefor, stating the object of
the meeting, to the Secretary. The Secretary shall set the time and place
of the meeting, which shall be held not later than 30 days after the
receipt of the request. If the Secretary shall neglect or refuse to set the
time and place of the meeting, the person or persons calling the meeting
may do so. Business transacted at all special meetings shall be confined to
the subjects stated in the request therefor and matters directly related
and germane thereto.
4.6 Annual Meeting. There shall be an annual meeting of the Board of
Directors following each annual meeting of the shareholders. At the annual
meeting, the Board of Directors shall elect officers and transact such
other business as may be properly brought before the meeting.
<PAGE>
4.7 Notices. Written notice of regular and annual meetings of the
Board of Directors, stating the time and place thereof shall be given to
all directors at least five days prior to the date of the meeting. Written
notice of special meetings of the Board of Directors shall be given to each
director at least 24 hours prior to the time of the meeting and shall state
the business to be transacted at the meeting.
4.8 Quorum. A majority of the members of the Board of Directors shall
constitute a quorum for the transaction of business, and the acts of a
majority of directors present and voting at a meeting at which a quorum
shall be the acts of the Board of Directors. In the event that a quorum is
not present at any meeting of the Board of Directors, the directors present
may adjourn the meeting without any notice of the time and place of the
adjourned meeting except for announcement at the meeting at which
adjournment is taken.
4.9 Vacancies. If the office of a director shall become vacant for any
reason, including an increase in the number of directors, the shareholders
shall elect a successor, who shall hold office for the unexpired term for
which the vacancy occurred or until his or her successor is duly qualified
and seated.
4.10 Alternate Directors. A shareholder or group of shareholders
entitled to elect, appoint, designate or otherwise select one or more
directors may select an alternate for each such director. In the absence of
a director from a meeting of the Board, his or her alternate may, in the
manner and upon the notice provided in these By-Laws, attend the meeting or
execute a written consent and exercise at the meeting or in such consent
all of the powers of the absent director.
<PAGE>
4.11 Removals and Resignations. The shareholders may remove a director
from office at any time, with or without cause. A director may resign at
any time by submitting a written resignation to the Chairman, or if there
is no Chairman to the President or in the case of a resignation of the
Chairman to any officer. A resignation need not be accepted to be
effective.
ARTICLE V - COMMITTEES
5.1 Establishment. The Board of Directors may establish one or more
standing or special committees, including without limitation an executive
committee. Except as otherwise provided in these By-Laws, the Articles of
Incorporation, or applicable law, any committee may exercise such powers
and functions as the Board of Directors may from time to time determine.
5.2 Committee Members. The Chairman, if any, or the President, if
there is no Chairman, shall appoint all committee members and committee
chairpersons and may appoint alternates for any member or chairperson of
any committee. Members of a committee need not be directors.
ARTICLE VI - OFFICERS
6.1 Officers. The officers of the corporation shall be chosen by the
Board of Directors and shall include either or both of a Chairman and
President, a Treasurer, a Secretary, and such Vice Presidents and assistant
officers as the Board of Directors may determine that the needs of the
corporation require. All officers shall be natural persons of full age, and
any two or more offices may be held by the same person.
<PAGE>
6.2 Election and Term. The Chairman, President, each Vice President,
Treasurer and Secretary shall be elected by the Board of Directors at its
annual meeting or at an appropriate special meeting and shall serve for a
term of one year, or until their successors are duly elected and qualified.
All assistant officers shall be elected or appointed at such times and for
such terms as the Board of Directors may determine. Any vacancy in any
office shall be filled by the Board.
6.3 Duties and Functions A. The officers shall have and exercise such
duties and functions as usually attach to their offices, with such
additional duties and functions and subject to such limitations as may be
provided in these By-Laws or established by the Board. Subject to the
authority of the Board, Vice Presidents and assistant officers shall be
subject to the direction and control of the Chief Executive Officer. B. If
there is both a Chairman and a President, the Chairman shall be Chief
Executive Officer and the President Chief Operating Officer of the
corporation. Otherwise, the Chairman or the President, as appropriate,
shall be Chief Executive and Chief Operating Officer.
6.4 Removals and Resignations. The Board of Directors may at any time
remove any officer from office, with or without cause. Any officer may
resign at any time by giving written notice of resignation to the officer
serving as Chief Executive Officer or, in the case of the resignation of
the Chief Executive Officer, to any other officer. A resignation need not
be accepted to be effective.
<PAGE>
ARTICLE VII - INDEMNIFICATION
7.1 Indemnification. The corporation shall indemnify every director
and officer, and may indemnify any employee or agent, to the full extent
permitted by the Delaware General Corporation Law and all amendments and
successor provisions thereto and any other present or future provisions of
Delaware law. The corporation shall pay and advance expenses to directors
and officers for matters covered by indemnification to the full extent
permitted by such law, and may similarly pay and advance expenses for
employees and agents. This Section 7.1 shall not exclude any other
indemnification or other rights to which any party may be entitled in any
manner.
ARTICLE VIII - NOTICES
8.1 Manner of Giving Notice. Whenever written notice is required or
permitted, by these By-Laws or otherwise, to be given to any person or
entity, it may be given either personally or by sending a copy thereof by
first class mail, postage prepaid, or by telegram (with messenger service
specified), telex or TWX (with answer back received) or courier service,
charges prepaid, or by telecopier, to the address of the appropriate person
or entity (or to telex, TWX, telecopier or telephone number) as it appears
on the books of the corporation. If notice is sent by telecopier, notice
shall be deemed to have been given upon receipt. If the notice is sent by
mail or telegraph, it shall be deemed to have been given when deposited in
the United States Mail or with a telegraph office for transmission.
<PAGE>
8.2 Waiver of Notice. Whenever a written notice is required, by these
By-Laws or otherwise, a waiver of such notice in writing, signed by the
person or persons or on behalf of the entity or entities entitled to
receive the notice shall be deemed equivalent to the giving of such notice,
whether the waiver is signed before or after the time required for such
notice. Except as otherwise required by law, the waiver of notice need not
state the business to be transacted at nor the purpose of the meeting,
except that the waiver of notice of a special meeting of the shareholders
or the Board of Directors shall specify the general nature of the business
to be transacted at the meeting.
8.3 Waiver by Attendance. Attendance at any meeting shall constitute
waiver of notice of such meeting, except where a person attends a meeting
for the express purpose of objecting at the beginning of the meeting, to
the transaction of business because the meeting was not called or convened
upon proper notice.
ARTICLE IX - MISCELLANEOUS PROVISIONS
9.1 Fiscal Year. The fiscal year of the corporation shall be as the
Board of Directors may determine.
9.2 Participation by Telecommunications. One or more persons may
participate in a meeting of the Board of Directors or of any committee by
means of a conference telephone or similar communications equipment by
which all persons participating in the meeting can hear one another.
Participation in a meeting pursuant to this section shall constitute the
presence in person at such meeting.
<PAGE>
9.3 Dividends. The Board of Directors may, at any meeting, declare
dividends upon the shares of the corporation to be paid in cash, property
or shares, subject to any limitations in the Articles of Incorporation or
applicable law. Before payment of any dividend, the Board may set aside out
of any funds of the corporation available for dividends such sum as the
Board, in its absolute discretion, thinks proper to meet contingencies,
equalize dividends, repair or maintain corporate property, or serve such
other purpose as the Board thinks in the best interest of the corporation,
and the Board may modify or abolish any such reserve in the manner in which
it was created.
ARTICLE X - AMENDMENTS
10.1 Amendments. These By-Laws may be adopted, amended or repealed, in
whole or in part, by the shareholders or by the Board of Directors, subject
to the power of the shareholders to change any such action by the Board.
Exhibit 3.3
Entity Number: 28403243 Filed with Department of State
on October 9, 1998
ARTICLES OF INCORPORATION -- FOR PROFIT
OF
JONES APPAREL GROUP USA, INC.
a Business -- Stock Corporation (15 Pa. C. S. ss. 1306)
In compliance with the requirements of the applicable provisions of 15
Pa. C. S. (relating to corporations and unincorporated associations), the
undersigned, desiring to incorporate a corporation for profit, hereby
states that
1. The name of the corporation is JONES APPAREL GROUP USA, INC.
2. The address of this corporation's initial registered office in this
Commonwealth is as follows:
250 Rittenhouse Circle, Bristol, PA 19007, in Bucks County.
3. The corporation is incorporated under the provisions of the
Business Corporation Law of 1988.
4. The aggregate number of shares authorized is 1,000 no par.
5. The name and address, including number and street, of the
incorporator is as follows:
Karen M. Wolcott 1735 Market Street
37th Floor
Philadelphia, PA 19103
6. The specified effective date is upon date of filing.
IN TESTIMONY WHEREOF, the incorporator has signed these Articles of
Incorporation this 8th day of October, 1998.
/s/ Karen M. Wolcott
-------------------------
Karen M. Wolcott
Exhibit 3.4
JONES APPAREL GROUP USA, INC.
BY-LAWS
ARTICLE I - OFFICES AND SEAL
1.1 Offices. The registered office of the corporation shall be at such
place within the Commonwealth of Pennsylvania as the Board of Directors may
determine, and the corporation may also have offices at such other places
as the Board deems appropriate.
1.2 Seal. The corporate seal shall have inscribed thereon the name of
the corporation, the year of its incorporation, and the words "Corporate
Seal, Pennsylvania".
ARTICLE II - SHAREHOLDERS' MEETINGS
2.1 Annual Meeting. There shall be an annual meeting of the
shareholders each year, at such time and place as the Board of Directors
may determine. At the annual meeting, the shareholders shall elect
directors, if appropriate, and transact such other business as may properly
be brought before the meeting.
2.2 Special Meetings. Special meetings of the shareholders may be
called at any time for any purpose not prohibited by law or the Articles of
Incorporation by the President, the Board of Directors, or the holders of
at least 20% of the shares outstanding and entitled to vote at the meeting,
by submitting a written request therefor, stating the object of the
meeting, to the Secretary. The Secretary shall fix the time and place of
the meeting, which shall be not later than 60 days after the receipt of the
request. If the Secretary shall neglect or fail so to set the time and
place of the meeting, the persons or entities calling the meeting may do
so. Business
<PAGE>
2
transacted at all special meetings shall be confined to the objects stated
in the request therefor, and matters directly related and germane thereto.
2.3 Notice. Written notice of every meeting of the shareholders,
stating the place, time and hour thereof, shall be given to each
shareholder not later than five days prior to the date of the meeting or
ten days prior to the day named for a meeting called to consider a
fundamental change. Notice of a special meeting shall state the general
nature of the business to be transacted.
2.4 Quorum. At all meetings of the shareholders, the holders of a
majority of the issued and outstanding shares entitled to vote, present in
person or represented by proxy, shall constitute a quorum. If a meeting of
shareholders cannot be organized because of the absence of a quorum, the
shareholders present in person or by proxy may adjourn the meeting to such
time and place as they may determine. Except as otherwise provided in these
By-Laws, the Articles of Incorporation, or applicable law, the acts of the
holders of a majority of shares entitled to vote, present in person or by
proxy, and voting at a meeting having a quorum shall be the acts of the
shareholders.
2.5 Voting. Each shareholder shall be entitled to one vote in person
or by proxy for each share he or she holds having voting power.
2.6 Voting List. The officer having charge of the transfer books for
shares of the corporation shall prepare, at least five days before each
meeting of shareholders, an alphabetical list of the names and addresses of
and shares held by the shareholders entitled to vote at the meeting. The
list shall be kept on file at the registered office of the corporation, and
be
<PAGE>
produced and kept open for inspection by shareholders throughout the
meeting for purposes of the meeting.
2.7 Judges of Elections. The Board of Directors may, before a meeting
of shareholders, appoint one or three Judges (who need not be shareholders)
for such meeting. If no such Judges of Election are appointed, the chairman
of the meeting may, and on the request of any shareholder or his proxy
shall, make such appointment. If Judges are appointed at the request of one
or more shareholders or proxies, the shareholders present and entitled to
vote shall determine whether there will be one or three Judges. The Judges
of Election shall take such action as may be necessary or proper fairly to
conduct the election or vote and shall report in writing on any matter they
determine, executing a certificate of any fact they find, if requested by
the chairman of the meeting or any shareholder. No person who is a
candidate for office shall act as Judge.
ARTICLE III - SHARE CERTIFICATES
3.1 Form of Certificate. The certificates of shares of the corporation
shall state that the corporation is incorporated under the laws of this
Commonwealth; the name of the person to whom issued; the number, class, and
designation of series (if any) of the shares represented; and the par value
of each share or the absence of par value, as appropriate. Each certificate
shall be numbered and registered in a share register in the order issued.
3.2 Signature. Each share certificate shall be signed, by the
President or a Vice President and the Secretary or an Assistant Secretary
or the Treasurer or an Assistant Treasurer,
<PAGE>
and sealed with the corporate seal, which may be facsimile. If an officer
who has signed a certificate, personally or by facsimile, ceases to be an
officer before the certificate is delivered, the certificate may be issued
as if the signatory remained in office.
3.3 Lost Certificates. The Board of Directors shall cause the issuance
of a new certificate as a replacement for a certificate claimed to have
been lost, destroyed or wrongfully taken, upon submission of an affidavit
of the person making the claim of the loss, destruction, or wrongful
taking. The Board of Directors may, in its discretion, require as a
condition to the issuance of a replacement certificate that the owner of
the certificate advertise the loss in such manner as the Board may
determine and/or give the corporation a bond in such sum and with such
sureties as the Board may direct as indemnity against any claim that may be
made against the corporation with respect to the certificate claimed to
have been lost, destroyed or wrongfully taken.
3.4 Transfer of Shares. Upon surrender to the corporation or its
transfer agent of a share certificate duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, the
corporation shall issue a new certificate to the person entitled thereto,
cancel the old certificate and record the transaction in its books.
3.5 Determination of Shareholders of Record. The Board of Directors
may fix a record date for the determination of the shareholders entitled to
notice of and to vote at a meeting, to receive payment of a dividend or
distribution, to receive an allotment of rights, or to exercise rights in
respect to a change, conversion or exchange of shares. In such case, only
the shareholders of record on the record date shall be entitled to notice
of or to vote at or participate
<PAGE>
in such meeting or activity or event, notwithstanding any transfer of any
shares on the books of the corporation after the record date. If the Board
of Directors closes the transfer books during such period, it shall so
notify each shareholder in writing. The record date may not be more than 90
days prior to the meeting, activity, or event to which it relates.
3.6 Registered Shareholders. The corporation shall be entitled to
treat the holder of record of any shares as the holder in fact for all
purposes and shall not be bound to recognize any claim to or interest in
such share on the part of any other person. The corporation shall not be
liable for any improper or impermissible registration or transfer of shares
which are or to be registered in the name of a fiduciary or its nominee
unless the corporation had actual knowledge that the fiduciary or nominee
are committing a breach of trust in requesting such registration or
transfer, or the corporation had knowledge of such facts that its
participation in the registration or transfer amounts to bad faith.
3.7 Partial Written Consent. Any action required or permitted to be
taken at a meeting of the shareholders or of a class of shareholders may be
taken without a meeting upon the written consent of the shareholders who
would have been entitled to cast the minimum number of votes that would be
necessary to authorize the action at a meeting at which all shareholders
entitled to vote thereon were present and voting. The consents shall be
filed with the Secretary of the Corporation. The action shall not become
effective until after at least ten days' written notice of the action has
been given to each shareholder entitled to vote thereon who has not
consented thereto. This Section shall not be construed to restrict the
right of the shareholders or any class of shareholders to act without a
meeting by unanimous written consent.
<PAGE>
ARTICLE IV - BOARD OF DIRECTORS
4.1 General Powers. The business and affairs of the corporation shall
be managed by the Board of Directors, and all powers of the corporation are
hereby granted to and vested in the Board of Directors, except as otherwise
expressly provided in these By-Laws, the Articles of Incorporation, or by
law.
4.2 Composition and Selection. There shall be not more than nine
members of the Board of Directors. The shareholders shall determine the
number of members of the Board and shall elect directors at the annual
meeting of the shareholders, or at any special meeting called for that
purpose; provided that the initial Board shall have the power and authority
to determine the number of, and to elect, the members of the Board which
succeeds the initial Board, subject to the right of the shareholders at any
time to change such action and to remove and replace the directors so
elected.
4.3 Term. Directors shall serve for a term of at least one year, as
the shareholders may determine, or until their successors are duly
qualified and seated.
4.4 Regular Meetings. The Board may hold regular meetings at such
times and places as it may determine.
4.5 Special Meetings. Special meetings of the Board of Directors may
be called, at any time, by the President, or a majority of the members of
the Board, by submitting a written request therefor, stating the object of
the meeting, to the Secretary. The Secretary shall set the time and place
of the meeting, which shall be held not later than 30 days after the
receipt of the request. If the Secretary shall neglect or refuse to set the
time and place of the meeting, the
<PAGE>
person or persons calling the meeting may do so. Business transacted at all
special meetings shall be confined to the subjects stated in the request
therefor and matters directly related and germane thereto.
4.6 Annual Meeting. There shall be an annual meeting of the Board of
Directors following each annual meeting of the shareholders. At the annual
meeting, the Board of Directors shall elect officers and transact such
other business as may be properly brought before the meeting.
4.7 Notices. Written notice of regular and annual meetings of the
Board of Directors, stating the time and place thereof shall be given to
all directors at least five days prior to the date of the meeting. Written
notice of special meetings of the Board of Directors shall be given to each
director at least 24 hours prior to the time of the meeting and shall state
the business to be transacted at the meeting.
4.8 Quorum. A majority of the members of the Board of Directors shall
constitute a quorum for the transaction of business, and the acts of a
majority of directors present and voting at a meeting at which a quorum is
present shall be the acts of the Board of Directors. In the event that a
quorum is not present at any meeting of the Board of Directors, the
directors present may adjourn the meeting without any notice of the time
and place of the adjourned meeting except for announcement at the meeting
at which adjournment is taken.
4.9 Vacancies. If the office of a director shall become vacant for any
reason, including an increase in the number of directors, the shareholders
shall elect a successor, who
<PAGE>
shall hold office for the unexpired term for which the vacancy occurred or
until his or her successor is duly qualified and seated.
4.10 Alternate Directors. A shareholder or group of shareholders
entitled to elect, appoint, designate or otherwise select one or more
directors may select an alternate for each such director. In the absence of
a director from a meeting of the Board, his or her alternate may, in the
manner and upon the notice provided in these By-Laws, attend the meeting or
execute a written consent and exercise at the meeting or in such consent
all of the powers of the absent director.
4.11 Removals and Resignations. The shareholders may remove a director
from office at any time, with or without cause. A director may resign at
any time by submitting a written resignation to the Chairman, or if there
is no Chairman to the President, or in the case of a resignation of the
Chairman to any officer. A resignation need not be accepted to be
effective.
ARTICLE V - COMMITTEES
5.1 Establishment. The Board of Directors may establish one or more
standing or special committees, including without limitation an executive
committee. Except as otherwise provided in these By-Laws, the Articles of
Incorporation, or applicable law, any committee may exercise such powers
and functions as the Board of Directors may from time to time determine.
5.2 Committee Members. The Chairman, if any, or the President, if
there is no Chairman, shall appoint all committee members and committee
chairpersons and may appoint alternates for any member or chairperson of
any committee. Members of a committee need not be directors.
<PAGE>
ARTICLE VI - OFFICERS
6.1 Officers. The officers of the corporation shall be chosen by the
Board of Directors and shall include either or both of a Chairman and
President, a Treasurer, a Secretary, and such Vice Presidents and assistant
officers as the Board of Directors may determine that the needs of the
corporation require. All officers shall be natural persons of full age, and
any two or more offices may be held by the same person.
6.2 Election and Term. The Chairman, President, each Vice President,
Treasurer and Secretary shall be elected by the Board of Directors at its
annual meeting or at an appropriate special meeting and shall serve for a
term of one year, or until their successors are duly elected and qualified.
All assistant officers shall be elected or appointed at such times and for
such terms as the Board of Directors may determine. Any vacancy in any
office shall be filled by the Board.
6.3 Duties and Functions
A. The officers shall have and exercise such duties and functions as
usually attach to their offices, with such additional duties and functions
and subject to such limitations as may be provided in these By-Laws or
established by the Board. Subject to the authority of the Board, Vice
Presidents and assistant officers shall be subject to the direction and
control of the Chief Executive Officer.
B. If there is both a Chairman and a President, the Chairman shall be
Chief Executive Officer and the President Chief Operating Officer of the
corporation. Otherwise, the Chairman or the President, as appropriate,
shall be Chief Executive and Chief Operating Officer.
<PAGE>
6.4 Removals and Resignations. The Board of Directors may at any time
remove any officer from office, with or without cause. Any officer may
resign at any time by giving written notice of resignation to the officer
serving as Chief Executive Officer or, in the case of the resignation of
the Chief Executive Officer, to any other officer. A resignation need not
be accepted to be effective.
ARTICLE VII - LIMITATION OF LIABILITY AND INDEMNIFICATION
7.1. Limitation of Liability. Directors of this corporation shall not
be personally liable for monetary damages as such for any action or failure
to take action other than as expressly provided in 15 Pa. C.S.A. ss.513 and
15 Pa. C.S.A. ss.ss.1713 and 1721 and any amendments thereto. It is the
intention of this Section 7.1 to limit the liability of directors of this
corporation to the fullest extent permitted by 15 Pa. C.S.A. ss.ss.513,
1713 and 1721, or future provision of Pennsylvania law.
7.2 Indemnification. The corporation shall indemnify every director
and officer, and may indemnify any employee or agent, to the full extent
permitted by the Pennsylvania Business Corporation Law of 1988, the
Pennsylvania Directors' Liability Act and any other present or future
provisions of Pennsylvania law. The corporation shall pay and advance
expenses to directors and officers for matters covered by indemnification
to the full extent permitted by such law, and may similarly pay and advance
expenses for employees and agents. This Section 7.2 shall not exclude any
other indemnification or other rights to which any party may be entitled in
any manner.
<PAGE>
ARTICLE VIII - NOTICES
8.1 Manner of Giving Notice. Whenever written notice is required or
permitted, by these By-Laws or otherwise, to be given to any person or
entity, it may be given either personally or by sending a copy thereof by
first class mail, postage prepaid, or by telegram (with messenger service
specified), telex or TWX (with answer back received) or courier service,
charges prepaid, or by telecopier, to the address of the appropriate person
or entity (or to the telex, TWX, telecopier or telephone number) as it
appears on the books of the corporation. If notice is sent by telecopier,
notice shall be deemed to have been given upon receipt. If the notice is
sent by mail or telegraph, it shall be deemed to have been given when
deposited in the United States Mail or with a telegraph office for
transmission.
8.2 Waiver of Notice. Whenever a written notice is required, by these
By-Laws or otherwise, a waiver of such notice in writing, signed by the
person or persons or on behalf of the entity or entities entitled to
receive the notice shall be deemed equivalent to the giving of such notice,
whether the waiver is signed before or after the time required for such
notice. Except as otherwise required by law, the waiver of notice need not
state the business to be transacted at nor the purpose of the meeting,
except that the waiver of notice of a special meeting of the shareholders
or the Board of Directors shall specify the general nature of the business
to be transacted at the meeting.
8.3 Waiver by Attendance. Attendance at any meeting shall constitute
waiver of notice of such meeting, except where a person attends a meeting
for the express purpose of
<PAGE>
objecting at the beginning of the meeting, to the transaction of business
because the meeting was not called or convened upon proper notice.
ARTICLE IX - MISCELLANEOUS PROVISIONS
9.1 Fiscal Year. The fiscal year of the corporation shall be as the
Board of Directors may determine.
9.2 Participation by Telecommunications. One or more persons may
participate in a meeting of the Board of Directors or of any committee by
means of a conference telephone or similar communications equipment by
which all persons participating in the meeting can hear one another.
Participation in a meeting pursuant to this section shall constitute the
presence in person at such meeting.
9.3 Dividends. The Board of Directors may, at any meeting, declare
dividends upon the shares of the corporation to be paid in cash, property
or shares, subject to any limitations in the Articles of Incorporation or
applicable law. Before payment of any dividend, the Board may set aside out
of any funds of the corporation available for dividends such sum as the
Board, in its absolute discretion, thinks proper to meet contingencies,
equalize dividends, repair or maintain corporate property, or serve such
other purpose as the Board thinks in the best interest of the corporation,
and the Board may modify or abolish any such reserve in the manner in which
it was created.
9.4 Financial Reports to Shareholders. Unless otherwise agreed by a
shareholder, the Board shall send to each shareholder financial statements
of the corporation which include a balance sheet as of the end of each
fiscal year and a statement of income and expenses for the
<PAGE>
fiscal year, which may be consolidated statements of the corporation and
one or more of its subsidiaries (if any). The financial statements shall be
mailed to each shareholder entitled thereto within 120 days after close of
each fiscal year and, after the mailing and upon written request, to any
shareholder or beneficial owner entitled thereto to whom a copy of the most
recent annual financial statement has not previously been mailed.
ARTICLE X - AMENDMENTS
10.1 Amendments. These By-Laws may be adopted, amended or repealed, in
whole or in part, by the shareholders or by the Board of Directors, subject
to the power of the shareholders to change any such action by the Board.
Exhibit 4.3
SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture") dated as
of January 1, 1999, among JONES APPAREL GROUP, INC., a Pennsylvania
corporation ("Jones"), JONES APPAREL GROUP HOLDINGS, INC., a Delaware
corporation ("Holding Company"), JONES APPAREL GROUP USA, INC., a
Pennsylvania corporation (the "Company"), and THE CHASE MANHATTAN BANK, a
New York State banking institution, as trustee under the indenture referred
to below (the "Trustee").
W I T N E S S E T H :
WHEREAS Jones has heretofore executed and delivered to the
Trustee an Indenture (the "Indenture") dated as of October 2, 1998,
providing for the issuance of an aggregate principal amount of $265,000,000
of 6.25% Senior Notes due 2001 (the "Securities");
WHEREAS Section 5.01(b) of the Indenture provides that in
connection with the Asset Drop-Down Transaction the Company shall expressly
assume by a supplemental indenture, executed and delivered to the Trustee,
all the obligations of Jones under the Securities and the Indenture;
WHEREAS Section 5.01(b) of the Indenture provides that under the
certain circumstances specified therein Jones and the Holding Company are
required to execute and deliver to the Trustee a supplemental indenture
pursuant to which the Holding Company shall unconditionally assume, as a
co-obligor, all the Company's obligations under the Securities and the
Indenture, and Jones shall reaffirm its obligations under the Securities
and the Indenture, on the terms and conditions set forth herein; and
WHEREAS pursuant to Section 9.01 of the Indenture, Jones, the
Holding Company, the Company and the Trustee are authorized to execute and
deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other
good and valuable consideration, the receipt of which is hereby
acknowledged, Jones, the Holding Company, the Company and the Trustee
mutually covenant and agree for the equal and ratable benefit of the
Securityholders as follows:
1. Succession and Assumption. The Company hereby agrees to fully
and unconditionally assume, as the successor
<PAGE>
operating company, all the obligations of Jones under the Securities and
the Indenture and to be bound by all applicable provisions of the
Securities and the Indenture.
2. Assumption and Reaffirmation. The Holding Company hereby
agrees to fully and unconditionally assume, as a co-obligor, the Company's
obligations under the Securities and the Indenture and to be bound by all
applicable provisions of the Securities and the Indenture. Jones hereby
agrees to fully and unconditionally reaffirm, as a co-obligor, its
obligations under the Securities and the Indenture and to continue to be
bound by all applicable provisions of the Securities and the Indenture. The
Company, the Holding Company and Jones agree that their obligations under
the Securities and the Indenture shall be joint and several. Without in any
way affecting the foregoing agreement, the parties hereto acknowledge that
it is expected that all payments in respect of the Securities will be made
by the Company.
3. Ratification of Indenture; Supplemental Indentures Part of
Indenture. Except as expressly amended hereby, the Indenture is in all
respects ratified and confirmed and all the terms, conditions and
provisions thereof shall remain in full force and effect. This Supplemental
Indenture shall form a part of the Indenture for all purposes, and every
Holder of Securities heretofore or hereafter authenticated and delivered
shall be bound hereby.
4. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT
WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.
5. Trustee Makes No Representation. The Trustee makes no
representation as to the validity or sufficiency of this Supplemental
Indenture.
6. Counterparts. The parties may sign any number of copies of
this Supplemental Indenture. Each signed copy shall be an original, but all
of them together represent the same agreement.
7. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction thereof.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed as of the date first above
written.
JONES APPAREL GROUP, INC.
By /s/ Wesley R. Card
------------------------------
Name: Wesley R. Card
Title: Chief Financial Officer
JONES APPAREL GROUP HOLDINGS, INC.
By /s/ Ira M. Dansky
------------------------------
Name: Ira M. Dansky
Title: President
JONES APPAREL GROUP USA, INC.
By /s/ Wesley R. Card
------------------------------
Name: Wesley R. Card
Title: Chief Financial Officer
THE CHASE MANHATTAN BANK,
as Trustee
By /s/ Sheik Wiltshire
------------------------------
Name: Sheik Wiltshire
Title: Second Vice President
Exhibit 5.1
[Letterhead of Ira M. Dansky]
January 25, 1999
Board of Directors of each of
Jones Apparel Group, Inc.,
Jones Apparel Group Holdings, Inc. and
Jones Apparel Group USA, Inc.
250 Rittenhouse Circle
Bristol, Pennsylvania 19007
Ladies and Gentlemen:
I have acted as counsel for each of Jones Apparel Group USA,
Inc., a Pennsylvania corporation (the "Company"), Jones Apparel Group
Holdings, Inc., a Delaware corporation ("Holdco"), and Jones Apparel Group,
Inc., a Pennsylvania corporation ("Jones" and, together with the Company
and Holdco, the "Credit Parties" and, each, a "Credit Party"), in
connection with the filing by the Credit Parties with the Securities and
Exchange Commission ("SEC") of a registration statement on Form S-4 (the
"Registration Statement"), Amendment No. 1 to which is being filed on
January 25, 1999, under the Securities Act of 1933, as amended (the "Act"),
relating to the proposed issuance, in exchange (the "Exchange Offer") for
any and all 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 6.25% Senior Notes due 2001, which will be
freely transferable (the "Exchange Notes" and, together with the Restricted
Notes, the "Notes"). The Exchange Notes are to be issued pursuant to the
indenture dated as of October 2, 1998 (the "Original Indenture") by and
between Jones, as issuer, and The Chase Manhattan Bank, as trustee (the
"Trustee"), as amended by the supplemental indenture dated as of January 1,
1999 (the "Supplemental Indenture"), by and among the Credit Parties and
the Trustee, pursuant to which the Company fully and unconditionally
assumed the obligations of Jones under the Original Indenture, with Jones
remaining and Holdco becoming co-obligors under the Original Indenture
(such Original Indenture, as so amended by the Supplemental Indenture, the
"Indenture").
<PAGE>
2
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 each Credit Party and, assuming the due authorization, execution and
delivery thereof by the Trustee, the Indenture constitutes a legal, valid
and binding obligation of each Credit Party enforceable against such Credit
Party 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, regardless of
whether such enforceability is considered in a proceeding in equity or at
law).
2. The Exchange Notes have been duly authorized by each Credit
Party, 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,
joint and several obligations of each Party, enforceable against such
Credit Party 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
January 25, 1999, of Mesirov Gelman Jaffe Cramer & Jamieson, LLP, a copy of
which appears as Exhibit 5.2 to the Registration Statement, as to all matters
<PAGE>
3 of law covered therein relating to the laws of the Commonwealth of
Pennsylvania and the General Corporation Law of the State of Delaware.
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 counsel
to the Credit Parties 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 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
Jones Apparel Group, Inc.
Exhibit 5.2
January 25, 1999
Ira M. Dansky, Esquire
Jones Apparel Group, Inc.
1411 Broadway
New York, NY 10018
Re: Jones Apparel Group, Inc.,
Jones Apparel Group Holdings, Inc., and
Jones Apparel Group USA, Inc.
Registration Statement on Form S-4
Dear Mr. Dansky:
As special counsel to Jones Apparel Group,
Inc., a Pennsylvania corporation (the "Company"), Jones Apparel
Group Holdings, Inc., a Delaware corporation, and Jones Apparel
Group USA, Inc., a Pennsylvania corporation (collectively, the
"Jones Companies"), we have been requested to render this opinion
in connection with the Jones Companies' Registration Statement on
Form S-4 (the "Registration Statement"), Amendment No. 1 to which
is being filed with the Securities and Exchange Commission (the
"SEC") on January 25, 1999, under the Securities Act of 1933.
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 by the Company on October 2, 1998 (the
"Restricted Notes"), which have certain transfer restrictions.
For purposes of this opinion we have examined the
Registration Statement; the Consent of the 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 Agreement and Plan of
Reorganization dated as of January 1, 1999 by and among the Jones
Companies; the Supplemental Indenture dated as of January 1, 1999
among each of the Jones Companies and the Trustee; the Consent of
the Board of Directors of the Company dated December 17, 1998,
and the Consents of the Sole Initial Director of each of the
other Jones Companies each dated December 2, 1998; the
Certificate of Ira M. Dansky, Esquire, General Counsel of the
Company, dated January 25, 1999; 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 counsel to the Jones Companies, we are not
necessarily familiar with all of the Jones Companies' affairs. As
a further basis for this opinion, we have made such inquiry of
the Jones Companies 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 Supplemental Indenture has been duly authorized,
executed and delivered by each of the Jones Companies
and, assuming the due authorization, execution and
delivery thereof by the Trustee, the Indenture
constitutes the legal, valid and binding obligation of
each of the Jones Companies enforceable against it in
accordance with its terms.
2. The Exchange 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 each of the Jones Companies
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, the
laws of the Commonwealth of Pennsylvania, and the corporate law
of the State of Delaware.
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 10.1
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT, made as of the first day of January, 1999, by and
between JONES APPAREL GROUP, INC. ("JAG"), a Pennsylvania corporation, and
JONES APPAREL GROUP HOLDINGS, INC. ("Jones Holdings"), a Delaware
corporation, and JONES APPAREL GROUP USA, INC. ("Jones USA"), a
Pennsylvania corporation.
W I T N E S S E T H :
JAG is engaged in the manufacture and distribution of wearing
apparel and related items by itself and through and in connection with
subsidiaries ("the Business"). JAG desires to effect a reorganization in
connection with certain subsidiaries in order to focus to their best use
the efforts and resources of JAG and its subsidiaries for the Business.
Jones Holdings is a newly formed Delaware corporation that will
devote its resources to intangible assets and investments in subsidiaries
so that its only activities will be the maintenance and management of
intangible assets and the stock of subsidiaries and the collection and
distribution of the income of such intangible assets and investments. Jones
USA is a newly formed Pennsylvania corporation that will devote its
activities to certain manufacturing, distribution and other operating
activities previously conducted by JAG. Jones Holding and Jones USA have no
previously issued or outstanding capital stock.
The parties desire to transfer assets as provided in this
Agreement to effect a reorganization under Section 351 of the Internal
Revenue Code, so that Jones Holdings will be a wholly-owned subsidiary of
JAG, and Jones USA a wholly-owned subsidiary of Jones Holdings, and the
reorganization provided for herein is referred to in this Agreement as "the
Reorganization." The parties believe that the Reorganization will provide a
management, financial and operating structure that will permit the best use
of resources to take advantage of opportunities for financing, growth and
development of the Business.
NOW, THEREFORE, the parties hereto, in consideration of the
foregoing and of the mutual covenants contained herein, and intending to be
legally bound hereby, agree as follows:
<PAGE>
ARTICLE I - REORGANIZATION TRANSFERS; JAG AND JONES USA
1.1 Asset Transfers to Jones USA. Subject to all of the terms and
conditions in this Agreement and solely in exchange for the Jones USA
Shares (hereafter defined), on the Effective Date (hereafter defined), JAG
shall transfer to Jones USA, subject to all liens, encumbrances, security
interests and claims of any kind thereon, all of the assets of JAG retained
or used by JAG in connection with the Business as follows (collectively
"the Transferred Assets"):
A. Cash and Cash Equivalents. Cash and cash equivalents
maintained for or in connection with the Business.
B. Accounts Receivable. Trade accounts receivable and other
accounts receivable, including commissions or other amounts receivable,
however calculated, arising from the sale of goods or provision of
services.
C. Inventory. All inventory of goods held for sale, regardless of
condition and whether or not usable or salable in the ordinary course of
business, including all shipping, packing and maintenance materials and
supplies.
D. Equipment. All equipment, office equipment, furniture,
fixtures, computer hardware and other equipment or fixed assets of any
kind, regardless of condition and whether or not usable, obtained, used or
held for the Business including all manufacturer's warranties or incentives
or other programs to the extent assignable.
E. Prepaid Expenses and Deposits. All prepaid expenses and
deposits relating to the Transferred Assets or the Business, including
prepaid expenses or deposits with suppliers.
F. Contracts. All contracts, orders, real property leases,
equipment and other personal property leases and other written or oral
agreements of any kind relating to the Transferred Assets or the Business
to the extent executory and not completed or fulfilled at the Effective
Date.
G. Intellectual Property. To the extent not previously or
hereafter assigned, transferred or otherwise owned or held by Jones Holding
Corporation (a Delaware corporation), all letters patent, trademarks, trade
names, service marks, designs, copyrights, product names, corporate or
business or
<PAGE>
fictitious names, logos or other business identification devices,
confidential information or know-how or similar rights and all other
intellectual property of any kind, including all recordings or
registrations or applications for recordings or registrations of any of the
foregoing and all reissues, continuations or extensions of any recordings
or registrations, and all proceeds and products of any of the foregoing and
all good will in connection with any of the foregoing.
H. Books and Records. All customer lists, supplier lists, books
of account and other books and records in any form, whether written or in
electronic media, together with all computer programs therefor or relating
thereto used or held for use in connection with the Business.
I. Licenses. All government licenses, permits and registrations
and other authorizations and approvals used or maintained in connection
with the Business.
J. Other Assets. All other tangible or intangible assets of any
kind used, maintained or held for use in connection with the Business.
1.2 Assumption of Liabilities. Effective as of the Effective Date, JAG
shall assign and transfer to Jones USA, and Jones USA shall accept and
hereby agrees to assume, discharge, pay or perform as appropriate, all
debts, obligations and liabilities of JAG relating to the Transferred
Assets or the Business (collectively "the Assumed Liabilities"), including
without limitation the following:
A. Notes Payable. All notes, lines of credit and other similar
liabilities payable relating to the Business.
B. Accounts Payable. All accounts payable relating to the
Business.
C. Accrued Liabilities. All accrued liabilities, including
accrued payroll and other tax liabilities.
D. Contractual Obligations. All contractual obligations arising
on or after the Effective Date under contracts transferred by JAG under
Section 1.1G, including commitments under outstanding purchase orders and
commitments.
E. Product Liability and Warranty Obligations. All claims,
obligations and liabilities for product liability, warranty or service
liability or other obligations arising out of or in connection with
products of the Business sold or services performed by JAG.
<PAGE>
F. Employee Obligations. All liabilities or obligations to or
with respect to employees of JAG transferred to employment by Jones USA in
accordance with Section 3.3 of this Agreement, under employee benefit plans
or for unpaid vacation or leave time or other benefits or obligations of
any nature accruing or relating to events or periods prior to the Effective
Date.
G. Other Liabilities. All other liabilities or obligations of any
kind or description, of or relating to JAG or the Business, whether
disclosed or undisclosed or known or unknown.
1.3 Transfer of Stock. At Closing (hereafter defined) Jones USA shall
issue to JAG 1,000 shares of Jones USA no par value common stock ("the
Jones USA Shares") which on the Effective Date will constitute all of the
issued and outstanding capital stock of Jones USA, and Jones USA shall at
Closing deliver to JAG a certificate or certificates for all of the Jones
USA Shares.
ARTICLE II - REORGANIZATION TRANSFERS; JAG AND JONES HOLDINGS
2.1 Asset Transfers to Jones Holdings. Subject to the terms of this
Agreement, as of the Effective Date and effective immediately after the
completion of the transfer of assets by JAG to Jones USA under Section 1.1
of this Agreement, and solely in exchange for the Jones Holdings Shares
(hereafter defined) as provided for in Section 2.4, JAG shall transfer to
Jones Holdings, subject to all liens, encumbrances, security interests and
claims of any kind thereon, all of the Jones USA Shares and the capital
stock of the JAG subsidiaries described on Exhibit "A" ("the Transferred
Subsidiaries").
2.2 Assumption of Liabilities. As of the Effective Date, effective
immediately after the Assumption of the Assumed Liabilities by Jones
Holdings under Section 1.3 of this Agreement, JAG shall transfer to Jones
Holdings, and Jones Holdings shall accept and hereby agrees to assume,
discharge, pay and perform as appropriate, all of the liabilities derived
solely from the ownership of the stock of the Transferred Subsidiaries.
2.3 Transfer of Jones USA Stock. At Closing, Jones Holdings shall
issue to JAG 1,000 shares of Jones Holdings no par value common stock ("the
Jones Holdings Shares") which on the Effective Date
<PAGE>
will constitute all of the issued and outstanding capital stock of Jones
Holdings, and Jones USA shall at Closing deliver to Jones Holdings a
certificate or certificates for all of the Jones Holdings Shares.
ARTICLE III - CLOSING
3.1 Closing. The Closing of the transactions of the Reorganization
shall take place at such time and place as the parties may mutually agree
and shall be effective as of the beginning of January 1, 1999 ("the
Effective Date").
3.2 Closing Transaction and Documents.
A. At Closing, JAG shall deliver to Jones USA and Jones Holdings
as appropriate such assignments, stock certificates and stock powers, bills
of sale, transfer agreements or other documents or instruments of transfer
as the parties may determine to be reasonably necessary or appropriate to
transfer and evidence the transfer of all assets being transferred under
this Agreement. The instruments of transfer delivered at Closing shall
include such documents and instruments in such form as may reasonably be
acceptable to the transferee; provided that acceptance shall not be
unreasonably withheld.
B. In accordance with Sections 1.3 and 2.3, at Closing, Jones USA
and Jones Holdings shall deliver to JAG certificates for the Jones USA
Shares and for the Jones Holdings Shares, which certificates shall evidence
the issuance of all of the issued and outstanding capital stock of Jones
USA and Jones Holdings, respectively.
3.3 Conditions. The obligations of each party to undertake and
complete the transactions of the Reorganization at Closing are subject to
the following conditions:
A. The representations and warranties of each other party shall
be true, correct and complete in all material respects at the time of
Closing.
B. Each other party shall in all material respects have fulfilled
and performed all covenants and agreements to be performed by it under this
Agreement, and shall have executed and delivered all documents or
instruments to be executed or delivered by it under this Agreement, at
Closing.
<PAGE>
C. All consents or waivers required to be obtained for the
transactions of the Reorganization contemplated by this Agreement shall
have been obtained on or before Closing. Nothing in this Agreement is
intended to assign or transfer a contract, right or obligation which
requires for transfer the consent or waiver of another party unless such
consent or waiver is obtained. If any required consent or waiver is not
obtained prior to Closing and the parties determine nonetheless to proceed
with the Closing and the transactions of the Reorganization, the parties
shall cooperate in taking such action and executing and delivering such
documents as may be reasonably necessary or appropriate promptly to obtain
the consent or waiver or to obtain for the appropriate party or parties the
benefits or burdens of the rights or obligations to be transferred,
notwithstanding the absence of the consent or waiver.
3.4. Employees. It is the intention of the parties that, as of the
Effective Date, Jones USA will employ the employees of JAG engaged in the
activities and operations to be conducted after the Effective Date by Jones
USA, and the parties shall take such action and execute and deliver such
documents and instruments as they may consider reasonably necessary or
appropriate to effect such transfer of employees. On or promptly after
Closing, the parties shall take such actions as may be necessary for Jones
USA to adopt, as of the Effective Date, all employee benefit plans or
similar arrangements applicable to the employees to be employed by Jones
USA as of the Effective Date.
3.5 Termination. At any time prior to the Effective Date, the parties
may terminate this Agreement and the obligation to proceed with Closing by
mutual written consent of all parties.
ARTICLE IV - WARRANTIES AND INDEMNIFICATION
4.1 Warranties of JAG. JAG hereby represents and warrants to Jones
Holdings and Jones USA as follows:
A. JAG is a corporation duly organized, validly existing and
subsisting under the laws of the Commonwealth of Pennsylvania and is duly
qualified to do business in all jurisdictions in which the nature of its
activities requires such qualification, except where the failure so to
qualify would not have a material adverse effect on JAG or its business or
affairs.
<PAGE>
B. JAG has all requisite power and authority to execute, deliver
and perform this Agreement and the Reorganization and all transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions provided for herein have been duly and
validly authorized by all necessary corporate action by JAG. This Agreement
has been duly executed and delivered by JAG and constitutes the legal,
valid and binding obligation of JAG, enforceable in accordance with its
terms, subject to the effect of bankruptcy, reorganization, fraudulent
conveyance and other similar laws affecting the enforcement of creditors'
rights and remedies generally.
C. The execution, delivery and performance of this Agreement will
not violate, result in the breach of or conflict with in any material
respect any term, condition or provision of (i) any law, ordinance or
governmental rule or regulation currently in effect to which JAG is
subject, (ii) any judgment, order or award or determination of any court,
arbitrator or other adjudicating body applicable to JAG, (iii) the Articles
of Incorporation or By-Laws of JAG, (iv) any license, permit or other
governmental authorization applicable to JAG or its properties or business
or affairs; or (v) any contract, lease, commitment or other written or oral
agreement to which JAG is a party or by which it or its property is bound.
D. Subject to the provisions of Section 3.3C, no authorization,
approval or consent and no registration with any governmental or regulatory
body or authority, which has not been obtained on or prior to the Effective
Date, is necessary for the execution, delivery and performance of this
Agreement by JAG.
E. JAG has conducted its business in substantial compliance with
all federal, state and local laws, ordinances, rules and regulations except
where the failure to comply would not have a material adverse effect on the
Business or Transferred Assets.
F. The financial statements of JAG as of the end of the last
fiscal year ending prior to the Effective Date, previously made available
to all parties, are true, correct and complete in all material respects and
fairly present the financial condition of JAG as of the dates thereof.
There have been no material adverse changes to the financial condition of
JAG since the dates of such statements.
<PAGE>
G. No representations or warranties made in this Agreement or in
any agreement, schedule or other document furnished by JAG in connection
herewith contains or will contain any untrue statement of material fact, or
omits or will omit any fact necessary to make the statements contained
therein not misleading.
4.2 Warranties of Jones USA. Jones USA hereby represents and warrants
to JAG and Jones Holdings as follows:
A. Jones USA is a corporation duly organized, validly existing
and subsisting under the laws of the Commonwealth of Pennsylvania and is
duly qualified to do business in all jurisdictions in which the nature of
its activities requires such qualification, except where the failure so to
qualify would not have a material adverse effect on Jones Holdings or its
business or affairs.
B. Jones USA has all requisite power and authority to execute,
deliver and perform this Agreement and the Reorganization and all
transactions contemplated hereby. The execution and delivery of this
Agreement and the consummation of the transactions provided for herein have
been duly and validly authorized by all necessary corporate action by Jones
USA. This Agreement has been duly executed and delivered by Jones USA and
constitutes the legal, valid and binding obligation of Jones USA,
enforceable in accordance with its terms, subject to the effect of
bankruptcy, reorganization, fraudulent conveyance and other similar laws
affecting the enforcement of creditors' rights and remedies generally.
C. The Jones USA Shares when issued to JAG as provided in this
Agreement will be validly issued, fully paid and non-assessable and free
and clear of all liens, pledges, security interests, encumbrances and
adverse claims of any nature and will constitute all of the issued and
outstanding capital stock of Jones USA. There are no outstanding options,
warrants, rights or agreements to purchase or acquire, or obligations
convertible into, capital stock of Jones USA.
D. The execution, delivery and performance of this Agreement will
not violate, result in the breach of or conflict with in any material
respect any term, condition or provision of (i) any law, ordinance or
governmental rule or regulation currently in effect to which Jones USA is
subject, (ii) any judgment, order or award or determination of any court,
arbitrator or other adjudicating body applicable to Jones USA, (iii) the
Articles of Incorporation or By-Laws of Jones USA, (iv) any license, permit
or other
<PAGE>
governmental authorization applicable to Jones Holdings or its properties
or business or affairs; or (v) any contract, lease, commitment or other
written or oral agreement to which Jones USA is a party or by which it or
its property is bound.
E. Subject to the provisions of Section 3.3C, no authorization,
approval or consent and no registration with any governmental or regulatory
body or authority, which has not been obtained on or prior to the Effective
Date, is necessary for the execution, delivery and performance of this
Agreement by Jones USA.
F. No representations or warranties made in this Agreement or in
any agreement, schedule or other document furnished by Jones USA in
connection herewith contains or will contain any untrue statement of
material fact, or omits or will omit any fact necessary to make the
statements contained therein not misleading.
4.3 Warranties of Jones Holdings. Jones Holdings hereby represents and
warrants to JAG and Jones Holdings as follows:
A. Jones Holdings is a corporation duly organized, validly
existing in good standing under the laws of the State of Delaware and is
duly qualified to do business in all jurisdictions in which the nature of
its activities requires such qualification, except where the failure so to
qualify would not have a material adverse effect on Jones Holdings or its
business or affairs.
B. Jones Holdings has all requisite power and authority to
execute, deliver and perform this Agreement and the Reorganization and all
transactions contemplated hereby. The execution and delivery of this
Agreement and the consummation of the transactions provided for herein have
been duly and validly authorized by all necessary corporate action by Jones
Holdings. This Agreement has been duly executed and delivered by Jones
Holdings and constitutes the legal, valid and binding obligation of Jones
Holdings, enforceable in accordance with its terms, subject to the effect
of bankruptcy, reorganization, fraudulent conveyance and other similar laws
affecting the enforcement of creditors' rights and remedies generally.
C. The Jones Holdings Shares when issued to Jones Holdings as
provided in this Agreement will be validly issued, fully paid and
non-assessable and free and clear of all liens, pledges,
<PAGE>
security interests, encumbrances and adverse claims of any nature and will
constitute all of the issued and outstanding capital stock of Jones
Holdings. There are no outstanding options, warrants, rights or agreements
to purchase or acquire, or obligations convertible into, capital stock of
Jones Holdings.
D. The execution, delivery and performance of this Agreement will
not violate, result in the breach of or conflict with in any material
respect any term, condition or provision of (i) any law, ordinance or
governmental rule or regulation currently in effect to which Jones USA is
subject, (ii) any judgment, order or award or determination of any court,
arbitrator or other adjudicating body applicable to Jones Holdings, (iii)
the Certificate of Incorporation or By-Laws of Jones Holdings, (iv) any
license, permit or other governmental authorization applicable to Jones
Holdings or its properties or business or affairs; or (v) any contract,
lease, commitment or other written or oral agreement to which Jones
Holdings is a party or by which it or its property is bound.
E. Subject to the provisions of Section 3.3C, no authorization,
approval or consent and no registration with any governmental or regulatory
body or authority, which has not been obtained on or prior to the Effective
Date, is necessary for the execution, delivery and performance of this
Agreement by Jones Holdings.
F. No representations or warranties made in this Agreement or in
any agreement, schedule or other document furnished by Jones Holdings in
connection herewith contains or will contain any untrue statement of
material fact, or omits or will omit any fact necessary to make the
statements contained therein not misleading.
4.4 Indemnification.
A. Jones USA agrees to defend, indemnify and hold harmless Jones
Holdings and JAG, and each of them, jointly and severally, from and against
any and all claims, demands, suits and actions, costs and losses of any
kind, including reasonable attorneys' fees, arising out of or in connection
with Assumed Liabilities accepted and assumed by Jones USA under this
Agreement.
B. Jones Holdings hereby agrees to indemnify, defend and hold
harmless JAG and Jones USA, and each of them, jointly and severally, from
and against any and all claims, demands, suits and
<PAGE>
actions, costs and losses of any kind, including reasonable attorneys'
fees, arising out of or in connection with Jones Holdings Liabilities
accepted and assumed by Jones Holdings under this Agreement.
C. Each party hereby agrees to indemnify, defend and hold
harmless the other parties, and each of them, jointly and severally, from
and against any and all claims, demands, suits and actions, costs and
losses of any kind, including reasonable attorneys' fees, arising as a
result of the incorrectness in a material respect of the representations
and warranties in this Agreement of the indemnifying party.
ARTICLE V - GENERAL PROVISIONS
5.1 Further Assurances. Each party shall take such action and execute
and deliver such documents as any other party may reasonably request to
effectuate the terms of this Agreement and the transactions contemplated
hereby.
5.2 Applicable Law. Pennsylvania law shall govern the validity,
construction, interpretation and effect of this Agreement, without regard
to principles of choice or conflict of laws.
5.3 Benefit and Assignments. This Agreement shall be binding on and
inure to the benefit of the parties hereto and their respective successors
and assigns; provided that no party may assign or transfer all or any part
of this Agreement, whether voluntarily, involuntarily, by operation of law
or otherwise, without the prior written consent of all other parties, which
consent may be granted or withheld in any party's unrestricted discretion.
There are no third party beneficiaries to this Agreement, and this
Agreement does not confer any rights or remedies on any party other than
the parties hereto and their permitted successors and assigns.
5.4 Entire Agreement. This Agreement constitutes the entire
understanding between the parties with respect to the subject matter
hereof. This Agreement may not be amended or modified in any manner except
by a written agreement duly executed by the party to be charged.
<PAGE>
5.5 Headings. The article and paragraph headings of this Agreement are
for convenience of reference only and do not form a part of the terms and
conditions of this Agreement or give full notice thereof.
5.6 Notices. All notices required or permitted under this Agreement
shall be in writing and shall be given by regular or registered or
certified mail or by any other reasonable means (including personal
delivery, telefax or reputable express courier) to the party to receive
notice at the following addresses or at such other address as any party
may, by notice, direct:
If to JAG: Jones Apparel Group, Inc.
If to Jones Holdings: Jones Holdings, Inc.
If to Jones USA: Jones USA, Inc.
All notices given by registered or certified mail shall be deemed as given
on the delivery date shown on the return mail receipt. All notices given in
any other manner shall be deemed as given when received.
5.7 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, and all of which
together shall constitute a single agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
JONES APPAREL GROUP, INC.
By: /s/ Wesley R. Card
-------------------------------
Wesley R. Card
Chief Financial Officer
<PAGE>
JONES APPAREL GROUP HOLDINGS, INC.
By: /s/ Ira M. Dansky
-------------------------------
Ira M. Dansky
President
JONES APPAREL GROUP USA, INC.
By: /s/ Wesley R. Card
-------------------------------
Wesley R. Card
Chief Financial Officer
<PAGE>
EXHIBIT "A"
Transferred Subsidiaries
Jones Apparel Group USA, Inc. a Pennsylvania corporation
Melru Corporation a Pennsylvania corporation
Jones Apparel Group Holdings, Inc. a Delaware corporation
Jones Investment Co., Inc. a Delaware corporation
Sun Apparel, Inc. (formerly SAI Acquisition Corp.) a Delaware Corporation
Exhibit 10.2
MASTER JOINDER AGREEMENT
THIS MASTER JOINDER AGREEMENT, dated as of the 1st day of January,
1999 (this "Agreement"), to the Credit Agreements referred to below is
entered into by and among JONES APPAREL GROUP, INC., a corporation
organized under the laws of Pennsylvania ("Jones"), JONES APPAREL GROUP
USA, INC., a corporation organized under the laws of Pennsylvania ("New
Jones"), JONES APPAREL GROUP HOLDINGS, INC., a corporation organized under
the laws of Delaware ("JAG" and collectively with New Jones and Jones, the
"Credit Parties") and FIRST UNION NATIONAL BANK, a national banking
association, as Administrative Agent (the "Administrative Agent") on behalf
of the Lenders.
Statement of Purpose
Jones, the Lenders and the Administrative Agent are parties to the
Amended and Restated 364-Day Credit Agreement and the Amended and Restated
Three Year Credit Agreement both dated as of October 15, 1998 (each as
supplemented hereby and as further amended, restated or otherwise modified,
collectively, the "Credit Agreements").
The Credit Agreements provide that from and after the date hereof (the
"Asset Drop-Down Effective Date"), (a) New Jones shall replace Jones as the
Borrower and (b) Jones and JAG shall become Additional Obligors thereunder.
Pursuant to Section 11.6(g) of the Credit Agreements, New Jones, Jones and
JAG are required to execute, among other documents, a joinder agreement
establishing New Jones as the Borrower and Jones and JAG as Additional
Obligors.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the parties hereto hereby agree as follows:
SECTION 1. Joinder of Credit Parties.
(a) Joinder of New Jones as Borrower. Pursuant to Section 11.6 of the
Credit Agreements, New Jones hereby agrees that, from and after the Asset
Drop-Down Effective Date, it is the Borrower under the Credit Agreements as
if a signatory thereof on the Closing Date, and New Jones shall comply with
and be subject to and have the benefit of all of the terms, conditions,
covenants, agreements and obligations set forth therein. New Jones hereby
agrees that each reference to the "Borrower" in the Credit Agreements and
other Loan Documents shall mean New Jones. Without limiting or releasing
the obligations of the Additional Obligors pursuant to Section 1(b), the
parties hereto acknowledge that, from and after the Asset Drop-Down
Effective Date, all payments in respect of the Obligations (and the
Additional Debt Securities) will be made by New Jones. New Jones
acknowledges that it has received a copy of each of the Credit Agreements
and that it has read and understands the terms thereof. Jones, the
Administrative Agent and the Lenders hereby acknowledge that, from and
after the Asset Drop-Down Effective Date, (i) Jones shall no longer be the
Borrower under the Credit Agreements and shall no longer have any
<PAGE>
rights as the Borrower under the Credit Agreements and (ii) Jones
shall be an Additional Obligor as set forth in Section 1(b).
(b) Joinder of Additional Obligors. Pursuant to Section 11.6 of the
Credit Agreements, JAG hereby agrees that, from and after the Asset
Drop-Down Effective Date, it is an Additional Obligor under the Credit
Agreements as if a signatory thereof on the Closing Date, and JAG shall
comply with and be subject to and have the benefit of all of the terms,
conditions, covenants, agreements and obligations set forth therein. Jones
hereby agrees that, from and after the Asset Drop-Down Effective Date, it
is an Additional Obligor under the Credit Agreements and shall comply with
and be subject to and have the benefit of all of the terms, conditions,
covenants, agreements and obligations set forth therein. Upon the
effectiveness of this Agreement pursuant to Section 2(a), each of the
Credit Parties shall be directly jointly and severally liable for the
Obligations under the Credit Agreements and the Replacement Notes (as
defined herein) issued pursuant to Section 2(a). Jones and JAG hereby agree
that each reference to an "Additional Obligor" or to the "Additional
Obligors" in the Credit Agreements and other Loan Documents shall mean
Jones and JAG. Jones and JAG acknowledge that they have received a copy of
each of the Credit Agreements and that they have read and understand the
terms thereof.
(c) Schedules. Attached hereto is an updated Schedule 7.1(b) to the
Credit Agreements completed as of the Asset Drop-Down Effective Date.
SECTION 2. Effectiveness.
(a) This Agreement shall become effective upon receipt by the
Administrative Agent of (i) an original replacement Amended and Restated
Revolving Credit Note for each Lender under the 364-Day Credit Agreement
(collectively, the "Replacement 364-Day Notes") executed by each Credit
Party in exchange for each cancelled Amended and Restated Revolving Credit
Note issued in favor of each such Lender on the Closing Date, (ii) an
original replacement Amended and Restated Revolving Credit Note and
replacement Amended and Restated Term Note for each Lender under the Three
Year Credit Agreement (collectively, the "Replacement Three-Year Notes" and
together with the Replacement 364-Day Notes, collectively, the "Replacement
Notes") executed by each Credit Party in exchange for each cancelled
Amended and Restated Revolving Credit Note and Amended and Restated Term
Note issued in favor of each such Lender on the Closing Date and (iii)
twenty (20) originally executed counterparts hereof. Each Lender hereby
agrees to return promptly all the cancelled Notes to the Administrative
Agent. Upon receipt by the Administrative Agent, each cancelled Note shall
be promptly returned to Jones, attention of Ira M. Dansky, Esq., General
Counsel.
(b) The Administrative Agent hereby acknowledges receipt of the
executed Replacement Notes and twenty executed counterparts hereof.
<PAGE>
(c) The parties hereto confirm that all conditions to the
effectiveness of the Asset Drop- Down and this Agreement under Section 11.6
of the Credit Agreements have been satisfied or waived.
SECTION 3. General Provisions.
(a) Representations and Warranties. Each Credit Party hereby confirms
that each representation and warranty made by the Credit Parties under the
Loan Documents is true and correct in all material respects as of the date
hereof and that no Default or Event of Default has occurred or is
continuing under the Credit Agreements, except for (i) any deviations from
such representations and warranties expressly permitted by the Credit
Agreements and (ii) any representation and warranties expressly made as of
an earlier date, which representation and warranty shall remain true and
correct as of such earlier date. Each such Credit Party hereby represents
and warrants that as of the date hereof there are no claims or offsets
against or defenses or counterclaims to their respective obligations under
the Credit Agreements or any other Loan Document.
(b) Limited Effect. Except as supplemented hereby, the Credit
Agreements and each other Loan Document shall continue to be, and shall
remain, in full force and effect. This Agreement shall not be deemed (i) to
be a waiver of, or consent to, or a modification or amendment of, any other
term or condition of the Credit Agreements or (ii) to prejudice any right
or rights which the Administrative Agent or Lenders may now have or may
have in the future under or in connection with the Credit Agreements or the
Loan Documents or any of the instruments or agreements referred to therein,
as the same may be amended, restated or modified from time to time.
(c) Costs and Expenses. The Credit Parties hereby jointly and
severally agree to pay or reimburse the Administrative Agent for all of its
reasonable and customary out-of-pocket costs and expenses incurred in
connection with the preparation, negotiation and execution of this
Agreement, including, without limitation, the reasonable fees and
disbursements of counsel.
(d) Counterparts. This Agreement may be executed by one or more of the
parties hereto in any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.
(e) Definitions. All capitalized terms used and not defined herein
shall have the meanings given thereto in the Credit Agreements.
(f) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REFERENCE TO THE CONFLICTS OR CHOICE OF LAW PRINCIPLES THEREOF.
(g) New Jones as Agent for the Credit Parties. The Credit Parties
hereby irrevocably appoint and authorize New Jones (i) to provide the
<PAGE>
Administrative Agent with all notices and instructions under the Credit
Agreements and (ii) to take such action on behalf of the Credit Parties as
New Jones deems appropriate on its behalf to carry out the purposes of the
Credit Agreements.
IN WITNESS WHEREOF the undersigned hereby causes this Agreement to
be executed and delivered as of the date first above written.
[CORPORATE SEAL] JONES APPAREL GROUP, INC.
By /s/ Wesley R. Card
-------------------------
Name: Wesley R. Card
Title: Chief Financial Officer
[CORPORATE SEAL] JONES APPAREL GROUP USA, INC.
By /s/ Wesley R. Card
-----------------------
Name: Wesley R. Card
Title: Chief Financial Officer
[CORPORATE SEAL] JONES APPAREL GROUP HOLDINGS, INC.
By /s/ Ira M. Dansky
----------------------
Name: Ira M. Dansky
Title: President
FIRST UNION NATIONAL BANK,
as Administrative Agent
By /s/ Joan Anderson
----------------------
Name: Joan Anderson
Title: Vice President
Exhibit 21
List of Subsidiaries
State/Country of
Incorporation
Parent Company: Jones Apparel Group, Inc.* Pennsylvania
First Tier Subsidiary Jones Apparel Group Holdings, Inc. (1) Delaware
Company:
(1) Jones Apparel Group Holdings, Inc.*
Second Tier Subsidiary Jones Apparel Group USA, Inc. (2) Pennsylvania
Companies:
Melru Corporation New Jersey
Jones Investment Co., Inc. Delaware
Jones Holding Corporation (3) Delaware
Jones Management Service Company Delaware
Jones Factor Co. Delaware
Sun Apparel, Inc. (formerly SAI Delaware
Acquisition Corp.)(4)
(2) Jones Apparel Group USA, Inc.*
Third Tier Subsidiary Camisas de Juarez, S.A. de C.V. Juarez, Mexico
Companies: Vestamex, S.A. de C.V. Juarez, Mexico
(3) Jones Holding Corporation
Third Tier Subsidiary Jones Apparel Group Canada, Inc. Ontario, Canada
Companies: Jones International Limited (5) Hong Kong
(4) Sun Apparel, Inc. (formerly
Third Tier Subsidiary SAI Acquisition Corp.)
Companies: Sun Apparel, Inc. (6) Delaware
Lone Star Selling Group, Inc. New York
R. L. Management, Inc. Delaware
Import Technology of Texas,
Inc. (7) Texas
(5) Jones International Limited
Fourth Tier Subsidiary Jones Far East Limited Hong Kong
Companies: Bongal Company Limited Hong Kong
Jones Apparel Group (HK) Limited Hong Kong
(6) Sun Apparel, Inc.
Fourth Tier Subsidiary Sun Apparel of Texas, Ltd.-
Companies: 99.5% (8) Texas
Maquilas Pami S.A. de C.V.- 1.0% Durango, Mexico
CNC West Division S.A. de
C.V. - 1.0% Durango, Mexico
(7) Import Technology of Texas, Inc.
Fourth Tier Subsidiary Sun Apparel of Texas, Ltd. - 0.5% Texas
Companies: Maquilas Pami S.A. de C.V. - 99.0% Durango, Mexico
CNC West Division S.A. de
C.V. - 99.0% Durango, Mexico
- --------------
* Registrants
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, New York
January 22, 1999
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)
Jones Apparel Group Holdings, Inc.
(Exact name of obligor as specified in its charter)
Jones Apparel Group USA, 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.)
Delaware 51-0384507
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
Pennsylvania 23-2978516
(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 25nd
day of January, 1999.
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.
JONES APPAREL GROUP HOLDINGS, INC.
JONES APPAREL GROUP USA, 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, Jones Apparel Group Holdings, Inc., a Delaware
corporation, and Jones Apparel Group USA, Inc. a Pennsylvania corporation
(collectively, 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., Jones Apparel
Group Holdings, Inc. and Jones Apparel Group USA, Inc. (collectively, 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.
JONES APPAREL GROUP HOLDINGS, INC. or
JONES APPAREL GROUP USA, 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.,
JONES APPAREL GROUP HOLDINGS, INC. AND
JONES APPAREL GROUP USA, INC.
As set forth in the Prospectus dated (the "Prospectus") of Jones
Apparel Group, Inc., Jones Apparel Group Holdings, Inc. and Jones Apparel
Group USA, Inc. (collectively, 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.
