SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
BRYLANE INC.
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(Name of Issuer)
COMMON STOCK, $0.01 PAR VALUE
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(Title of Class of Securities)
117661 10 8
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(CUSIP Number)
DAVID A. KATZ, ESQ.
WACHTELL, LIPTON, ROSEN & KATZ
51 WEST 52ND STREET
NEW YORK, NEW YORK 10019
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
APRIL 3, 1998
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(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box / /.
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
(Continued on following pages)
Page 1 of 9 Pages
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CUSIP NO. 117661 10 8 13D PAGE 2 OF 9 PAGES
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1 NAME OF REPORTING PERSON
PINAULT - PRINTEMPS - REDOUTE S.A.
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) /x/
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
BK
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5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
FRANCE
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7 SOLE VOTING POWER
NUMBER OF 8,010,917 (SEE ITEM 5)
SHARES -------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
EACH -------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 8,010,917 (SEE ITEM 5)
WITH -------------------------------------------
10 SHARED DISPOSITIVE POWER
-0-
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,010,917 (SEE ITEM 5)
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
43.7% (SEE ITEM 5)
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14 TYPE OF PERSON REPORTING*
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT
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ITEM 1. SECURITY AND ISSUER.
This Statement relates to shares of common stock, par value $0.01 per
share ("Common Stock"), of Brylane Inc., a Delaware corporation ("Brylane"). The
principal executive offices of Brylane are located at 463 Seventh Avenue, 21st
Floor, New York, New York 10018.
ITEM 2. IDENTITY AND BACKGROUND.
(a), (b), (c) and (f). The name of the person filing this statement
is Pinault-Printemps-Redoute S.A., a societe anonyme organized and existing
under the laws of the Republic of France ("PPR"). PPR is filing this statement
on behalf of itself and its wholly owned subsidiaries (i) La Redoute, a societe
anonyme organized and existing under the laws of the Republic of France and a
wholly owned, direct subsidiary of PPR ("La Redoute") and (ii) REDAM LLC, a
limited liability company organized and existing under the laws of the State of
Delaware and a wholly owned, direct subsidiary of La Redoute ("REDAM"). REDAM is
the holder of record of the Common Stock beneficially owned by PPR.
Approximately 40.5% of the capital stock and 56.2% of the voting
rights, respectively, of PPR are owned by Artemis S.A., a a societe anonyme
organized and existing under the laws of the Republic of France ("Artemis").
Approximately 76.4% of the voting stock of Artemis is owned by S.C.A. Financiere
Pinault, a societe en commandite par actions organized and existing under the
laws of the Republic of France ("SFP"). Mr. Francois Pinault, the Vice President
of the Supervisory Board of PPR, is the general partner of SFP, and
approximately 55.9% of the interests in SFP are owned by Mr. Pinault and certain
members of his family.
The principal business address of PPR is 18 Place Henri Bergson,
75381 Paris, France. The principal business address of La Redoute S.A. is 110,
rue de Blanchemaille, 59051 Roubaix, France. The principal business address of
REDAM is c/o La Redoute S.A., 110, rue de Blanchemaille, 59051 Roubaix, France.
The principal business address of SFP, Artemis and Mr. Pinault is 5, Boulevard
de Latour Maubourg, 75007 Paris, France. PPR, through its subsidiaries, is
principally engaged in the following businesses: distribution of electrical
components and industrial supplies; the distribution of furniture, office
products, leisure products and home equipment; department stores and mail order
of retail products through various catalogues; and financial services in
connection with group businesses. PPR is also a holding company for a variety of
industrial and commercial companies in Africa and the French overseas
territories, as well as for certain trading companies in Europe.
Exhibit 1 sets forth with respect to each executive officer and
director of each of SFP, Artemis, PPR and REDAM such person's name, business
address and principal employment, the name and address of any business
corporation or other organization in which such employment is conducted and such
person's citizenship.
(d) and (e) None of SFP, Artemis, PPR, REDAM or Mr. Pinault and none
of the persons named in Exhibit 1 as an executive officer or director of any of
SFP, Artemis, PPR and REDAM has been convicted in a criminal proceeding during
the last five years; nor has any of
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said parties been a party to a civil proceeding of a court of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting or
mandating activities subject to, federal or state securities laws or finding any
violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On April 3, 1998, pursuant to a Stock Purchase Agreement (the "FS
Stock Purchase Agreement"), dated as of February 19, 1998, by and among PPR, FS
Equity Partners II, L.P., FS Equity Partners III, L.P. and FS Equity Partners
International, L.P. (collectively, the "FS Entities"), the FS Entities sold and
REDAM, as assignee of PPR under the FS Stock Purchase Agreement, purchased
4,389,294 shares of Common Stock (such shares of Common Stock, the "FS Shares").
On April 3, 1998, pursuant to a Stock Purchase Agreement (the "M&P
Stock Purchase Agreement" and, together with the FS Stock Purchase Agreement and
the Tag-Along Stock Purchase Agreements (as defined below), the "Stock Purchase
Agreements"), dated as of February 19, 1998, by and between PPR and M&P
Distributing Co. ("M&P"), M&P sold and REDAM, as assignee of PPR under the M&P
Stock Purchase Agreement, purchased 2,573,762 shares of Common Stock (such
shares of Common Stock, the "MP Shares").
In addition, at the time of the closings under the Stock Purchase
Agreements, REDAM purchased an aggregate 533,109 additional shares of Common
Stock (the "Management Shares") from certain members of management. In addition,
REDAM purchased an aggregate of 514,752 shares of Common Stock from two other
stockholders (the "Tag-Along Stockholders") of Brylane who were parties to a
Stockholders Agreement, dated as of February 26, 1997 (collectively, the "Other
Shares," and together with the Management Shares, the MP Shares and the FS
Shares, the "Shares").
The aggregate purchase price for the Shares paid to the FS Entities,
M&P, the Tag-Along Stockholders and certain members of management was in the
aggregate $408,556,767. These funds were obtained by REDAM as a capital
contribution from La Redoute, which borrowed such funds from PPR, which obtained
such funds from a drawdown on an existing line of credit with Banque Nationale
de Paris, Natexis, Union European du Credit Industriel et Commercial, Credit
Commercial de France, Credit du Nord and Credit Mutuel.
A copy of each of the FS Stock Purchase Agreement, the M&P Stock
Purchase Agreement and the two Stock Purchase Agreements, each dated as of April
3, 1998, between PPR and the Tag-Along Stockholders (the "Tag-Along Stock
Purchase Agreements") are attached hereto as Exhibits 2, 3, 4 and 5
respectively, and are specifically incorporated herein by reference, and the
descriptions herein of such agreements and the Exhibits thereto are qualified in
their respective entireties by reference to such agreements.
ITEM 4. PURPOSE OF TRANSACTION.
The purchase of the Shares is for the purpose of ownership and not
with a view to or for sale in connection with any distribution thereof. PPR and
REDAM have no present
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intention or plan to effect any distribution of the Shares. PPR acquired the
Shares in order to acquire a significant equity interest in Brylane, certain of
whose businesses are similar to businesses owned by PPR.
As described under Item 3, pursuant to the Stock Purchase Agreements,
REDAM purchased the aggregate 8,010,917 Shares at a price of $51.00 per Share on
April 3, 1998.
As contemplated by the FS Stock Purchase Agreement and the M&P Stock
Purchase Agreement, PPR and Brylane entered into a Governance Agreement, dated
as of April 3, 1998 (the "Governance Agreement") at the time of the purchase of
the Shares. The Governance Agreement is filed as Exhibit 6 hereto, is
incorporated herein by reference, and the following description of such
agreement is qualified in its entirety by reference to such Exhibit.
Pursuant to the Governance Agreement, during a standstill period of
three years (which period is subject to early termination in certain
circumstance set forth in the Governance Agreement), PPR and its affiliates are
subject to certain limitations and restrictions relating to (x) solicitations or
public proposals to effect a merger or other business combination or sale of all
or substantially all of the assets of Brylane and (y) acquisitions of additional
shares of Common Stock limited to approximately 47.5% of the outstanding shares
of Common Stock. In addition, under the Governance Agreement, (i) Brylane is
required to use its best efforts to have the Board of Directors of Brylane (the
"Board") include up to five nominees of PPR in the slate of nominees presented
by the Board for election at each stockholder meeting at which directors are to
be elected (the "PPR Directors"), subject to the resignation of specified
numbers of PPR Directors in the event ownership of Common Stock by PPR or its
affiliates falls below certain thresholds set forth in the Governance Agreement;
(ii) PPR and Brylane are required to use their best efforts to assure that the
Board will include (a) at least three directors who are independent of PPR,
Freeman Spogli & Co., The Limited, Inc. and Brylane's management (the
"Independent Directors") and (b) Brylane's chief executive officer; (iii) PPR
has specified representation on the committees of the Board; and (iv) until the
first anniversary of the Governance Agreement, certain specified officers of
Brylane may not be terminated without cause unless two-thirds of the directors
then in office approve such termination.
In addition, pursuant to the Governance Agreement, PPR has agreed
that, as long as at least two-ninths or an equivalent proportion of the
directors are PPR Directors, (i) any transaction with PPR or its affiliates must
be on arm's-length terms and approved by a majority of the Independent
Directors; (ii) any amendment, repeal or other modification of the Governance
Agreement or any other agreement or instrument of Brylane, including Brylane's
charter or bylaws, which would have the effect of altering the terms of the
Governance Agreement in any manner adverse to the stockholders of Brylane (other
than PPR) must be approved by a majority of the Independent Directors; (iii)
dispositions of any assets of the Brylane or any business combination, spin-off
or other transaction pursuant to which PPR would receive consideration different
from that received by other holders of Common Stock must be approved by a
majority of the Independent Directors; and (iv) any corporate opportunity
(merger or acquisition) relating to the United States mail order business which
PPR or its affiliates receives must first be presented to and considered by
Brylane. If, within 20 days of being
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<PAGE>
presented with an opportunity described in clause (iv) of the preceding
sentence, Brylane chooses not to pursue such opportunity or Brylane chooses to
pursue such opportunity and fails to consummate a transaction with respect to
such opportunity within 45 days of being presented with the opportunity, PPR
and/or its affiliates may pursue such opportunity. In addition, if any PPR
business that is primarily mail order desires to enter the United States mail
order business, then Brylane will be offered a right of first refusal with
respect to such business in the United States. If, within 20 days of being
presented with such opportunity, Brylane chooses not to pursue such opportunity
or Brylane chooses to pursue such opportunity and fails to consummate a
transaction with respect to such opportunity within 45 days of being presented
with the opportunity, PPR and/or its affiliates may pursue such opportunity. PPR
will not interfere with any merger or acquisition opportunities that Brylane
receives on its own (other than through participating in any decision made by
the Board).
Pursuant to the FS Stock Purchase Agreement and the M&P Stock
Purchase Agreement, five nominees of PPR were elected as directors of Brylane on
April 3, 1998 to serve until Brylane's next annual meeting and until their
successors are duly elected and qualified. The five individuals elected as
directors are Serge Weinberg, President and Chief Executive Officer of PPR;
Hartmut Kramer, Chairman and Chief Executive Officer of La Redoute, Richard
Simonin, Chairman and Chief Executive Officer of Redoute France; Antoine
Metzger, Chief Financial Officer of La Redoute; and Johannes Loning,
Vice-President in charge of Corporate Development of La Redoute.
Concurently, with the purchase of the Shares, Brylane and PPR entered
into a registration rights agreement, dated as of April 3, 1998 (the
"Registration Rights Agreement"), pursuant to which Brylane has granted PPR
certain registration rights to facilitate the resale of the Shares under certain
conditions. Under the Registration Rights Agreement, PPR and its affiliates are
entitled to two demand registrations. Such agreement is filed as Exhibit 7
hereto, is incorporated herein by reference, and the description herein of such
agreement is qualified in its entirety by reference to such agreement
Except as set forth in this Item 4, PPR presently has no plans or
proposals that relate to or would result in any of the actions specified in
clauses (a) through (j) of Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
As of April 3, 1998, PPR may be deemed to beneficially own 8,010,917
Shares because of REDAM's acquisition of the Shares. Based upon the 18,329,948
shares of Common Stock which Brylane has informed PPR are outstanding as of
April 3, 1998, PPR beneficially owns approximately 43.7% of the Common Stock.
Except as set forth in this Item 5, to the best knowledge and belief
of PPR, no transactions involving Common Stock have been effected during the
past 60 days by PPR or by its directors, executive officers or controlling
persons.
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<PAGE>
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDING OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER.
As described above in Items 3 and 4, the Stock Purchase Agreements,
the Governance Agreement and the Registration Rights Agreement provide for
various rights and restrictions with respect to Brylane's Common Stock.
A copy of each of the Stock Purchase Agreements, the Governance
Agreement and the Registration Rights Agreement are attached hereto as Exhibits
2, 3, 4, 5, 6 and 7, respectively, and are incorporated herein by reference, and
the description herein of such agreements are qualified in their respective
entireties by reference to such agreements.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
The following Exhibits are filed as part of this Schedule 13D:
Exhibit 1 - Name, Business Address, and Present Principal
Occupation of Each Executive Officer and Director of
S.C.A. Financiere Pinault, Artemis S.A.,
Pinault-Printemps-Redoute S.A. and REDAM, LLC
Exhibit 2 - Stock Purchase Agreement, dated as of February 19,
1988, by and among FS Equity Partners II, L.P., FS
Equity Partners III, L.P., and FS Partners
International, L.P. and Pinault Printemps-Redoute,
S.A. (incorporated by reference to Exhibit 99.1 of
Brylane's Current Report on Form 8-K filed with the
Securities and Exchange Commission on March 4, 1998).
Exhibit 3 - Stock Purchase Agreement, dated as of February 19,
1988, by and between M&P Distributing Co. and
Pinault Printemps-Redoute, S.A. (incorporated by
reference to Exhibit 99.2 of Brylane's Current
Report on Form 8-K filed with the Securities and
Exchange Commission on March 4, 1998).
Exhibit 4 Stock Purchase Agreement, dated as of April 3, 1988,
by and between Leeway & Co. and Pinault
Printemps-Redoute, S.A.
Exhibit 5 Stock Purchase Agreement, dated as of April 3, 1988,
by and between Bell Atlantic Master Trust and Pinault
Printemps-Redoute, S.A.
Exhibit 6 Governance Agreement, dated as of April 3, 1998, by
and between Brylane, Inc. and Pinault
Printemps-Redoute, S.A.
Exhibit 7 Registration Rights Agreement, dated as of April 3,
1998, by and between Brylane, Inc. and Pinault
Printemps-Redoute, S.A.
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<PAGE>
SIGNATURE
After reasonable inquiry and to the best of the undersigned's knowledge
and belief, the undersigned certify that the information set forth in this
statement is true, complete, and correct.
PINAULT-PRINTEMPS-REDOUTE, S.A.
By: /s/ Serge Weinberg
Name: Serge Weinberg
Title:Chairman and Chief Executive Officer
April 13, 1998
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<PAGE>
EXHIBIT INDEX
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NO.
Exhibit 1 - Name, Business Address, and Present
Principal Occupation of Each Executive
Officer and Director of S.C.A. Financiere
Pinault, Artemis S.A.,
Pinault-Printemps-Redoute S.A. and REDAM,
LLC.
Exhibit 2 - Stock Purchase Agreement, dated as of
February 19, 1988, by and among FS Equity
Partners II, L.P., FS Equity Partners
III, L.P., and FS Partners International,
L.P. and Pinault Printemps-Redoute, S.A.
(incorporated by reference to Exhibit
99.1 of Brylane's Current Report on Form
8-K filed with the Securities and
Exchange Commission on March 4, 1998).
Exhibit 3 Stock Purchase Agreement, dated as of
February 19, 1988, by and M&P
Distributing Co. and Pinault
Printemps-Redoute, S.A. (incorporated by
reference to Exhibit 99.2 of Brylane's
Current Report on Form 8-K filed with the
Securities and Exchange Commission on
March 4, 1998).
Exhibit 4 Stock Purchase Agreement, dated as of April
3, 1988, by and between Leeway & Co. and
Pinault Printemps-Redoute, S.A.
Exhibit 5 Stock Purchase Agreement, dated as of April 3, 1988, by and
between Bell Atlantic Master Trust and Pinault Printemps-Redoute,
S.A.
Exhibit 6 Governance Agreement, dated as of April
3, 1998, by and between Brylane, Inc. and
Pinault Printemps-Redoute, S.A.
Exhibit 7 Registration Rights Agreement, dated as
of April 3, 1998, by and between Brylane,
Inc. and Pinault Printemps-Redoute, S.A.
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EXHIBIT 1
GENERAL PARTNERS OF S.C.A.
FINANCIERE PINAULT
Name and Principal
Business Address
Citizenship Position
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Francois PINAULT Managing General Partner
4, rue de Tournon
75006 Paris
Citizenship: French
PINAULT TRUSTEE (S.A.R.L.) General Partner
5, Boulevard de Latour Mauboug
75007 Paris
Citizenship
(Jurisdiction of
Organization): French
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS OF ARTEMIS S.A.
Name and Principal
Business Address
Citizenship Position
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Francois PINAULT Chairman and CEO
c/o Artemis
Citizenship: French
Patricia BARBIZET-DUSSART Managing Director
c/o Artemis
Citizenship: French
Francois-Henri PINAULT Managing Director
c/o Artemis
Citizenship: French
Jean-Louis de ROUX Director
c/o Artemis
Citizenship: French
John J. RIAN III Director
c/o Artemis
Citizenship: American
2
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DIRECTORS AND EXECUTIVE OFFICERS OF
PINAULT-PRINTEMPS-REDOUTE S.A.
Name and Principal
Business Address
Citizenship Position
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Serge WEINBERG Chairman & CEO
c/o PPR
Citizenship: French
Francois Henri PINAULT Director
c/o PPR
Citizenship: French
Jean-Claude DARROUZET Director
c/o PPR
Citizenship: French
Per KAUFMANN Director
c/o PPR
Citizenship: Swedish
Alain REDHEUIL Director
c/o PPR
Citizenship: French
3
<PAGE>
SUPERVISORY BOARD OF
PINAULT-PRINTEMPS-REDOUTE S.A.
Name and Principal
Business Address
Citizenship Position
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Ambroise ROUX President
c/o PPR
Citizenship: French
Francois PINAULT Vice-President
c/o Artemis
Citizenship: French
Patricia BARBIZET-DUSSARD Supervisor
c/o Artemis
Citizenship: French
Patrick DUVERGER Supervisor
c/o Societe Generale
29, boulevard Hausmann
75009 Paris
Citizenship: French
Baudoin PROT Supervisor
c/o Banque Nationale de Paris
16, boulevard des Italiens
75009 Paris
Citizenship: French
Loik LE FLOCH-PRIGENT Supervisor
c/o PPR
Citizenship: French
Jean POLLET Supervisor
4
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c/o PPR
Citizenship: French
Patrick POLLET Supervisor
c/o Credit Commercial de
France
103, avenue des Champs-Elysees
75008 Paris
Citizenship: French
Alain MINC Supervisor
c/o A.M. Conseil
10, avenue George V
75008 Paris
Citizenship: French
Bruno ROGER Supervisor
c/o Banque Lazard Freres &
Cie.
121 boulevard Hausmann
75008 Paris
Citizenship: French
Jean-Yves DURANCE Supervisor
c/o Credit Lyonnais
19, boulevard des Italiens
75002 Paris
Citizenship: French
Francois HENROT Supervisor
c/o Rothschild & Cie Banque
17, avenue Matignon
75008 Paris
Citizenship: French
5
<PAGE>
ADVISORY BOARD OF
PINAULT-PRINTEMPS-REDOUTE S.A.
Name and Principal
Business Address
Citizenship Position
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Leon CLIGMAN Advisor
c/o PPR
Citizenship: French
Credit Lyonnias Advisor
represented by Jean Paul AMIEL
c/o PPR
Citizenship: French
Jean LOYRETTE Advisor
c/o PPR
Citizenship: French
Jean-Philippe HOTTINGER Advisor
c/o PPR
Citizenship: French
Jean-Louis de ROUX Advisor
c/o PPR
Citizenship: French
6
<PAGE>
DIRECTORS OF LA REDOUTE
Name and Principal
Business Address
Citizenship Position
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Serge Weinberg Chairman
c/o La Redoute
Citizenship: French
Patrice MARTEAU Director
c/o La Redoute
Citizenship: French
SAPARDIS Director
represented by Francois POTIER
c/o La Redoute
Citizenship: French
CAUMARTIN PARTICIPATION Director
represented by Michel
FRIOCOURT
c/o La Redoute
Citizenship: French
7
<PAGE>
MANAGERS OF REDAM LLC
Name and Principal
Business Address
Citizenship Position
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Hartmut Kramer Chairman
c/o REDAM
Citizenship: French
Johannes Loning Manager
c/o REDAM
Citizenship: French
Antoine Metzger Manager
c/o REDAM
Citizenship: French
Alain Penet Manager
c/o REDAM
Citizenship: French
Pascal Cesbon Lavau Manager
c/o REDAM
Citizenship: French
8
Exhibit 4
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT ("Agreement") dated as of April 3, 1998
between Leeway & Co., a Massachusetts partnership ("Seller"), and Pinault
Printempts-Redoute, S.A., a company organized under the laws of France ("PPR").
A G R E E M E N T:
NOW, THEREFORE, in consideration of the mutual and dependent promises
set forth herein, the sufficiency of which is hereby acknowledged, the parties
hereby agree as follows:
ARTICLE I
THE TRANSACTIONS
1.1 Purchase and Sale. Upon the terms and subject to the conditions
set forth in this Agreement, at the Closing (as defined below) PPR shall
purchase from Seller, and Seller shall sell to PPR, the 257,376 shares (the
"Shares") of common stock (the "Common Stock"), par value $.01 per share of
Brylane, Inc., a Delaware corporation ("Brylane") owned by Seller. The purchase
price to be paid by PPR to Seller for the Shares to be sold and purchased
hereunder shall be $51.00 per share of Common Stock (the "Purchase Price"). The
Purchase Price and the number of Shares to be purchased and sold hereunder shall
be adjusted to give effect to any stock splits, stock dividends,
recapitalizations and similar transactions declared or occurring between the
date hereof and Closing.
1.2 Closing. At the closing (a) PPR will wire transfer in same day
funds to accounts set forth in writing by Seller the sum of $13,126,176 in
payment of the Purchase Price for the Shares to be purchased by PPR, and (b)
Seller shall deliver a certificate or certificates to PPR, representing the
Shares purchased thereby, duly endorsed for transfer in blank (the
"Certificates") with stock transfer stamps attached. The consummation of the
transactions contemplated by this Agreement (the "Closing") shall take pace at
10:00 a.m. New York time, at the offices of Wachtell, Lipton, Rosen & Katz on
the Closing Date (as defined in the Stock Purchase Agreement (the "MPD
Agreement"), dated as of February 21, 1998, by and between PPR and M&P
Distributing Co.). If the MPD Agreement is terminated or the Closing Date does
not occur prior to April 30, 1998, then this Agreement shall automatically
terminate.
1.3 Fees and Expenses. PPR and Seller shall each be responsible for
the fees and expenses incurred by it in connection with this Agreement and the
transactions contemplated hereby.
1.4 Assignment. PPR may assign its right to purchase the Shares to
any one or more direct or indirect majority-owned subsidiaries, or affiliates
controlled by PPR; provided
<PAGE>
that no such assignment shall relieve PPR of its obligations hereunder to the
extent that the assignee fails to fulfill the same.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF PPR
PPR represents and warrants to Seller as follows:
2.1 Authority. PPR has full corporate power and authority to execute
and deliver this Agreement, and to consummate the transactions contemplated on
its part hereby. The execution, delivery and performance by PPR of this
Agreement and the consummation of the transactions contemplated hereby have been
duly authorized by all necessary action on the part of PPR. No other action on
the part of PPR is necessary to authorize the execution and delivery of this
Agreement by PPR or the performance by PPR of its obligations hereunder or
thereunder. This Agreement has been duly executed and delivered by PPR and
constitutes a legal, valid and binding agreement of PPR, enforceable against it
in accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting creditors' rights generally
and subject to general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to PPR as follows:
3.1 Authority. Seller has full power and authority to execute and
deliver this Agreement, and to consummate the transactions contemplated on its
part hereby. The execution, delivery and performance by Seller of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary action on the part of Seller. No other action on the
part of Seller is necessary to authorize the execution and delivery of this
Agreement by Seller or the performance by Seller of its obligations hereunder or
thereunder. This Agreement has been duly executed and delivered by Seller and
constitutes a legal, valid and binding agreement of Seller, enforceable against
it in accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting creditors' rights generally
and subject to general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
3.2 Title to Shares. Seller has good, valid and marketable title to
the Shares of Common Stock, free and clear of any Encumbrances (as defined
below). At the Closing, PPR will acquire all of Seller's right, title and
interest in and to, and will have good, valid and market-
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<PAGE>
able title to the Shares of Common Stock from Seller, free and clear of any and
all security interests, liens, claims, pledges, encumbrances or other rights or
claims of any other person of any kind or any preemptive or similar rights
(collectively, "Encumbrances"). The Shares constitute all of the shares of
capital stock of Brylane or its subsidiaries owned or held by Seller (other than
any shares that may be owned by Seller and held in discretionary accounts
managed by unaffiliated money managers).
ARTICLE IV
MISCELLANEOUS
4.1 Notices. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been given or
made if in writing and delivered personally, sent by commercial carrier or
registered or certified mail (postage prepaid, return receipt requested) or
transmitted by facsimile (with receipt confirmed) to the parties at the
following addresses and numbers listed on Schedule 4.1 hereto or at such other
addresses as shall be furnished by the parties by like notice, and such notice
or communication shall be deemed to have been given or made as of the date
actually received.
4.2 Publicity. Except as required by law, so long as this Agreement
is in effect, PPR and Seller shall not, and shall cause their affiliates not to,
issue or cause the publication of any press release or other announcement with
respect to the transactions contemplated by this Agreement without the consent
of the other parties, which consent shall not be unreasonably withheld or
delayed.
4.3 Headings; Entire Agreement; Counterparts; Amendments; Third
Party Beneficiaries. The headings contained in this Agreement are inserted for
convenience only and do not constitute a part of this Agreement. This Agreement
(including any Schedules hereto) constitutes the entire agreement among the
parties and supersedes all other prior agreements and understandings, both
written and oral, among the parties, or any of them, with respect to the subject
matter hereof. This Agreement may be executed in one or more counterparts, all
of which shall be considered one and the same agreement and each of which shall
be deemed an original. This Agreement may not be amended except by an instrument
in writing signed on behalf of each of the parties hereto. This Agreement is not
intended to confer upon any other person other than the Parties hereto any
rights or remedies hereunder.
4.4 Survival. The representations and warranties contained herein
shall survive the Closing and shall continue in effect for two years.
4.5 Assignment. This Agreement and all of the provisions hereof
shall be binding upon and inure to the benefits of the parties hereto and their
respective successors and permitted assigns. Subject to Section 1.4, neither
this Agreement nor any of the rights, interests
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<PAGE>
or obligations shall be assigned by any of the parties hereto without the prior
written consent of the other parties.
4.6 Governing Law. The validity and interpretation of this Agreement
shall be governed by the laws of the State of New York, without reference to the
conflict of laws principles thereof.
4.7 Specific Performance. The parties hereto shall acknowledge that,
in view of the uniqueness of the parties hereto, the parties hereto would not
have an adequate remedy at law for money damages in the event that this
Agreement were not performed in accordance with its terms, and therefore agree
that the parties shall be entitled to specific enforcement of the terms hereof
in addition to any other remedy to which the parties hereto may be entitled at
law or in equity.
IN WITNESS WHEREOF, PPR and Seller have caused this Agreement to be
signed by a duly authorized officer as of the date first written above.
PINAULT PRINTEMPS-REDOUTE, S.A.
By: /s/ Serge Weinberg
Name: Serge Weinberg
Title: Chairman and Chief Executive Officer
LEEWAY & CO., as nominee for the Long-Term
Investment Trust
By: State Street Bank and Trust, a Partner
By: /s/ Kimberly A. Moynihan
Name: Kimberly A. Moynihan
Title: Assistant Secretary
-4-
Exhibit 5
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT ("Agreement") dated as of April 3, 1998
between Bell Atlantic Master Trust, a trust organized under the laws of New York
("Seller"), and Pinault Printempts-Redoute, S.A., a company organized under the
laws of France ("PPR").
A G R E E M E N T:
NOW, THEREFORE, in consideration of the mutual and dependent promises
set forth herein, the sufficiency of which is hereby acknowledged, the parties
hereby agree as follows:
ARTICLE I
THE TRANSACTIONS
1.1 Purchase and Sale. Upon the terms and subject to the conditions
set forth in this Agreement, at the Closing (as defined below) PPR shall
purchase from Seller, and Seller shall sell to PPR, the 257,376 shares (the
"Shares") of common stock (the "Common Stock"), par value $.01 per share of
Brylane, Inc., a Delaware corporation ("Brylane") owned by Seller. The purchase
price to be paid by PPR to Seller for the Shares to be sold and purchased
hereunder shall be $51.00 per share of Common Stock (the "Purchase Price"). The
Purchase Price and the number of Shares to be purchased and sold hereunder shall
be adjusted to give effect to any stock splits, stock dividends,
recapitalizations and similar transactions declared or occurring between the
date hereof and Closing.
1.2 Closing. At the closing (a) PPR will wire transfer in same day
funds to accounts set forth in writing by Seller the sum of $13,126,176 in
payment of the Purchase Price for the Shares to be purchased by PPR, and (b)
Seller shall deliver a certificate or certificates to PPR, representing the
Shares purchased thereby, duly endorsed for transfer in blank (the
"Certificates") with stock transfer stamps attached. The consummation of the
transactions contemplated by this Agreement (the "Closing") shall take pace at
10:00 a.m. New York time, at the offices of Wachtell, Lipton, Rosen & Katz on
the Closing Date (as defined in the Stock Purchase Agreement (the "MPD
Agreement"), dated as of February 21, 1998, by and between PPR and M&P
Distributing Co.). If the MPD Agreement is terminated or the Closing Date does
not occur prior to April 30, 1998, then this Agreement shall automatically
terminate.
1.3 Fees and Expenses. PPR and Seller shall each be responsible for
the fees and expenses incurred by it in connection with this Agreement and the
transactions contemplated hereby.
1.4 Assignment. PPR may assign its right to purchase the Shares to
any one or more direct or indirect majority-owned subsidiaries, or affiliates
controlled by PPR; provided
<PAGE>
that no such assignment shall relieve PPR of its obligations hereunder to the
extent that the assignee fails to fulfill the same.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF PPR
PPR represents and warrants to Seller as follows:
2.1 Authority. PPR has full corporate power and authority to execute
and deliver this Agreement, and to consummate the transactions contemplated on
its part hereby. The execution, delivery and performance by PPR of this
Agreement and the consummation of the transactions contemplated hereby have been
duly authorized by all necessary action on the part of PPR. No other action on
the part of PPR is necessary to authorize the execution and delivery of this
Agreement by PPR or the performance by PPR of its obligations hereunder or
thereunder. This Agreement has been duly executed and delivered by PPR and
constitutes a legal, valid and binding agreement of PPR, enforceable against it
in accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting creditors' rights generally
and subject to general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to PPR as follows:
3.1 Authority. Seller has full power and authority to execute and
deliver this Agreement, and to consummate the transactions contemplated on its
part hereby. The execution, delivery and performance by Seller of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary action on the part of Seller. No other action on the
part of Seller is necessary to authorize the execution and delivery of this
Agreement by Seller or the performance by Seller of its obligations hereunder or
thereunder. This Agreement has been duly executed and delivered by Seller and
constitutes a legal, valid and binding agreement of Seller, enforceable against
it in accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting creditors' rights generally
and subject to general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
3.2 Title to Shares. Seller has good, valid and marketable title to
the Shares of Common Stock, free and clear of any Encumbrances (as defined
below). At the Closing, PPR will acquire all of Seller's right, title and
interest in and to, and will have good, valid and market-
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<PAGE>
able title to the Shares of Common Stock from Seller, free and clear of any and
all security interests, liens, claims, pledges, encumbrances or other rights or
claims of any other person of any kind or any preemptive or similar rights
(collectively, "Encumbrances"). The Shares constitute all of the shares of
capital stock of Brylane or its subsidiaries owned or held by Seller (other than
any shares that may be owned by Seller and held in discretionary accounts
managed by unaffiliated money managers).
ARTICLE IV
MISCELLANEOUS
4.1 Notices. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been given or
made if in writing and delivered personally, sent by commercial carrier or
registered or certified mail (postage prepaid, return receipt requested) or
transmitted by facsimile (with receipt confirmed) to the parties at the
following addresses and numbers listed on Schedule 4.1 hereto or at such other
addresses as shall be furnished by the parties by like notice, and such notice
or communication shall be deemed to have been given or made as of the date
actually received.
4.2 Publicity. Except as required by law, so long as this Agreement
is in effect, PPR and Seller shall not, and shall cause their affiliates not to,
issue or cause the publication of any press release or other announcement with
respect to the transactions contemplated by this Agreement without the consent
of the other parties, which consent shall not be unreasonably withheld or
delayed.
4.3 Headings; Entire Agreement; Counterparts; Amendments; Third
Party Beneficiaries. The headings contained in this Agreement are inserted for
convenience only and do not constitute a part of this Agreement. This Agreement
(including any Schedules hereto) constitutes the entire agreement among the
parties and supersedes all other prior agreements and understandings, both
written and oral, among the parties, or any of them, with respect to the subject
matter hereof. This Agreement may be executed in one or more counterparts, all
of which shall be considered one and the same agreement and each of which shall
be deemed an original. This Agreement may not be amended except by an instrument
in writing signed on behalf of each of the parties hereto. This Agreement is not
intended to confer upon any other person other than the Parties hereto any
rights or remedies hereunder.
4.4 Survival. The representations and warranties contained herein
shall survive the Closing and shall continue in effect for two years.
4.5 Assignment. This Agreement and all of the provisions hereof
shall be binding upon and inure to the benefits of the parties hereto and their
respective successors and permitted assigns. Subject to Section 1.4, neither
this Agreement nor any of the rights, interests
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<PAGE>
or obligations shall be assigned by any of the parties hereto without the prior
written consent of the other parties.
4.6 Governing Law. The validity and interpretation of this Agreement
shall be governed by the laws of the State of New York, without reference to the
conflict of laws principles thereof.
4.7 Specific Performance. The parties hereto shall acknowledge that,
in view of the uniqueness of the parties hereto, the parties hereto would not
have an adequate remedy at law for money damages in the event that this
Agreement were not performed in accordance with its terms, and therefore agree
that the parties shall be entitled to specific enforcement of the terms hereof
in addition to any other remedy to which the parties hereto may be entitled at
law or in equity.
IN WITNESS WHEREOF, PPR and Seller have caused this Agreement to be
signed by a duly authorized officer as of the date first written above.
PINAULT PRINTEMPS-REDOUTE, S.A.
By: /s/ Serge Wenberg
Name: Serge Weinberg
Title: Chairman and Chief Executive Officer
BELL ATLANTIC MASTER TRUST
By: Mellon Bank, N.A., solely in its capacity as
Trustee for Bell Atlantic Master Pension
Trust (as directed by the Bell Atlantic
Corporation), and not in its individual
capacity
By: /s/ Carole Bruno
Name: Carole Bruno
Title: Authorized Signatory
-4-
Exhibit 6
===================================================================
GOVERNANCE AGREEMENT
by and between
BRYLANE INC.
and
PINAULT PRINTEMPS-REDOUTE, S.A.
dated as of
April 3, 1998
===================================================================
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE 1
Definitions
Section 1.1 Affiliate..................................... 1
Section 1.2 Agreement..................................... 1
Section 1.3 Beneficially Own.............................. 1
Section 1.4 Board......................................... 1
Section 1.5 Common Stock.................................. 2
Section 1.6 Company....................................... 2
Section 1.7 Covered Transaction........................... 2
Section 1.8 Director...................................... 2
Section 1.9 Early Termination Event....................... 2
Section 1.10 Group......................................... 2
Section 1.11 Independent Director.......................... 2
Section 1.12 Investor...................................... 2
Section 1.13 Investor Nominees............................. 2
Section 1.14 Key Committees................................ 2
Section 1.15 Material Adverse Effect....................... 2
Section 1.15 1933 Act...................................... 2
Section 1.16 1934 Act...................................... 2
Section 1.17 person........................................ 2
Section 1.19 Permitted Percentage.......................... 2
Section 1.20 Standstill Period............................. 3
Section 1.21 Stock Purchase Agreements..................... 3
Section 1.22 13D Group..................................... 3
Section 1.23 Voting Securities............................. 3
ARTICLE 2
Standstill Provisions
Section 2.1 Standstill Period............................. 3
Section 2.2 Restrictions During Standstill Period......... 4
Section 2.3 Waivers of Restrictions....................... 5
ARTICLE 3
Other Covenants
Section 3.1 Maintenance of Ownership...................... 5
<PAGE>
Section 3.2 Actions Requiring Approval.................... 5
Section 3.3 Indemnification Agreements and
Insurance..................................... 6
ARTICLE 4
Board of Directors
Section 4.1 Investor Nominees............................. 6
Section 4.2 Committee Representation...................... 7
ARTICLE 5
Representations & Warranties
Section 5.1 Company Representations and Warranties........ 8
Section 5.2 Investor Representations and Warranties....... 8
ARTICLE 6
Miscellaneous
Section 6.1 Counterparts.................................. 9
Section 6.2 Governing Law................................. 9
Section 6.3 Entire Agreement.............................. 9
Section 6.4 Expenses...................................... 10
Section 6.5 Notices....................................... 10
Section 6.6 Successors and Assigns........................ 10
Section 6.7 Headings...................................... 11
Section 6.8 Amendments and Waivers........................ 11
Section 6.9 Interpretation; Absence of Presumption........ 11
Section 6.10 Severability.................................. 11
Section 6.11 Further Assurances............................ 11
Section 6.12 Specific Performance.......................... 11
Section 6.13 Fiduciary Dates............................... 12
Section 6.14 Confidentiality; Other Arrangements........... 12
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<PAGE>
THIS GOVERNANCE AGREEMENT (the "Agreement"), dated as of April 3,
1998, is made by and between Brylane Inc., a Delaware corporation (the
"Company"), and Pinault Printemps-Redoute, S.A., a societe anonyme organized
under the laws of France ("Investor").
RECITALS:
WHEREAS, the Investor and The Limited, Inc. ("The Limited") and
certain affiliates of Freeman Spogli & Co. (collectively, "FS," and together
with The Limited, the "Selling Stockholders") have each entered into individual
Stock Purchase Agreements, dated as of February 19, 1998 (collectively, the
"Stock Purchase Agreements"), pursuant to which the Selling Stockholders are
selling, conveying, assigning and transferring, and Investor is purchasing,
certain shares of the common stock, par value $.01 per share, of the Company
(the "Common Stock") on the date hereof; and
WHEREAS, it is a condition to the transactions contemplated by the
Stock Purchase Agreements and the parties believe it to be in their best
interests that they enter into this Agreement to provide for certain rights and
restrictions with respect to the investment by Investor in the Company and the
corporate governance of the Company; and
NOW, THEREFORE, in consideration of the premises and the covenants
and agreements contained herein and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the parties agree as follows:
ARTICLE 1
Definitions
As used in this Agreement, the following terms shall have the following
respective meanings:
Section 1.1 "Affiliate" shall have the meaning ascribed thereto in
Rule 12b-2 promulgated under the 1934 Act, and as in effect on the date hereof.
Section 1.2 "Agreement" shall have the meaning set forth in the
first paragraph hereof.
Section 1.3 "Beneficially Own" shall mean, with respect to any
security, having direct or indirect (including through any Subsidiary or
Affiliate) "beneficial ownership" of such security, as determined pursuant to
Rule 13d-3 under the 1934 Act, including pursuant to any agreement, arrangement
or understanding, whether or not in writing.
Section 1.4 "Board" shall mean the board of directors of the
Company.
<PAGE>
Section 1.5 "Common Stock" shall have the meaning set forth in the
second paragraph hereof.
Section 1.6 "Company" shall have the meaning set forth in the first
paragraph hereof.
Section 1.7 "Covered Transaction" shall have the meaning set forth
in Section 2.1(iv).
Section 1.8 "Director" shall mean a member of the Board.
Section 1.9 "Early Termination Event" shall have the meaning set
forth in Section 2.1.
Section 1.10 "Group" shall mean a "group" as such term is used in
Section 13(d)(3) of the 1934 Act.
Section 1.11 "Independent Director" shall mean Mr. William C.
Johnson, Mr. Peter M. Starrett as well as any individual who is not a member of
the Company's management and is not affiliated with Investor, The Limited, or FS
or any of their respective affiliates (including any individual who in the past
three years has been an officer, employee, consultant or advisor of or to any of
the foregoing).
Section 1.12 "Investor" shall have the meaning set forth in the
first paragraph hereof.
Section 1.13 "Investor Nominees" shall have the meaning set forth in
Section 4.1.
Section 1.14 "Key Committees" shall have the meaning set forth in
Section 4.2.
Section 1.15 "Material Adverse Effect" shall mean a material adverse
effect on the results of operations, condition, financial or otherwise, or on
the earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise.
Section 1.16 "1933 Act" shall mean the Securities Act of 1933, as
amended.
Section 1.17 "1934 Act" shall mean the Securities Exchange Act of
1934, as amended.
Section 1.18 "person" shall mean any individual, corporation,
partnership, limited liability company, joint venture, trust, unincorporated
organization, other form of business or legal entity or government authority.
Section 1.19 "Permitted Percentage" shall have the meaning set forth
in Section 2.2.
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<PAGE>
Section 1.20 "Standstill Period" shall have the meaning set forth in
Section 2.1.
Section 1.21 "Stock Purchase Agreements" shall have the meaning set
forth in the second paragraph hereof.
Section 1.22 "13D Group" shall mean any group of persons acquiring,
holding, voting or disposing of Voting Securities which would be required under
Section 13(d) of the 1934 Act and the rules and regulations thereunder (as in
effect, and based on legal interpretations thereof existing, on the date hereof)
to file a statement on Schedule 13D with the Securities and Exchange Commission
as a "person" within the meaning of Section 13(d)(3) of the 1934 Act if such
group beneficially owned Voting Securities representing more than 5% of any
class of Voting Securities then outstanding.
Section 1.23 "Voting Securities" shall mean at any time shares of
any class of capital stock of the Company which are then entitled to vote
generally in the election of Directors.
ARTICLE 2
Standstill Provisions
Section 2.1 Standstill Period. The "Standstill Period" shall be the period
commencing on the date of Closing and ending on the earlier of (x) the date that
is 36 months from the date thereof, or (y) the earliest of:
(i) the occurrence of any event of default on the part of the
Company or any subsidiary under any debt agreements, instruments, or
arrangements which event of default would reasonably be expected to
result in a Material Adverse Effect and, in the case of a
non-monetary event of default, which event of default cannot be, or
is not, cured by the Company within the applicable cure period under
such debt agreement, instrument or arrangement;
(ii) the acquisition by any person or Group other than Investor
or any Affiliate thereof of, or the announcement or commencement of a
tender or exchange offer by any person or Group other than Investor
or any Affiliate thereof to acquire, Beneficial Ownership of more
than 20% of the outstanding shares of Voting Securities;
(iii) the commencement by any person or Group (not affiliated
with Investor) of an "election contest" (as defined in Section 2.2)
or the seeking through other means of the removal of any Directors
from office; and
(iv) the written submission by any person or Group other than
Investor or any Affiliate thereof of a proposal to the Company
(including to the Board or any agent, representative or Affiliate of
the Company) with respect to, or
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<PAGE>
otherwise expressing an interest in pursuing, a merger,
consolidation or other business combination of the Company, sale of
all or substantially all of the assets of the Company or significant
recapitalization or significant reorganization of the Company (any of
the foregoing, a "Covered Transaction"); provided, however, that the
Standstill Period shall not terminate pursuant to this Section
2.1(iv) if, as soon as practicable after receipt of any such
proposal, a majority of the Independent Directors determines that
such proposal is not in the best interest of the Company and its
shareholders and for so long as a majority of the Independent
Directors continues to reject such proposal as a result of such
determination.
Any event set forth in subsection (i), (ii), (iii) or (iv) of this
Section 2.1 shall be an "Early Termination Event."
Section 2.2 Restrictions During Standstill Period. During the
Standstill Period, Investor will not, and will use its reasonable best efforts
to cause each of its Affiliates not to, directly or indirectly:
(i) act in concert with any other person or Group by becoming a
member of a 13D Group, other than any 13D Group comprised exclusively
of Investor and one or more of its Affiliates;
(ii) purchase or otherwise acquire shares of capital stock
(including Common Stock or other Voting Securities) (or options,
rights or warrants or other commitments to purchase and securities
convertible into (or exchangeable or redeemable for) shares of such
capital stock or other Voting Securities) as a result of which, after
giving effect to such purchase or acquisition, Investor and its
Affiliates will Beneficially Own more than the percentage of the
outstanding shares of Voting Securities (the "Permitted Percentage")
represented by the sum of (i) 6,963,056 shares of Common Stock sold
pursuant to the Stock Purchase Agreements with The Limited and FS,
(ii) the 595,195 shares of Common Stock subject to tag-along rights
pursuant to that certain Stockholders' Agreement dated as of February
26, 1997 among certain stockholders of the Company, (iii) the 374,365
shares of Common Stock beneficially owned by TJX and related parties
(including those underlying the convertible note held by TJX), (iv)
the 163,900 shares of Common Stock issued pursuant to certain
subscription agreements, and (v) the shares of Common Stock
underlying certain management options and related securities (i.e.,
617,084 performance shares and 68,500 redeemable preferred shares)
(giving effect to the issuance and exercise of such shares and
options) divided by the 18,470,469 then outstanding shares of Common
Stock (which gives effect to the shares of Common Stock issued upon
exercise or conversion of the foregoing securities);
(iii) solicit, encourage or publicly propose
to effect any Covered Transaction;
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<PAGE>
(iv) solicit, initiate, encourage or participate in any
"solicitation" of "proxies" or become a "participant" in any
"election contest" (as such terms are defined or used in Regulation
14A under the 1934 Act, disregarding clause (iv) of Rule 14a-1(l)(2)
and including an exempt solicitation pursuant to Rule 14a-2(b)(1));
call, or in any way encourage or participate in a call for, any
special meeting of shareholders of the Company (or take any action
with respect to acting by written consent of the shareholders of the
Company); request, or take any action to obtain or retain any list of
holders of any securities of the Company; or initiate or propose any
shareholder proposal or participate in or encourage the making of, or
solicit shareholders of the Company for the approval of, one or more
shareholder proposals; provided, however, that Investor shall not be
prohibited from communicating with a securityholder who is engaged in
any "solicitation" of "proxies" or who is a "participant" in any
"election contest"; or
(v) assist, advise, encourage or act in concert with any person
with respect to, or seek to do, any of the foregoing.
Section 2.3 Waivers of Restrictions. Notwithstanding anything to the
contrary contained herein, the Company may waive any of the foregoing
restrictions during the Standstill Period upon the approval of a majority of
Independent Directors.
ARTICLE 3
Other Covenants
Section 3.1 Maintenance of Ownership. (a) From and after the date hereof,
Investor shall have the ability to maintain its ownership of up to the Permitted
Percentage of the outstanding shares of Voting Securities through (i) open
market purchases or (ii) purchases of Common Stock directly from the Company;
provided, that any purchases directly from the Company pursuant to clause (ii)
of this Section 3.1(a) shall be subject to the prior approval of a majority of
the Independent Directors.
(b) If, at any time following the termination of the Standstill
Period, Investor acquires more than 65% of the outstanding shares of Voting
Securities, Investor shall (i) commence a tender offer for all of the
outstanding shares of Common Stock held by stockholders other than Investor and
its Affiliates at a price per share equal to at least the greater of (a) the
average closing price of the Common Stock over the prior 365-day period or (b)
the then-current market price or (ii) shall engage in such other transaction
approved by a majority of the Independent Directors.
Section 3.2 Actions Requiring Prior Approval. (a) As long as at
least two-ninths or an equivalent proportion of the Directors are Investor
Nominees, (i) any transaction with Investor or its Affiliates must be on
arm's-length terms and approved by a majority of the Independent Directors; (ii)
any amendment, repeal or other modification of this Agreement or any other
agreement or instrument of the Company, including the Company's charter or
bylaws,
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<PAGE>
which would have the effect of altering the terms of this Agreement in any
manner adverse to the stockholders of the Company (other than Investor) must be
approved by a majority of the Independent Directors; (iii) dispositions, of any
assets of the Company or any business combination, spin-off or other transaction
pursuant to which Investor would receive consideration different from that
received by other holders of Common Stock must be approved by a majority of the
Independent Directors; and (iv) any corporate opportunity (merger or
acquisition) relating to the United States mail order business which Investor or
its Affiliates receives shall first be presented to and considered by the
Company. If, within 20 days of being presented with such opportunity , the
Company chooses not to pursue such opportunity or the Company chooses to pursue
such opportunity and fails to consummate a transaction with respect to such
opportunity within 45 days of being presented with the opportunity, Investor
and/or its Affiliates may pursue such opportunity. In addition, if any Investor
business that is primarily mail order desires to enter the United States mail
order business, then the Company shall be offered a right of first refusal with
respect to such business in the United States. If the Company does not pursue
any corporate opportunity (or Investor business) presented to it, Investor may
then pursue such opportunity. Investor will not interfere with any merger or
acquisition opportunities that the Company receives on its own (other than
through participating in any decision made by the Board). If, within 20 days of
being presented with such opportunity , the Company chooses not to pursue such
opportunity or the Company chooses to pursue such opportunity and fails to
consummate a transaction with respect to such opportunity within 45 days of
being presented with the opportunity, Investor and/or its Affiliates may pursue
such opportunity.
(b) From the date hereof until the first anniversary
hereof, none of Mr. Canzone, Mr. Pulciani, Ms. Garelik, Mr. Rao,
Ms. Meyrowitz or Mr. Silbert may be terminated (other than for
"cause" as defined in their respective employment agreements as
in effect on the date hereof) without the approval of two-thirds
of the Directors then in office.
Section 3.3 Indemnification Agreements and
Insurance. (a) Investor shall use its reasonable best efforts to
cause the Company to adopt indemnification agreements with any
Independent Directors.
(b) Investor shall use its reasonable best efforts to cause the
Company to maintain the director and officer insurance in place on the date
hereof.
ARTICLE 4
Board of Directors
Section 4.1 Investor Nominees. The Company shall use its best efforts to have
the Board include up to five nominees named by Investor in the slate of nominees
presented by the Board for election at each meeting of stockholders of the
Company at which Directors are to be elected (such nominees who become
Directors, "Investor Directors"); provided, however, if Investor's share
ownership falls below the percentages indicated below (without Investor buying
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<PAGE>
back up to the applicable percentage within 30 days), Investor agrees that the
number specified of Investor Nominees will resign, and Independent Directors
will be appointed in their places:
Number
Ownership of Directors
Percentage to Resign (Total)
---------- -----------------
40% 1
30% 2
20% 3
Investor and the Company shall each use their best efforts to assure that at all
times at least three members of the Board will be Independent Directors and that
the Company's Chief Executive Officer will also be a Director. Investor shall
vote all of its shares in favor of the election of its nominees, Independent
Directors and the Chief Executive Officer.
Section 4.2 Committee Representation. During such time as Investor
is entitled pursuant to Section 4.1 to have at least two Investor Nominees
included in the slate of nominees, Investor and the Company shall use their best
efforts to assure that each committee of the Board shall include two Independent
Directors; provided that the following committees (the "Key Committees") shall
have the composition indicated:
Audit Committee: two Independent Directors;
Compensation Committee: two Investor
Nominees, two Independent Directors (Chairman of
Compensation Committee to be an Investor Nominee); and
Strategic Planning Committee: two Investor
Nominees; one Independent Director, the Company's Chief
Executive Officer;
Investor and the Company shall use their best efforts to assure that (i) any
members of any Key Committee who are Investor Nominees shall, in the event of
any vacancy in such membership, be replaced by a Director who is an Investor
Nominee elected by a majority of the Directors who are Investor Nominees; (ii)
any members of any Key Committee who are Independent Directors shall, in the
event of any vacancy in such membership, be replaced by an Independent Director
approved by a majority of the Independent Directors on the Board; and (iii) the
composition of any other committees of the Board (other than any committees of
Independent Directors formed to act with respect to any transactions involving
Investor (and/or its Affiliates) and the Company and/or its stockholders) shall
be appropriately reflective of the composition of the Board.
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<PAGE>
ARTICLE 5
Representations and Warranties
Section 5.1 Company Representations and Warranties. The
Company represents and warrants to Investor as follows:
(a) Organization. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
(b) Authority. The Company has full corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated on its part hereby. The execution, delivery and performance by the
Company of this Agreement and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of the
Company. No other action on the part of the Company is necessary to authorize
the execution and delivery of this Agreement by the Company or the performance
by the Company of its obligations hereunder. This Agreement has been duly
executed and delivered by the Company and constitutes a legal, valid and binding
agreement of the Company, enforceable against it in accordance with its terms,
subject to applicable bankruptcy, insolvency, moratorium, reorganization or
similar laws affecting creditors' rights generally and subject to general
equitable principles (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(c) No Violation. The execution and delivery of this Agreement by
the Company, the performance by the Company of its obligations hereunder and the
consummation by the Company of the transactions contemplated hereby, will not
(a) violate any provision of law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award applicable to the Company, (b)
require the consent, waiver, approval, license or authorization of or any filing
by the Company with any governmental authority (other than any filings required
under the 1934 Act) or (c) violate, result (with or without notice or the
passage of time, or both) in a breach of or give rise to the right to
accelerate, terminate or cancel any obligation under or constitute (with or
without notice or the passage of time, or both) a default under, any of the
terms or provisions of any charter document or bylaw, agreement, note,
indenture, mortgage, contract, order, judgment, ordinance, regulation or decree
to which the Company is subject or by which the Company is bound and which would
have an adverse effect on the ability of the Company to perform its obligations
under this Agreement.
Section 5.2 Investor Representations and Warranties. Investor
represents and warrants to the Company as follows:
(a) Organization. Investor is a societe anonyme duly organized,
validly existing and in good standing under the laws of France.
(b) Authority. Investor has full corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated on its part hereby. The execution, delivery and performance by
Investor of this Agreement and the consummation of the
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<PAGE>
transactions contemplated hereby have been duly authorized by all necessary
action on the part of Investor. No other action on the part of Investor is
necessary to authorize the execution and delivery of this Agreement by Investor
or the performance by Investor of its obligations hereunder. This Agreement has
been duly executed and delivered by Investor and constitutes a legal, valid and
binding agreement of Investor, enforceable against it in accordance with its
terms, subject to applicable bankruptcy, insolvency, moratorium, reorganization
or similar laws affecting creditors' rights generally and subject to general
equitable principles (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(c) No Violation. The execution and delivery of this Agreement by
Investor, the performance by Investor of its obligations hereunder and the
consummation by Investor of the transactions contemplated hereby will not (a)
violate any provision of law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award applicable to Investor, (b) require
the consent, waiver, approval, license or authorization of or any filing by
Investor with any governmental authority (other than any filings required under
the 1934 Act) or (c) violate, result (with or without notice or the passage of
time, or both) in a breach of or give rise to the right to accelerate, terminate
or cancel any obligation under or constitute (with or without notice or the
passage of time, or both) a default under, any of the terms or provisions of any
charter document or bylaw, agreement, note, indenture, mortgage, contract,
order, judgment, ordinance, regulation or decree to which Investor is subject or
by which Investor is bound and which would have an adverse effect on the ability
of Investor to perform its obligations under this Agreement.
ARTICLE 6
Miscellaneous
Section 6.1 Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement,
and shall become effective when one or more counterparts have been signed by
each of the parties and delivered to the other party. Copies of executed
counterparts transmitted by telecopy, telefax or other electronic transmission
service shall be considered original executed counterparts for purposes of this
Section, provided receipt of copies of such counterparts is confirmed.
Section 6.2 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT REFERENCE
TO THE CHOICE OF LAW PRINCIPLES THEREOF.
Section 6.3 Entire Agreement. This Agreement hereto contains the
entire agreement between the parties with respect to the subject matter hereof
and there are no agreements, understandings, representations or warranties
between the parties other than those set forth or referred to herein. This
Agreement is not intended to confer upon any person not a party hereto (and
their successors and assigns) any rights or remedies hereunder.
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<PAGE>
Section 6.4 Expenses. Except as set forth in the Stock Purchase
Agreement, all legal and other costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall be paid by the
party incurring such costs and expenses.
Section 6.5 Notices. All notices and other communications hereunder
shall be sufficiently given for all purposes hereunder if in writing and
delivered personally, sent by documented overnight delivery service or, to the
extent receipt is confirmed, telecopy, telefax or other electronic transmission
service to the appropriate address or number as set forth below. Notices to the
Company shall be addressed to:
Brylane Inc.
463 Seventh Avenue, 21st Floor
New York, New York 10018
Attention: Peter Canzone
Telecopy Number: (212) 741-0980
with a copy to:
Riordan & McKenzie
California Plaza
300 South Grand Avenue, 29th Floor
Attention: Roger H. Lustberg, Esq.
Telecopy Number: (213) 229-8550
or at such other address and to the attention of such other person as the
Company may designate by written notice to Investor. Notices to Investor shall
be addressed to:
Pinault Printemps-Redoute
18, Place Henri Bergson
75381 Paris, France Cedex 08
Attention: Serge Weinberg
Telecopy Number: (331) 44-90-63-92
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: David A. Katz, Esq.
Telecopy Number: (212) 403-2000
Section 6.6 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors. Investor may assign its rights and obligations hereunder to one or
more majority-owned, direct or indirect subsidiaries or other affiliates.
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<PAGE>
Section 6.7 Headings. The Section, Article and other headings
contained in this Agreement are inserted for convenience of reference only and
will not affect the meaning or interpretation of this Agreement. All references
to Sections or Articles contained herein mean Sections or Articles of this
Agreement unless otherwise stated.
Section 6.8 Amendments and Waivers. This Agreement may not be
modified or amended except by an instrument or instruments in writing signed by
the party against whom enforcement of any such modification or amendment is
sought. Either party hereto may, only by an instrument in writing, waive
compliance by the other party hereto with any term or provision hereof on the
part of such other party hereto to be performed or complied with. The waiver by
either party hereto of a breach of any term or provision hereof shall not be
construed as a waiver of any subsequent breach.
Section 6.9 Interpretation; Absence of Presumption. (a) For the
purposes hereof, (i) words in the singular shall be held to include the plural
and vice versa and words of one gender shall be held to include the other gender
as the context requires, (ii) the terms "hereof", "herein", and "herewith" and
words of similar import shall, unless otherwise stated, be construed to refer to
this Agreement as a whole and not to any particular provision of this Agreement,
and Article, Section and paragraph references are to the Articles, Sections and
paragraphs to this Agreement unless otherwise specified, (iii) the word
"including" and words of similar import when used in this Agreement shall mean
"including, without limitation," unless the context otherwise requires or unless
otherwise specified, (iv) the word "or" shall not be exclusive, and (v)
provisions shall apply, when appropriate, to successive events and transactions.
(b) This Agreement shall be construed without regard to any
presumption or rule requiring construction or interpretation against the party
drafting or causing any instrument to be drafted.
Section 6.10 Severability. Any provision hereof which is invalid or
unenforceable shall be ineffective to the extent of such invalidity or
unenforceability, without affecting in any way the remaining provisions hereof.
Section 6.11 Further Assurances. The Company and Investor agree
that, from time to time, each of them will, and will cause their respective
Affiliates to, execute and deliver such further instruments and take such other
action as may be necessary to carry out the purposes and intents hereof.
Section 6.12 Specific Performance. The Company and Investor each
acknowledge that, in view of the uniqueness of arrangements contemplated by this
Agreement, the parties hereto would not have an adequate remedy at law for money
damages in the event that this Agreement were not performed in accordance with
its terms, and therefore agree that the parties hereto shall be entitled to
specific enforcement of the terms hereof in addition to any other remedy to
which the parties hereto may be entitled at law or in equity.
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<PAGE>
Section 6.13 Fiduciary Duties. Nothing contained in this Agreement
shall be intended to limit actions taken by any Directors in the exercise of
their fiduciary duties.
Section 6.14 Confidentiality; Other Arrangements. Investor will not,
and will use its best efforts to cause the Investor Nominees not to, share
confidential business information which comes into its possession in connection
with its investment in the Company or through the Board. Investor intends,
through its investment in the Company, that Investor and the Company will enter
into mutually advantageous arrangements, providing for the expansion of their
respective businesses.
-12-
<PAGE>
IN WITNESS WHEREOF, this Agreement has been signed by or on behalf of
each of the parties hereto as of the day first above written.
BRYLANE, INC.
By: /s/ Robert A. Pulciani
Name: Robert A. Pulciani
Title: Executive Vice President,
Chief Financial Officer, Secretary
and Treasurer
PINAULT PRINTEMPS-REDOUTE, S.A.
By: /s/ Serge Weinberg
Name: Serge Weinberg
Title: Chairman And Chief Executive Officer
-13-
Exhibit 7
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is dated as of this
3rd day of April, 1998 among Brylane Inc., a Delaware corporation (the
"Company") and Pinault Printemps-Redoute, S.A., a company organized under the
laws of France (the "Stockholder").
W I T N E S S E T H:
A. The Stockholder or its affiliate (as defined below) has acquired shares
of common stock, par value $0.01 per share, of the Company (the "Common Stock")
in the manner contemplated by those certain Stock Purchase Agreements dated as
of February 19, 1998, among FS Equity Partners II, L.P., a California limited
partnership, FS Equity Partners III, L.P., a Delaware limited partnership, FS
Equity Partners International, L.P., a Delaware limited partnership and the
Stockholder and between M&P Distributing Company, a Nevada corporation and the
Stockholder as well as certain additional shares of Common Stock pursuant to
offers extended to certain other shareholders as contemplated by said Stock
Purchase Agreements.
B. It is a condition to the closing of the Stock Purchase Agreements (the
"Closing") that the Company grant to the Stockholder certain registration rights
with respect to all of the shares of the Common Stock it purchases thereunder or
as contemplated thereby.
C. In order to evidence such registration rights, the parties hereto
desire to enter into this Agreement.
A G R E E M E N T:
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION I.1 Definitions. The following terms shall have the following
meanings:
"Affiliate" means with respect to any Person, any Person directly or
indirectly
<PAGE>
controlling, controlled by, or under common control with such other Person. For
purposes of this definition, "control" when used with respect to any Person
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise, and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Board" means the Board of Directors of the Company.
"Commission" means the Securities and Exchange Commission.
"Common Stock" shall have the meaning set forth in the Preamble.
"Demand Registration" means a Demand Registration as defined in Section
2.1.
"Excess Amount" means the number of Registrable Securities requested by
the Stockholder or other Persons to be sold pursuant to Section 2.1 or a demand
registration granted in a Registration Rights Agreement with the Company, as the
case may be, which the managing Underwriter or Underwriters determines exceeds
the largest number of Registrable Securities which can successfully be sold in
an orderly manner in such offering within a price range acceptable to the
Company.
"1933 Act" means the Securities Act of 1933 and the rules and regulations
thereunder.
"1934 Act" means the Securities Exchange Act of 1934 and the rules and
regulations thereunder.
"Person" means an individual, a corporation, a partnership, an
association, a trust or other entity or organization, including a government or
political subdivision or an agency or instrumentality thereof.
"Piggy-Back Registration" shall have the meaning set forth in Section 2.2.
"Registrable Security" means any share of Common Stock outstanding until
(i) a registration statement covering such Common Stock has been declared
effective by the Commission and it has been disposed of pursuant to such
effective registration statement, (ii) it is sold under circumstances in which
all of the applicable conditions of Rule 144 (or any similar provisions then in
force) under the 1933 Act ("Rule 144") are met or it may be sold pursuant to
Rule 144(k) or (iii) (a) it has been otherwise Transferred, (b) the Company has
delivered a new certificate or other evidence of ownership for it not bearing
the legend required pursuant to the Stock Purchase Agreements or other
applicable agreement of the Company and (c) it may be resold without subsequent
registration under the 1933 Act.
2.
<PAGE>
"Requisite Share Number" means a number of Registrable Securities
representing not less than 10% of the total number of shares of Common Stock
then outstanding or shares of Common Stock representing not less than
$15,000,000 in fair market value as determined by the Board, or such lesser
number as constitutes all shares of Common Stock then held by the Stockholder
representing not less than 3% of the total number of shares of Common Stock then
outstanding.
"Transfer" means any direct or indirect transfer, sale, assignment,
pledge, hypothecation, encumbrance or other disposition of Common Stock.
"Underwriter" means a securities dealer who purchases any Registrable
Securities as principal in an underwritten offering and not as part of such
dealer's market-making activities.
ARTICLE II
REGISTRATION RIGHTS
SECTION II.1 Demand Registration.
(a) Request for Registration. At any time and from time to time, the
Stockholder, on behalf of itself or any of its Affiliates owning, individually
or in the aggregate, at least the Requisite Share Number, may make a written
request for registration under the 1933 Act of all or part of its or their
Registrable Securities (a "Demand Registration"); provided that the Company
shall not be obligated to effect (i) more than three demand registrations in any
eighteen (18) month period for all holders of Common Stock with demand
registration rights (including the Stockholder and its Affiliates) or (ii) more
than two Demand Registrations in total for the Stockholder and its Affiliates.
Such request will specify the number of shares of Registrable Securities
proposed to be sold and will also specify the intended method of disposition
thereof. Unless the Stockholder shall consent in writing, no other party,
including the Company, shall be permitted to offer securities under any such
Demand Registration.
(b) Effective Registration. A registration will not count as a Demand
Registration until it has become effective.
(c) Underwritten Offering. If the Stockholder so elects, the offering
of such Registrable Securities pursuant to such Demand Registration shall be in
the form of an underwritten offering. The Stockholder shall select one or more
nationally recognized firms of investment bankers to act as the managing
Underwriter or Underwriters in connection with such offering and shall select
any additional managers to be used in connection with the offering which
selection shall be subject to the Company's approval which shall not be
3.
<PAGE>
unreasonably withheld.
SECTION II.2 Piggy-Back Registration. If at any time the Company proposes
to file a registration statement under the 1933 Act with respect to an offering
by the Company for its own account or for the account of any of its respective
securityholders of the same class as the Registrable Securities (other than a
registration statement on Form S-4 or S-8 (or any substitute form that may be
adopted by the Commission) or a registration statement filed in connection with
an exchange offer or offering of securities solely to the Company's existing
securityholders), then the Company shall give written notice of such proposed
filing to the Stockholder as soon as practicable (but in no event less than ten
(10) days before the anticipated filing date), and such notice shall offer the
Stockholder the opportunity to register such number of shares of Registrable
Securities as the Stockholder may request in writing within five (5) days of
receipt of such notice on behalf of itself or its Affiliates (which request
shall specify the Registrable Securities intended to be disposed of by the
Stockholder and its Affiliates and the intended method of distribution thereof)
(a "Piggy-Back Registration"). The Company shall use its best efforts to cause
the managing Underwriter or Underwriters of a proposed underwritten offering to
permit the Registrable Securities requested to be included in a Piggy-Back
Registration to be included on the same terms and conditions as any similar
securities of the Company included therein to permit the sale or other
disposition of such Registrable Securities in accordance with the intended
method of distribution thereof. Subject to Section 2.4(b), the Stockholder shall
have the right to withdraw its request for inclusion of its Registrable
Securities in any Piggy-Back Registration by giving written notice to the
Company of its request to withdraw within twenty (20) days of its request for
inclusion. The Company may withdraw a Piggy-Back Registration at any time prior
to the time it becomes effective; provided that the Company shall reimburse the
Stockholder of Registrable Securities requested to be included in such
Piggy-Back Registration for all out-of-pocket expenses (including counsel fees
and expenses) incurred prior to such withdrawal.
SECTION II.3 Reduction of Offering.
(a) Notwithstanding anything contained herein, if the managing
Underwriter or Underwriters of an offering described in Section 2.2 determine
that the size of the offering that the Stockholder, the Company and/or another
Person having registration rights and electing to participate in the offering
intends to make is such that the success of the offering would be materially and
adversely affected by inclusion of the Registrable Securities requested to be
included, then (i) with respect to a demand registration initiated by a Person
other than the Company, and subject to the right of the Person making such
demand (the "Initiating Person") to request to exclude any securities not held
by such Person therefrom, if the size of the offering is the basis of such
Underwriter's or Underwriters' determination, the Company shall not include in
such registration an amount of Registrable Securities requested to be included
in such offering by the Stockholder and such other stockholders (other than the
Initiating Person) requesting to be included, as the case may be, equal to the
Excess Amount (such reduction to be allocated pro rata among the Stockholder and
such other stockholders (other than the Initiating Person) requesting to be
included, as the case may be,
4.
<PAGE>
according to the number of Registrable Securities requested for inclusion) and
(ii) in the case of a registration by the Company covering securities to be sold
by it, if securities are being offered for the account of the Stockholder and
other Persons as well as the Company, the securities the Company seeks to
include shall have priority over securities sought to be included by any other
Person (including the Stockholder and its Affiliates) and the proportion by
which the amount of securities intended to be offered by the Stockholder and its
Affiliates is reduced shall not exceed the proportion by which the amount of
securities intended to be offered by such other Persons is reduced.
(b) If, as a result of the proration provisions of Section 2.3(a),
the Stockholder shall not be entitled to include all Registrable Securities in a
Demand Registration or Piggy-Back Registration that the Stockholder has
requested to be included, the Stockholder may elect to withdraw its request to
include Registrable Securities in such registration (a "Withdrawal Election");
provided, however, that a Withdrawal Election shall be irrevocable and, after
making a Withdrawal Election, the Stockholder shall no longer have any right to
include Registrable Securities in the registration as to which such Withdrawal
Election was made.
ARTICLE III
REGISTRATION PROCEDURES
SECTION III.1 Filings; Information. Whenever the Stockholder requests that
any Registrable Securities be registered pursuant to a Demand Registration, the
Company will use its best efforts to effect the registration and the sale of
such Registrable Securities in accordance with the intended method of
disposition thereof as quickly as practicable, and:
(a) In connection with any Demand Registration request, the Company
will as expeditiously as possible prepare and file with the Commission a
registration statement on any form for which the Company then qualifies or which
counsel for the Company shall deem appropriate and which form shall be available
for the sale of the Registrable Securities to be registered thereunder in
accordance with the intended method of distribution thereof, and use its best
efforts to cause such filed registration statement to become and remain
effective until the earlier of (i) one hundred eighty (180) days from the date
such registration statement became effective or (ii) the date on which the sale
of Registrable Securities has been completed; provided that, if the Company
shall furnish to the Stockholder a certificate signed by either its Chairman or
the Vice Chairman (if any) stating that in his good faith judgment it would be
significantly disadvantageous to the Company for such a registration statement
to be filed as expeditiously as possible, the Company shall have a period of not
more than ninety (90) days within which to file such registration statement
measured from the date of
5.
<PAGE>
receipt of the request in accordance with Section 2.1.
(b) The Company will, prior to filing a registration statement or
prospectus or any amendment or supplement thereto, furnish to the Stockholder,
counsel representing the Stockholder, and each Underwriter, if any, of the
Registrable Securities covered by such registration statement, copies of such
registration statement as proposed to be filed, together with exhibits thereto,
which documents will be subject to prompt review and approval by the foregoing,
and thereafter furnish to the Stockholder, counsel and each Underwriter, if any,
such number of copies of such registration statement, each amendment and
supplement thereto (in each case including all exhibits thereto and documents
incorporated by reference therein), the prospectus included in such registration
statement (including each preliminary prospectus) and such other documents as
the Stockholder or Underwriter may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by the Stockholder and/or its
Affiliates.
(c) After the filing of the registration statement, the Company will
promptly notify the Stockholder of any stop order issued or threatened by the
Commission and take all reasonable actions required to prevent the entry of such
stop order or to remove it if entered.
(d) The Company will use its best efforts to (i) register or qualify
the Registrable Securities under such other securities or blue sky laws of such
jurisdictions in the United States as the Stockholder reasonably (in light of
the Stockholder's intended plan of distribution) requests and (ii) cause such
Registrable Securities to be registered with or approved by such other
governmental agencies or authorities in the United States as may be necessary by
virtue of the business and operations of the Company and do any and all other
acts and things that may be reasonably necessary or advisable to enable the
Stockholder to consummate the disposition of the Registrable Securities owned by
the Stockholder; provided that the Company will not be required to (A) qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this paragraph (d), (B) subject itself to taxation
in any such jurisdiction or (C) consent to general service of process in any
such jurisdiction.
(e) The Company will immediately notify the Stockholder at any time
when a prospectus relating thereto is required to be delivered under the 1933
Act, of the occurrence of an event requiring the preparation of a supplement or
amendment to such prospectus so that, as thereafter delivered to the purchasers
of such Registrable Securities, such prospectus will not contain an untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading and
promptly make available to the Stockholder any such supplement or amendment.
(f) The Company will enter into customary agreements (including, if
applicable, an underwriting agreement in customary form) and take such other
actions as are
6.
<PAGE>
reasonably required in order to expedite or facilitate the disposition of such
Registrable Securities (the Stockholder may, at its option, require that any or
all of the representations, warranties and covenants of the Company to or for
the benefit of such Underwriters also be made to and for the benefit of the
Stockholder).
(g) The Chairman of the Board of the Company, the Chief Executive
Officer of the Company and other members of the management of the Company will
cooperate fully in any offering of Registrable Securities pursuant to Section
2.1 hereof, including, without limitation, participation in meetings with
potential investors and preparation of all materials for such investors.
(h) The Company will deliver promptly to the Stockholder and each
Underwriter, if any, subject to restrictions imposed by the United States
federal government or any agency or instrumentality thereof, copies of all
correspondence between the Commission and the Company, its counsel or auditors
and all memoranda relating to discussions with the Commission or its staff with
respect to the registration statement and make available for inspection by the
Stockholder, any Underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other professional
retained by the Stockholder or Underwriter (collectively, the "Inspectors"), (it
being understood that the Company is responsible for payment of the reasonable
fees and expenses of only one counsel (in addition to counsel to the issuer)
pursuant to clause (h) of Section 3.2) all financial and other records,
pertinent corporate documents and properties of the Company (collectively, the
"Records"), subject to restrictions imposed by any governmental authority
governing access to classified information, as shall be reasonably necessary to
enable them to exercise their due diligence responsibility, and cause the
Company's officers, directors and employees to supply all information reasonably
requested by any Inspectors in connection with such registration statement.
Records which the Company determines, in good faith, to be confidential and
which it notifies the Inspectors are confidential shall not be disclosed by the
Inspectors unless (i) the disclosure of such Records is necessary to avoid or
correct a misstatement or omission in such registration statement or (ii) the
disclosure or release of such Records is requested or required pursuant to oral
questions, interrogatories, requests for information or documents or a subpoena
or other order from a court of competent jurisdiction or other process; provided
that prior to any disclosure or release pursuant to clause (ii), the Inspectors
shall provide the Company with prompt notice of any such request or requirement
so that the Company may seek an appropriate protective order or waive such
Inspectors' obligation not to disclose such Records; and provided, further, that
if failing the entry of a protective order or the waiver by the Company
permitting the disclosure or release of such Records, the Inspectors, upon
advice of counsel, are compelled to disclose such Records, the Inspectors may
disclose that portion of the Records which counsel has advised the Inspectors
that the Inspectors are compelled to disclose. The Stockholder agrees that
information obtained by it solely as a result of such inspections (not including
any information obtained from a third party who, insofar as is known to the
Stockholder after reasonable inquiry, is not prohibited from providing such
7.
<PAGE>
information by a contractual, legal or fiduciary obligation to the Company)
shall be deemed confidential and shall not be used by it as the basis for any
market transactions in the securities of the Company or its Affiliates unless
and until such information is made generally available to the public. The
Stockholder further agrees that it will, upon learning that disclosure of such
Records is sought in a court of competent jurisdiction, give notice to the
Company and allow the Company, at its expense, to undertake appropriate action
to prevent disclosure of the Records deemed confidential.
(i) The Company will use its reasonable best efforts to furnish to
the Stockholder and to each Underwriter, if any, a signed counterpart, addressed
to the Stockholder or Underwriter, of (i) an opinion or opinions of counsel to
the Company and (ii) a comfort letter or comfort letters from the Company's
independent public accountants, each in customary form and covering such matters
of the type customarily covered by opinions or comfort letters, as the case may
be, as the Stockholder included in such offering or the managing Underwriter
therefor reasonably requests.
(j) The Company will comply with all applicable rules and regulations
of the Commission, and make available to its securityholders, as soon as
reasonably practicable, an earnings statement covering a period of twelve (12)
months, beginning within three (3) months after the effective date of the
registration statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the 1933 Act.
(k) The Company will use its best efforts (i) to cause all such
Registrable Securities to be listed on a national securities exchange (if such
shares are not already so listed) and on each additional national securities
exchange on which similar securities issued by the Company are then listed (if
any), if the listing of such Registrable Securities is then permitted under the
rules of such exchange or (ii) to secure designation of all such Registrable
Securities covered by such registration statement as a NASDAQ "national market
system security" within the meaning of Rule 11Aa2-1 of the Commission or,
failing that, to secure NASDAQ authorization for such Registrable Securities
and, without limiting the generality of the foregoing, to arrange for at least
two market makers to register as such with respect to such Registrable
Securities with the NASD.
(l) The Company may require the Stockholder to promptly furnish in
writing to the Company such information regarding the distribution of the
Registrable Securities as the Company may from time to time reasonably request
and such other information as may be legally required in connection with such
registration.
The Stockholder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3.1(e)
hereof, the Stockholder will forthwith discontinue and, if applicable, cause its
Affiliates to discontinue disposition of Registrable Securities pursuant to the
registration statement covering such Registrable
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Securities until the Stockholder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3.1(e) hereof, and, if so directed by
the Company, the Stockholder will deliver to the Company all copies, other than
permanent file copies then in the Stockholder's possession, of the most recent
prospectus covering such Registrable Securities at the time of receipt of such
notice. In the event the Company shall give such notice, the Company shall
extend the period during which such registration statement shall be maintained
effective (including the period referred to in Section 3.1(a) hereof) by the
number of days during the period from and including the date of the giving of
notice pursuant to Section 3.1(e) hereof to the date when the Company shall make
available to the Stockholder a prospectus supplemented or amended to conform
with the requirements of Section 3.1(e) hereof.
SECTION III.2 Registration Expenses. In connection with any Demand
Registration pursuant to Section 2.1 hereof and any registration statement filed
pursuant to Section 2.2 hereof, the Company shall pay the following registration
expenses incurred in connection with the registration hereunder, whether or not
such registration becomes effective (the "Registration Expenses"): (a) all
registration and filing fees, (b) fees and expenses of compliance with
securities or blue sky laws (including fees and disbursements of counsel in
connection with blue sky qualifications of the Registrable Securities), (c)
printing expenses, (d) the Company's internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties), (e) the fees and expenses incurred in connection
with the listing of the Registrable Securities, (f) fees and disbursements of
counsel for the Company and fees and expenses for independent certified public
accountants retained by the Company (including the expenses of any comfort
letters or costs associated with the delivery by independent certified public
accountants of a comfort letter or comfort letters requested pursuant to Section
3.1(i) hereof), (g) the fees and expenses of any special experts retained by the
Company in connection with such registration, and (h) reasonable fees and
expenses of one counsel (who shall be reasonably acceptable to the Company) for
the Stockholder as well as all of the other Persons selling Common Stock in
connection with the registration (in addition to counsel for the Company).
Except as set forth in the first sentence of this Section 3.2, the Company shall
have no obligation to pay any underwriting fees, discounts or commissions
attributable to the sale of Registrable Securities, or any other out-of-pocket
expenses of the Stockholder.
ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
SECTION IV.1 Indemnification by the Company. The Company agrees to
indemnify and hold harmless the Stockholder, its officers, directors and agents,
and each Person, if any, who controls the Stockholder within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act from and against any
loss, claim, damage or liability and any
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action in respect thereof to which the Stockholder, its officers, directors and
agents, and any such controlling Person may become subject under the 1933 Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, any untrue statement or alleged untrue statement of a
material fact contained in any registration statement or prospectus relating to
the Registrable Securities (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) or any preliminary prospectus,
or arises out of, or is based upon, any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and shall reimburse the Stockholder, its
officers, directors and agents, and each such controlling Person for any legal
and other expenses reasonably incurred by the Stockholder, its officers,
directors and agents, or any such controlling Person in investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action. The Company also agrees to indemnify any Underwriters of the
Registrable Securities, their officers and directors and each Person who
controls such Underwriters on substantially the same basis as that of the
indemnification of the Stockholder provided in this Section 4.1; provided that
the indemnity agreement contained in this Section 4.1 shall not apply to amounts
paid in settlement of any such loss, claim, damage or liability and any action
in respect thereof if such settlement is effected without the consent of the
Company (which consent shall not be unreasonably withheld), nor shall the
Company be liable in any such case for any loss, claim, damage, liability and
any action in respect thereof to the extent that it arises from or is based upon
written information relating to a Person furnished expressly for use in
connection with such registration by such Person, nor shall the Company be
liable to any Person for any such loss, claim, damage or liability and any
action in respect thereof to the extent it arises from or is based upon (a) any
untrue statement or alleged untrue statement of a material fact contained in any
registration statement or prospectus relating to the Registrable Securities
delivered by such Person after such Person had received a written notice
provided by the Company that such registration statement or prospectus contained
such untrue statement or alleged untrue statement of a material fact, (b) any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading after
such Person had received a written notice provided by the Company that such
registration statement or prospectus contained such omission or alleged
omission, or (c) the failure of such Person to deliver any preliminary or final
prospectus, or any amendments or supplements thereto, required under applicable
securities laws, including the 1933 Act, to be so delivered, provided that a
sufficient number of copies thereof had been provided by the Company to such
Person.
SECTION IV.2 Indemnification by the Stockholder of Registrable Securities.
The Stockholder agrees to indemnify and hold harmless the Company, its officers,
directors and agents and each Person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act to the
same extent as the foregoing indemnity from the Company to the Stockholder, but
only with reference to information related to the Stockholder furnished in
writing by the Stockholder expressly for use in any
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registration statement or prospectus relating to the Registrable Securities, or
any amendment or supplement thereto, or any preliminary prospectus. The
Stockholder also agrees to indemnify and hold harmless Underwriters of the
Registrable Securities, if any, their officers and directors and each Person who
controls such Underwriters on substantially the same basis as that of the
indemnification of the Company provided in this Section 4.2; provided that in no
event shall any indemnity obligation under this Section 4.2 exceed the net
proceeds from the offering received by the Stockholder.
SECTION IV.3 Conduct of Indemnification Proceedings. Promptly after
receipt by any person in respect of which indemnity may be sought pursuant to
Section 4.1 or 4.2 (an "Indemnified Party") of notice of any claim or the
commencement of any action, the Indemnified Party shall, if a claim in respect
thereof is to be made against the person against whom such indemnity may be
sought (an "Indemnifying Party"), notify the Indemnifying Party in writing of
the claim or the commencement of such action provided that the failure to notify
the Indemnifying Party shall not relieve it from any liability which it may have
to an Indemnified Party otherwise than under Section 4.1 or 4.2 and except to
the extent of any actual prejudice resulting therefrom. If any such claim or
action shall be brought against an Indemnified Party, and it shall notify the
Indemnifying Party thereof, the Indemnifying Party shall be entitled to
participate therein, and, to the extent that it wishes, jointly with any other
similarly notified Indemnifying Party, to assume the defense thereof with
counsel satisfactory to the Indemnified Party. After notice from the
Indemnifying Party to the Indemnified Party of its election to assume the
defense of such claim or action, the Indemnifying Party shall not be liable to
the Indemnified Party for any legal or other expenses subsequently incurred by
the Indemnified Party in connection with the defense thereof other than
reasonable costs of investigation; provided that the Indemnified Party shall
have the right to employ separate counsel to represent the Indemnified Party and
its controlling Persons who may be subject to liability arising out of any claim
in respect of which indemnity may be sought by the Indemnified Party against the
Indemnifying Party, but the fees and expenses of such counsel shall be for the
account of such Indemnified Party unless (a) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of such counsel or
(b) based upon the written opinion of counsel of such Indemnified Party
representation of both parties by the same counsel would be inappropriate due to
actual or potential differing interests between them. The Indemnifying Party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settlement is made with such consent or if there be a
final judgment for the plaintiff, the Indemnifying Party shall indemnify the
Indemnified Party from and against any loss, claim, damage, or liability by
reason of such settlement or judgment. No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any
claim or pending or threatened proceeding in respect of which the Indemnified
Party is or could have been a party and indemnity could have been sought
hereunder by such Indemnified Party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability arising out
of such claim or proceeding.
SECTION IV.4 Contribution. If the indemnification provided for in this
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Article IV is unavailable to the Indemnified Parties in respect of any losses,
claims, damages or liabilities referred to herein, then each such Indemnifying
Party, in lieu of indemnifying such Indemnified Party, shall contribute to the
amount paid or payable by such Indemnified Party as a result of such losses,
claims, damages or liabilities (a) as between the Company, the Stockholder and
other Persons selling Common Stock, if any, on the one hand and the
Underwriters, if any, on the other, in such proportion as is appropriate to
reflect the relative benefits received by the Company, the Stockholder and other
Persons selling Common Stock, if any, on the one hand and the Underwriters on
the other from the offering of the Registrable Securities, or if such allocation
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits but also the relative fault of the
Company, the Stockholder and other Persons selling Common Stock, if any, on the
one hand and of the Underwriters on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations and (b) as between the
Company on the one hand and the, the Stockholder and other Persons selling
Common Stock, if any, on the other, in such proportion as is appropriate to
reflect the relative fault of the Company and of, the Stockholder and other
Persons selling Common Stock, if any, in connection with such statements or
omissions, as well as any other relevant equitable considerations; provided,
however, that no person found guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) by a court of competent jurisdiction
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation). The relative benefits received by the Company,
the Stockholder and other Persons selling Common Stock, if any, on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total proceeds from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Company, the
Stockholder and other Persons selling Common Stock, if any, bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the prospectus. The relative
fault of the Company, the Stockholder and other Persons selling Common Stock, if
any, on the one hand and of the Underwriters on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, and the Stockholder and other
Persons selling Common Stock, if any, or by the Underwriters. The relative fault
of the Company on the one hand and of the Stockholder and other Persons selling
Common Stock, if any, and with respect to the Stockholder and other Persons
selling Common Stock, if any, among themselves, on the other shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by such party, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the Stockholder agree that it would not be just and
equitable if contribution pursuant to this Section 4.4 were determined by pro
rata allocation (even if the
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Underwriters were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or payable
by an Indemnified Party as a result of the losses, claims, damages or
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such Indemnified Party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 4.4, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the
Registrable Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission, and the Stockholder shall not be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities of the Stockholder were offered to the
public (less underwriting discounts and commissions) exceeds the amount of any
damages which the Stockholder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 1933 Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. In no event shall the
Stockholder's obligation to contribute pursuant to this Section 4.4 exceed the
net proceeds of the offering received by the Stockholder.
ARTICLE V
MISCELLANEOUS
SECTION V.1 Participation in Underwritten Registrations. The Stockholder
may not participate in any underwritten registration under Section 2.2 unless it
(a) agrees to sell its securities on the basis provided in any underwriting
arrangements that will also be applicable to the Company or other Person
initiating the registration in which the Stockholder wishes to participate and
(b) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements and these Registration Rights; provided that
(i) the Stockholder will not be required to make any representations or
warranties except those which relate solely to the Stockholder and (ii) the
liability of the Stockholder or any of its Affiliates to any Underwriter under
such underwriting agreement will be limited to liability arising from
misstatements in, or omissions from, written information regarding the
Stockholder provided by the Stockholder for inclusion in the prospectus.
SECTION V.2 Rule 144. The Company covenants that it will use its
reasonable best efforts to file any reports required to be filed by it under the
1933 Act and the 1934 Act and that it will take such further action as the
Stockholder may reasonably request, all to the
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extent reasonably required from time to time to enable the Stockholder to sell
Registrable Securities without registration under the 1933 Act within the
limitation of the exemptions provided by (a) Rule 144 or Rule 144A under the
1933 Act, as such Rules may be amended from time to time, or (b) any similar
Rule or regulation hereafter adopted by the Commission. Upon the request of the
Stockholder, the Company will deliver to the Stockholder a written statement as
to whether it has complied with such requirements.
SECTION V.3 Holdback Agreements.
(a) Restrictions on Public Sale. To the extent not inconsistent with
applicable law, the Stockholder agrees not to effect any sale or distribution or
to permit any of its Affiliates to effect any sale or distribution of the issue
being registered or of a similar security of the Company, or any securities
convertible into or exchangeable or exercisable for such securities, including a
sale pursuant to Rule 144 or Rule 144A under the 1933 Act, during the fourteen
(14) days prior to, and during the one hundred twenty (120) day period beginning
on, the effective date of the registration statement filed by the Company
(except as part of such registration) if, and to the extent, requested by the
managing Underwriter or Underwriters in the case of an underwritten public
offering.
(b) Restrictions on Sale by the Company and Others. With respect to a
Demand Registration effected pursuant to Section 2.1 hereof, the Company agrees
(i) not to effect any sale or distribution of any securities similar to those
being registered in accordance with Section 2.1 hereof, or any securities
convertible into or exchangeable or exercisable for such securities, during the
fourteen (14) days prior to, and during the one hundred twenty (120) day period
beginning on, the effective date of any registration statement (except as part
of a registration statement where the Stockholder consents) or the commencement
of a public distribution of Registrable Securities if, and to the extent,
requested by the managing Underwriters or Underwriters in the case of an
underwritten public offering, and (ii) that any agreement entered into after the
date hereof pursuant to which the Company issues or agrees to issue any
privately placed securities shall contain a provision under which holders of
such securities agree not to effect any sale or distribution of any such
securities during the periods described in (i) above, in each case including a
sale pursuant to Rule 144 (except as part of any such registration, if
permitted); provided, however, that the provisions of this paragraph (b) shall
not prevent the conversion or exchange of any securities pursuant to their terms
into or for other securities and shall not prevent the issuance of securities by
the Company under any employee benefit, stock option or stock subscription plans
or in private placements.
SECTION V.4 Successors and Assigns. This Agreement, and all obligations
and rights hereunder, shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and permitted assigns;
provided that no rights of the Stockholder under this Agreement may be assigned,
except that the Stockholder may assign its rights hereunder to an Affiliate,
provided that, prior to such assignment, such Affiliate shall enter
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into a written agreement to be bound by the terms and conditions of this
Agreement applicable to the Stockholder.
SECTION V.5 No Waivers; Amendments.
(a) No failure or delay by any party in exercising any right, power,
or privilege hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise thereof preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
(b) This Agreement may not be amended, modified or supplemented other
than by a written instrument signed by each party hereto.
(c) Any provision of this Agreement may be waived if, but only if,
such waiver is in writing and is signed by the party against whom the
enforcement of such waiver is sought.
SECTION V.6 Notices. All notices, requests, and other communications to
any party hereunder shall be in writing (including telex, telecopy or similar
writing) and shall be given as follows:
If to the Brylane Inc.
Company, to: 463 Seventh Avenue, 21st Floor
New York, New York 10018
Attention: Mr. Peter J. Canzone
Telecopy: (212) 613-9551
If to the Pinault Printemps-Redoute, S.A.
Stockholder: 18, Place Henri Bergson
75381 Paris CEDEX 08
Attention: Serge Weinberg
Telecopy: 011-331-44-90-62-93
With a Wachtell, Lipton, Rosen & Katz
copy to: 51 West 52nd Street
New York, New York 10019
Attention: David A. Katz, Esq.
Telecopy: (212) 403-2000
or to such other address or telecopy number and with such other copies, as such
party may hereafter specify for the purpose of notice to the other parties. Each
such notice, request or
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other communication shall be effective (a) if given by telecopy, when such
telecopy is transmitted to the telecopy number specified in this Section and
evidence of receipt is received or (b) if given by any other means, upon
delivery or refusal of delivery at the address specified in this Section 5.6.
SECTION V.7 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the state of Delaware (without regard
to the choice of law provisions thereof).
SECTION V.8 Entire Agreement. This Agreement constitutes the entire
agreement and understanding among the parties hereto with respect to the subject
matter hereof and supersedes any and all prior agreements and understandings,
written or oral, relating to the subject matter hereof.
SECTION V.9 Severability. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdictions, it being intended that
all rights and obligations of the parties hereunder shall be enforceable to the
fullest extent permitted by law.
SECTION 5.10 Counterparts. This Agreement may be signed in counterparts,
each of which shall constitute an original and which together shall constitute
one and the same agreement.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date set forth above.
PINAULT PRINTEMPS-REDOUTE, S.A.
By: /s/ Serge Weinberg
Name: Serge Weinberg
Title: Chairman and Chief Executive Officer
BRYLANE INC.
By: /s/ Robert A. Pulciani
Name: Robert A. Pulciani
Title: Executive Vice President, Chief
Financial Officer, Secretary and
Treasurer
