AMENDED AND RESTATED RECEIVABLES FINANCING AGREEMENT Dated as of October 31, 1995 Among ANNTAYLOR FUNDING, INC. as the Company ANNTAYLOR, INC. as Servicer and MARKET STREET CAPITAL CORP. as Lender and PNC BANK, NATIONAL ASSOCIATION as Administrator - - ----------------------------------------------------------------- TABLE OF CONTENTS ARTICLE I LOANS SECTION 1.01. Commitments to Lend; Limits on Lender's Obligations 2 SECTION 1.02. Loan Procedures 2 SECTION 1.03. Borrowing Base 3 SECTION 1.04. Note 3 SECTION 1.05. Principal 4 ARTICLE II INTEREST SECTION 2.01. Interest 4 SECTION 2.02. Payment Dates 4 SECTION 2.03. Funding with Commercial Paper 5 ARTICLE III SETTLEMENTS SECTION 3.01. Settlement Procedures 5 SECTION 3.02. Deemed Collections; Reduction of Outstanding Principal, Etc 8 SECTION 3.03. Payments and Computations, Etc. 10 SECTION 3.04. Treatment of Collections and Deemed Collections 11 SECTION 3.05. Spread Account; Customer Letter of Credit 11 ARTICLE IV FEES AND YIELD PROTECTION SECTION 4.01. Fees 13 SECTION 4.02. Yield Protection 13 SECTION 4.03. Funding Losses 15 ARTICLE V CONDITIONS PRECEDENT SECTION 5.01. Conditions Precedent to Effectiveness 16 SECTION 5.02. Conditions Precedent to All 18 ARTICLE VI REPRESENTATIONS AND WARRANTIES SECTION 6.01. Representations and Warranties of the Company 18 SECTION 6.02. Representations and Warranties of AnnTaylor 23 ARTICLE VII GENERAL COVENANTS OF THE COMPANY AND ANNTAYLOR SECTION 7.01. Affirmative Covenants 27 SECTION 7.02 Separate Corporate Existence 28 SECTION 7.03. Reporting Requirements 31 SECTION 7.04. Negative Covenants of the Company 33 SECTION 7.05 Negative Covenants of AnnTaylor 35 ARTICLE VIII ADMINISTRATION AND COLLECTION SECTION 8.01. Designation of Servicer 37 SECTION 8.02. Duties of Servicer 38 SECTION 8.03. Rights of the Administrator 39 SECTION 8.04. Responsibilities of the Company 41 SECTION 8.05. Further Action Evidencing Security Interest 41 SECTION 8.06. Application of Collections 42 ARTICLE IX SECURITY INTEREST SECTION 9.01. Grant of Security Interest 42 SECTION 9.02. Remedies 43 ARTICLE X EVENTS OF DEFAULT SECTION 10.01. Events of Default 43 SECTION 10.02. Remedies 45 ARTICLE XI THE ADMINISTRATOR SECTION 11.01. Authorization and Action 46 SECTION 11.02. Administrator's Reliance, Etc 46 SECTION 11.03. PNC Bank and Affiliates 47 ARTICLE XII ASSIGNMENT OF LENDER'S INTEREST SECTION 12.01. Restrictions on Assignments 47 SECTION 12.02. Rights of Assignee 48 SECTION 12.03. Evidence of Assignment 48 ARTICLE XIII INDEMNIFICATION SECTION 13.01. Indemnities 48 ARTICLE XIV MISCELLANEOUS SECTION 14.01. Amendments, Etc 52 SECTION 14.02. Notices, Etc. 53 SECTION 14.03. No Waiver; Remedies 53 SECTION 14.04. Binding Effect; Survival 53 SECTION 14.05. Costs, Expenses and Taxes 54 SECTION 14.06. No Proceedings 54 SECTION 14.07. Confidentiality of the Company Information 55 SECTION 14.08. Confidentiality of Program Information 57 SECTION 14.09. Captions and Cross References 59 SECTION 14.10. Governing Law 59 SECTION 14.11. Waiver Of Jury Trial 59 SECTION 14.12. Consent To Jurisdiction; Waiver Of Immunities 60 SECTION 14.13. Execution in Counterparts 60 SECTION 14.14. No Recourse Against Other Parties 60 APPENDICES APPENDIX A Definitions SCHEDULES SCHEDULE 6.01(n) List of Offices of the Company where Records Are Kept SCHEDULE 6.01(o) List of Lock-Box Banks SCHEDULE 6.01(p)-1 Forms of Contracts SCHEDULE 6.01(p)-2 Description of Credit and Collection Policy SCHEDULE 6.02(k) List of Offices of the Servicer where Records Are Kept SCHEDULE 6.02(l) List of Bank Accounts SCHEDULE 6.01(r) Trade Names EXHIBITS EXHIBIT 1.02(a) Form of Borrowing Notice EXHIBIT 1.04 Form of Note EXHIBIT 3.01(a) Form of Information Package EXHIBIT 3.05 Form of Spread Account Agreement EXHIBIT 5.01(g) Form of Lock-Box Agreement EXHIBIT 5.01(h)-(i) Form of Opinion of Skadden, Arps, Slate, Meagher & Flom - Enforceability EXHIBIT 5.01(h)-(ii) Form of Opinion of General Counsel for the Company EXHIBIT 5.01(h)-(iii) Form of Opinion of Skadden, Arps, Slate, Meagher & Flom - True Sale EXHIBIT 5.01(h)-(iv) Form of Opinion of Skadden, Arps, Slate, Meagher & Flom - Substantive Consolidation EXHIBIT 5.01(h)-(v) Form of Opinion of Connecticut Counsel ============================================================================= AMENDED AND RESTATED RECEIVABLES FINANCING AGREEMENT THIS IS AN AMENDED AND RESTATED RECEIVABLES FINANCING AGREEMENT, dated as of October 31, 1995, among ANNTAYLOR FUNDING, INC., a Delaware corporation (the "Company"), ANNTAYLOR, INC., a ------------ Delaware corporation ("AnnTaylor"), as initial servicer, MARKET --------- STREET CAPITAL CORP., a Delaware corporation ("Lender"), and PNC ------ BANK, NATIONAL ASSOCIATION, a national banking association ("PNC --- Bank"), as administrator for Lender (in such capacity, the - - ---- "Administrator"). Unless otherwise indicated, capitalized terms - - -------------- used in this Agreement are defined in Appendix A. ---------- Background ---------- 1. The Company is a limited purpose subsidiary of AnnTaylor formed for the purpose of purchasing Receivables generated by AnnTaylor in the ordinary course of its business. 2. The Company, AnnTaylor, Clipper Receivables Corporation ("Clipper"), State Street Boston Capital Corporation ("State ------ ----- Street"), as administrator, and PNC Bank, as relationship bank, - - ------ entered into the Receivables Financing Agreement, dated as of January 27, 1994 (as amended prior to the date hereof, the "Original Financing Agreement"). - - ----------------------------- 3. Clipper has assigned to Lender all of its rights, claims and obligations under the Original Financing Agreement and the other Transaction Documents pursuant to the Assignment and Assumption Agreement, dated as of October 31, 1995 (the "Assignment Agreement"), among Clipper, Lender, State Street and - - -------------------- PNC Bank. 4. In connection with the assignment to Lender pursuant to the Assignment Agreement, the parties hereto desire to amend and restate the Original Financing Agreement in its entirety as set forth herein. 5. The Company has, and expects to have, Pool Receivables which the Company intends to finance pursuant to this Agreement. The Company has requested Lender, and Lender has agreed, subject to the terms and conditions contained in this Agreement, to make loans to the Company from time to time during the term of this Agreement, which loans will be secured by the Receivables Pool. 6. AnnTaylor has been requested by the Company, Lender and the Administrator to act, and has agreed to act, as initial Servicer. 7. PNC Bank has been requested, and is willing, to act as the Administrator. NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained, the parties hereto agree as follows: ====================================================================== ARTICLE I LOANS SECTION 1.01. Commitments to Lend; Limits on Lender's ------------------- Obligations. Upon the terms and subject to the conditions of this Agreement, from time to time prior to the Termination Date, the Company may request that Lender make loans to the Company (each being a "Loan") and Lender shall make such Loans; provided ---- -------- that no Loan shall be made by Lender if, after giving effect thereto, the then Outstanding Principal would exceed either (a) $40,000,000 (the "Lending Limit"), or (b) the Borrowing Base then ------------- in effect; and provided further that each Loan made pursuant to ---------------- this Section 1.01 shall have an original principal amount of at ------------ least $5,000,000 and shall be in integral multiples of $1,000,000, unless the Outstanding Principal is $20,000,000 or more, in which case, each Loan shall have an original principal amount of at least $100,000 and shall be in integral multiples of $100,000. SECTION 1.02. Loan Procedures. --------------- (a) Notice of Loan. Each Loan to the Company by Lender -------------- shall be made on notice from the Company to the Administrator substantially in the form of Exhibit 1.02(a) (each, a "Borrowing --------------- --------- Notice") received by the Administrator not later than noon (New - - ------ York City time) on the Business Day next preceding the date of such proposed Loan. Each such notice of a proposed Loan shall specify the desired amount and date of such Loan, which date shall be a Settlement Date. (b) Funding of Loan. On the date of each Loan, Lender --------------- shall, upon satisfaction of the applicable conditions set forth in Article V, make available to the Administrator at the --------- Administrator's Office the principal amount of its Loan in same day funds, and after receipt by the Administrator of such funds, the Administrator will disburse such funds to an account of the Company designated in writing by the Company in the applicable Borrowing Notice. SECTION 1.03. Borrowing Base. -------------- (a) Computation of Borrowing Base. On any date, the ----------------------------- "Borrowing Base" means an amount equal to NPB - LR where: LR = the Loss Reserve on such date; and NPB = the Net Pool Balance on such date. (b) Frequency of Computation. The Borrowing Base shall be ------------------------ computed and reported, as provided in Section 3.01, as of (i) the ------------ date of the initial Loan and (ii) the Cut-Off Date for each Settlement Period. In addition, if the Administrator reasonably believes that there shall exist any event or occurrence that has a reasonable possibility of causing a Material Adverse Effect, the Administrator may require the Servicer to provide a computation of Collections received by the Company or the Servicer since the last Cut-Off Date, the then aggregate Unpaid Balance of all Pool Receivables and such other information comprising a part of the Information Package that can be updated from the last Cut-Off Date for purposes of computing the Borrowing Base as of any other date, and the Servicer agrees to do so within 5 Business Days of its receipt of the Administrator's request. SECTION 1.04. Note. The Loans shall be evidenced by a ---- replacement promissory note (as from time to time supplemented, extended, amended, modified or further replaced from time to time, and including the Original Note for as long as it was in effect, the "Note"), substantially in the form set forth in ---- Exhibit 1.04, with appropriate insertions, dated the date hereof, - - ----------- payable to the order of Lender in the maximum principal amount of $40,000,000 (or, if less, in the aggregate unpaid principal amount of all of the Loans) on the Termination Date. The Administrator shall record in its records, or at its option on the schedule attached to the Note, the date and amount of each Loan made hereunder, each repayment thereof and the other information provided for thereon. The aggregate unpaid principal amount so recorded shall be rebuttable presumptive evidence of the principal amount owing and unpaid on the Note. The failure so to record any such information or the error in so recording any such information shall not, however, limit or otherwise affect the actual obligations of the Company hereunder or under the Note to repay the principal amount of all Loans, together with all interest accruing thereon. SECTION 1.05. Principal. The Company shall repay the --------- principal of the Loans (i) on each Settlement Date in an amount equal to the excess, if any, of the Outstanding Principal over the Borrowing Base then in effect and (ii) in full on the Termination Date. Outstanding Principal shall not be considered reduced by any allocation, setting aside or distribution of any portion of Collections unless such Collections shall have been actually delivered to the Administrator pursuant hereto (or deemed delivered pursuant to Section 3.03(a)(i)). Outstanding ----------------- Principal shall not be considered reduced by any distribution of any portion of Collections if at any time such distribution is rescinded or must otherwise be returned for any reason. ====================================================================== ARTICLE II INTEREST SECTION 2.01. Interest. The Company hereby promises to pay -------- interest for each Interest Period on the unpaid principal amount of each Loan (or the applicable portion thereof) for the period commencing on the date of such Loan until such Loan is paid in full, as follows: (a) at all times while the making or maintenance of such Loan (or the applicable portion thereof) by Lender is funded by the issuance of Commercial Paper Notes, the CP Rate for such Interest Period; and (b) at all times while the making or maintenance of such Loan (or the applicable portion thereof) by Lender is not funded by the issuance of Commercial Paper Notes, the Bank Rate applicable to such Interest Period; provided, however, that on any day when an Event of Default shall - - ------- ------ have occurred and be continuing, the Loans shall accrue interest at a rate per annum equal to the higher of (i) the Alternate Base Rate plus 2% per annum and (ii) the rate otherwise applicable to such Loan during such Interest Period plus 2% per annum. The interest rate on any Loan bearing interest at the Alternate Base Rate shall change simultaneously with each change in the Alternate Base Rate. SECTION 2.02. Payment Dates. Interest accrued on each Loan ------------- shall be payable, without duplication; (a) on the Termination Date; (b) on the date of any payment or repayment, in whole or in part, of any principal outstanding on such Loan and (c) on each Settlement Date. Interest accrued on Loans after the date such Loan is due and payable (whether on the Termination Date, upon acceleration or otherwise), together with interest on any and all other amounts remaining unpaid, shall be payable upon demand. No provision of this Agreement shall require the payment or permit the collection of interest in excess of the maximum permitted by applicable law. Interest for any Loan shall not be considered paid by any distribution if at any time such distribution is rescinded or must otherwise be returned for any reason. SECTION 2.03. Funding with Commercial Paper. Lender will ----------------------------- initially fund the Loans with Liquidity Loans made to Lender under the Liquidity Agreement and/or other advances made to Lender under its other Program Support Agreements. At such time as (i) the Fixed Charge Coverage Ratio is at least 1.00 to 1.00 for at least one full fiscal quarter, and there has been no material adverse change in the consolidated financial condition, business or operations of ATSC and its consolidated Subsidiaries since the end of such fiscal quarter, (ii) Standard & Poor's and Moody's Investors Service, Inc. have confirmed that the Commercial Paper Notes will be rated A1/P-1 after giving effect to the transaction contemplated by this Agreement, and (iii) Lender, the Administrator and the Company have agreed upon a new Program Fee, Lender will, to the extent that it is able to do so, fund the Loans by the issuance of Commercial Paper Notes. ==================================================================== ARTICLE III SETTLEMENTS SECTION 3.01. Settlement Procedures. --------------------- The parties hereto will take the following actions with respect to each Settlement Period: (a) Information Package. On or before the fifth day ------------------- of the calendar month immediately following the calendar month in which the Cut-Off Date for such Settlement Period occurs, or, if such day is not a Business Day, the next succeeding Business Day (each, a "Reporting Date"), Servicer shall deliver to the Administrator a report, substantially in the form of Exhibit 3.01 (each, an "Information ------------ ----------- Package"). In the event that the amount of Collections ------- received during the Settlement Period to which an Information Package relates is less than the amount equal to (i) the Amount Payable for the related Settlement Date minus (ii) the amount of funds available to be drawn from the Spread Account on such Settlement Date, the Administrator shall withdraw the amount of any such deficiency from the Customer Letter of Credit on the Business Day next succeeding the applicable Reporting Date. The Administrator shall hold the funds so withdrawn from the Customer Letter of Credit in a segregated account for application on the related Settlement Date pursuant to this Section 3.01. ------------ (b) Collections. Servicer shall set aside for the ----------- sole benefit of Lender and the Administrator all Collections received to the extent necessary to pay the Estimated Amount as it accrues (whether or not then due) that will be payable during such Settlement Period or on the next occurring Settlement Date; provided that, unless the Administrator -------- shall request it to do so in writing after the occurrence and during the continuance of an Event of Default, Servicer shall not be required to hold such Collections in a separate deposit account containing only such Collections. So long as no Event of Default has occurred and is continuing, Collections received during a Settlement Period in excess of the amount to be set aside with respect to the Estimated Amount for such Settlement Period shall be used by the Company to pay the purchase price for Receivables generated by AnnTaylor, as seller, pursuant to the Purchase Agreement; if any Collections remain after such payment, they shall be retained by the Company for use in its sole discretion (subject to the terms of this Agreement). If an Event of Default has occurred and is continuing, all Collections shall be held by Servicer pursuant to the first sentence of this paragraph (b). On each Settlement Date, Servicer shall ------------ remit to the Administrator an amount equal to the lesser of (1) the amount of Collections received during the Settlement Period related to such Settlement Date and (2) the sum of (i) the amount of interest on the Loans accrued during the most recently ended Interest Period (plus any interest previously accrued and remaining unpaid), plus (ii) the ---- amount of principal then due and owing with respect to the Loans (plus any principal previously due and remaining unpaid), plus (iii) all fees and other amounts accrued and ---- payable by the Company under this Agreement (the amount set forth in this clause (2), the "Amount Payable"). To the --------- -------------- extent that the amount described in the foregoing clause (1) ---------- is less than the amount described in the foregoing clause (2), the Administrator shall withdraw the amount of --------- any such deficiency from the Spread Account. All Collections received during the applicable Settlement Period that exceed the amount described in the foregoing clause (2) ---------- shall be (A) deposited by the Servicer to the Spread Account and/or (B) paid by the Servicer to the issuer of the Customer Letter of Credit, in each case, to the extent necessary to bring the sum of the funds in the Spread Account plus the stated amount of the Customer Letter of Credit up to the Enhancement Limit; unless an Event of Default has occurred and is continuing, all remaining Collections shall be available to the Company pursuant to the second sentence of this paragraph (b). ------------- (c) Order of Application of Collections Prior to --------------------------------------------- Termination Date. Upon receipt by the Administrator of --------------- amounts on any Settlement Date pursuant to the foregoing paragraph (b) and any amounts withdrawn from the Customer ------------ Letter of Credit pursuant to the foregoing paragraph (a) ------------- prior to the occurrence of the Termination Date, the Administrator shall apply such amounts to the items specified in the subclauses below, in the order of priority of such subclauses: (i) to accrued and unpaid Servicer's Fee; (ii) to interest accrued during the most recently ended Interest Period in respect of the Loans, plus any such interest previously due and remaining unpaid; (iii) to the Program Fee accrued during the most recently ended Interest Period, plus any portion of the Program Fee previously due and remaining unpaid; (iv) to the extent of any principal due on the Loans, to such outstanding principal; (v) to accrued and unpaid amounts owed to the Administrator hereunder; (vi) to other accrued and unpaid amounts owing to Lender hereunder; (vii) on a pro rata basis, to accrued and --- ---- unpaid amounts owing to any Affected Party hereunder; and (viii) any remaining amounts to the Spread Account, up to the Enhancement Limit or to the issuer of the Customer Letter of Credit, up to the amount necessary to restore the stated amount thereof to the Enhancement Limit, as applicable. (d) Order of Application of Collections After ----------------------------------------- Termination Date. Upon receipt by the Administrator of --------------- amounts on any Settlement Date pursuant to the foregoing paragraph (b) and any amounts withdrawn from the Customer ------------- Letter of Credit pursuant to the foregoing paragraph (a) on ------------- or after the occurrence of the Termination Date, the Administrator shall apply such items to the item specified in the subclauses below, in the order of priority of such subclauses: (i) to accrued and unpaid Servicer's Fee; (ii) to interest accrued during the most recently ended Interest Period in respect of the Loans, plus any such interest previously due and remaining unpaid; (iii) to the Program Fee accrued during the most recently ended Interest Period, plus any such Program Fee previously due and remaining unpaid; (iv) to the outstanding principal of the Loans until reduced to zero; (v) to accrued and unpaid amounts owed to the Administrator hereunder; (vi) to other accrued and unpaid amounts owing to Lender hereunder; (vii) on a pro rata basis, to accrued and --- ---- unpaid amounts owing to any Affected Party hereunder; and (viii) any remaining amounts to the Company. (e) Non-Distribution of Servicer's Fee. If the ---------------------------------- Administrator consents (which consent may be revoked at any time during the continuance of an Event of Default), the amount in respect of Servicer's Fee may be retained by Servicer, in which case no distribution shall be made in respect of the Servicer's Fee pursuant to clause (c) or (d) ---------- --- above, as the case may be. (f) Delayed Payment. If on any day described in this --------------- Section 3.01, a payment is not paid because the sum of (i) ------------ Collections during the relevant Settlement Period, (ii) the amounts in the Spread Account and (iii) the amounts available to be drawn on the Customer Letter of Credit were less than the aggregate amounts payable, the next available Collections shall be applied to such payment. SECTION 3.02. Deemed Collections; Reduction of Outstanding ------------------------------------------- Principal, Etc. - - -------------- (a) Deemed Collections. If on any day ------------------ (i) the Unpaid Balance of any Pool Receivable is (A) reduced as a result of any defective, rejected or returned merchandise or services, any cash discount, or any adjustment by the Company or any Affiliate of the Company, (B) reduced or cancelled as a result of a setoff in respect of any claim by the Obligor thereof against the Company or any Affiliate of the Company (whether such claim arises out of the same or a related or an unrelated transaction), or (C) reduced on account of the obligation of the Company or any Affiliate of the Company to pay to the related Obligor any rebate or refund, or (D) less than the amount included in calculating the Net Pool Balance for purposes of any Information Package, or (ii) any of the representations or warranties of the Company set forth in Section 6.01(l), (p) or (u) were not -------------- --- --- true when made with respect to any Pool Receivable, or any of the representations or warranties of the Company set forth in Section 6.01(l) or (u) are no longer true with --------------- --- respect to any Pool Receivable, or (iii) without duplication, the Company receives a Deemed Collection (as defined in the Purchase Agreement), then, on such day, the Company shall be deemed to have received a Collection of such Pool Receivable (I) in the case of clause (i) above, in the ---------- amount of such reduction or cancellation or the difference between the actual Unpaid Balance and the amount included in calculating such Net Pool Balance, as applicable; (II) in the case of clause (ii) above, in ----------- the amount of the Unpaid Balance of such Pool Receivable; and (III) in the case of clause (iii) above, in ------------ the amount so received as a Deemed Collection. If the Company has paid in full the Unpaid Balance of a Receivable, such Receivable, and any Related Security therefor, shall be released from the security interest therein created by this Agreement, without any further act, and such Receivable shall no longer be a Pool Receivable. (b) The Company's Optional Prepayment. The Company may at --------------------------------- any time elect to prepay the Loans in whole or in part, by giving the Administrator at least 3 Business Days' prior written notice of such prepayment (including the amount of such proposed reduction and the proposed date on which such prepayment will be made), provided that, (A) the amount of any such prepayment shall be not less than $100,000 and shall be an integral multiple of $100,000, and the Outstanding Principal after giving effect to such reduction shall be not less than $20,000,000 (unless the Outstanding Principal shall thereby be reduced to zero), and (B) any prepayment shall be accompanied by the interest accrued on the amount being prepaid, plus any Liquidation Fee, plus, if the Termination Date shall have occurred and the Outstanding Principal shall thereby be reduced to zero, all other amounts then due to the Lender or the Administrator. SECTION 3.03. Payments and Computations, Etc. ------------------------------ (a) Payments. All amounts to be paid, remitted or -------- deposited by the Company or Servicer to the Administrator or any other Person hereunder (other than amounts payable under Section 4.02) shall be paid or deposited in accordance with the - - ------------ terms hereof no later than 11:30 a.m. (New York time) on the day when due in lawful money of the United States of America in same day funds (i) in the case of amounts to be paid, remitted or deposited in respect of accrued and unpaid interest on the Loans or in reduction of Outstanding Principal, to the Administrator at PNC Bank, ABA #043000096, for further credit to Account #1002420425; Reference: AnnTaylor Funding, (ii) in the case of all fees, expenses and other amounts (other than amounts payable under Section 4.02), to the Administrator at PNC Bank, ABA ------------ #043000096, Account #1-188375, Attention: Charlene Wilson, 7001, and (iii) in all other cases to the address of the Person entitled to such payment or deposit as such Person shall specify. (b) Late Payments. Without duplication, the Company shall, ------------- to the extent permitted by law, pay to Lender interest on all amounts not paid or deposited when due hereunder and the Servicer shall, to the extent permitted by law, pay to Lender interest on all amounts not remitted when due hereunder because of any failure of the Servicer to comply with its obligations as Servicer hereunder, in each case at 2% per annum above the --- ----- Alternate Base Rate, payable on demand, provided, however, that -------- ------- such interest rate shall not at any time exceed the maximum rate permitted by applicable law. (c) Method of Computation. All computations of interest, --------------------- Liquidation Fee, any fees payable under Sections 4.01(b) and any ---------------- other fees payable by the Company to Lender or the Administrator in connection with Loans hereunder shall be made on the basis of a year of 360 days (other than interest calculated by reference to the Alternate Base Rate, in which case such calculation shall be made on the basis of a year of 365 or 366 days, as applicable) for the actual number of days (including the first day but excluding the last day) elapsed. SECTION 3.04. Treatment of Collections and Deemed ----------------------------------- Collections. The Company shall forthwith deliver to Servicer all - - ----------- Collections deemed received by the Company pursuant to Section ------- 3.02(a), and Servicer shall hold or distribute such Collections - - ------ pursuant to the terms hereof to the same extent as if such Collections had actually been received on the date of such delivery to Servicer. During the continuance of an Event of Default, if requested by the Administrator, Servicer shall cause such deemed Collections to be paid on the second Business Day after they arise to the Lock-Box Bank or, if Collections are being paid to the Administrator pursuant to Section 8.03(c), to --------------- the Administrator. So long as the Company shall hold any Collections or deemed Collections required to be paid to Servicer or the Administrator, it shall hold such Collections for the sole benefit of the Lender and the Administrator and shall clearly mark its records to reflect such benefit (subject to the Company's right to use certain Collections to pay the purchase price due under the Purchase Agreement as set forth in Section ------- 3.01(b)); provided that unless the Administrator shall request it - - ------ -------- to do so in writing after the occurrence and during the continuance of an Event of Default, the Company shall not be required to hold such Collections in a separate deposit account containing only such Collections. SECTION 3.05. Spread Account; Customer Letter of Credit. ----------------------------------------- (a) Unless the Company has delivered a Customer Letter of Credit pursuant to Section 3.05(e), the Company, for the benefit of --------------- Lender, shall establish and maintain or cause to be established and maintained in the name of the Company, on behalf of Lender, with PNC Bank, a segregated account (the "Spread Account"), -------------- bearing a designation clearly indicating that the funds deposited therein are held for the benefit of Lender. The Spread Account, all funds deposited therein from time to time, all investments of such funds and all proceeds of any of the foregoing shall be subject to a pledge and security interest in favor of the Administrator for the benefit of Lender pursuant to an agreement substantially in the form attached hereto as Exhibit 3.05 (such ------------ agreement, as further amended, supplemented or otherwise modified from time to time, being the "Spread Account Agreement"). ------------------------ (b) Except as expressly provided in this Agreement, Servicer agrees that it shall have no right of setoff or banker's lien against, and no right to otherwise deduct from, any funds held in the Spread Account for any amount owed to it by the Administrator or Lender. (c) Funds on deposit in the Spread Account shall be invested at the direction of Servicer in accordance with the Spread Account Agreement; provided, however, investments of funds -------- ------- representing Collections collected during any Settlement Period shall be invested in investments that will mature so that such funds will be available for transfer on the applicable Settlement Date with respect to such Settlement Period. All interest and other investment earnings (net of losses and investment expenses) on funds on deposit in the Spread Account shall be added to the balance in the Spread Account and applied in accordance with this Agreement. (d) If on any Settlement Date, no Event of Default has occurred and is continuing and the amount of funds in Spread Account, after giving effect to all withdrawals therefrom on such date, exceeds 1.5% of the Lending Limit (the "Enhancement ----------- Limit"), the amount of such excess shall be released to the - - ----- Company. (e) The Company may, at its option, in lieu of establishing and maintaining the Spread Account, deliver to the Administrator, for the benefit of Lender, and maintain in force until the Final Payout Date, one or more irrevocable letters of credit (collectively, with any substitutions therefor and replacements thereof, the "Customer Letter of Credit"), with a stated amount ------------------------- equal to the Enhancement Limit, from, or confirmed by, a bank or other financial institution whose short term unsecured debt obligations are rated at least A-1 by Standard and Poor's Corporation and P-1 by Moody's Investors Service, Inc., and who is otherwise acceptable to the Administrator (whose acceptance shall not be unreasonably withheld), and in a form reasonably acceptable to the Administrator, together with an opinion of counsel for such Customer Letter of Credit issuer acceptable in form and substance to the Administrator; provided that a copy of -------- such Customer Letter of Credit shall have been provided to Standard & Poor's Corporation and Moody's Investors Service, Inc. and they shall have either confirmed (orally or in writing) the rating of the Commercial Paper Notes or waived (orally or in writing) such requirement of confirmation. (f) The Company may satisfy its obligations pursuant to this Section 3.05 by providing both a Spread Account and a ----------- Customer Letter of Credit, provided that the sum of the amount of -------- funds from time to time in the Spread Account plus the stated amount from time to time of the Customer Letter of Credit is at least equal to the Enhancement Limit. In the event that the Company has provided a Customer Letter of Credit and the issuer of such Customer Letter of Credit (including any issuer of a confirming letter of credit) is downgraded below the ratings required pursuant to the foregoing paragraph (e) (or such ratings ------------ are withdrawn), unless the Company has provided a substitute Customer Letter of Credit satisfying the requirements of the foregoing paragraph (e) or the Company has deposited in the ------------ Spread Account the amount necessary to bring the amount therein up to the Enhancement Limit, in each case, on or prior to two (2) Business Days after such downgrading or withdrawal, the Administrator shall withdraw the full stated amount of the Customer Letter of Credit and deposit it in the Spread Account. If the Customer Letter of Credit has a stated expiration date that is earlier than the Final Payout Date, unless the Company has substituted therefor another Customer Letter of Credit satisfying the requirements of the foregoing paragraph (e) or ------------- deposited into the Spread Account the amount necessary to bring the amount of funds therein up to the Enhancement Limit on or before two (2) Business Days prior to the stated expiration date, the Administrator shall withdraw the full stated amount of the Customer Letter of Credit and deposit such funds into the Spread Account. =================================================================== ARTICLE IV FEES AND YIELD PROTECTION SECTION 4.01. Fees. The Company shall pay to the ---- Administrator for the account of the Lender certain fees payable in such amounts and on such dates as are set forth in the fee letter, dated as of the date hereof (as amended or supplemented from time to time, the "Fee Letter") among the Company, AnnTaylor ---------- and the Administrator. SECTION 4.02. Yield Protection. ---------------- (a) If (i) Regulation D or (ii) any Regulatory Change occurring after the date hereof (A) shall subject an Affected Party to any tax, duty or other charge with respect to any Loan owned by, owed to or funded by it, or any obligations or right to make Loans or to provide funding therefor, or shall change the basis of taxation of payments to the Affected Party of any part of the Loans owned by, owed to or funded in whole or in part by it or any other amounts due under this Agreement in respect of the Loans (or any portion thereof) owned by or funded by it or its obligations or rights, if any, to make Loans or to provide funding therefor (except for changes in the rate of any tax which is a franchise tax or a tax on the net income of such Affected Party imposed by the United States of America, by any jurisdiction in which such Affected Party's principal executive office is located and, if such Affected Party's principal executive office is not in the United States of America, by any jurisdiction where such Affected Party's principal office in the United States is located); or (B) shall impose, modify or deem applicable any reserve (including, without limitation, any reserve imposed by the Federal Reserve Board, but excluding any reserve included in the determination of the interest rate applicable to the Loans), special deposit or similar requirement against assets of any Affected Party, deposits or obligations with or for the account of any Affected Party or with or for the account of any affiliate (or entity deemed by the Federal Reserve Board to be an affiliate) of any Affected Party, or credit extended by any Affected Party; or (C) shall change the amount of capital maintained or required or requested or directed to be maintained by any Affected Party in respect of the transactions contemplated hereby; or (D) shall impose any other condition affecting any Loan owned by, owed to or funded in whole or in part by any Affected Party, or its obligations or rights, if any, to make Loans or to provide funding therefor; and the result of any of the foregoing is or would be (x) to increase the cost to (I) an Affected Party funding or making or maintaining any Loans (or any portion thereof), any purchases, reinvestments, or loans or other extensions of credit under any Program Support Agreement or any commitment of such Affected Party with respect to any of the foregoing, or (II) the Administrator for continuing its or the Company's relationship with Lender, (y) to reduce the amount of any sum received or receivable by an Affected Party under this Agreement, or under any Program Support Agreement with respect thereto, or (z) in the sole determination of such Affected Party, to reduce the rate of return on the capital of an Affected Party as a consequence of its obligations hereunder or arising in connection herewith to a level below that which such Affected Party could otherwise have achieved, then within thirty days after demand by such Affected Party (which demand shall be accompanied by a statement setting forth the basis of such demand), the Company shall pay directly to such Affected Party such additional amount or amounts as will compensate such Affected Party for such additional or increased cost or such reduction. (b) Each Affected Party will promptly notify the Company and the Administrator of any event of which it has knowledge which will entitle such Affected Party to compensation pursuant to this Section 4.02; provided, however, no failure to give or ------------ -------- ------- delay in giving such notification shall adversely affect the rights of any Affected Party to such compensation except that no Affected Party shall be entitled to compensation under this Section 4.02 with respect to any increased costs or reduced - - ------------ return incurred more than 90 days prior to the date on which a responsible officer of such Affected Party had actual knowledge and notified the Company of the event giving rise to such increased cost or reduced return. (c) In determining any amount provided for or referred to in this Section 4.02, an Affected Party may use any reasonable ------------ averaging and attribution methods that it reasonably shall deem applicable; provided that such Affected Party shall not be -------- arbitrary with respect to requesting similar compensation with respect to similar transactions to the extent it is entitled to do so pursuant to the applicable agreements. Any Affected Party when making a claim under this Section 4.02 shall submit to the ------------ Company a statement as to such increased cost or reduced return (including calculation thereof in reasonable detail), which statement shall, in the absence of demonstrable error, be conclusive and binding upon the Company. (d) Any Affected Party which is a participant shall only be entitled to amounts under this Section 4.02 to the extent that ------------ such amounts, together with all amounts due to the Person selling such participation under this Section 4.02, do not exceed the ------------- amounts that would have been due to such Person under this Section 4.02 if the participation had not been entered into or - - ----------- sold. SECTION 4.03. Funding Losses. In the event that any -------------- Liquidity Bank shall incur any loss or expense (including any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Liquidity Bank to make any Liquidity Loan or maintain any Liquidity Loan, but not including loss of anticipated profit) as a result of any Loan not being made in accordance with a request therefore under Section 1.02 (other than by reason of the failure ------------ of Lender to fund such Loan pursuant to its commitment) or as a result of any Loan being paid on a date other than a Settlement Date, then, upon written notice from the Administrator to the Company and Servicer, but without duplication of any Liquidation Fee paid by the Company, the Company shall pay to Servicer, and Servicer shall remit such amount paid by the Company to the Administrator for the account of such Liquidity Bank, the amount of such loss or expense. Such written notice (which shall include calculations in reasonable detail) shall, in the absence of manifest error, be conclusive and binding upon the Company and Servicer. ==================================================================== ARTICLE V CONDITIONS PRECEDENT SECTION 5.01. Conditions Precedent to Effectiveness. The ------------------------------------- effectiveness of this Amended and Restated Receivables Financing Agreement is subject to the condition precedent that the Administrator shall have received, on or before the date of such effectiveness, the following, each (unless otherwise indicated) dated such date and in form and substance satisfactory to the Administrator: (a) A copy of the resolutions of the Board of Directors of each of the Company and AnnTaylor approving this Agreement and the other Transaction Documents to which it is a party to be delivered by it hereunder and the transactions contemplated hereby, certified by its Secretary or Assistant Secretary; (b) Good standing certificates for the Company issued by the Secretaries of State of Delaware and Connecticut; good standing certificates for AnnTaylor issued by the Secretaries of State of New York and Delaware; (c) A certificate of the Secretary or Assistant Secretary of each of the Company and AnnTaylor certifying the names and true signatures of the officers authorized on its behalf to sign this Agreement and the other Transaction Documents to be delivered by it hereunder (on which certificate the Administrator and Lender may conclusively rely until such time as the Administrator shall receive from the Company or AnnTaylor, as the case may be, a revised certificate meeting the requirements of this subsection (c)); (d) The Certificate of Incorporation of each of the Company and AnnTaylor, duly certified by the Secretary of State of Delaware, as of a recent date acceptable to Administrator, together with a copy of the by-laws of each of the Company and AnnTaylor, duly certified by the Secretary or an Assistant Secretary of the Company or AnnTaylor, as the case may be; (e) Copies of proper assignments of, and amendments to, the financing statements (Form UCC-1) filed in connection with the transactions contemplated by the Original Financing Agreement, and copies of proper financing statements (Form UCC-1) naming the Company as the debtor and Lender as the secured party, filed or delivered to the Lender or the Administrator for filing; (f) A search report updating the search report delivered in connection with the Original Financing Agreement provided in writing to the Administrator by LEXIS Document Service, listing all effective financing statements that name the Company or AnnTaylor as debtor and that are filed in the jurisdictions in which filings were made pursuant to subsection (e) above and in such other ------------- jurisdictions that Administrator shall reasonably request, together with copies of such financing statements (none of which shall cover the Receivables Pool or any interests therein other than those in favor of Clipper); (g) Duly executed copies of Lock-Box Agreements with each of the Lock-Box Banks; (h) Opinions of (i) Skadden, Arps, Slate, Meagher & Flom, special counsel to the Company, in substantially the form of Exhibits 5.01(h)-(i), 5.01(h)-(iii) and 5.01(h)- ------------------- ------------- -------- (iv), (ii) Jocelyn F.L. Barandiaran, general counsel for the ---------- Company, in substantially the form of Exhibit 5.01(h)-(ii) ------------------- and (iii) Tyler, Cooper & Alcorn, special Connecticut counsel to the Company, in substantially the form of Exhibit ------- 5.01(h)-(v); ----------- (i) Such powers of attorney as the Administrator shall reasonably request to enable the Administrator to collect all amounts due under any and all Pool Receivables; (j) A pro forma Information Package, assuming a Cut- --------- Off Date of October 27, 1995; (k) The Assignment Agreement, duly executed by Clipper, State Street, Lender and the Administrator; (l) The Liquidity Agreement, duly executed by Lender, the Liquidity Agent and each Liquidity Bank; (m) The Spread Account Agreement, duly executed by the parties thereto; (n) An amendment to the Purchase Agreement, duly executed by the Company and AnnTaylor; (o) The Note, duly executed by the Company; and (p) The Fee Letter, duly executed by the Company and AnnTaylor. SECTION 5.02. Conditions Precedent to All Loans. Each Loan --------------------------------- and the effectiveness of this Amended and Restated Receivables Financing Agreement shall be subject to the further conditions precedent that on the date of such Loan or effectiveness, as the case may be, the following statements shall be true (and the Company by accepting the amount of such Loan or executing and delivering this Agreement, as the case may be, shall be deemed to have certified that): (a) the representations and warranties contained in Section 6.01 are correct on and as of such day as though ------------ made on and as of such day and shall be deemed to have been made on such day, (b) no event has occurred and is continuing, or would result from such Loan or effectiveness, as the case may be, that constitutes an Event of Default or Unmatured Event of Default, (c) after giving effect to each proposed Loan, the Outstanding Principal will not exceed the Lending Limit or the Borrowing Base, and (d) the Termination Date shall not have occurred. ==================================================================== ARTICLE VI REPRESENTATIONS AND WARRANTIES SECTION 6.01. Representations and Warranties of the ------------------------------------- Company. The Company represents and warrants as follows: - - ------- (a) Organization and Good Standing. It has been duly ----------------------------- organized and is validly existing as a corporation in good standing under the laws of the State of Delaware, with power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted, and had at all relevant times, and now has, all necessary power, authority, and legal right to acquire and own the Pool Receivables. (b) Due Qualification. It is duly qualified to do ----------------- business as a foreign corporation in good standing, and has obtained all necessary licenses and approvals, in all jurisdictions in which the ownership or lease of property or the conduct of its business requires such qualification, licenses or approvals except where the failure to be in good standing or to so qualify has not had and will not have a Material Adverse Effect. (c) Power and Authority; Due Authorization. It (i) -------------------------------------- has all necessary power, authority and legal right to (A) execute and deliver this Agreement, the Note and the other Transaction Documents to which it is a party, (B) carry out the terms of the Transaction Documents, and (C) borrow the Loans and grant the security interest in the Receivables Pool on the terms and conditions herein provided and (ii) has duly authorized by all necessary corporate action the execution, delivery and performance of this Agreement, the Note and the other Transaction Documents to which it is a party and the borrowing of the Loans and the granting of the security interest in the Receivables Pool on the terms and conditions herein provided. (d) Valid Security Interest; Binding Obligations. -------------------------------------------- This Agreement creates a valid first priority security interest in the Receivables Pool in favor of the Lender, enforceable against creditors of, and purchasers from, the Company; and this Agreement constitutes, and the Note and each other Transaction Document to be signed by it when duly executed and delivered will constitute, its legal, valid and binding obligation enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law. (e) No Violation. The consummation of the ------------ transactions contemplated by this Agreement, the Note and the other Transaction Documents and the fulfillment of the terms hereof will not (i) conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time or both) a default under, the certificate of incorporation or by-laws of the Company or any indenture, loan agreement, receivables purchase agreement, mortgage, deed of trust, or other agreement or instrument to which the Company is a party or by which it or any of its properties is bound, except where such conflict, breach or default has not had and will not have a Material Adverse Effect, (ii) result in the creation or imposition of any Lien upon any of the Company's properties pursuant to the terms of any such indenture, loan agreement, receivables purchase agreement, mortgage, deed of trust, or other agreement or instrument, other than this Agreement, or (iii) violate any law or any order, rule, or regulation applicable to the Company of any court or of any federal or state regulatory body, administrative agency, or other governmental instrumentality having jurisdiction over the Company or any of its properties except where such violation has not had and will not have a Material Adverse Effect. (f) No Proceedings. There are no proceedings or -------------- investigations pending, or to the Company's knowledge threatened, before any court, regulatory body, administrative agency, or other tribunal or governmental instrumentality (i) asserting the invalidity of this Agreement or any other Transaction Document, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or any other Transaction Document, or (iii) seeking any determination or ruling that could reasonably be expected to have a Material Adverse Effect. (g) Bulk Sales Act. No transaction contemplated -------------- hereby requires compliance with any bulk sales act or similar law. (h) Government Approvals. No authorization or -------------------- approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for the due execution, delivery and performance by the Company of this Agreement or any other Transaction Document, except for the filing of the UCC statements and ------ the assignments of, and amendments to, the UCC financing statements referred to in Article V, all of which, at the --------- time required in Article V, shall have been duly made and --------- shall be in full force and effect (or shall have been duly delivered to the Administrator). (i) Financial Condition. (x) The balance sheet of ------------------- the Company as of January 28, 1995, and the related statements of income and shareholders' equity of the Company for the fiscal year then ended certified by Deloitte & Touche, independent certified public accountants, copies of which have been furnished to the Administrator, fairly present the Company's financial condition, business, business prospects and operations as at such date and the results of the operations of the Company for the period ended on such date; and (y) since January 28, 1995, there has been no material adverse change in any of the Company's financial condition, business, or operations. (j) Litigation. No injunction, decree or other ---------- decision has been issued or made by any court, governmental agency or instrumentality thereof that could reasonably be expected to have a Material Adverse Effect, and no written threat by any person has been made to attempt to obtain any such decision. (k) Margin Regulations. The use of all funds obtained ------------------ by the Company under this Agreement will not conflict with or contravene any of Regulations G, T, U and X promulgated by the Board of Governors of the Federal Reserve System from time to time. (l) Quality of Title. The Receivables Pool is owned ---------------- by the Company free and clear of any Lien (other than any Lien arising hereunder solely as the result of any action taken by Lender (or any assignee thereof) or by the Administrator); upon the filing of the assignments of, and amendments to, the UCC-1 financing statements filed with the Secretary of State of Connecticut in connection with the Original Financing Agreement, the filing of new UCC-1 financing statements with the Secretary of State of Connecticut and the execution of the Spread Account Agreement, Lender shall have acquired and shall at all times thereafter continuously maintain a valid and perfected first priority security interest in the Receivables Pool (other than with respect to the Spread Account, in which case such security interest shall be in respect of the Eligible Investments (as defined in the Spread Account Agreement) credited thereto), free and clear of any Lien (other than any Lien arising hereunder solely as the result of any action taken by Lender (or any assignee thereof) or by the Administrator); and no financing statement or other instrument similar in effect covering the Receivables Pool or any portion thereof is on file in any recording office except such as may be filed (i) in favor of AnnTaylor in accordance with the Contracts, (ii) in favor of Lender or the Administrator in accordance with this Agreement or in connection with any Lien arising hereunder solely as the result of any action taken by Lender (or any assignee thereof) or by the Administrator or (iii) in favor of the Company pursuant to the Purchase Agreement. (m) Accurate Reports. No Information Package (if ---------------- prepared by the Company or to the extent information therein was supplied by the Company) or other information, exhibit, financial statement, document, book, record or report furnished or to be furnished in writing by or on behalf of the Company to the Administrator or Lender in connection with this Agreement was or will be inaccurate in any material respect (in light of the circumstances under which such information was furnished and taken as a whole together with all other information previously furnished or then being furnished) as of the date it was or will be dated or (except as otherwise disclosed to the Administrator and Lender at or prior to such time) as of the date so furnished, or contained or will contain any material misstatement of fact or omitted or will omit to state a material fact or any fact necessary to make the statements contained therein not materially misleading on the date as of which such information is dated or certified. (n) Offices. The chief place of business and chief ------- executive office of the Company is located at its address specified in Schedule 6.01(n), and the offices where the ---------------- Company keeps all its books, records and documents evidencing Pool Receivables, the related Contracts and all agreements related to such Pool Receivables are located at the addresses specified in Schedule 6.01(n) (or at such ---------------- other locations, notified to the Administrator in accordance with Section 7.01(f), in jurisdictions where all action -------------- required by Section 8.05 has been taken and completed). ------------ (o) Lock-Box Accounts. The names and addresses of all ----------------- the Lock-Box Banks, together with the account numbers of the lock-box accounts of the Company at such Lock-Box Banks, are specified in Schedule 6.01(o) (or have been notified to the ---------------- Administrator in accordance with Section 7.04(d)). --------------- (p) Eligible Receivables. Each Receivable included in -------------------- the Net Pool Balance as an Eligible Receivable on the date of any calculation of the Borrowing Base shall be an Eligible Receivable on such date. (q) Capitalization. The authorized capital stock of -------------- the Company consists of one hundred (100) shares of common stock, $1.00 par value, of which all are currently issued and outstanding. All of such outstanding shares are validly issued, fully paid and nonassessable and are owned (beneficially and of record) by AnnTaylor. (r) Trade Names. Except as disclosed on Schedule ----------- -------- 6.01(r), the Company does not use any trade name other than ------ its actual corporate name. From and after the date that fell five (5) years before the date hereof, the Company has not been known by any legal name other than its corporate name as of the date hereof, nor has it been the subject of any merger or other corporate reorganization except as disclosed on Schedule 6.01(r). ------- (s) Taxes. The Company has filed all tax returns and ----- reports required by law to have been filed by it and has paid all taxes and governmental charges thereby shown to be owing, except any taxes not yet delinquent and any such taxes or charges which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its respective books. (t) Compliance with Applicable Laws. The Company is ------------------------------- in compliance in all material respects with the requirements of all applicable laws, rules, regulations, and orders of all governmental authorities (including, without limitation, Regulation Z, laws, rules and regulations relating to usury, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy and all other consumer laws, rules and regulations applicable to the Receivables and related Contracts), a breach of any of which, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. (u) Receivable Evidenced By Instruments. None of the ----------------------------------- Receivables is evidenced by an instrument (other than instruments received in connection with collection efforts, all of which shall be delivered, duly endorsed, to the Administrator if requested by the Administrator during the continuance of an Event of Default). SECTION 6.02. Representations and Warranties of AnnTaylor. ------------------------------------------- AnnTaylor, as Servicer, represents and warrants as follows: (a) Organization and Good Standing. It has been duly ------------------------------ organized and is validly existing as a corporation in good standing under the laws of the State of Delaware, with power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted. (b) Due Qualification. It is duly qualified to do ----------------- business as a foreign corporation in good standing, and has obtained all necessary licenses and approvals, in all jurisdictions in which the ownership or lease of property or the conduct of its business requires such qualification, licenses or approvals except where the failure to be in good standing or to so qualify has not had and will not have a Servicer Material Adverse Effect. (c) Power and Authority; Due Authorization. It (i) -------------------------------------- has all necessary power, authority and legal right to (A) execute and deliver this Agreement and the other Transaction Documents to which it is a party, and (B) carry out the terms of the Transaction Documents, in its capacity as Servicer, and (ii) has duly authorized by all necessary corporate action the execution, delivery and performance of this Agreement and the other Transaction Documents to which it is a party in its capacity as Servicer. (d) Binding Obligations. This Agreement constitutes, ------------------- and each other Transaction Document to be signed by it in its capacity as Servicer when duly executed and delivered will constitute, its legal, valid and binding obligation enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law. (e) No Violation. The consummation of the ------------ transactions contemplated by this Agreement and the other Transaction Documents to which AnnTaylor is a party in its capacity as Servicer, and the fulfillment of the terms hereof will not (i) conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time or both) a default under, the certificate of incorporation or by-laws of AnnTaylor or any indenture, loan agreement, receivables purchase agreement, mortgage, deed of trust, or other agreement or instrument to which AnnTaylor is a party or by which it or any of its properties is bound, except where such conflict, breach or default has not had and will not have a Servicer Material Adverse Effect, (ii) result in the creation or imposition of any Lien upon any of AnnTaylor's properties pursuant to the terms of any such indenture, loan agreement, receivables purchase agreement, mortgage, deed of trust, or other agreement or instrument, other than this Agreement, or (iii) violate any law or any order, rule, or regulation applicable to AnnTaylor of any court or of any federal or state regulatory body, administrative agency, or other governmental instrumentality having jurisdiction over AnnTaylor or any of its properties except where such violation has not had and will not have a Servicer Material Adverse Effect. (f) No Proceedings. There are no proceedings or -------------- investigations pending, or to AnnTaylor's knowledge threatened, before any court, regulatory body, administrative agency, or other tribunal or governmental instrumentality (i) asserting the invalidity of this Agreement or any other Transaction Document to which AnnTaylor is a party as Servicer, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or any other Transaction Document to which AnnTaylor is a party as Servicer, or (iii) seeking any determination or ruling that could reasonably be expected to have a Servicer Material Adverse Effect. (g) Government Approvals. No authorization or -------------------- approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for the due execution, delivery and performance by AnnTaylor of this Agreement or any other Transaction Document to which it is a party in its capacity as Servicer. (h) Financial Condition. (x) The consolidated ------------------- balance sheets of ATSC and its consolidated Subsidiaries as at July 29, 1995, and the related statements of income and shareholders' equity of ATSC and its consolidated Subsidiaries for the six months then ended, certified by a Responsible Officer of ATSC, copies of which have been furnished to the Administrator, fairly present the consolidated financial condition, business, business prospects and operations of ATSC and its consolidated Subsidiaries as at such date and the consolidated results of the operations of ATSC and its consolidated Subsidiaries for the period ended on such date, all in accordance with GAAP consistently applied; and (y) since July 29, 1995 there has been no material adverse change in any such condition, business, or operations. (i) Litigation. No injunction, decree or other ---------- decision has been issued or made by any court, governmental agency or instrumentality thereof that could reasonably be expected to have a Servicer Material Adverse Effect, and no written threat by any person has been made to attempt to obtain any such decision. (j) Accurate Reports. No Information Package (if ---------------- prepared by AnnTaylor or any of its Affiliates, (other than the Company), as Servicer, or to the extent information therein was supplied by AnnTaylor or any of its Affiliates (other than the Company), as Servicer, or other information, exhibit, financial statement, document, book, record or report furnished or to be furnished in writing by or on behalf of AnnTaylor or any of its Affiliates (other than the Company), as Servicer to the Administrator or Lender in connection with this Agreement was or will be inaccurate in any material respect (in light of the circumstances under which such information was furnished and taken as a whole together with all other information previously furnished or then being furnished) as of the date it was or will be dated or (except as otherwise disclosed to the Administrator and Lender at or prior to such time) as of the date so furnished, or contained or will contain any material misstatement of fact or omitted or will omit to state a material fact or any fact necessary to make the statements contained therein not materially misleading. (k) Offices. The chief place of business and chief ------- executive office of AnnTaylor is located at its address specified in Schedule 6.02(k), and the offices where --------------- AnnTaylor keeps all its books, records and documents evidencing Pool Receivables, the related Contracts and all agreements related to such Pool Receivables are located at the addresses specified in Schedule 6.02(k) (or at such --------------- other locations, notified to the Administrator in accordance with Section 7.01(f)). -------------- (l) Bank Accounts. The names and addresses of all ------------- banks with accounts in which Collections received at AnnTaylor's stores or its headquarters are deposited, together with the account numbers of such accounts are specified in Schedule 6.02(l) (or have been notified to the --------------- Administrator in accordance with Section 7.03(d)). --------------- (m) Servicing Programs. No further license or ------------------ approval is required for the Administrator's use of any program used by Servicer in the servicing of the Pool Receivables, other than those which have been obtained and are in full force and effect. (n) Taxes. AnnTaylor has filed all tax returns and ----- reports required by law to have been filed by it and has paid all taxes and governmental charges thereby shown to be owing, except any taxes not yet delinquent and any such taxes or charges which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its respective books. (o) Compliance with Applicable Laws. AnnTaylor, as ------------------------------- Servicer, is in compliance in all material respects with the requirements of all applicable laws, rules, regulations, and orders of all governmental authorities (including, without limitation, Regulation Z, laws, rules and regulations relating to usury, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy and all other consumer laws, rules and regulations applicable to the Receivables and related Contracts), a breach of any of which, individually or in the aggregate, could reasonably be expected to have a Servicer Material Adverse Effect. ========================================================================== ARTICLE VII GENERAL COVENANTS OF THE COMPANY AND ANNTAYLOR SECTION 7.01. Affirmative Covenants. From the date hereof --------------------- until the Final Payout Date, the Company and AnnTaylor each covenants, as to itself, that it will unless, in each case, the Administrator shall otherwise consent in writing: (a) Compliance with Laws, Etc. Comply in all material ------------------------- respects with all applicable laws, rules, regulations and orders with respect to the Pool Receivables and related Contracts except where such noncompliance has not had and will not have a Material Adverse Effect, in the case of this covenant by the Company, or Servicer Material Adverse Effect, in the case of this covenant by AnnTaylor. (b) Preservation of Corporate Existence. Preserve and ----------------------------------- maintain its corporate existence, rights, franchises and privileges in the jurisdiction of its incorporation, and qualify and remain qualified in good standing as a foreign corporation in each jurisdiction where the failure to preserve and maintain such existence, rights, franchises, privileges and qualification would have a Material Adverse Effect, in the case of this covenant by the Company, or Servicer Material Adverse Effect, in the case of this covenant by AnnTaylor. (c) Audits. (i) At any time and from time to time ------ during regular business hours, upon reasonable notice and in a manner designed not to unreasonably disrupt the normal business operations of AnnTaylor or the Company, permit the Administrator or any of its agents or representatives, (A) to examine and make copies of and abstracts from all books, records and documents (including, without limitation, computer tapes and disks) in its possession or under its control relating to the Receivables Pool, including, without limitation, the related Contracts and other agreements, and (B) to visit its offices and properties for the purpose of examining such materials described in clause (i)(A) next ------------ above, and to discuss matters relating to the Receivables Pool or its performance hereunder with any of its officers or employees having knowledge of such matters; and (ii) without limiting the provisions of clause (i) next above, ---------- from time to time on request of Administrator, permit certified public accountants or other auditors acceptable to the Administrator to conduct, at AnnTaylor's or the Company's expense, as the case may be, a review of its books and records; provided, however, that, unless an Event of Default has occurred and is continuing, AnnTaylor and the Company shall only be obligated to pay for (i) the out-of- pocket expenses of the internal auditors of the Administrator incurred with respect to such reviews done not more frequently than three times per year (and such expenses shall be subject to Section 14.05(a)) and (ii) in addition ---------------- to the amounts set forth in clause (i), the allocated cost --------- of the internal auditors of the Administrator with respect to such reviews done not more frequently than once a year. (d) Keeping of Records and Books of Account. Maintain --------------------------------------- and implement administrative and operating procedures (including, without limitation, an ability to recreate records evidencing Pool Receivables in the event of the destruction of the originals thereof), and keep and main tain, all documents, books, records and other information reasonably necessary or advisable for the collection of all Pool Receivables (including, without limitation, records adequate to permit the daily identification of each new Pool Receivable and all Collections of and adjustments to each existing Pool Receivable). (e) Performance and Compliance with Receivables and ----------------------------------------------- Contracts. At its expense timely and fully perform and --------- comply with all material provisions, covenants and other promises required to be observed by it under the Contracts related to the Pool Receivables and all other agreements related to such Pool Receivables. (f) Location of Records. Keep its chief place of ------------------- business and chief executive office, and the offices where it keeps its records concerning the Pool Receivables, all related Contracts and all other agreements related to such Pool Receivables (and all original documents relating thereto), at its address(es) referred to in Section 6.01(n) --------------- or 6.02(k), as the case may be, or, upon 30 days' prior ------- written notice to the Administrator, at such other locations in jurisdictions where all action required by Section 8.05 ------------ shall have been taken and completed. (g) Credit and Collection Policies. Comply in all ------------------------------ material respects with the Credit and Collection Policy in regard to each Pool Receivable and the related Contract. (h) Collections. Instruct all Obligors to cause all ----------- Collections of Pool Receivables to be deposited directly with a Lock-Box Bank. SECTION 7.02 Separate Corporate Existence. The Company ---------------------------- hereby acknowledges that Lender, the Liquidity Banks and the Administrator, are entering into the transactions contemplated by this Agreement and the other Transaction Documents in reliance upon the Company's identity as a legal entity separate from AnnTaylor. Therefore, from and after the date hereof, the Company shall take all steps specifically required by this Agreement or by the Lender or Administrator to continue the Company's identity as a separate legal entity and to make it apparent to third Persons that the Company is an entity with assets and liabilities distinct from those of Servicer, AnnTaylor and any other Person, and is not a division of Servicer, AnnTaylor or any other Person. Without limiting the generality of the foregoing and in addition to and consistent with the other covenants set forth herein, the Company shall take such actions as shall be required in order that: (a) The Company will be a limited purpose corporation whose primary activities are restricted in its certificate of incorporation to purchasing or otherwise acquiring from AnnTaylor, owning, holding, granting security interests, or selling interests, in Receivables, Contracts, Related Security and Collections from AnnTaylor, entering into agreements for the servicing and financing of the Receivables Pool, entering into interest rate agreements, spread account agreements and similar documents and conducting such other activities as it deems necessary or appropriate to carry out its primary activities; (b) Not less than one member of the Company's Board of Directors (the "Independent Director") shall be an -------------------- individual who is not a direct, indirect or beneficial stockholder, officer, director, employee, affiliate, associate, or supplier of the Company or any of its Affiliates. The certificate of incorporation of the Company shall provide that (i) the Company's Board of Directors shall not approve, or take any other action to cause the filing of, a voluntary bankruptcy petition with respect to the Company unless the Independent Director shall approve the taking of such action in writing prior to the taking of such action and (ii) such provision cannot be amended without the prior written consent of the Independent Director; (c) The Independent Director shall not at any time serve as a trustee in bankruptcy for the Company, AnnTaylor or any Affiliate thereof; (d) Any employee, consultant or agent of the Company will be compensated from the Company's funds for services provided to the Company. The Company will engage no agents other than its attorneys, auditors and other professionals, and a servicer for the Receivables Pool, which servicer will be fully compensated for its services to the Company by payment of the Servicer's Fee; (e) The Company will contract with Servicer to perform for the Company all operations required on a daily basis to service the Receivables Pool. The Company will pay Servicer the Servicer's Fee pursuant hereto. The Company will not incur any material indirect or overhead expenses for items shared between the Company and AnnTaylor (or any other Affiliate thereof) which are not reflected in the Servicer's Fee. To the extent, if any, that the Company and AnnTaylor (or any other Affiliate thereof) share items of expenses not reflected in the Servicer's Fee, such as legal, auditing and other professional services, such expenses will be allocated to the extent practical on the basis of actual use or the value of services rendered, and otherwise on a basis reasonably related to the actual use or the value of services rendered, it being understood that AnnTaylor shall pay all expenses relating to the preparation, negotiation, execution and delivery of the Transaction Documents, including, without limitation, legal, agency and other fees; (f) The Company's operating expenses will not be paid by AnnTaylor or any other Affiliate thereof; (g) The Company will have its own separate post office box and stationery; (h) The Company's books and records will be maintained separately from those of AnnTaylor and any other Affiliate thereof; (i) All financial statements of AnnTaylor or any Affiliate thereof that are consolidated to include the Company will contain detailed notes clearly stating that (A) all of the Company's assets are owned by the Company, and (B) the Company is a separate corporate entity with creditors who have received security interests in the Company's assets; (j) The Company's assets will be maintained in a manner that facilitates their identification and segregation from those of AnnTaylor or any Affiliate thereof; (k) The Company will strictly observe corporate formalities in its dealings with AnnTaylor or any Affiliate thereof, and funds or other assets of the Company will not be commingled with those of AnnTaylor or any Affiliate thereof. The Company shall not maintain joint bank accounts or other depository accounts to which AnnTaylor or any Affiliate thereof (other than AnnTaylor in its capacity as Servicer) has independent access; and (l) The Company will maintain arm's-length relationships with AnnTaylor (and any Affiliate thereof). Any Person that renders or otherwise furnishes services to the Company will be compensated by the Company at market rates for such services it renders or otherwise furnishes to the Company. Except as contemplated in the Transaction Documents neither the Company nor AnnTaylor will be or will hold itself out to be responsible for the debts of the other or the decisions or actions respecting the daily business and affairs of the other. SECTION 7.03. Reporting Requirements. From the date hereof ---------------------- until the Final Payout Date, the Company and AnnTaylor each covenants as to itself that it will, unless the Administrator shall otherwise consent in writing, furnish to the Administrator the items set forth in paragraphs (a), (b), (g), (h), (i), (j), -------------- --- --- --- --- --- (k) and (m) in the case of the Company and the items set forth in - - --- --- paragraphs (c), (d), (e), (f), (g), (h), (i), (k), (l) and (m) in - - ---------- --- --- --- --- --- --- --- --- --- --- the case of AnnTaylor: (a) Monthly Financial Statements - the Company. As ------------------------------------------ soon as available and in any event within 45 days after the end of each month copies of the financial statements of the Company prepared in conformity with GAAP (but subject to year end audit adjustments), duly certified by a Responsible Officer of the Company; (b) Annual Financial Statements - the Company. As ----------------------------------------- soon as available and in any event within 90 days after the end of each fiscal year of the Company, copies of the financial statements of the Company prepared in conformity with GAAP, including a footnote containing the aggregate Unpaid Balance of the Pool Receivables, the Unpaid Balance of the Delinquent Receivables and of the Defaulted Receivables, duly certified by independent certified public accountants of recognized standing selected by the Company; (c) Quarterly Financial Statements - ATSC. As soon as ------------------------------------- available and in any event within 45 days after the end of each fiscal quarter of ATSC, copies of the financial statements of ATSC and its Subsidiaries prepared on a consolidated basis in conformity with GAAP, duly certified by a Responsible Officer of ATSC, together with a certificate from such officer containing a computation of, and showing compliance with, the financial restrictions contained in Sections 7.05(d) and (e); ---------------- --- (d) Annual Financial Statements - ATSC. As soon as ---------------------------------- available and in any event within 90 days after the end of each fiscal year of ATSC, copies of the financial statements of ATSC and its Subsidiaries prepared on a consolidated basis in conformity with GAAP, duly certified by independent certified public accountants of recognized standing selected by ATSC, together with a certificate from such accountants containing a computation of, and showing compliance with, the financial restrictions contained in Sections 7.05(d) and ---------------- (e); --- (e) Financial Statements - AnnTaylor. As soon as -------------------------------- practicable after requested by the Administrator, copies of the financial statements of AnnTaylor and its Subsidiaries prepared on a consolidated basis in conformity with GAAP, duly certified by a Responsible Officer of AnnTaylor; (f) Reports to Holders and Exchanges. In addition to -------------------------------- the reports required by subsections (a), (b), (c), (d) and --------------- --- --- --- (e) next above, promptly upon the Administrator's request, --- copies of any reports which ATSC sends to any of its securityholders, and any reports or registration statements that ATSC files with the Securities and Exchange Commission or any national securities exchange other than registration statements relating to employee benefit plans and to registrations of securities for selling securities; (g) ERISA. Promptly after the filing or receiving ----- thereof, copies of all reports and notices with respect to any Reportable Event defined in Article IV of ERISA as to which the 30-day notice requirement has not been waived by the Pension Benefit Guaranty Corporation which ATSC, the Company or AnnTaylor, as the case may be, files under ERISA with the Internal Revenue Service, the Pension Benefit Guaranty Corporation or the U.S. Department of Labor or which the Company or AnnTaylor, as the case may be, receives from the Pension Benefit Guaranty Corporation; (h) Events of Default. As soon as possible and in any ----------------- event within five days after a Responsible Officer of the Company or AnnTaylor, as the case may be, has knowledge of the occurrence of each Event of Default and each Unmatured Event of Default, a written statement of a Responsible Officer of the Company or AnnTaylor, as the case may be, setting forth details of such event and the action that the Company proposes to take with respect thereto; (i) Litigation. As soon as possible and in any event ---------- within five Business Days of the Company's or AnnTaylor's, as the case may be, knowledge thereof, notice of (i) any litigation, investigation or proceeding which may exist at any time could reasonably be expected to have a Material Adverse Effect and (ii) any material adverse development in previously disclosed litigation; (j) Management Report. As soon as available, a copy ----------------- of the annual management report of ATSC prepared in connection with the annual audit referred to in Section ------- 7.03(d). ------ (k) Change in Credit and Collection Policy. Prior to -------------------------------------- its effective date, notice of any change in the Credit and Collection Policy; (l) Bank Accounts. On or prior to each January 27th ------------ and, during the continuance of an Event of Default, as often as requested by the Administrator, an updated and corrected Schedule 6.02(l); and --------------- (m) Other. Promptly, from time to time, such other ----- information, documents, records or reports respecting the Pool Receivables or the condition or operations, financial or otherwise, of the Company or AnnTaylor, as the case may be, as the Administrator may from time to time reasonably request in order to protect the interests of the Administrator or Lender under or as contemplated by this Agreement. SECTION 7.04. Negative Covenants of the Company. From the --------------------------------- date hereof until the Final Payout Date, the Company will not without the prior written consent of the Administrator: (a) Sales, Liens, Etc. Except as otherwise provided ----------------- herein or in the Purchase Agreement, sell, assign (by operation of law or otherwise) or otherwise dispose of, or create or suffer to exist any Lien upon or with respect to, the Receivables Pool, or any interest therein, or any lock- box account to which any Collections of any Pool Receivable are sent, or any right to receive income or proceeds from or in respect of any of the foregoing. (b) Extension or Amendment of Receivables. Except in ------------------------------------- accordance with the Credit and Collection Policy as permitted in Section 8.02, extend, amend or otherwise modify ------------ the terms of any Pool Receivable, or amend, modify or waive any term or condition of any Contract related thereto. (c) Change in Business or Credit and Collection ------------------------------------------- Policy. Make any change in the character of its business or ------ in the Credit and Collection Policy, which change would, in either case, adversely affect the collectability of a significant portion of the Pool Receivables or otherwise adversely affect the first priority, perfected security interest or remedies of Lender under this Agreement or any other Transaction Document or, without limiting the generality of the foregoing, change the method of calculating aging, which method is described in the Credit and Collection Policy. (d) Change in Payment Instructions to Obligors. Add ------------------------------------------ or terminate any bank as a Lock-Box Bank from those listed in Schedule 6.01(o) or make any change in its instructions ---------------- to Obligors regarding payments to be made to the Company or Servicer or payments to be made to any Lock-Box Bank, unless the Administrator shall have received notice of such addition, termination or change and duly executed copies of Lock-Box Agreements with each new Lock-Box Bank. (e) Mergers, Acquisitions, Sales, etc. Be a party to --------------------------------- any merger or consolidation, or purchase or otherwise acquire all or substantially all of the assets or any stock of any class of, or any partnership or joint venture interest in, any other Person, or sell, transfer, convey or lease all or any substantial part of its assets (other than pursuant hereto and the Purchase Agreement), or sell or assign with or without recourse any Receivables or any interest therein (other than pursuant hereto or the Purchase Agreement). (f) Restricted Payments. Purchase or redeem any ------------------- shares of the capital stock of the Company, declare or pay any dividends thereon (other than stock dividends), make any distribution to stockholders or set aside any funds for any such purpose, or make any payment in cash with respect to the Company Note (as defined in the Purchase Agreement) issued pursuant to the Purchase Agreement, unless after giving effect thereto, the Company's Net Worth is at least $850,000. (g) Deposits to Special Accounts. Deposit or ---------------------------- otherwise credit, or cause or permit to be so deposited or credited, to any Lock-Box Account cash or cash proceeds other than Collections of Pool Receivables. (h) Incurrence of Indebtedness. Incur or permit to -------------------------- exist any indebtedness or liability on account of deposits or advances or for borrowed money or for the deferred purchase price of any property or services, except (i) indebtedness not exceeding in the aggregate $4,995 at any one time outstanding, (ii) the Company's obligations hereunder or under the other Transaction Documents and (iii) the Company's obligations under a reimbursement agreement related to the Customer Letter of Credit, provided that such -------- obligations are subordinate to the Company's obligations hereunder and under the Note and the parties thereto have agreed to non-petition language with respect to the Company reasonably satisfactory to the Administrator. (i) Purchase Agreement. Amend or waive any provision ------------------ of the Purchase Agreement, or terminate the Purchase Agreement, other than pursuant to the amendment dated the date hereof. (j) Certificate of Incorporation. Amend, repeal or ---------------------------- waive Articles III, VII, X, XI, XII or XIV of its certificate of incorporation, other than the amendment thereto on or about the date hereof made in connection with the amendment and restatement of this Agreement. SECTION 7.05 Negative Covenants of AnnTaylor. From the ------------------------------- date hereof until the Final Payout Date, AnnTaylor will not, without the prior written consent of the Administrator: (a) Conduct of Business. Engage in any business other ------------------- than the business engaged in by AnnTaylor on the date hereof and any business activities substantially similar or related thereto. (b) Mergers, Acquisitions, etc. Be a party to any -------------------------- merger, consolidation, or purchase or otherwise acquire all or substantially all of the assets or any stock of any class of, or any partnership or joint venture interest in, any other person, or, except in the ordinary course of its business, sell, transfer, convey or lease all or any substantial part of its assets, or sell or assign with or without recourse any Receivables or any interest therein other than: (i) pursuant to the Purchase Agreement; (ii) licenses of trademarks to the extent necessary to maintain or protect such trademarks in jurisdictions outside the United States of America; (iii) any sale or disposition of AnnTaylor's interest in the CAT Joint Venture pursuant to the CAT Joint Venture Agreement; (iv) any purchase or acquisition of any assets among AnnTaylor and its Restricted Subsidiaries; it being understood that AnnTaylor shall be permitted to incorporate new Restricted Subsidiaries; (v) any purchase or acquisition of any interest in joint ventures (in the form of corporations, partnerships or otherwise) in a maximum amount not exceeding $10,000,000 at any one time outstanding; (vi) any purchase or acquisition of any assets or capital stock in Unrestricted Subsidiaries in an amount not to exceed $1,000,000 at any one time outstanding; (vii) any purchase or acquisition of any assets or capital stock in the CAT Joint Venture pursuant to the CAT Joint Venture Agreement in an amount not to exceed 15% of Net Worth; and (viii) any merger or consolidation of any Subsidiary (other than the Company) into or with AnnTaylor, so long as AnnTaylor is the surviving corporation. (c) Restricted Payments. Violate the provisions of ------------------- Section 8.05 of the AnnTaylor Credit Agreement as in effect ------------ from time to time or, if the AnnTaylor Credit Agreement is terminated or cancelled or it expires, as in effect immediately prior to such termination, cancellation or expiration (and such provisions, and the definitions related thereto, are herein incorporated by reference as if fully set forth herein). (d) Net Worth. Permit Net Worth as determined at the --------- end of any fiscal quarter (beginning with the fiscal quarter ending on or about January 28, 1995) to be less than the Net Worth on or about October 30, 1994 plus (a) 50% of Net Income after October 30, 1994 (without deducting from such cumulative amount the amount of any net loss incurred in any fiscal year except extraordinary losses associated with the redemption or repurchase of indebtedness) plus (b) 100% of the net proceeds of any equity issue or conversion of debt to equity subsequent to October 30, 1994 minus (c) any ----- expenses related to the payments for ATSC's share of expenses incurred in connection with any public offering of common stock minus (d) payments by ATSC or AnnTaylor to acquire shares of common stock from employees of ATSC, AnnTaylor or any Restricted Subsidiary in an aggregate amount not exceeding $100,000 in any fiscal year. (e) Fixed Charge Coverage Ratio. Permit the Fixed --------------------------- Charge Coverage Ratio, as determined at (i) the end of the fiscal quarter ended in October of 1995 for such fiscal quarter to be less than 0.45 to 1.00 and (ii) the end of any fiscal quarter for the preceding four fiscal quarters (or, if less, the number of full fiscal quarters elapsed since October 28, 1995) to be less than the ratio set forth opposite the month in which such fiscal quarter ends: Quarter Ended Minimum Ratio ------------- ------------- January 1996 0.75 to 1.00 April 1996 1.00 to 1.00 July 1996 1.10 to 1.00 October 1996 1.15 to 1.00 January 1997 and thereafter 1.25 to 1.00 (f) Purchase Agreement. Amend or waive any provision ------------------ of the Purchase Agreement, or terminate the Purchase Agreement, except for the amendment to the Purchase Agreement dated the date hereof. ==================================================================== ARTICLE VIII ADMINISTRATION AND COLLECTION SECTION 8.01. Designation of Servicer. ----------------------- (a) AnnTaylor as Initial Servicer. The servicing, ----------------------------- administering and collection of the Pool Receivables shall be conducted by the Person designated as Servicer hereunder ("Servicer") from time to time in accordance with this Section ------- 8.01. Until the Administrator gives to AnnTaylor a Successor - - ---- Notice (as defined in Section 8.01(b)), AnnTaylor is hereby --------------- designated as, and hereby agrees to perform the duties and obligations of, Servicer pursuant to the terms hereof. (b) Successor Notice; Servicer Transfer Events. Upon ----------------------------------------- AnnTaylor's receipt of a notice from the Administrator of the Administrator's designation of a new Servicer (a "Successor --------- Notice"), AnnTaylor agrees that it will terminate its activities - - ------ as Servicer hereunder in a manner that the Administrator believes will facilitate the transition of the performance of such activities to the new Servicer, and the Administrator (or its designee) shall assume each and all of AnnTaylor's obligations to service and administer such Receivables, on the terms and subject to the conditions herein set forth, and AnnTaylor shall use its best efforts to assist the Administrator (or its designee) in assuming such obligations, including, without limitation, by allowing the Administrator (or its designee) access to all computer software and programs used by AnnTaylor to service the Pool Receivables. The Administrator agrees not to give AnnTaylor a Successor Notice until after the occurrence and only during the continuance of any Event of Default (any such Event of Default being herein called a "Servicer Transfer Event"), in which case ----------------------- such Successor Notice may be given at any time in the Administrator's discretion. If AnnTaylor disputes the occurrence of a Servicer Transfer Event, AnnTaylor may take appropriate action to resolve such dispute provided that AnnTaylor must -------- terminate its activities hereunder as Servicer and allow the newly designated Servicer to perform such activities on the date provided by the Administrator as described above, notwithstanding the commencement or continuation of any proceeding to resolve the aforementioned dispute. (c) Subcontracts. Servicer may, with the prior consent of ------------ the Administrator, subcontract with any other Person for servicing, administering or collecting the Pool Receivables, provided that Servicer shall remain liable for the performance of the duties and obligations of Servicer pursuant to the terms hereof. SECTION 8.02. Duties of Servicer. ------------------ (a) Appointment; Duties in General. Each of the Company, ------------------------------ Lender and the Administrator hereby appoints as its agent Servicer, as from time to time designated pursuant to Section 8.01, to enforce its rights and interests in and under the Pool Receivables, the Related Security and the related Contracts. Servicer shall take or cause to be taken all such actions as may be necessary or advisable to collect each Pool Receivable from time to time, all in accordance with applicable laws, rules and regulations, with reasonable care and diligence, and in accordance with the Credit and Collection Policy. (b) Allocation of Collections; Segregation. Servicer shall -------------------------------------- set aside for the account of the Lender the Collections of Pool Receivables as set forth in Section 3.01, but shall not be ------------ required (unless otherwise requested by the Administrator after the occurrence and during the continuance of an Event of Default) to segregate the funds constituting such portions of such Collections prior to the remittance thereof in accordance with such Section. If instructed by the Administrator after the occurrence and during the continuance of an Event of Default, Servicer shall segregate and deposit with a bank designated by the Administrator, the Collections of Pool Receivables, on the second Business Day following receipt by Servicer of such Collections in immediately available funds. Such Collections shall be applied in accordance with Section 3.01. ------------ (c) Modification of Receivables. So long as AnnTaylor is --------------------------- the Servicer, Servicer may, (A) in accordance with the Credit and Collection Policy, (i) extend the maturity of, or defer interest payments or finance charges with respect to, any Pool Receivable as Servicer may determine to be appropriate to maximize Collections thereof, and (ii) adjust the Unpaid Balance of any Receivable to reflect the reductions or cancellations described in the first sentence of Section 3.02(a) or (B) as a result of a -------------- --- natural disaster, extend the maturity or defer interest payments or finance charges with respect to any Pool Receivable of an Obligor that is located in the area affected by such natural disaster as Servicer may determine; provided that the aggregate -------- Unpaid Balance of such extended or deferred Pool Receivables does not exceed 3% of Outstanding Principal. (d) Documents and Records. The Company shall deliver to --------------------- Servicer, and Servicer shall hold for the sole benefit of the Company and Lender in accordance with their respective interests, all documents, instruments and records (including, without limitation, computer tapes or disks) that evidence or relate to Pool Receivables. (e) Certain Duties to the Company. Servicer, if other than ----------------------------- AnnTaylor, shall, as soon as practicable upon demand, deliver to the Company copies of all documents, instruments and records in its possession that evidence or relate to Pool Receivables. (f) Termination. Servicer's authorization under this ----------- Agreement shall terminate upon the Final Payout Date. (g) Power of Attorney. The Company hereby grants to ----------------- Servicer an irrevocable power of attorney, with full power of substitution, coupled with an interest, to take in the name of the Company all steps which are necessary or advisable to endorse, negotiate or otherwise realize on any writing or other right of any kind held or transmitted by the Company or transmitted or received by Lender (whether or not from the Company) in connection with any Pool Receivable. (h) Information. Servicer shall take such steps as shall ----------- be necessary to enable it to provide complete and accurate information, within five (or, if an Event of Default is continuing, one) Business Day(s) of request, to the Administrator, with respect to the daily amounts and corresponding locations of those Collections received by the Company that have not been sent directly to the Lock-Box Banks. SECTION 8.03. Rights of the Administrator. --------------------------- (a) Notice to Obligors. At any time after the occurrence ------------------ and during the continuance of an Event of Default the Administrator may notify the Obligors of Pool Receivables, or any of them, of the security interest held by Lender. (b) Notice to Lock-Box Banks. At any time following the ------------------------ occurrence and during the continuance of a Event of Default the Administrator is hereby authorized to give notice to the Lock-Box Banks, as provided in the Lock-Box Agreements, of the transfer to the Administrator of dominion and control over the lock-boxes and related accounts to which the Obligors of Pool Receivables make payments. The Company hereby transfers to the Administrator, effective when the Administrator shall give notice to the Lock- Box Banks as provided in the Lock-Box Agreements, the exclusive dominion and control over such lock-boxes and accounts, and shall take any further action that the Administrator may reasonably request to effect such transfer. To the extent that the Lock-Box Banks are transferring Collections directly to the Administrator or pursuant to instructions from the Administrator, neither the Company nor the Servicer shall have any obligation to pay over such Collections pursuant to Section 3.01(b). The Administrator --------------- hereby agrees that upon the request of the Company (i) at and after such time that this Agreement is no longer in effect, it will provide written notice to the Lock-Box Banks and any bank referred to in Section 7.01(i) to such effect and (ii) unless an -------------- Event of Default is then continuing, it will within one Business Day of such request by the Company deliver instructions to any Lock-Box Bank whose Lock-Box Agreement has been cancelled or terminated directing that mail addressed to the lock-box account, administered by such Lock-Box Bank be forwarded to another Lock- Box Bank as specified in such request by the Company. (c) Rights on Servicer Transfer Event. At any time --------------------------------- following a Servicer Transfer Event: (i) The Administrator may direct the Obligors of Pool Receivables, or any of them, to pay all amounts payable under any Pool Receivable directly to the Administrator. (ii) AnnTaylor shall, at the Administrator's request and at AnnTaylor's expense, give notice of the Lender's security interest to each Obligor and direct that payments be made directly to the Administrator. (iii) AnnTaylor shall, at the Administrator's request, (A) assemble all of the documents, instruments and other records (including, without limitation, computer programs, tapes and disks) which evidence the Pool Receivables, and the related Contracts and Related Security, or which are otherwise necessary or desirable to collect such Pool Receivables, and make the same available to the Administrator at a place selected by the Administrator, and (B) segregate all cash, checks and other instruments received by it from time to time constituting Collections of Pool Receivables in a manner acceptable to the Administrator and promptly upon receipt, remit all such cash, checks and instruments, duly endorsed or with duly executed instruments of transfer, to the Administrator. (iv) Each of AnnTaylor, the Company and Lender hereby authorizes the Administrator, and grants to the Administrator an irrevocable power of attorney, to take any and all steps in the Company's or AnnTaylor's name and on behalf of the Company, AnnTaylor and Lender which are necessary or desirable, in the determination of the Administrator, to collect all amounts due under any and all Pool Receivables, including, without limitation, endorsing the Company's or AnnTaylor's name on checks and other instruments representing Collections and enforcing such Pool Receivables and the related Contracts; provided that the Administrator shall not exercise its rights under such power of attorney unless a Servicer Transfer Event shall have occurred and be continuing. SECTION 8.04. Responsibilities of the Company. Anything ------------------------------- herein to the contrary notwithstanding: (a) Contracts. The Company shall perform all of its ---------- obligations under the Contracts related to the Pool Receivables and under the other agreements related thereto to the same extent as if the security interest had not been granted hereunder and the exercise by the Administrator or its designee of its rights hereunder shall not relieve the Company from such obligations. (b) Limitation of Liability. Neither the Administrator nor ----------------------- Lender shall have any obligation or liability with respect to any Pool Receivables, the Contracts related thereto or any other agreements related thereto, nor shall any of them be obligated to perform any of the obligations of the Company thereunder. SECTION 8.05. Further Action Evidencing Security Interest. ------------------------------------------- (a) Further Assurances. The Company agrees that from time ------------------ to time, at its expense, it will promptly execute and deliver all further instruments and documents, and take all further action that the Administrator or its designee may reasonably request in order to perfect or more fully evidence the security interest granted hereunder, or to enable Lender or the Administrator or its designee to exercise or enforce any of their respective rights hereunder or under any Transaction Document. Without limiting the generality of the foregoing, the Company will upon the request of the Administrator or its designee: (i) execute and file such financing or continuation statements, or amendments thereto or assignments thereof, and such other instruments or notices, as may be necessary or appropriate; (ii) mark its summary master control data processing records evidencing such Pool Receivables and related Contracts with a legend, acceptable to the Administrator, that the Pool Receivable and related Contracts have been pledged hereunder. (b) Additional Financing Statements; Performance by ----------------------------------------------- Administrator. The Company hereby authorizes the Administrator - - ------------ or its designee to file one or more financing or continuation statements, and amendments thereto and assignments thereof, relative to all or any portion the Receivables Pool now existing or hereafter arising in the name of the Company. If the Company fails to perform any of its agreements or obligations under this Agreement, the Administrator or its designee may (but shall not be required to) itself perform, or cause performance of, such agreement or obligation, and the expenses of the Administrator or its designee incurred in connection therewith shall be payable by the Company as provided in Section 14.05. ------------- (c) Continuation Statements; Opinion. Without limiting the -------------------------------- generality of subsection (a), the Company will, not earlier than -------------- six (6) months and not later than three (3) months prior to the fifth anniversary of the date of filing of the financing statement referred to in Section 5.01(e) of the Original -------------- Financing Agreement or any other financing statement filed pursuant to this Agreement or in connection with any Loan hereunder, unless the Final Payout Date shall have occurred execute and deliver and file or cause to be filed an appropriate continuation statement with respect to such financing statement. SECTION 8.06. Application of Collections. Any payment by -------------------------- an Obligor in respect of any indebtedness owed by it to the Company shall, except as otherwise specified by such Obligor, required by the underlying Contract or law be applied, first, as ----- a Collection of any Finance Charge Receivable or Receivables that are Pool Receivables then outstanding of such Obligor in the order of the age of such Finance Charge Receivables, starting with the oldest of such Finance Charge Receivable, second, as a ------ Collection of any Principal Receivable or Receivables that are Pool Receivables then outstanding of such Obligor in the order of the age of such Principal Receivables, starting with the oldest of such Principal Receivable, and third, to any other ----- indebtedness of such Obligor. ====================================================================== ARTICLE IX SECURITY INTEREST SECTION 9.01. Grant of Security Interest. To secure all -------------------------- obligations of the Company arising in connection with this Agreement, the Note and each other Transaction Document, whether now or hereafter existing, due or to become due, direct or indirect, or absolute or contingent, including, without limitation, the principal of and interest on the Loans, all Indemnified Amounts, payments on account of deemed Collections and fees, the Company hereby assigns and grants to Lender a continuing security interest in all of the Company's right, title and interest, now or hereafter existing, in, to and under the Receivables Pool (other than the Spread Account, it being understood that the Company has granted a continuing security interest in the Spread Account to the Lender under the Spread Account Agreement). SECTION 9.02. Remedies. Upon the occurrence and during the -------- continuance of an Event of Default, Lender shall have, with respect to the collateral granted pursuant to Section 9.01, and ------------ in addition to all other rights and remedies available to Lender or the Administrator under this Agreement or other applicable law, all the rights and remedies of a secured party upon default under the UCC. ==================================================================== ARTICLE X EVENTS OF DEFAULT SECTION 10.01. Events of Default. The following events ----------------- shall be "Events of Default" hereunder: ----------------- (a) (i) The Company shall fail to pay any principal of, or interest on, any Loan when due (whether or not sufficient Collections have then been received to make such payment) or (ii) Servicer (if AnnTaylor or its Affiliate is Servicer) shall fail to perform or observe any term, covenant or agreement that is an obligation of Servicer hereunder (other than as referred to in clause (iii) next ------------ following) and such failure shall remain unremedied for three Business Days or (iii) Servicer (if AnnTaylor or its Affiliate is Servicer) shall fail to make any payment or deposit to be made by it hereunder when due; or (b) Any representation or warranty made or deemed to be made by the Company or AnnTaylor (or any of their respective officers) under or in connection with this Agreement shall prove to have been false or incorrect in any material respect when made (other than a breach of the representations set forth in Section 6.01(l), 6.01(p) or ----------------------- 6.01(u)); or ------ (c) The Company or AnnTaylor shall fail to perform or observe any other term, covenant or agreement contained in this Agreement or any of the other Transaction Documents on its part to be performed or observed and any such failure shall remain unremedied for twenty days; or (d) A default shall have occurred and be continuing under any instrument or agreement evidencing, securing or providing for the issuance of indebtedness for borrowed money in excess of $2,000,000 of, or guaranteed by, AnnTaylor, ATSC or any Restricted Subsidiary, which default if unremedied, uncured, or unwaived (with or without the passage of time or the giving of notice or both) would permit acceleration of the maturity of such indebtedness and such default shall have continued unremedied, uncured or unwaived for a period long enough to permit such acceleration and any notice of default required to permit acceleration shall have been given; or any default under any agreement or instrument relating to the purchase of receivables of AnnTaylor, ATSC or any Restricted Subsidiary, or any other event, shall occur and shall continue after the applicable grace period, if any, specified in such agreement or instrument, if the effect of such default is to terminate, or permit the termination of, the commitment of any party to such agreement or instrument to purchase receivables or the right of AnnTaylor, ATSC or any Restricted Subsidiary to reinvest in receivables the principal amount paid by any party to such agreement or instrument for interest in receivables; or (e) An Event of Bankruptcy shall have occurred and remain continuing with respect to the Company, AnnTaylor, ATSC or any Restricted Subsidiary; or (f) The Net Yield at any time is less than -2%; or (g) The Gross Default-to-Liquidation Ratio exceeds 2.00% or the Net Default to Liquidation Ratio exceeds 1.45%; or (h) The Payment Rate is less than 22%; or (i) The Delinquency Ratio at any Cut-Off Date is greater than 11.5% or the average of the Delinquency Ratios for the most recent three Cut-Off Dates is greater than 11%; or (j) There shall exist any event, circumstance or occurrence that would be reasonably likely to have a material adverse effect on the validity or enforceability of this Agreement, the Note or any other Transaction Document or on the status, existence, perfection, priority or enforceability of Lender's interest in the Receivables Pool; or (k) The warranty in Section 6.01(i)(y) shall not be ------------------ true at any time; or (l) The occurrence of a Change-in-Control; or (m) The Internal Revenue Service shall file notice of a lien pursuant to Section 6323 of the Internal Revenue Code with regard to any of the assets of the Company and such lien shall not have been released within 5 days (or 30 days, if payment in full with respect thereto shall have been made within 5 days), or the Pension Benefit Guaranty Corporation shall file notice of a lien pursuant to Section 4068 of ERISA with regard to any of the assets of the Company; or (n) The Dilution Ratio exceeds 15%; or (o) The sum of (i) the balance in the Spread Account and (ii) the stated amount of the Customer Letter of Credit as of any Settlement Date, after giving effect to all withdrawals therefrom or draws thereupon on such date, shall be less than 0.5% of the then Outstanding Principal; or (p) The Outstanding Principal shall exceed the Borrowing Base as set forth in the most recently delivered Information Package (or portion thereof) and the Company shall not have prepaid the Loan in the amount of such excess within one Business Day. SECTION 10.02. Remedies. -------- (a) Optional Acceleration. Upon the occurrence of a Event --------------------- of Default (other than a Event of Default described in subsection ---------- (e) of Section 10.01), the Administrator shall, at the request, - - --- ------------- or may with the consent, of Lender, by notice to the Company declare the Loan Termination Date to have occurred, whereupon the obligation of Lender to make any Loans hereunder shall immediately terminate, and declare the unpaid principal amount of, and any and all accrued and unpaid interest on the Loans to be, and the same shall thereupon be, immediately due and payable, without presentment, further demand, or protest or other requirement of any kind, all of which are expressly waived by the Company. (b) Automatic Acceleration. Upon the occurrence of a Event ---------------------- of Default described in subsection (e) of Section 10.01 with ------------- respect to the Company, AnnTaylor or ATSC, or subsection (f), -------------- (g), (h), (i), (n), (o) or (p) of Section 10.01, the Loan - - --- --- --- --- --- --- ------------- Termination Date shall occur automatically, whereupon the obligation of Lender to make any Loan hereunder shall immediately terminate, and the unpaid principal amount of and any and all accrued interest on the Loans shall automatically become immediately due and payable, without presentment, demand or protest or other requirement of any kind, all of which are hereby expressly waived by the Company. (c) Additional Remedies. Upon any Loan Termination Date ------------------- pursuant to this Section 10.02, no Loans thereafter will be made, ------------- and the Administrator and Lender shall have, in addition to all other rights and remedies under this Agreement or otherwise, all other rights and remedies provided to secured parties under the UCC of each applicable jurisdiction and other applicable laws, which rights shall be cumulative. ====================================================================== ARTICLE XI THE ADMINISTRATOR SECTION 11.01. Authorization and Action. Lender has ------------------------ appointed and authorized the Administrator (or its designees) to take such action as agent on its behalf and to exercise such powers under this Agreement as are delegated to the Administrator by the terms hereof, together with such powers as are reasonably incidental thereto. SECTION 11.02. Administrator's Reliance, Etc. The ----------------------------- Administrator and its directors, officers, agents or employees shall not be liable for any action taken or omitted to be taken by it or them under or in connection with the Transaction Documents (including, without limitation, the servicing, administering or collecting Pool Receivables as Servicer pursuant to Section 8.01), except for its or their own gross negligence or ------------ willful misconduct. Without limiting the generality of the foregoing, the Administrator: (a) may consult with legal counsel (including counsel for the Company or AnnTaylor), independent certified public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (b) makes no warranty or representation to Lender or any other holder of any interest in Pool Receivables and shall not be responsible to Lender or any such other holder for any statements, warranties or representations made in or in connection with any Transaction Document; (c) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of any Transaction Document by the Company or AnnTaylor, or to inspect the property (including the books and records) of the Company or AnnTaylor; (d) shall not be responsible to Lender or any other holder of any interest in Pool Receivables for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of any Transaction Document; and (e) shall incur no liability under or in respect of this Agreement by acting upon any notice (including notice by telephone), consent, certificate or other instrument or writing (which may be by facsimile or telex) believed by it to be genuine and signed or sent by the proper party or parties. SECTION 11.03. PNC Bank and Affiliates. PNC Bank and any ----------------------- of its Affiliates may generally engage in any kind of business with the Company, AnnTaylor or any Obligor, any of their respective Affiliates and any Person who may do business with or own securities of the Company, AnnTaylor or any Obligor or any of their respective Affiliates, all as if PNC Bank were not the Administrator, and without any duty to account therefor to Lender or any other holder of an interest in Pool Receivables. ========================================================================== ARTICLE XII ASSIGNMENT OF LENDER'S INTEREST SECTION 12.01. Restrictions on Assignments. --------------------------- (a) Neither the Company, nor AnnTaylor, as Servicer, may assign its rights, or delegate its duties hereunder or any interest herein without the prior written consent of the Administrator. Lender may not assign its rights hereunder (although it may delegate its duties hereunder as expressly indicated herein) or the Loans (or any portion thereof) to any Person without the prior written consent of the Company, which consent shall not be unreasonably withheld; provided, however, ----------------- that (i) Lender may assign all of its rights and interests in the Transaction Documents, together with all its interest in the Loans, to PNC Bank, or any Affiliate of PNC Bank, or to any "bankruptcy remote" special purpose entity the business of which is administered by PNC Bank or any Affiliate of PNC Bank or to any Program Support Provider; provided, however, no such assignment may be made unless the ---------------- assignee shall agree with the Company that the Company shall not be obligated to pay interest on the Loans in excess of the interest that the Company would have been obligated to pay absent such assignment, unless an Event of Default has occurred and is continuing; and (ii) Lender may assign and grant a security interest or a participating interest in all of its rights in the Transaction Documents, together with all of its rights and interest in the Loans, to the Liquidity Agent or any Program Support Provider, to secure Lender's obligations under or in connection with the Commercial Paper Notes, the Liquidity Agreement and any other Program Support Agreement, and certain other obligations of Lender incurred in connection with the funding of the Loans hereunder, which assignment and grant of a security interest or a participating interest shall not be considered an "assignment" for purposes of Section 12.01 or, prior to the enforcement of such security interest, for purposes of any other provision of this Agreement. The parties hereto anticipate that Market Street Capital Corp. will assign all of its rights and obligations under this Agreement and the other Transaction Documents to Market Street Funding Corporation, a Delaware corporation ("Funding"). The ------- Company and AnnTaylor hereby consent to such assignment, and agree that upon receipt by AnnTaylor of notice of such assignment by PNC Bank, (i) all references herein and in the other Transaction Documents to "Lender" shall be deemed to refer to Funding and (ii) all references herein and in the other Transaction Documents to the "Administrator" shall refer to PNC Bank, as administrator for Funding. The Company and AnnTaylor hereby agree to execute and deliver such documents and instruments, including UCC financing statements, as the Administrator may reasonably request to evidence such assignment. (b) The Company agrees to advise the Administrator within five Business Days after notice to the Company of any proposed assignment by Lender of the Loans (or any portion thereof), not otherwise permitted under subsection (a), of the Company's ------------- consent or non-consent to such assignment and if it does not consent, the reasons therefor. If the Company does not consent to such assignment, Lender may immediately assign such Loans (or portion thereof) to PNC Bank or any Affiliate of PNC Bank. All of the aforementioned assignments shall be upon such terms and conditions as Lender and the assignee may mutually agree. SECTION 12.02. Rights of Assignee. Upon the assignment by ------------------ Lender in accordance with this Article XII, the assignee ----------- receiving such assignment shall have all of the rights of Lender with respect to the Transaction Documents and the Loans (or such portion thereof as has been assigned). SECTION 12.03. Evidence of Assignment. Any assignment of ---------------------- the Loans (or any portion thereof) to any Person may be evidenced by such instrument(s) or document(s) as may be satisfactory to Lender, the Administrator and the assignee. ========================================================================== ARTICLE XIII INDEMNIFICATION SECTION 13.01. Indemnities. ---------- (a) General Indemnity. Without limiting any other rights ---------------- which any such Person may have hereunder or under applicable law, the Company hereby agrees to indemnify each of the Administrator, Lender, the Liquidity Banks, the other Program Support Providers, the Liquidity Agent, each of their respective Affiliates, and all successors, transferees, participants and assigns and all officers, directors, shareholders, controlling persons, employees and agents of any of the foregoing (each an "Indemnified Party"), ----------------- forthwith on demand, from and against any and all damages, losses, claims, liabilities and related costs and expenses, including reasonable attorneys' fees and disbursements (all of the foregoing being collectively referred to as "Indemnified ----------- Amounts") awarded against or incurred by any of them arising out - - ------- of or relating to the Transaction Documents or the ownership or funding of the Loans or in respect of any Receivable or any Contract, excluding, however, (a) Indemnified Amounts to the --------- ------- extent determined by a court of competent jurisdiction to have resulted from gross negligence or willful misconduct of such Indemnified Party, (b) recourse (except as otherwise specifically provided in this Agreement) for Defaulted Receivables, (c) taxes on net income, or (d) Indemnified Amounts resulting solely from acts or omissions of Servicer. Without limiting the foregoing, the Company shall indemnify each Indemnified Party for Indemnified Amounts arising out of or relating to: (i) the transfer by the Company of any interest in any Receivable other than the grant of a security interest to Lender pursuant to Section 9.01; ------------ (ii) any representation or warranty made by the Company under or in connection with any Transaction Document, any Information Package or any other information or report delivered by or on behalf of the Company pursuant hereto, which shall have been false, incorrect or misleading in any material respect when made or deemed made; (iii) the failure by the Company to comply with any applicable law, rule or regulation (including truth in lending, fair credit billing, usury, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy) with respect to any Pool Receivable or the related Contract, or the nonconformity of any Pool Receivable or the related Contract with any such applicable law, rule or regulation; (iv) the failure to vest and maintain vested in Lender a first priority perfected security interest, in the Receivables in, or purporting to be in, the Receivables Pool, free and clear of any Lien, other than a Lien arising solely as a result of an act of Lender or the Administrator, whether existing at the time of any Loan or at any time thereafter; (v) the failure to file, or any delay in filing, financing statements or other similar instruments or documents under the UCC of any applicable jurisdiction or other applicable laws with respect to any Receivables in, or purporting to be in, the Receivables Pool, whether at the time of any Loan or at any time thereafter; (vi) without duplication of amounts paid pursuant to Section 3.02(a), any dispute, claim, offset or defense --------------- (other than discharge in bankruptcy) of the Obligor to the payment of any Receivable in, or purporting to be in, the Receivables Pool (including, without limitation, a defense based on such Receivable's or the related Contract's not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim resulting from the sale of the merchandise or services related to such Receivable or the furnishing or failure to furnish such merchandise or services; (vii) any failure of the Company or Servicer to perform its duties or obligations in accordance with the provisions of Article VIII; or ------------ (viii) any products liability claim arising out of or in connection with merchandise or services that are the subject of any Pool Receivable. (b) Indemnity by AnnTaylor. Without limiting any other ---------------------- rights which any such person may have hereunder under applicable law, AnnTaylor hereby agrees to indemnify each Indemnified Party, forthwith on demand, from and against any and all Indemnified Amounts awarded against or incurred by any of them arising out of or relating to: (i) any representation or warranty made by AnnTaylor under or in connection with any Transaction Document in its capacity as Servicer, any Information Package or any other information or report delivered by or on behalf of AnnTaylor in its capacity as Servicer pursuant hereto, which shall have been false, incorrect or misleading in any material respect when made or deemed made; (ii) the failure by AnnTaylor, in its capacity as Servicer, to comply with any applicable law, rule or regulation (including truth in lending, fair credit billing, usury, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy) with respect to any Pool Receivable or other related contract; or (iii) any failure of AnnTaylor to perform its duties, covenants and obligations in accordance with the applicable provisions of this Agreement. (c) After-Tax Basis. Indemnification hereunder shall be in --------------- an amount necessary to make the Indemnified Party whole after taking into account any tax consequences to the Indemnified Party of the payment of any of the aforesaid taxes and the receipt of the indemnity provided hereunder or of any refund of any such tax previously indemnified hereunder, including the effect of such tax or refund on the amount of tax measured by net income or profits which is or was payable by the Indemnified Party. (d) Contest. Promptly after receipt of notice of the ------- commencement of any action involving any indemnified party in respect of which an indemnity will be sought pursuant to this Section 13.01, such indemnified party shall promptly notify the - - ------------- Company or AnnTaylor, as applicable; provided, however, that such -------- failure to so notify shall not affect the rights of such Indemnified Party to indemnity hereunder unless such failure prejudices the Company's or AnnTaylor's ability to contest such claim. The Company or AnnTaylor, as applicable, shall have the right to assume the defense with respect to such indemnified claim, and to retain counsel reasonably satisfactory to the Indemnified Party to represent such Indemnified Party; provided -------- that (i) AnnTaylor or the Company, as applicable, shall pay all of the fees, costs and expenses of such counsel related to such proceedings, (ii) the Company or AnnTaylor, as appropriate, has acknowledged in writing to such Indemnified Party that such claim is an indemnified claim hereunder and (iii) no Event of Default has occurred and is continuing. In any such proceeding, any Indemnified Party shall have the right to retain its own counsel at its own expense, except that AnnTaylor or the Company, as applicable, shall pay the fees and expenses of such counsel retained by the Indemnified Party in the event that (i) the Company or AnnTaylor, as applicable, and the Indemnified Party shall mutually agree to the retention of such counsel or, (ii) the named parties to any such proceeding (including any impleaded party) include both the Company and the Indemnified Party and representation of both parties by the same counsel would be inappropriate, in the reasonable opinion of the Indemnified Party, due to actual or potential differing interests between them. Neither the Company nor AnnTaylor, as applicable, shall be liable for any settlement, compromise or fine or judgement by consent with respect to any proceeding effected without its written consent, unless an Event of Default has occurred and is continuing, but if settled with such consent or if there shall be a final judgement for the plaintiff, the Company or AnnTaylor, as applicable, agrees to indemnify the indemnified party to the extent set forth in this Section 13.01. In addition, neither the ------------- Company nor AnnTaylor will, without the prior written consent of the Indemnified Party, settle or compromise or consent to the entry of any judgement in any pending or threatened claim, action, suit, proceeding or investigation or agree to any fine in respect of which indemnification may be sought hereunder (whether or not the indemnified party is an actual or potential party to such claim, action, suit, proceeding, or investigation) unless such settlement, compromise, consent or agreement includes an unconditional release of each Indemnified Party from all liability arising out of such claim, action, suit, proceeding or investigation. If an Event of Default has occurred and is continuing, neither the Company nor AnnTaylor shall have the right to control the defense of any indemnified claim pursuant to this paragraph (d). ------------ (e) Contribution. If for any reason the indemnification ------------ provided above in this Section 13.01 is unavailable to an ------------ Indemnified Party or is insufficient to hold an Indemnified Party harmless, then the Company or AnnTaylor or both, as applicable, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect not only the relative benefits received by such Indemnified Party on the one hand and the Company or AnnTaylor or both, as applicable, on the other hand but also the relative fault of such Indemnified Party as well as any other relevant equitable considerations. (f) Participants. Any Indemnified Party which is a ------------ participant shall only be entitled to amounts under this Section ------- 13.01 to the extent that such amounts, together with all amounts - - ----- due to the Person selling such participation under this Section ------- 13.01, do not exceed the amounts that would have been due to such - - ----- Person under this Section 13.01 if the participation had not been ------------- entered into or sold. ==================================================================== ARTICLE XIV MISCELLANEOUS SECTION 14.01. Amendments, Etc. No amendment or waiver of --------------- any provision of this Agreement nor consent to any departure by the Company or AnnTaylor therefrom shall in any event be effective unless the same shall be in writing and signed by (a) the Company, AnnTaylor, the Administrator and Lender (with respect to an amendment) or (b) the Administrator and Lender (with respect to a waiver or consent by them) or the Company or AnnTaylor (with respect to a waiver or consent by it), as the case may be, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. The parties acknowledge that, before entering into such an amendment or granting such a waiver or consent, Lender may also be required to obtain the approval of some or all of the Liquidity Banks to obtain confirmation from certain rating agencies that such amendment, waiver or consent will not result in a withdrawal or reduction of the ratings of the Commercial Paper Notes. SECTION 14.02. Notices, Etc. All notices and other ------------ communications provided for hereunder shall, unless otherwise stated herein, be in writing (including facsimile communication) and shall be personally delivered or sent by express mail or courier or by certified mail, postage prepaid, or by facsimile, to the intended party at the address or facsimile number of such party set forth under its name on the signature pages hereof or at such other address or facsimile number as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective, (a) if personally delivered or sent by express mail or courier or if sent by certified mail, when received, and (b) if transmitted by facsimile, when sent, receipt confirmed by telephone or electronic means. SECTION 14.03. No Waiver; Remedies. No failure on the part ------------------- of the Administrator, any Affected Party, any Indemnified Party, Lender or any other holder of the Loans (or any portion thereof) to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. Without limiting the foregoing, to the fullest extent permitted by law, each of PNC Bank, individually and as the Administrator, and each Liquidity Bank is hereby authorized by the Company at any time and from time to time, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by PNC Bank or such Liquidity Bank to or for the credit or the account of the Company for obligations now or hereafter existing under this Agreement, to the Administrator, any Affected Party, any Indemnified Party or Lender, or their respective successors and assigns. SECTION 14.04. Binding Effect; Survival. This Agreement ------------------------ shall be binding upon and inure to the benefit of the Company, AnnTaylor, the Administrator, Lender and their respective successors and assigns, and the provisions of Section 4.02 and ------------ Article XIII shall inure to the benefit of the Affected Parties - - ------------ and the Indemnified Parties, respectively, and their respective successors and assigns; provided, however, nothing in the foregoing shall be deemed to authorize any assignment not permitted by Section 12.01. This Agreement shall create and ------------- constitute the continuing obligations of the parties hereto in accordance with its terms, and shall remain in full force and effect until the Final Payout Date. The rights and remedies with respect to any breach of any representation and warranty made by the Company or AnnTaylor pursuant to Article VI and the ---------- indemnification and other provisions of Article XIII and Sections ------------ -------- 4.02, 14.05, 14.06, 14.07, 14.08 and 14.15 shall be continuing - - ---- ----- ----- ----- ----- ----- and shall survive any termination of this Agreement. SECTION 14.05. Costs, Expenses and Taxes. In addition to ------------------------- its obligations under Article XIII, the Company agrees to pay on ------------ demand: (a) all costs and expenses incurred by the Administrator, the Liquidity Banks and the Lender in connection with the negotiation, preparation, execution and delivery, or the enforcement of, or any actual or claimed breach of, this Agreement and the other Transaction Documents, including, without limitation (i) the reasonable fees and expenses of counsel to any of such Persons incurred in connection with any of the foregoing or in advising such Persons as to their respective rights and remedies under any of the Transaction Documents, and (ii) subject to Section ------- 7.01(c), all reasonable out-of-pocket expenses (including ------ reasonable fees and expenses of independent accountants but, other than as set forth in Section 7.01(c), excluding --------------- allocations of any expenses relating to salaries of employees or other overhead expenses), incurred in connection with any review of the Company's or AnnTaylor's books and records either prior to the execution and delivery hereof or pursuant (it being understood that receipts will be required for expenses over $5, meal expenses will be limited to $40 per day per person, air travel shall be by unrestricted coach class and, unless an Event of Default has occurred and shall be continuing, flight and lodging arrangements shall be made through AnnTaylor Travel, Inc.); and (b) all stamp and other similar taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording of this Agreement or the other Transaction Documents, and agrees to indemnify each Indemnified Party against any liabilities with respect to or resulting from any delay in paying or omission to pay such taxes and fees; provided that any Indemnified Party -------- which is a participant shall only be entitled to amounts under this Section 14.05(b) to the extent that such amounts, ---------------- together with all amounts due to the Person selling such participation under this Section 14.05, do not exceed the ------------- amounts that would have been due to such Person under this Section 14.05 if the participation had not been entered into ------------- or sold. SECTION 14.06. No Proceedings. The Company, AnnTaylor, -------------- Servicer and PNC Bank (individually and as Administrator) each hereby agrees that it will not institute against Lender, or join any other Person in instituting against Lender, any insolvency proceeding (namely, any proceeding of the type referred to in the definition of Event of Bankruptcy) so long as any Commercial Paper Notes issued by Lender shall be outstanding or there shall not have elapsed one year plus one day since the last day on which any such Commercial Paper Notes shall have been outstanding. The foregoing shall not limit the Company's or AnnTaylor's right to file any claim in or otherwise take any action with respect to any insolvency proceeding that was instituted by any Person other than the Company or AnnTaylor. SECTION 14.07. Confidentiality of the Company Information. ------------------------------------------ (a) Confidential Company Information. Each party hereto -------------------------------- (other than the Company or AnnTaylor) acknowledges that certain of the information provided to such party by or on behalf of the Company or AnnTaylor in connection with this Agreement and the transactions contemplated hereby is or may be confidential, and each such party severally agrees that, unless the Company or AnnTaylor shall otherwise agree in writing, and except as provided in subsection (b), such party will not disclose to any ------------- other person or entity: (i) any information regarding, or copies of, any non- public financial statements, reports and other information furnished by the Company or AnnTaylor to Lender or the Administrator pursuant to Section 3.01, 5.01(j), 5.01(k), ------------ ------ ------- 6.01(i), 6.01(j), 6.01(m), 6.02(h), 6.02(i), 6.02(j), ------- ------ ------- ------ ------ ------- 7.01(c) or 7.03, or ------ --- (ii) any other information regarding the Company or AnnTaylor which is designated by the Company or AnnTaylor to such party in writing as confidential (the information referred to in clauses (i) and (ii) above, ----------- --- whether furnished by the Company, AnnTaylor or any attorney for or other representative of the Company or AnnTaylor (each a "Company Information Provider"), is collectively referred to as - - ---------------------------- the "Company Information"; provided, however, the "Company ------------------- -------- ------- ------- Information" shall not include - - ----------- (A) any information which is or becomes generally available to the general public or to such party on a nonconfidential basis from a source other than any Company Information Provider, or which was known to such party on a nonconfidential basis prior to its disclosure by any Company Information Provider, or (B) information regarding the nature of this Agreement, the basic terms hereof (including without limitation the amount and nature of Lender's commitment and Outstanding Principal and of the recourse or other credit enhancement provided by the Company hereunder), the nature, amount and status of the Pool Receivables, and the current and/or historical ratios of losses to liquidations, dilutions and/or outstandings with respect to the Receivables Pool, such other information as may be required to be disclosed, in the Administrator's reasonable judgement, under securities laws applicable to Lender. (b) Disclosure. Notwithstanding subsection (a), each party --------- -------------- may disclose any of the Company Information: (i) to any of such party's independent attorneys, consultants and auditors, and to each Liquidity Bank, each other Program Support Provider, any dealer or placement agent for Lender's commercial paper, and any actual or potential assignees of, or participants in, any of the rights or obligations of Lender, any Liquidity Bank, any other Program Support Provider or the Administrator under or in connection with this Agreement, who (A) in the good faith belief of such party, have a need to know such Company Information, (B) are informed by such party of the confidential nature of the Company Information and the terms of this Section 14.07, and (C) are subject to ------------ confidentiality restrictions generally consistent with this Section 14.07, ------------ (ii) to any rating agency that maintains a rating for Lender's commercial paper or is considering the issuance of such a rating, for the purposes of reviewing the credit of Lender in connection with such rating, (iii) to any other party to this Agreement, for the purposes contemplated hereby, (iv) as may be required by any municipal, state, federal or other regulatory body having or claiming to have jurisdiction over such party, in order to comply, in the reasonable judgement of counsel to such party, with any law, order, regulation, regulatory request or ruling applicable to such party, or (v) subject to subsection (c), in the event such party ------------- is legally compelled (by interrogatories, requests for information or copies, subpoena, civil investigative demand or similar process) to disclose such Company Information. (c) Legal Compulsion. In the event that any party hereto --------------- (other than the Company or AnnTaylor) or any of its representatives is requested or becomes legally compelled (by interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) to disclose any of the Company or AnnTaylor Information, such party will (or will cause its representative to) (i) provide the Company or AnnTaylor with prompt written notice so that (A) the Company or any other Company Information Provider may seek a protective order or other appropriate remedy, or (B) the Company or AnnTaylor may, if it so chooses, agree that such party (or its representatives) may disclose such Company Information pursuant to such request or legal compulsion; and (ii) unless the Company or AnnTaylor agrees that such Company Information may be disclosed, make a timely objection to the request or compulsion to provide such Company Information on the basis that such Company Information is confidential and subject to the agreements contained in this Section 14.07. ------------ In the event such protective order or remedy is not obtained, or the Company or AnnTaylor waives compliance with the provisions of this Section 14.07, such party will furnish only that portion of ------------- the Company Information which (in such party's good faith judgment) is legally required to be furnished and will exercise reasonable efforts to obtain reliable assurance that confidential treatment will be afforded the Company Information. (d) This Section 14.07 shall survive termination of this ------------ Agreement. SECTION 14.08. Confidentiality of Program Information. -------------------------------------- (a) Confidential Information. Each party hereto ----------------------- acknowledges that PNC Bank regards the structure of the transactions contemplated by this Agreement to be proprietary, and each such party severally agrees that: (i) it will not disclose without the prior consent of PNC Bank (other than to the directors, employees, auditors, counsel or affiliates (collectively, "representatives")) of such party, each of whom shall be informed by such party of the confidential nature of the Information (as defined below) and of the terms of this Section 14.08, (A) any ------------- information regarding the pricing in, or copies of, the Fee Letter, (B) any information regarding the organization, business or operations of Lender generally or the services performed by the Administrator for Lender, or (C) any information which is furnished by PNC Bank to such party and which is designated by PNC Bank to such party in writing as confidential or as not otherwise available to the general public (the information referred to in clauses (A), (B) and ---------- --- (C) is collectively referred to as the "Program -- ------- Information"); provided, however, that such party may ---------- -------- ------ disclose any such Program Information (I) to any other party to this Agreement for the purposes contemplated hereby, (II) as may be required, in the reasonable judgement of counsel to such party, by any municipal, state, federal or other regulatory body having or claiming to have jurisdiction over such party, (III) in order to comply with any law, order, regulation, regulatory request or ruling applicable to such party, (IV) subject to subsection (c), in the event such ------------- party is legally compelled (by interrogatories, requests for information or copies, subpoena, civil investigative demand or similar process) to disclose any such Program Information, (V) to any of such party's independent attorneys, consultants and auditors, or (VI) in defending any action or proceeding relating to the Transaction Documents; (ii) it will use the Program Information solely for the purposes of evaluating, administering and enforcing the transactions contemplated by this Agreement and making any necessary business judgments with respect thereto; and (iii) it will, upon written demand, return (and cause each of its representatives to return) to PNC Bank, all documents or other written material received from PNC Bank, as the case may be, in connection with (a)(i)(B) or (C) --------- --- above and all copies thereof made by such party which contain the Program Information. The parties hereto acknowledge that AnnTaylor will file a copy of this Agreement with the Securities and Exchange Commission and will provide copies hereof to Persons requesting such copies as may be required by applicable law and to such Persons as may have a valid business need to review this Agreement; provided that -------- none of the Company, AnnTaylor nor any Affiliate thereof shall otherwise distribute copies of this Agreement. (b) Availability of Confidential Information. This Section ---------------------------------------- ------- 14.08 shall be inoperative as to such portions of the Program - - ----- Information which are or become generally available to the public or such party on a nonconfidential basis from a source other than PNC Bank or were known to such party on a nonconfidential basis prior to its disclosure by PNC Bank. (c) Legal Compulsion to Disclose. In the event that any ---------------------------- party or anyone to whom such party or its representatives transmits the Program Information is requested or becomes legally compelled (by interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) to disclose any of the Information, such party will (i) provide PNC Bank with prompt written notice so that PNC Bank may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Section 14.08; and ------------- (ii) unless PNC Bank waives compliance by such party with the provisions of this Section 14.08, make a timely ------------- objection to the request or confirmation to provide such Program Information on the basis that such Program Information is confidential and subject to the agreements contained in this Section 14.08. ------------- In the event that such protective order or other remedy is not obtained, or PNC Bank waives compliance with the provisions of this Section 14.08, such party will furnish only that portion of ------------- the Program Information which (in such party's good faith judgment) is legally required to be furnished and will exercise reasonable efforts to obtain reliable assurance that confidential treatment will be accorded the Program Information. (d) Survival. This Section 14.08 shall survive termination -------- ------------- of this Agreement. SECTION 14.09. Captions and Cross References. The various ----------------------------- captions (including, without limitation, the table of contents) in this Agreement are provided solely for convenience of reference and shall not affect the meaning or interpretation of any provision of this Agreement. Unless otherwise indicated, references in this Agreement to any Section, Appendix, Schedule or Exhibit are to such Section of or Appendix, Schedule or Exhibit to this Agreement, as the case may be, and references in any Section, subsection, or clause to any subsection, clause or subclause are to such subsection, clause or subclause of such Section, subsection or clause. SECTION 14.10. Governing Law. THIS AGREEMENT, INCLUDING ------------- THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. SECTION 14.11. Waiver Of Jury Trial. EACH PARTY HERETO -------------------- HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, THE NOTE, ANY OTHER TRANSACTION DOCUMENT OR UNDER ANY AMENDMENT, INSTRUMENT OR DOCUMENT DELIVERED OR WHICH MAY BE IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY BANKING OR OTHER RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. SECTION 14.12. Consent To Jurisdiction; Waiver Of ---------------------------------- Immunities. EACH OF ANNTAYLOR AND THE COMPANY HEREBY - - --------- ACKNOWLEDGES AND AGREES THAT: (a) IT IRREVOCABLY (i) SUBMITS TO THE JURISDICTION, FIRST, OF ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL JURISDICTION IS NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER CASE SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, (ii) AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED ONLY IN SUCH NEW YORK STATE OR FEDERAL COURT AND NOT IN ANY OTHER COURT, AND (iii) WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING. (b) TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID TO EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, IT HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER OR IN CONNECTION WITH THIS AGREEMENT. SECTION 14.13. Execution in Counterparts. This Agreement -------------------------- may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same Agreement. SECTION 14.14. No Recourse Against Other Parties. No --------------------------------- recourse under any obligation, covenant or agreement of Lender contained in this Agreement shall be had against any stockholder, employee, officer, director, or incorporator of Lender, provided, however, that nothing in this Section 14.14 shall relieve any of ------------- the foregoing Persons from any liability which such Person may otherwise have for his/her or its gross negligence or willful misconduct. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written. ANNTAYLOR FUNDING, INC. as the Company By /s/ Walter J. Parks ------------------------------- Title: Vice President 414 Chapel Street New Haven, CT 06511 Telephone No.: (203) 865-0811 Facsimile No.: (203) 865-2756 Attention: President ANNTAYLOR, INC., as initial Servicer By /s/ Walter J. Parks --------------------------------- Title: Senior Vice President 142 West 57th Street New York, NY 10019 Telephone No.: (212) 541-3300 Facsimile No.: (212) 541-3299 Attention: Senior Vice President with a copy to: AnnTaylor, Inc. 414 Chapel Street New Haven, CT 06511 Telephone No.: (203) 865-0811 Facsimile No.: (203) 865-2756 Attention: Vice President - Controller MARKET STREET CAPITAL CORP., as Lender By /s/ Douglas K. Johnson -------------------------------- Title President c/o AMACAR Group, L.L.C. 6707-D Fairview Road Charlotte, North Carolina 28210 Facsimile No.: (704) 365-1362 Attention: Douglas K. Johnson PNC BANK, NATIONAL ASSOCIATION, as Administrator By: /s/ Robert O. Finley, Jr. -------------------------- Title: Vice President Fifth Avenue and Wood Street Pittsburgh, Pennsylvania 15265 Facsimile No.: (412) 762-9184 Attention: Robert O. Finley, Jr. - - -------------------------------------------------------------- APPENDIX A DEFINITIONS This is Appendix A to the Amended and Restated Receivables Financing Agreement dated as of October 31, 1995 among AnnTaylor Funding, Inc., AnnTaylor, Inc., Market Street Capital Corp. and PNC Bank, National Association, as Administrator (as further amended, supplemented or otherwise modified from time to time, and including the Original Financing Agreement for the time that it was in effect, this "Agreement"). Each reference in this --------- Appendix A to any Section, Appendix or Exhibit refers to such - - ---------- Section of or Appendix or Exhibit to this Agreement. A. Defined Terms. As used in this Agreement, unless the ------------- context requires a different meaning, the following terms have the meanings indicated hereinbelow: "Account" means each revolving credit card account ------- established pursuant to a Contract between AnnTaylor and any Obligor pursuant to which indebtedness may arise for the purchase of goods. "Account Age" has the meaning set forth in Schedule 7.03(c). ----------- ---------------- "Administrator" has the meaning set forth in the preamble. ------------- -------- "Administrator's Office" means the office of the ---------------------- Administrator at Fifth Avenue and Wood Street, Pittsburgh, Pennsylvania 15265, Attention: Market Street, or such other address as shall be designated by the Administrator in writing to the Company and Lender. "Affected Party" means each of Lender, each Liquidity Bank, -------------- any assignee or participant of Lender or any Liquidity Bank, each other Program Support Provider, any assignee or participant of any Program Support Provider, PNC Bank, any successor to PNC Bank as Administrator and any sub-agent of the Administrator. "Affiliate" when used with respect to ATSC, AnnTaylor or the --------- Company means ATSC or any Subsidiary of ATSC and when used with respect to any other Person means any other Person controlling, controlled by, or under common control with, such Person. "Alternate Base Rate" means, on any date, a fluctuating rate ------------------- of interest per annum equal to the higher of --- ----- (a) the rate of interest most recently announced by PNC Bank in Pittsburgh, Pennsylvania, as its prime rate; and (b) the Federal Funds Rate (as defined below) most recently determined by PNC Bank plus 1.0% per annum. --- ----- The Alternate Base Rate is not necessarily intended to be the lowest rate of interest determined by the Liquidity Agent in connection with extensions of credit. "Amount Payable" has the meaning set forth in -------------- Section 3.01(b). - - --------------- "AnnTaylor" has the meaning set forth in the preamble. --------- -------- "AnnTaylor Credit Agreement" means the Amended and Restated -------------------------- Credit Agreement, dated as of September 29, 1995, among AnnTaylor, Bank of America National Trust and Savings Association and Fleet Bank, National Association, as Co-Agents, the financial institutions from time to time party thereto and Bank of America National Trust and Savings Association, as Agent. "Assignment Agreement" has the meaning set forth in -------------------- paragraph 3 of the Background. - - ----------- ---------- "ATSC" means AnnTaylor Stores Corporation, a Delaware ---- corporation. "Bank Rate" for any Interest Period means --------- (a) in the case of any Interest Period other than a Interest Period described in clause (b), an interest rate ---------- per annum equal to the sum of (x) the Bank Rate Spread, plus --- ----- ---- (y) the Eurodollar Rate (Reserve Adjusted) for such Interest Period; (b) in the case of (i) any Interest Period on or prior to the first day of which Lender or any Liquidity Bank shall have notified the Administrator that (A) the introduction of or any change in or in the interpretation of any law or regulation makes it unlawful, or any central bank or other governmental authority asserts that it is unlawful, for such Person to fund the applicable Loan (or portion thereof) at the rate described in clause (a), or (B) due to market ---------- conditions affecting the London interbank eurodollar market, funds are not reasonably available to such Person in such market in order to enable it to fund such Loan (or portion thereof) at the rate described in clause (a) (and in the case of subclause (A) or (B), ---------- ------------- --- such Person shall not have subsequently notified the Administrator that such circumstances no longer exist), or (ii) any Interest Period as to which the Administrator does not receive notice or determine, by no later than 12:00 noon (New York City time) on the third Business Day preceding the first day of such Interest Period, that the applicable Loan (or portion thereof) will be funded by Liquidity Loans and not by the issuance of Commercial Paper Notes, an interest rate per annum equal to (x) the Bank Rate --- ----- Spread, plus (y) the Alternate Base Rate in effect from time ---- to time during such Interest Period. "Bank Rate Spread" for purposes of determining the Bank Rate ---------------- for any Interest Period means a rate per annum equal to (i) if --- ----- the Bank Rate for such Interest Period will be based on the Eurodollar Rate (Reserve Adjusted), 1.25% per annum, and (ii) if --- ----- the Bank Rate for such Interest Period will be based on the Alternate Base Rate, 0.25% per annum. --- ----- "Board of Directors" means either the Board of Directors of ------------------ the Company or any duly authorized committee of that board. "Borrowing Base" has the meaning set forth in Section -------------- ------- 1.03(a). - - ------- "Borrowing Notice" has the meaning set forth in Section ---------------- ------- 1.02(a). - - ------- "Business Day" means a day on which both (a) the ------------ Administrator at its principal office in Pittsburgh, Pennsylvania is open for business and (b) commercial banks in New York City and Chicago, Illinois are not authorized or required to be closed for business. "Capital Expenditures" shall mean, for any period, on a -------------------- consolidated basis for AnnTaylor and its Restricted Subsidiaries, the aggregate of all expenditures (whether paid in cash or accrued as liabilities during that period and including that portion of Capital Leases (except any capitalized interest) which is capitalized on the consolidated balance sheet of AnnTaylor and its Restricted Subsidiaries) made by AnnTaylor or any Restricted Subsidiary during such period that, in conformity with GAAP, are required to be included in or reflected by property, plant or equipment, licenses and permits, or other similar fixed asset accounts as reflected in such balance sheet (including expenditures for equipment purchased simultaneously with the trade-in of existing equipment owned by AnnTaylor or any such Restricted Subsidiary to the extent the gross amount of such purchase price exceeds the book value of the equipment being traded in, but excluding expenditures made in connection with the replacement or restoration of assets, to the extent reimbursed or financed from insurance proceeds or condemnation awards). "Capital Lease", as applied to any Person, shall mean any ------------- lease of any property (whether real, personal, or mixed) by that Person as lessee which, in conformity with GAAP, is accounted for as a capital lease on the balance sheet of that Person. "Cash Interest Expense" shall mean, for any period, all --------------------- Interest Expense for such period payable in cash. "Change in Control" means any of the following: ----------------- (a) "Change in Control" as defined in the Indenture dated as of June 15, 1993 from AnnTaylor to Fleet Bank, N.A., as Trustee relating to the 8-3/4% Subordinated Notes due 2000 of AnnTaylor as in effect on the date hereof; or (b) the failure of AnnTaylor to own directly or indirectly, 100% of the outstanding voting stock of the Company. "Clipper" has the meaning set forth in paragraph 2 of the ------- ----------- Background. - - ---------- "Collections" means, with respect to any Receivable, all ----------- funds which either (a) are received by the Company or Servicer from or on behalf of the related Obligors in payment of any amounts owed (including, without limitation, purchase prices, finance charges, interest and all other charges) in respect of such Receivable, or applied to such amounts owed by such Obligors (including, without limitation, insurance payments that the Company or Servicer applies in the ordinary course of its business to amounts owed in respect of such Receivable and net proceeds of sale or other disposition of repossessed goods or other collateral or property of the Obligor or any other party directly or indirectly liable for payment of such Receivable and available to be applied thereon), or (b) are deemed to have been received by the Company or any other Person as a Collection pursuant to Section 3.02. ------------ "Commercial Paper Notes" means short-term promissory notes ---------------------- issued or to be issued by Lender to fund its investments in accounts receivable or other financial assets. "Commitment Fee" has the meaning set forth in the Fee -------------- Letter. "Company" has the meaning set forth in the preamble. ------- -------- "Company Information" has the meaning set forth in Section ------------------- ------- 14.07(a). - - -------- "Company Information Provider" has the meaning set forth in ---------------------------- Section 14.07(a). - - ---------------- "Company's Net Worth" means, at any time, the amount by ------------------- which the Company's total assets exceed the Company's total liabilities, as determined in accordance with GAAP. "Contract" means a contract between AnnTaylor and any Person -------- pursuant to or under which such Person establishes a revolving credit card account pursuant to which indebtedness may arise for the purchase of goods. A "related" Contract with respect to the Receivables means a Contract under which Receivables in the Receivables Pool arise or which is relevant to the collection or enforcement of such Receivables. "CP Rate" for any period means a rate per annum calculated ------- --- ----- by the Administrator equal to the sum of (i) the rate or, if more than one rate, the weighted average of the rates, determined by converting to an interest-bearing equivalent rate per annum the --- ----- discount rate (or rates) at which Commercial Paper Notes on each day during such period have been sold by the commercial paper placement agents selected by the Administrator, plus (ii) the ---- commissions and charges charged by such commercial paper placement agents with respect to such Commercial Paper Notes, expressed as a percentage of such face amount and converted to an interest-bearing equivalent rate per annum. --- ----- "Credit and Collection Policy" means those credit and ---------------------------- collection policies and practices relating to Contracts and Receivables described in Schedule 6.01(p)-2, as modified without ------------------ violating Section 7.03(c). --------------- "Customer Letter of Credit" has the meaning set forth in ------------------------- Section 3.05(e). - - --------------- "Cut-Off Date" means the last day of each Settlement Period. ------------ "Defaulted Receivable" means a Receivable (a) with an -------------------- Account Age greater than 6, unless a payment has been received in the past 30 days, and in all cases where the Account Age is greater than 7, or (b) as to which the computer records of the Company or the Servicer identify that an Event of Bankruptcy with respect to the Obligor thereof has occurred and remains continuing. "Delinquency Ratio" means the ratio (expressed as a ----------------- percentage) computed as of any Cut-Off Date by dividing (x) the sum for each of the four billing dates in the Settlement Period ending on such Cut-Off Date of the aggregate Unpaid Balance of all Pool Receivables that are Delinquent Receivables and that have been billed on one of such four billing dates by (y) the sum for each of the four billing dates in the Settlement Period ending on such Cut-Off Date of the aggregate Unpaid Balance of all Pool Receivables that have been billed on one of such four billing dates. "Delinquent Receivable" means a Receivable that is not a --------------------- Defaulted Receivable and which has an Account Age of 2 or more. "Dilution Ratio" means the ratio (expressed as a percentage) -------------- computed as of any Cut-Off Date by dividing (x) the aggregate reductions in Unpaid Balance of all Pool Receivables on account of returns, allowances, revisions or cancellations during the three Settlement Periods ending on such Cut-Off Date by (y) the sum of the aggregate Unpaid Balance of all Pool Receivables on the last day of each of such three Settlement Periods. "Distribution Center" shall mean the distribution center, ------------------- and related systems and equipment, in Louisville, Kentucky. "Dollars" means dollars in lawful money of the United States ------- of America. "Downgraded Liquidity Bank" means a Liquidity Bank which has ------------------------- been the subject of a Downgrading Event. "Downgrading Event" with respect to any Person means the ----------------- lowering of the rating with regard to the short-term securities of such Person to below (i) A-1 by Standard & Poor's Corporation, or (ii) P-1 by Moody's Investors Service, Inc. "Due Amount" with respect to any Settlement Period means the ---------- sum of (i) the amount of interest on the Loans that will be due on the Settlement Date relating to such Settlement Period, together with any interest previously accrued and remaining unpaid, plus (ii) the amount of principal that will be due and ---- owing with respect to the Loans on the Settlement Date relating to such Settlement Period, together with any principal previously due and remaining unpaid, plus (iii) all fees and other amounts ---- that will be payable by the Company on the Settlement Date relating to such Settlement Period pursuant to the Agreement, plus (iv) the amount required to be deposited into the Spread - - ---- Account and/or reimbursed to the issuer of the Customer Letter of Credit on the Settlement Date relating to such Settlement Period to bring the sum of the amount of funds on deposit in the Spread Account plus the stated amount of the Customer Letter of Credit up to the Enhancement Limit. "Earned Discount Rate" means with respect to any Settlement -------------------- Period, the weighted average of the interest rates applicable to the Loans during such Settlement Period. "EBITDA" shall mean, for any period, the sum of the amounts ------ for such period, of (a) Net Income, plus (b) to the extent Net ---- Income is reduced thereby (i) all charges for amortization of intangibles and depreciation, (ii) Interest Expense, (iii) all income tax expense and (iv) extraordinary losses, minus (c) ----- extraordinary gains (net of taxes). "Eligible Contract" means a Contract in one of the forms set ----------------- forth in Schedule 6.01(p)-1 or otherwise approved by the ------------------ Administrator. "Eligible Receivable" means, at any time, a Pool Receivable: ------------------- (a) which was generated by AnnTaylor in the ordinary course of business and was sold to the Company pursuant to the Purchase Agreement; (b) which, (i) if the perfection of Lender's security interest therein is governed by the laws of a jurisdiction where the Uniform Commercial Code -- Secured Transactions is in force, constitutes an account or general intangible as defined in the Uniform Commercial Code as in effect in such jurisdiction, and (ii) if the perfection of Lender's security interest therein is governed by the law of any jurisdiction where the Uniform Commercial Code -- Secured Transactions is not in force, the Company has furnished to the Administrator such opinions of counsel and other evidence as has reasonably been requested, establishing to the reasonable satisfaction of the Administrator that Lender's security interest and other rights with respect thereto are not significantly less protected and favorable than such rights under the Uniform Commercial Code; (c) the Obligor of which is resident of the United States of America, or any of its possessions or territories, is not an Affiliate of the Company, and is not a government or a governmental subdivision or agency; (d) which is not a Defaulted Receivable or a Delinquent Receivable; (e) with regard to which the warranty of the Company in Section 6.01(l) is true and correct; --------------- (f) the sale of an undivided interest in which does not contravene or conflict with any law; (g) which is denominated and payable only in Dollars in the United States; (h) which arises under an Eligible Contract that has been duly authorized by the parties thereto and that, together with such Receivable, is in full force and effect and constitutes the legal, valid and binding obligation of the Obligor of such Receivable enforceable against such Obligor in accordance with its terms except as enforceability may be limited by bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditor's rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law; (i) which, together with the Contract related thereto, does not contravene in any material respect any laws, rules or regulations applicable thereto (including, without limitation, laws, rules and regulations relating to usury, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy) and with respect to which no party to the Contract related thereto is in violation of any such law, rule or regulation in any material respect if such violation would impair the collectability of such Receivable; (j) which satisfies all applicable requirements of the Credit and Collection Policy; and (k) the Unpaid Balance (or any portion thereof) of which is not being disputed by the Obligor. "Enhancement Limit" has the meaning set forth in Section ----------------- 3.05(d). "ERISA" means the U.S. Employee Retirement Income Security ----- Act of 1974, as amended from time to time. "Estimated Amount" means, with respect to any Settlement ---------------- Period, the sum of the (i) the Due Amount that the Company reasonably estimates will be due on the Settlement Date relating to such Settlement Period, plus (ii) the amount that the Company ---- reasonably estimates will be necessary to provide funds for all other expenses of the Company incurred during such Settlement Period. "Eurodollar Rate (Reserve Adjusted)" means, with respect to ---------------------------------- any Interest Period and any Loan (or portion thereof), a rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) determined pursuant to the following formula: Eurodollar Rate = Eurodollar Rate --------------- (Reserve Adjusted) 1-Eurodollar Reserve Percentage where: ----- "Eurodollar Rate" means, with respect to any Interest Period --------------- and any Loan (or portion thereof), the rate per annum at which Dollar deposits in immediately available funds are offered to the Eurodollar Office of the Administrator two Eurodollar Business Days prior to the beginning of such period by prime banks in the interbank eurodollar market at or about 11:00 a.m., New York City time, for delivery on the first day of such Interest Period, for the number of days comprised therein and in an amount equal or comparable to such Loan (or portion thereof) for such Interest Period. "Eurodollar Business Day" means a day of the year on which ----------------------- dealings are carried on in the London eurodollar interbank market and banks are open for business in London and are not required or authorized to close in New York City or Pittsburgh. "Eurodollar Office" means the Administrator's office located ----------------- at Fifth Avenue and Wood Street, Pittsburgh, Pennsylvania 15265, or such other office as shall be designated by the Administrator as its Eurodollar Office pursuant to a written notice delivered by the Administrator to the Liquidity Agent, AnnTaylor and the Company. "Eurodollar Reserve Percentage" means, with respect to any ----------------------------- Interest Period, the applicable percentage (expressed as a decimal) prescribed by the Federal Reserve Board for determining reserve requirements applicable to "Eurocurrency Liabilities" pursuant to Regulation D, on the first day of such Interest Period. "Event of Bankruptcy" shall be deemed to have occurred with ------------------- respect to a Person if either: (a) a case or other proceeding shall be commenced, without the application or consent of such Person, in any court, seeking the liquidation, reorganization, debt arrangement, dissolution, winding up, or composition or readjustment of debts of such Person, the appointment of a trustee, receiver, custodian, liquidator, assignee, sequestrator or the like for such Person or all or substantially all of its assets, or any similar action with respect to such Person under any law relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts, and such case or proceeding shall continue undismissed, or unstayed and in effect, for a period of 60 consecutive days; or an order for relief in respect of such Person shall be entered in an involuntary case under the federal bankruptcy laws or other similar laws now or hereafter in effect; or (b) such Person shall commence a voluntary case or other proceeding under any applicable bankruptcy, insolvency, reorganization, debt arrangement, dissolution or other similar law now or hereafter in effect, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) for, such Person or for any substantial part of its property, or shall make any general assignment for the benefit of creditors, or shall fail to, or admit in writing its inability to, pay its debts generally as they become due, or, if a corporation or similar entity, its board of directors shall vote to implement any of the foregoing. "Event of Default" has the meaning set forth in Section ---------------- ------- 10.01. - - ----- "Exchange Act" means the Securities and Exchange Act of ------------ 1934, as amended. "Federal Funds Rate" means, for any period, a fluctuating ------------------ interest rate per annum equal (for each day during such period) --- ----- to (a) the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York; or (b) if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by PNC Bank from three federal funds brokers of recognized standing selected by it. "Federal Reserve Board" means the Board of Governors of the --------------------- Federal Reserve System, or any successor thereto or to the functions thereof. "Fee Letter" has the meaning set forth in Section 4.01. ---------- ------------ "Final Payout Date" means the date following the Termination ----------------- Date on which Outstanding Principal shall have been reduced to zero and all other amounts payable by the Company under the Transaction Documents shall have been paid in full or all of the Pool Receivables existing on or prior to the Termination Date have been written off as uncollectible in accordance with the Credit and Collection Policy, whichever occurs first. "Finance Charge Receivables" shall mean all amounts billed -------------------------- to the Obligors on any Account in respect of finance charges, late charges, and other fees and charges with respect to the Accounts. "Fixed Charge Coverage Ratio" shall mean, for any period, --------------------------- the quotient obtained by dividing (a) EBITDA by (b) the sum of (i) Capital Expenditures paid or payable during such period, plus ---- (ii) scheduled payments made during such period for principal on Indebtedness excluding any payment made upon termination of the transactions contemplated by this Agreement, plus (iii) Cash ---- Interest Expense during such period, plus (iv) income tax expense ---- during such period. "GAAP" means generally accepted accounting principles set ---- forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board, or in such other statements by such other entity as may be in general use by significant segments of the accounting profession, which are applicable to the circumstances as of the date of determination. "Gross Default-to-Liquidation Ratio" means the ratio ---------------------------------- (expressed as a percentage) computed as of a Cut-Off Date by dividing (x) the aggregate Unpaid Balance of all Pool Receivables that became Defaulted Receivables during the three Settlement Periods ending on such Cut-Off Date by (y) the aggregate Collections of all Pool Receivables during such three Settlement Periods. "Indemnified Amounts" has the meaning set forth in Section ------------------- ------- 13.01. - - ----- "Indemnified Party" has the meaning set forth in Section ----------------- ------- 13.01. - - ----- "Information Package" has the meaning set forth in Section ------------------- ------- 3.01. - - ---- "Interest Expense" shall mean, for any period for ATSC, ---------------- AnnTaylor and its Restricted Subsidiaries on a consolidated basis, total consolidated interest expense, whether paid or accrued (including any amortization of discount and the interest component of Capital Leases), for such period, including to the extent included in interest expense, all commissions, discounts and other fees and charges owed with respect to the letters of credit, the fees payable under this Agreement and net costs under Interest Rate Contracts, all as determined in conformity with GAAP, plus (without duplication) all capitalized interest. ---- "Interest Period" means --------------- (a) the period from, and including, the date hereof to the next occurring Settlement Date; and (b) thereafter, each period from, and including, a Settlement Date to, but excluding, the next Settlement Date; provided, however, that the last Interest Period shall end on the - - -------- ------- date on which the Loans have been reduced to zero and all other fees and expenses owed by the Company hereunder shall have been paid in full. "Lender" has the meaning set forth in the preamble. ------ -------- "Lending Limit" has the meaning set forth in Section 1.01. ------------- ------------ "Lien" means any mortgage, lien, pledge, encumbrance, ---- charge, retained security title of a conditional vendor or lessor or other security interest of any kind, whether arising under a security agreement, mortgage, deed of trust, chattel mortgage, assignment, pledge, retention or security title, financing or similar statement or notice or arising as a matter of law, judicial process or otherwise. "Liquidation Fee" means, for each Loan (or portion thereof) --------------- for each day in any Interest Period the amount, if any, by which: (a) the additional interest (calculated without taking into account any Liquidation Fee) which would have accrued on any portion of the Loan prepaid during such Interest Period (as so computed) if such prepayments had not been made exceeds, (b) the income, if any, received by Lender from investing the proceeds of such prepayments of the Loan. "Liquidity Agent" means PNC Bank, as agent for the Liquidity --------------- Banks under the Liquidity Agreement, or any successor to PNC Bank in such capacity. "Liquidity Agreement" means and includes (a) the Liquidity ------------------- Agreement dated as of October 31, 1995 among Lender, as borrower, the Liquidity Agent, and the Liquidity Banks, and (b) any other agreement hereafter entered into by Lender providing for the making of loans or other extensions of credit to Lender secured by a direct or indirect security interest in the Loans (or any portion thereof), to support all or part of Lender's payment obligations under the Commercial Paper Notes or to provide an alternate means of funding Lender's investments in accounts receivable or other financial assets, and under which the amount available from such extensions of credit is limited to an amount calculated by reference to the value or eligible unpaid balance of such accounts receivable or other financial assets or any portion thereof or the level of deal-specific credit enhancement available with respect thereto, as such Liquidity Agreement or other agreement may be amended, supplemented or otherwise modified from time to time. "Liquidity Bank" means any one of, and "Liquidity Banks" -------------- --------------- means all of, PNC Bank, United States National Bank of Oregon and the other commercial lending institutions that are at any time parties to the Liquidity Agreement. "Liquidity Loan" means a loan made by the Liquidity Bank (or -------------- simultaneous loans made by the Liquidity Banks) pursuant to the Liquidity Agreement. "Loan" has the meaning set forth in Section 1.01. ---- ------------ "Loan Termination Date" means that day on which an Event of --------------------- Default has occurred and is continuing, and (a) the Administrator declares a Loan Termination Date in a notice to the Company in accordance with Section ------- 10.02(a); or -------- (b) in accordance with Section 10.02(b), becomes the ---------------- Loan Termination Date automatically. "Lock-Box Agreement" means a letter agreement, in ------------------ substantially the form of Exhibit 5.01(g), between the Company --------------- and any Lock-Box Bank. "Lock-Box Bank" means any of the banks holding one or more ------------- lock-box accounts for receiving Collections from Pool Receivables. "Loss Reserve" means on any day, an amount equal to the ------------ product of the Outstanding Principal multiplied by the sum of ------------- (1) 16.5%; plus ---- (2) if a positive number, 4.5% minus the Net Yield as of such ----- day, plus ---- (3) if a positive number, the Dilution Ratio on such day minus ----- 12.5%, plus ---- (4) if a positive number, the Delinquency Ratio minus 11.0%. ----- "Material Adverse Effect" means, with respect to any event ----------------------- or circumstance, a material adverse effect on: (i) the business, assets, financial condition, operations or prospects of the Company; (ii) the ability of the Company to perform its obligations under this Agreement, the Note or any other Transaction Document; (iii) the validity or enforceability of this Agreement, the Note or any other Transaction Document; (iv) the status, existence, perfection, priority or enforceability of Lender's interest in the Receivables Pool; or (v) the collectability of a significant portion of the Pool Receivables. "Net Default-to-Liquidation Ratio" means the ratio -------------------------------- (expressed as a percentage) computed as of a Cut-Off Date by dividing (x) the aggregate Unpaid Balance of all Pool Receivables that became net charge-offs during the three Settlement Periods ending on the most recent Cut-Off Date by (y) the aggregate Collections of all Pool Receivables during such three Settlement Periods. "Net Income" means, for any period on a consolidated basis ---------- for ATSC, AnnTaylor and its Restricted Subsidiaries, the consolidated net income (or loss) of AnnTaylor and its Restricted Subsidiaries for such period taken as a single accounting period, after adding or deducting the amount of any extraordinary gain and extraordinary loss net of taxes, determined in conformity with GAAP. "Net Pool Balance" at any time means an amount equal to the ---------------- aggregate Unpaid Balance of the Eligible Receivables in the Receivables Pool as set forth in the most recent delivered Information Package reduced by the amount by which the Unpaid Balance of the Eligible Receivables with respect to which interest payments have been deferred exceeds 3% of Outstanding Principal. "Net Worth" shall mean, as at any date of determination, the --------- amount by which (a) the total consolidated assets of ATSC, AnnTaylor and its Restricted Subsidiaries exceed (b) the total consolidated liabilities of ATSC, AnnTaylor and its Restricted Subsidiaries, as determined in conformity with GAAP, but excluding for the purposes of this definition, unrealized foreign exchange translation gains and losses from investments in foreign Subsidiaries. "Net Yield" means, with respect to any Settlement Period, --------- the Portfolio Yield minus the Servicer's Fee Rate, the Earned Discount Rate and the Program Fee rate. "Note" has the meaning set forth in Section 1.04. ---- ------------ "Obligor" means a Person obligated to make payments with ------- respect to a Receivable, including any guarantor thereof. "Original Financing Agreement" has the meaning set forth in ---------------------------- paragraph 2 of the Background. - - ----------- ---------- "Original Note" means the promissory note issued by the ------------- Company and delivered to Clipper pursuant to the Original Financing Agreement. "Outstanding Principal" means at any time an amount equal to --------------------- the aggregate principal amount of the Loans outstanding at such time. "Payment Rate" means, with respect to any Settlement Period, ------------ the ratio, expressed as a percentage, of (x) the Collections received during such Settlement Period to (y) the aggregate Unpaid Balance of all Pool Receivables as of the last day of the previous Settlement Period. "Person" means an individual, partnership, corporation ------ (including a business trust), joint stock company, trust, unincorporated association, joint venture, government or any agency or political subdivision thereof or any other entity. "PNC Bank" has the meaning set forth in the preamble. -------- -------- "Pool Receivable" means each Receivable described in Section --------------- 1.1(a) or (b) of the Purchase Agreement. "Portfolio Yield" means, with respect to any Settlement --------------- Period, the annualized percentage equivalent of a fraction, the numerator of which is the amount of Finance Charge Receivables accrued during the immediately preceding Settlement Period, after subtracting therefrom the aggregate Unpaid Balance of Receivables which were net charge offs in such Settlement Period, and the denominator of which is the aggregate Unpaid Balance of Pool Receivables as of the last day of the immediately preceding Settlement Period. "Principal Receivables" means amounts (other than any --------------------- amounts which represent Finance Charge Receivables) billed to the Obligor on any Account in respect of purchases of goods. "Program Fee" has the meaning set forth in the Fee Letter. ----------- "Program Information" has the meaning set forth in Section ------------------- ------- 14.08. - - ----- "Program Support Provider" means and includes any Liquidity ------------------------ Bank and any other or additional Person (other than any customer of Lender) now or hereafter extending credit or having a commitment to extend credit to or for the account of, or to make purchases from, Lender or issuing a letter of credit, surety bond or other instrument to support any obligations arising under or in connection with Lender's securitization program. "Program Support Agreement" means and includes the Liquidity ------------------------- Agreement and any other agreement entered into by any Program Support Provider providing for the issuance of one or more letters of credit for the account of Lender, the issuance of one or more surety bonds for which Lender is obligated to reimburse the applicable Program Support Provider for any drawings thereunder, the sale by Lender to any Program Support Provider of the Loans (or portions thereof) and/or the making of loans and/or other extensions of credit to Lender in connection with Lender's securitization program, together with any letter of credit, surety bond or other instrument issued thereunder [(but excluding any discretionary advance facility provided by the Administrator). "Purchase Agreement" means the Purchase and Sale Agreement, ------------------ dated as of January 27, 1994 between the Company and AnnTaylor, as seller, as it may be amended, supplemented or otherwise modified from time to time. "Qualifying Liquidity Bank" means a Liquidity Bank with a ------------------------- rating of its short-term securities equal to or higher than (i) A- 1 by Standard & Poor's Corporation and (ii) P-1 by Moody's Investors Service, Inc. "Receivable" means any right to payment from a Person, ---------- whether constituting an account, chattel paper, instrument or a general intangible, arising under an Account, and includes the right to payment of any interest or finance charges and other obligations of such Person with respect thereto. "Receivables Pool" means at any time all then outstanding ---------------- Pool Receivables, the Contracts related thereto, Related Security, the Spread Account, all amounts payable to, or for the benefit of, the Company under the interest rate agreements, if any, entered into by the Company, all rights and claims of the Company in and under the Purchase Agreement, all Collections, all books and records related to any of the foregoing, and all proceeds of the foregoing, in each case whether now or hereafter existing. "Regulation D" means Regulation D of the Federal Reserve ------------ Board, or any other regulation of the Federal Reserve Board that prescribes reserve requirements applicable to nonpersonal time deposits or "Eurocurrency Liabilities" as presently defined in Regulation D, as in effect from time to time. "Regulatory Change" means, relative to any Affected Party ----------------- (a) any change in (or the adoption, implementation, change in phase-in or commencement of effectiveness of) any (i) United States federal or state law or foreign law applicable to such Affected Party; (ii) regulation, interpretation, directive, requirement or request (whether or not having the force of law) applicable to such Affected Party of (A) any court, government authority charged with the interpretation or administration of any law referred to in clause (a)(i) or of (B) any fiscal, monetary or ------------- other authority having jurisdiction over such Affected Party; or (iii) generally accepted accounting principles or regulatory accounting principles applicable to such Affected Party and affecting the application to such Affected Party of any law, regulation, interpretation, directive, requirement or request referred to in clause (a)(i) or (a)(ii) above; ------------- ------- or (b) any change in the application to such Affected Party of any existing law, regulation, interpretation, directive, requirement, request or accounting principles referred to in clause (a)(i), (a)(ii) or (a)(iii) above. ------------- ------- -------- "Related Security" means, with respect to any Pool ---------------- Receivable: (a) all right, title and interest in and to all Contracts that relate to such Pool Receivable; (b) all interests in returned merchandise, if any, relating to the sale which gave rise to such Pool Receivable; (c) all other security interests or liens and property subject thereto from time to time purporting to secure payment of such Pool Receivable, whether pursuant to the Contract related to such Pool Receivable or otherwise; (d) all UCC financing statements covering any collateral securing payment of such Pool Receivable; and (e) all guarantees and other agreements or arrangements of whatever character from time to time supporting or securing payment of such Pool Receivable whether pursuant to the Contract related to such Pool Receivable or otherwise. "Reporting Date" has the meaning set forth in Section -------------- ------- 3.01(a). - - ------- "Responsible Officer" means (a) with respect to AnnTaylor or ------------------- ATSC: the Chief Financial Officer, Treasurer, Vice President - Financial Reporting or Vice President - Credit and (b) with respect to the Company: the President, Treasurer or any Vice President. "Restricted Subsidiary" shall mean any Subsidiary of --------------------- AnnTaylor which is not an Unrestricted Subsidiary. Whether or not a Restricted Subsidiary is a "wholly-owned Restricted Subsidiary" shall be determined without taking into account any directors' qualifying shares. "Secured Parties" means Lender, the Administrator, the --------------- Indemnified Parties and the Affected Parties. "Servicer" has the meaning set forth in Section 8.01(a). -------- --------------- "Servicer Material Adverse Effect" means, with respect to -------------------------------- any event or circumstance, a material adverse effect on: (i) the business, assets, financial condition, operations or prospects of the Servicer; (ii) the ability of the Servicer to perform its obligations under this Agreement or any other Transaction Document to which the Servicer, in its capacity as such, is a party; (iii) the validity or enforceability as against the Servicer of this Agreement or any other Transaction Document to which the Servicer, in its capacity as such, is a party; (iv) the status, existence, perfection, priority or enforceability of Lender's interest in the Receivables Pool; or (v) the collectability of a significant portion of the Pool Receivables. "Servicer Transfer Event" has the meaning set forth in ----------------------- Section 8.01(b). - - --------------- "Servicer's Fee" accrued for any day means an amount equal -------------- to (x) the Servicer's Fee Rate, times (y) the Net Pool Balance at ----- the close of business on such day, times (z) 1/360. ----- "Servicer's Fee Rate" means (a) 2% per annum if AnnTaylor is ------------------- the Servicer and (b) up to 3% per annum if a Person other than AnnTaylor is the Servicer. "Settlement Date" means the second Business Day following --------------- each Reporting Date. "Settlement Period" means ----------------- (a) the period from, but excluding, October 24, 1995 to, and including, November 24, 1995; and (b) thereafter, each period from, but excluding, the last day of the next preceding Settlement Period to, and including, the 24th day of the next following calendar month. "Spread Account" has the meaning set forth in Section -------------- ------- 3.05(a). - - ------- "Spread Account Agreement" has the meaning set forth in ------------------------ Section 3.05(a). - - --------------- "State Street" has the meaning set forth in paragraph 2 of ------------ ----------- the Background. ---------- "Subsidiary" means a corporation of which AnnTaylor and/or ---------- its other Subsidiaries own, directly or indirectly, such number of outstanding shares as have more than 50% of the ordinary voting power for the election of directors. "Successor Notice" has the meaning set forth in Section ---------------- ------- 8.01(b). - - ------- "Termination Date" means the earliest of ---------------- (a) the date of termination (whether by scheduled expiration, termination on default or otherwise) of either the Liquidity Banks' commitments under the Liquidity Agreement or any other Program Support Provider's commitment under any other Program Support Agreement; (b) the Loan Termination Date; (c) January 27, 1997; (d) 3 Business Days after the Administrator has received a written request by the Company to terminate the commitment of Lender under this Agreement; (e) failure to obtain a Liquidity Agreement in substitution for the then existing Liquidity Agreement on or before 30-days prior to the expiration of the commitments of the Liquidity Banks thereunder; or (f) (i) a Downgrading Event with respect to a Liquidity Bank shall have occurred and been continuing for not less than 45 days, (ii) the Downgraded Liquidity Bank shall not have been replaced by a Qualifying Liquidity Bank pursuant to a Liquidity Agreement in form and substance acceptable to Lender and the Administrator, and (iii) the commitment of such Downgraded Liquidity Bank under the Liquidity Agreement shall not have been funded or collateralized in such a manner that such Downgrading Event will not result in a reduction or withdrawal of the credit rating applied to the Commercial Paper Notes by any of the rating agencies then rating the Commercial Paper Notes; or (g) Lender shall become an "investment company" within the meaning of the Investment Company Act of 1940, as amended. "Transaction Documents" means this Agreement, the Lock-Box --------------------- Agreements, the Purchase Agreement, the Fee Letter, the Note, the Spread Account Agreement and the other documents to be executed and delivered in connection herewith. "UCC" means the Uniform Commercial Code as from time to time --- in effect in the applicable jurisdiction or jurisdictions. "Unmatured Event of Default" means any event which, with the -------------------------- giving of notice or lapse of time, or both, would become an Event of Default. "Unpaid Balance" of any Receivable means at any time (a) in -------------- the case of any Principal Receivable, the unpaid amount thereof and (b) in the case of any Finance Charge Receivable, the amount thereof accrued in accordance with the related Contract and unpaid at such time. "Unrestricted Subsidiary" shall mean a Subsidiary of ----------------------- AnnTaylor which has been designated as such by resolution duly adopted by the board of directors of AnnTaylor, which at the time of such designation had assets of $1,000 or less and which does not own or hold any securities of, or any Lien on any property of, ATSC, AnnTaylor or any Restricted Subsidiary provided no -------- Subsidiary of AnnTaylor shall be (or, if already an Unrestricted Subsidiary shall immediately cease to be) an Unrestricted Subsidiary if, at any time, ATSC, AnnTaylor or any other Restricted Subsidiary of AnnTaylor shall create, incur, issue, assume, guarantee or in any other manner whatsoever be or become liable with respect to any claim against or any contractual obligation or indebtedness of, such Subsidiary. B. Other Terms. The following terms shall have the ----------- meanings assigned thereto in the AnnTaylor Credit Agreement, as in effect on the date hereof, and such definitions are hereby incorporated by reference: "Indebtedness", "Interest Rate ------------ -------------- Contracts" and "Restricted Payment". All accounting terms not - - --------- ------------------ specifically defined herein shall be construed in accordance with generally accepted accounting principles. All terms used in Article 9 of the UCC in the State of New York, and not specifically defined herein, are used herein as defined in such Article 9. C. Computation of Time Periods. Unless otherwise stated --------------------------- in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until" each means "to but excluding". - - ---------------------------------------------------------------- Schedule 6.01(n) ---------------- List of Offices Where Records are Kept ---------------------- AnnTaylor Funding, Inc. - - ----------------------- Chief place of business and chief executive office: 414 Chapel Street New Haven, Connecticut 06511 or 142 West 57th Street New York, New York 10019 location of books and records, etc. 142 West 57th Street New York, New York 10019 414 Chapel Street New Haven, Connecticut 06511 ================================================================= Schedule 6.01(o) ---------------- List of Lock-Box Banks ---------------------- AmSouth Bank N.A. 1900 Fifth Avenue North Birmingham, Alabama 35203 Account Number: 55976026 ===================================================================== Schedule 6.01(p)-1 ------------------ Forms of Contracts ------------------ (See AnnTaylor Credit Card Application) ====================================================================== Schedule 6.01(p)-2 ------------------- Credit and Collection Policy and Method of Aging ------------------------------------------------ (Contact AnnTaylor Corporate Offices for copy of Credit And Collection Policy and Method of Aging) ====================================================================== Schedule 6.01(r) ---------------- TRADE NAMES ----------- AnnTaylor Funding, Inc. - - ----------------------- None ===================================================================== Schedule 6.02(k) ---------------- List of Offices of the Services Where Records Are Kept ------------------------------------------------------ AnnTaylor, Inc. - - --------------- Chief place of business and chief executive office: 142 West 57th Street New York, New York 10019 location of books and records, etc.: 142 West 57th Street New York, New York 10019 414 Chapel Street New Haven, Connecticut 06511 ===================================================================== Schedule 6.02(L) ---------------- List of Bank Accounts --------------------- (See attached) 1 New Haven Peoples 42-7004109 950 Chapel Street 786-2600 Brian New Haven, CT 06510 2 Westport Chase Manhattan 5601016602 P.O. Box 871 Bridgeport, CT 06601 3 New Canaan Shawmut Bank 006561-0893 Customer Center P.O. Box 1365 Framingham, MA 01701 4 Greenwich Fleet Bank 1429965 Attn: Donna Flynn Mail Code: CT E8HX15A One Constitution Plaza Hartford, CT 06115-1600 5 Braintree Baybank 3869-909-1 2 Technology Place (800) 833-3336 Mail Code: A-504 Waltham, MA 02154 6 Warwick Citizens Bank & Trust 018-901-4 One Citizens Drive (401) 456-7171 Riverside, RI 02915- 401-456-7500 3000 10 Burlington Baybank 921-258-2 2 Technology Place (617) 273-1700 Mail Code: A-504 1-800-833-3336 Waltham, MA 02154 12 Cambridge Baybank 100-03555 2 Technology Place (617) 661-3300 Mail Code: A-504 (617) 893-7750 Waltham, MA 02154 13 Pheasant Lane First N.H. Bank 20163164801 One Hampshire Plaza (800) FIRSTNH Manchester, NH 03105 14 80th & Chase Manhattan 034-1-208015 Madison Box 241 New York, NY 10081 15 Eastchester North Fork Bank 2424004097 696 White Plains Rd Scarsdale, NY 10583 16 Holyoke Mall Springfield Institute 49815723 1441 Main Street Springfield, MA 01103 20 Riverside United Jersey Bank 111 013224 401 Hackensack Avenue Hackensack, NJ 07602 21 Georgetown Riggs National Bank 1218-077 Service Line Dept. (202) 835-4000 P.O. Box 96758 Glen Johnson Washington, DC 20090- 6758 22 Newbury Fleet Bank, MA 2661-5294 Street Attn: Donna Flynn (617) 267-5261 Mail Code: CT E8HX15A One Constitution Plaza Hartford, CT 06115- 1600 23 Hartford Shawmut Bank 00-6552-7183 Customer Center P.O. Box 1365 Framingham, MA 01701 24 Wellesley Shawmut Bank 05-0096-3922 Square Customer Center P.O. Box 1365 Framingham, MA 01701 25 Michigan First Nat'l Bank of 80-08086 Avenue Chicago (312) 407-1604 Mail Suite 0205 Chicago, IL 60670 28 Oak Street Northern Trust Company 00004319-31 50 South LaSalle Street (312) 630-6652 Chicago, IL 60675 Barbara Perkin 29 Manhasset Crossland Bank 0337701957 2030 Northern Blvd. Manhasset, NY 11030 30 Tyson's Riggs National Bank 01755552 Service Line Dept. (202) 835-6530 P.O. Box 96758 Glenn Johnson Washington, DC 20090- 6758 31 White Flint Citizens Bank & Trust 057-4-919 Co. (800) 777-1962 of Maryland White Flint Mall Kensington, MO 20895 33 Continental Bank of America 77-93189 Bank 231 South LaSalle St. Chicago, IL 60697 36 Mazza Riggs National Bank 17184432 Service Line Dept. P.O. Box 96758 Washington, DC 20090- 6758 40 Central Fleet Bank 263624-7 Office Attn: Donna Flynn (203) 351-1254 Mail Code: CT E8HX15A Mary McArdle One Constitution Plaza Hartford, CT 06115- 1600 41 Troy Michigan National Bank 59631-1465-6 2038 West Big Beaver (313) 643-8660 Troy, MI 48984 43 Ardmore Mellon Bank 2-125-649 Mellon Square, Customer (215) 553-8000 Service Pittsburgh, PA 15259- 0003 44 King of Mellon Bank 2-540-672 Prussia Mellon Square, Customer Service Pittsburgh, PA 15259- 0003 46 Oxford Center Dollar Bank 2661397701 340 Fourth Avenue Pittsburgh, PA 15222 48 North Clark First Nat'l Bank of 1115000631979 Street Chicago (312) 407-4000 1660 N. LaSalle St. Suite 0294 Chicago, IL 60670-0294 49 Third Avenue European American 106-01414-5 Bank & Trust Co. (212) 688-0992 Ed 800 Third Avenue Kline New York, NY 10022 51 Ross Park Mellon Bank 1561627 Mellon Square, Customer (412) 366-9710 Service Caroline Pittsburgh, PA 15259- 0003 52 Walnut Street First Fidelity Bank 3308285 Chester Operations (215) 734-6100 Center 1 West 4th Street Chester, PA 19013 55 Mt. Lebanon PNC Bank 001-240786 P.O. Box 609 (412) 762-2435 Pittsburgh, PA 15230- 9738 56 Glen Eagle PNC Bank 8559245451 Square P.O. Box 8319 Philadelphia, PA 19101 57 Nanuet Mall Chemical Bank 654-0640488-65 41 South Middletown Rd. Nanuet, NY 10954 58 Woodbridge First Fidelity Bank 84075-006-91 10 Main Street Woodbridge, NJ 07095 59 Menlo Park First Fidelity Bank 8503500135 477 Menlo Park (908) 549-1366 Menlo Park Shopping Center Edison, NJ 08837 63 Mayfair Coconut Grove Bank 010022006206 Village Branch (305) 858-6666 2701 S. Bayshore Drive Miami, FL 33133 69 Altamonte Sun Bank 0760-760020586 Mall 498 Palm Springs Drive Altamonte Springs, FL 32701 70 Westwood Bank of America 1233-9-54955 Attn: Robert Simpson (310) 552-4421 P.O. Box 27128 Concord, CA 94520 71 Woodland Bank of America 1140-8-00-593 Hills Attn: Robert Simpson (818) 712-6070 P.O. Box 27128 Concord, CA 94520 73 Beverly Hills Bank of Los Angeles 137-012-051126 Beverly Hills Office (213) 351-2359 9601 Wilshire Boulevard Beverly Hills, CA 90210 75 Del Amo Bank of America 09930-10494 Attn: Robert Simpson (310) 212-4802 P.O. Box 27128 Concord, CA 94520 76 Beverly National Bank of 1005308 Center California Beverly Center P.O. Box 48929 Los Angeles, CA 90048 79 Horton Plaza Wells Fargo Bank 0780-010542 101 W. Broadway #303 (619) 589-5150 San Diego, CA 92101 83 Houston Town First Interstate Bank 2110064350 & P.O. Box 3326 (713) 464-9431 Country Houston, TX 77253 86 San Antonio Security Sevice FCU 4198691071 474 No. Star Mall San Antonio, TX 78216 89 New Orleans First Bank of Commerce 1102-93185 Ctr P.O. Box 60279 (504) 561-1641 New Orleans, LA 70160 90 Sutter Street Bank of America 02600-15257 Attn: Robert Simpson (415) 396-2972 P.O. Box 27128 (415) 781-2235 Concord, CA 94520 92 Ghirardelli Wells Fargo Bank 0043-054006 Square #2 Grant Avenue (415) 396-2972 San Francisco, CA 94108 Jennifer 94 Palo Alto Bank of America 05203-11068 Attn: Robert Simpson (415) 853-5811 P.O. Box 27128r Concord, CA 94520 95 Mail Order Fleet Bank 000-2247852 Attn: Donna Flynn Mail Code: CT E8HX15A One Constitution Plaza Hartford, CT 06115-1600 98 Lakeside Mall Hibernia Bank 67212-709-2 P.O. Box 61540 New Orleans, LA 70161 99 Staten Island Dime Savings Bank 02-00-00103906-4 EAB Plaza (718) 761-6200 12th Floor Uniondale, NY 11553 100 Old Hyde Park Southern Exchange Bank 100153-2 1509 West Suann Avenue (813) 254-4040 Tampa, FL 33601 101 Fashion Mall Safra Bank 303-517171 300 N.W. 82nd Avenue Cathy Shimko Plantation, FL 33324 102 Boynton Beach Barnett Bank 1611799545 Corresondence P.O. Box 30318 Tampa, FL 33633-0663 103 The Avenues Barnett Bank 2181703593 Correspondence (904) 464-7693 P.O. Box 30318 Tampa, FL 33633-0663 104 University Barnett Bank 1406172621 Square Correspondence (813) 225-2200 P.O. Box 30318 Tampa, FL 33633-0663 105 Cherry Hill Midlantic National Bank 14030-9651-2 Cherry Hill Mall Route 38 Cherry Hill, NJ 08002 106 Mall @ St. Pioneer Bank 3194019 Vincent P.O. Box 31750 Shreveport, LA 71130 108 Cambridgeside East Cambridge Savings 04-80-8001076 292 Cambridge St. (617) 354-7700 Cambridge, MA 02141- 1263 110 Larimer Colorado National Bank 1-227-0088-0646 Square 1515 Arapahoe Street (303) 820-4229 Denver, CO 80292 111 Charleston Harris Bank 158739 Center Mall 1 East Main Street St. Charles, IL 60174 112 Siena Square Norwest Bank of Boulder 1823473562 1242 Pearl Street Box 227 Boulder, CO 80306 114 Cherry Creek Cherry Creek National 16-803085 Bank 3033 East First Avenue Denver, CO 80206-5698 115 Trolley First Security Bank 131-00283-43 Square 445 Trolley Square (801) 350-6600 Salt Lake City, UT 84102 116 Town Square NBD 000410001709287 2000 S. Naperville Road Wheaton, IL 60187 117 Lincoln Place First Interstate Bank 043-443 150 Washington Ave. Santa Fe, MN 87501 118 Ocean County First Fidelity Bank 3000-5-12065 1201 Hooper Avenue (908) 905-4274 Tom's River, NJ 08753 119 Las Vegas Bank of America 150199602 2500 W. Spring Mountain Rd. Las Vegas, NV 89193 121 St. Louis Mercantile Trust Co. NA 1001281409 Center 8th & Locust P.O. Box 524 St. Louis, MO 63166 122 West County Colonial Bank 01-06944-601 Ctr 12330 Manchester Road (314) 966-8100 Des Peres, MO 63131 123 One Pacific Firstier Bank 0827622 Place 9 Farnam at Seventeenth (402) 345-1100 Omaha, NE 68102 124 Country Club Country Club Bank 078501 414 Nichols Road (816) 931-4060 Kansas City, MI 64112 126 Tower Place Fifth Third Bank 714-16492 7708 Montgomery Rd. Cincinnati, OH 45230 127 Tucson Mall Bank of America 125-709559 4201 No. Circle Rd. Tucson, AZ 85705 128 Freehold First Fidelity Bank 3000398408 72 West Main St. Freehold, NJ 07728 129 Rockingham Shawmut Bank 510017916 Park Mall Customer Center (800) 685-5595 P.O. Box 1365 Framingham, MA 01701 130 Regency Nations Bank 02052218 Square P.O. Box 27025 (804) 788-2030 Richmond, VA 23261-7025 131 Owings Mills First Fidelity Bank 4063798294 P.O. Box 896 Baltimore, MD 21203 132 Harbour Place Nations Bank 00-0140-8032 P.O. Box 27025 (800) 241-5788 Richmond, VA 23261-7025 133 Chesterfield Peoples Bank 004031413712 5756 Hopkins Road Richmond, VA 23234 134 Union Station Adams National Bank 0100161201 1627 K Street, NW (202) 466-4090, Washington, DC 20006 ext 160 136 Reston Town First Union Bank of 2070478000217 Ctr Virginia (800) 677-3778 7711 Plantation Rd. Roanoke, VA 24019 137 Montgomery First Fidelity Bank 4063795803 P.O.Box 896 Baltimore, MD 21203 138 Towson Town Maryland National Bank 09111774 Center P.O. Box 987 (410) 828-9666 Baltimore, MD 21203 Ann O'Neil 140 Woodbury Chemical Bank 141062437865 Commons 7600 Jericho Turnpike (516) 364-0012 Woodbury, NY 11797 143 West Farms Farmington Savings Bank 30-57-000093 P.O. Box 8 677-4541 Farmington, CT 06034- 0008 144 Buckland Savings Bank of 662002398 Hills Manchester (203) 647-1050 923 Main St. P.O. #231 Manchester, CT 06044- 0231 145 75th Street Marine Midland Bank 027712770 1340 Third Ave. (800) 872-0228 New York, NY 10021 151 Ridgedale AmeriBank 1017039 1809 Plymouth Road South ( ) 546-6060 Minnetonka, MN 55343 152 Conservatory Firstar Bank 180000027 1550 E. 79th Street Bloomington, MN 55425 153 South Bend First Source Bank 119-865-4 P.O. Box 1602 South Bend, IN 46634 154 Fairlane Town NBD 2567524 Center 18800 Hubbard Dr. Dearborn, MI 48126 155 Briarwood NBD 205000023148 P.O. Box 8601 (313) 995-8100 Ann Arbor, MI 48107 Bob Connor 159 Springfield Nations Bank 11060385 Mall P.O. Box 27025 Richmond,VA 23261-7025 163 Cumberland Sun Trust Bank 9300313351 Mall Mail Code 011 (414) 438-6859 P.O. Box 4418 Atlanta, GA 30302 165 Augusta First Union Bank of GA 2080000090669 699 Broad Street Augusta, GA 30901 167 Mall of First Bank 1359-30107747 America 9633 Lyndale Ave. South Bloomington, MN 55420 172 Main Place Bank of America 1233-5-54957 Attn: Robert Simpson (714) 558-2155 P.O Box 27128 Concord, CA 94520 173 La Jolla Wells Fargo Bank 0734-011133 7714 Girard Ave. (619) 454-2265 La Jolla, CA 92037 174 Biltmore First Interstate Bank 096466018 Biltmore Office (602) 528-7400 5050 N. 24th Street P.O. Box 53412 Phoenix, AZ 85072-3412 177 South Lake Wells Fargo Bank 0613058866 Avenue 82 South Lake Avenue (619) 745-3911 Pasadena, CA 91101 178 Ala Moana Bank of America 8870100646 P.O. Box 539 Honolulu, HI 96809-0539 179 Brea Bank of America 952-2-35581 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 180 Desert Bank of America 09506-01505 Fashion Mall Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 181 Santa Monica Santa Monica Bank 09008586 Place 152 Santa Monica Place Santa Monica, CA 90401 182 Palos Verdes Union Bank 0730010656 507 Silver Spur Road Rolling Hills Estates, CA 90274 183 Media City Wells Fargo Bank 0933-040495 Center 900 N. San Fernando Blvd. Burbank, CA 91504 184 No. County Wells Fargo Bank 0760-017830 Fair 1991 E. Valley Pkwy Escondido, CA 92027 185 University Wells Fargo Bank 0721-113330 Towne 4315 La Jolla Village Center Dr. San Diego, CA 92122 187 The Oaks Bank of America 1011-1-11247 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 192 Stonestown Bank of America 0252900245 Attn: Robert Simpson (415) 956-4433 P.O. Box 27128 Concord, CA 94520 193 San Francisco Bank of America 00666-18805 Ctr Attn: Robert Simpson (415) 622-4894 P.O. Box 27128 Concord, CA 94520 194 Pacific First Seafirst Bank 63497713 Ctr 701 Fifth Avenue (206) 358-7800 Seattle, WA 98104 (800) 235-0785 195 Arden Fair Wells Fargo Bank 347056947 1795 Arden Way (916) 440-4670 Sacramento, CA 95815 196 Pioneer Place U.S. Bank of Oregon 0700008980 309 S.W. Sixth Avenue (503) 275-6671 P.O. Box 4412 Portland, OR 97208 197 Stoneridge First Interstate Bank 713515701 Mall 5790 Stoneridge Mall (510) 463-1170 Pleasanton, CA 94566 200 Fifth Avenue Chemical Bank 134069245265 401 Madison Avenue (212) 949-2539 New York, NY 10017 201 Cedarhurst NatWest Bank 2011-60-8235 400 Central Avenue (516) 569-4200 Cedarhurst, LI 11559 203 Upper West Chemical Bank 067-0648979-65 Side 2045 Broadway (212) 974-1616 New York, NY 10023 204 Crossgate Albany Savings Bank 280000-222-8 120 Washington Avenue (518) 426-6401 Ext. Gerrianne Albany, NY 12203 205 Walden Key Bank 12-100223-3 Galleria 2000 Walden Ave., Suite (716) 683-0480 B 216 Cheektowaga, NY 14225 207 A & S Plaza Chemical Bank 023071029165 349 Fifth Avenue New York, NY 10016 208 87th Street Citibank 3360-8426 2350 Broadway (212) 868-1100 New York, NY 10024 209 Roosevelt Crossland Bank 0417702354 Field Roosevelt Field Mall Garden City, NY 11530 241 Fashion Mall NBD 700002-634-309 One Indiana Square - J- 400 Indianapolis, IN 46266 242 Twelve Oaks Comerica Inc. 1840312803 27768 Novi Road Novi, MI 48050 243 Grosse Point NBD 4163494 P.O. Box 206A (800) CALL-NBD Detroit, MI 48232 (313) 862-4NBD 244 Kenwood Town Fifth Third Bank 71652145 Center 7708 Montgomery Rd. (513) 891-5600 Cincinnati, OH 45230 245 Columbus City Bank One 11-86775 65 East State Street (800) TRY-8400 Columbus, OH 43271-1040 Shari (800) 248-2880 246 Woodland Mall Michigan National Bank 5856-160097 2627 E. Beltline SE Grand Rapids, MI 49546 248 Westgate Dollar Bank 2593219871 20981 Westgate (216) 331-9494 Fairview Park, OH 44126 249 Laurel Park NBD 0010679-14 37458 Six Mile Road (313) 953-0620 Livonia, MI 48152 Jean Phillips 260 Saddlecreek Victory Bank 0200020958 7550 West Farmington Boulevard Germantown, TN 38138 261 Bellevue First Tennessee Bank 9111646 Center 8160 Sawyer Brown Rd. (615) 748-4121 Nashville, TN 37230 262 Penn Place Bank of Oklahoma 822007911 3535 NW 58 #200 P.O. Box 24128 Oklahoma City, OK 73124 263 Utica Square F & M Bank and Trust 400029793 Box 4500 (918) 748-4290 Tulsa, OK 74159 266 Willowbrook Charter Bank 40044865 P.O. Box 4525 Houston, TX 77210 271 Hanes Mall First Union Bank of NC. 7188418502 No. Wilkesboro Service Center P.O. Box 106 No. Wilkesboro, NC 28659-0106 273 Park Plaza Twin City Bank 90139376 P.O. Box 5581 (501) 661-0265 Capital & Broadway No. Little Rock, AK 72119 275 Fayette Mall National City Bank 704-08416 P.O. Box 36000 Louisville, KY 40233- 6000 277 Asheville Nations Bank 430062612 1104 Brevard Rd. Asheville, NC 28802 278 Hamilton First Tennessee Bank 0006213 Place 701 Market Street Chattanooga, TN 37401 279 Coolsprings First Tennessee Bank 0722596 P.O. Box 100 Franklin, TN 37065-0100 280 Madison First Alabama Bank 0401403478 Square Mall P.O. Box 680 Huntsville, AL 35804- 0680 281 Houston Laredo Bank 801-175-9 Galleria P.O. Box 59 700 San Bernardo Laredo, TX 78042 282 Hillsdale Wells Fargo Bank 0525-031290 Hillsdale Office (415) 325-2004 SW Hillsdale Boulevard San Mateo, CA 94403 283 Dallas Nations Bank 059-0001347 Galleria 5304 Alpha Road (214) 647-4488 Dallas, TX 75240 284 Perimeter Sun Trust Bank 8801928410 Mall Mail Code 049 P.O. Box 4418 Atlanta, GA 30302 285 Bellevue Seafirst Bank 67545715 Square P.O. Box 907 Bellevue, WA 01970 286 South Coast Bank of America 0694-2-08817 Plaza Attn: Robert Simpson (714) 840-6447 P.O. 27128 Concord, CA 94520 288 North Shore Salem Five 0089-00710145-7 210 Essex Street Salem, MA 01970 289 Century City Glendale Federal 1047023283 1801 Avenue of the Stars Los Angeles, CA 90067- 5902 291 Downtown Bank of America 1233-2-17890 Plaza Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 292 Fairfield Star Bank 48361-0374 Commons 425 Walnut Street Cincinnati, OH 45203 293 Stamford Town Fleet Bank 886-1005 Center Attn: Donna Flynn (203) 244-5825 Mail Code: CT E8HX15A One Constitution Plaza Hartford, CT 06115- 1600 294 Lenox Square Sun Trust Bank 8800781216 Mail Code 049 (404) 588-7521 P.O. Box 4418 Atlanta, GA 30302 295 Worthington NBD 4000003758 Square 175 South Third Street Columbus, OPH 43215 296 The Grove Shrewsbury State 0110-74426 465 Broad St. (908) 842-7700 Shrewsbury, NJ 297 Ridgewood Natwest Bank 4000019513 10 Exchange Place Jersey City, NJ 298 Winter Park Barnett Bank 2830666787 Correspondence (407) 646-3281 P.O. Box 30318 Tampa, FL 33633-0663 299 Broadway Bank of America 02240-04907 Plaza Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 300 River Oaks Nations Bank 266-308-5222 West Gray P.O. Box 2578 Houston, TX 77252-2518 301 Annapolis First Fidelity Bank 0039-29744 Mall P.O. Box 896 (800) 492-1653 Baltimore, MD 21203 302 North Point Sun Trust Bank 8801067144 Mail Code 049 P.O. Box 4418 Atlanta, GA 30302 303 Dadeland Dadeland Bank 10164397500 7439 Dadeland Mall Miami, FL 33156 304 Boca Town Barnett Bank 1611773989 Center Correspondence P.O. Box 30318 Tampa, FL 33633-0663 305 Chestnut Hill Baybank 325-699-5 2 Technology Place (617) 273-1700 Mail Code: A-504 Waltham, MA 02154 307 Oakbrook Republic Bank 1930011379 6501 So. Pulaski Rd. (312) 581-4500 Chicago, IL 60629 308 Glendale Wells Fargo Bank 0795-055698 420 North Brand (818) 246-7361 Glendale, CA 91203 309 World Trade Chemical Bank 024-033715 Ctr 100 World Trade Center (212) 912-0163 New York, NY 10048 310 Waterside BancFlorida 070137393 Shops 5801 Pelican Bay Blvd (800) 368-5800 Box 413004 Naples, FL 33941-3004 311 Ft. Barnett Bank 1800122224 Lauderdale Correspondence (305) 522-5550 P.O. Box 30318 Tampa, FL 33633-0663 312 Tysons II Riggs National Bank 01808389 Service Line Dept. P.O. Box 96758 Washington, DC 20090- 6758 313 Short Hills Investors Savings Bank 0056109969 Mall & Short Hills Short Hills, NJ 07078 314 La Cumbre I Bank of America 1233-1-18994 Attn: Robert Simpson (800) 262-2726 P.O. Box 27128 Concord, CA 94520 315 Plaza Mark Twain Bank 361-400-5591 Frontenac 1630 S. Lindbergh Road (314) 997-7444 St. Louis, MO 63131 317 Bal Harbour Sun Bank 0599-000137380 Bal Harbour Office (305) 591-6000 9600 Collins Avenue Bal Harbour, FL 33154 318 Natick Baybank 3867-3408 2 Technology Place Mail Code: A-504 Waltham, MA 02154 319 Fashion Wells Fargo Bank 0769-259009 Valley 1350 Fashion Valley Road San Diego, CA 92108 320 North Park Comerica Bank 783101-0215 P.O. Box 650282 Dallas, TX 75265-0282 321 Tower City National City Bank 4601217 P.O. Box 5756 Cleveland, OH 44101- 0756 322 Valley Fair Bank of America 05750-01049 Attn: Robert Simpson (408) 277-7329 P.O. Box 27128 Concord, CA 94520 323 Bridgewater PNC Bank 80-0159-8151 P.O Box 1032 Morristown, NJ 08057- 0932 324 Embarcadero Bank of America 1233-8-54960 Sqr. Attn: Robert Simpson (415) 445-4043 P.O. Box 27218 Concord, CA 94520 325 Charleston First Citizens Bank 079013275701 182 Meeting St. (803) 577-4560 Charleston, SC 326 Santa Anita Bank of America 1233-5-19468 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 327 Pearlridge Bank of America 5955117841 Kam Highway Aeia, HI 96701 328 Raleigh First Union Bank of NC. 2000000-407737 4401 Glenwood Ave. Raleigh, NC 27612 329 Prudential Fleet Bank, MA 936361-2920 Center Attn: Donna Flynn Mail Code: CT EHX15A One Constitution Plaza Hartford, CT 06115-1600 330 Corte Madera Bank of America 978-0-08430 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 331 Scottsdale Bank of America 235100550 69100 E. Camelback Scottsdale, AZ 85251 332 Faneuil Hall Shawmut Bank 200495677 Customer Center P.O. Box 1365 Framingham, MA 01701 333 Old Orchard First American Bank 12-437-001 4949 Old Orchard Road (312) 679-2200 Skokie, IL 60077 334 K Street Crestar Bank 0520-21442 15th St. & New York Ave. (703) 838-3141 N.W. Washington, DC 20005 335 Rosedale MidAmerica 8400780612 2440 N. Fairview Ave. Roseville, MN 55713 336 Northgate Village Bank 1092871 1058 W. Club Blvd. Durham, NC 27701 337 Coronado Sunwest Bank 0162700363 P.O. Box 2550 Albuquerque, NM 87125- 0550 338 Carousel Key Bank 221-025156 Center 1510 W. Genesee St. (315) 470-5478 Syracuse, NY 13204 Richard Cizensk 340 Fashion Place First Security Bank 0640002614 6161 South St. Murray, UT 84107 341 Fashion Show Bank of America 150240885 P.O. Box 98600 Las Vegas, NV 89195- 0001 342 Sherman Oaks Bank of America 0397914183 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 343 Trumbull Lafayette Bank & Trust 051008068 Co. (203) 336-6200 P.O. Box 1899 Bridgeport, CT 06601- 9964 344 Arboreteum Bank One 0690014402 Market P.O. Box 2266 Austin, TX 78780-9989 345 Canal Place Premier Bank 54- 19105377 P.O. Box 3399 (504) 569-0483 Baton Rouge, LA 70821 346 Woodland Boatman's Bank 170182756214 Hills 6701 Sou Memorial Dr. P.O. Box 35829 Tulsa, OK 74133-2000 347 Brandon Town Nations Bank 3603705653 Center 2105 West Brandon Blvd Brandon, FL 33511-4703 348 Shadyside Integra Bank 84-48889 300 Fourth Avenue (412) 621-3370 Pittsburgh, PA 15278 349 The Bank of New York 6700681597 Westchester 158 Westchester Avenue White Plains, NY 10601 350 Collin Creek Plano Bank & Trust 0767129 Mall P.O. Box 869111 Plano, TX 75086-9111 351 Shelter Cove Nations Bank 745040798 23C Shelter Cove Lane Hilton Head, SC 29938 352 Southpark First Union Bank of NC. 2070490732110 Mall Deposit Accounting Center Charlotte, NC 28288- 0455 353 Somerset Shawmut Bank 7103-2265 Square Customer Center P.O. Box 1365 Framingham, MA 01701 354 Beachwood Society National Bank 163200361 26300 Cedar Road (216) 464-9330 Beachwood, OH 44122 355 Riverchase Southtrust Bank 60306603 Galleria 420 North 20 th Street, Sixth Floor Birmingham, AL 35203 356 Highland Mall First State Bank 0108-3392 P.O. Box 3550 (512) 495-6050 Austin, TX 78764 357 Hulen Mall Overton Park 00058818 4840 Overton Plaza Fort Worth, TX 76109- 4990 358 Northbrook Firstar Bank 327046828 1819 Lake Cook Road Northbrook, IL 60062 359 Four Seasons Wachovia Bank of North 3569-022658 Town Center Carolina 600 Four Seasons Blvd. Greensboro, NC 27407 360 Oxmoor Center PNC Bank 309547-8353 Customer Service (502) 581-2347 P.O. Box 33000 Louisville, KY 40232- 3000 361 Willow Grove First Valley Bank 069700273 One Bethlehem Plaza Bethlehem, PA 18018- 5781 362 Madison Chemical Bank 026078694565 Avenue 598 Madison Avenue New York, NY 10022 363 The Falls Sun Bank 6990010119595 8820 SW 136th Street Miami, FL 331765 364 Oakview Mall Firstier Bank 053-7-651 1700 Farnam Street Omaha, NE 68102-2183 366 Palmer Square PNC Bank 80-0053-0825 P.O. Box 1032 Morristown, NJ 08-57- 0932 367 Church Street Merchants Bank 01497676 Marketplace 123 Church Street P.O. Box 1009 Burlington, VT 05402- 1009 368 Baybrook Bay Area Bank & Trust 079189 218 Nasa Road One Webster, TX 77598 369 Palisades National Westminster 4370202198 Ave. Bank 42 North Dean Street Englewood, NJ 07631 380 West Town First Tennessee Bank 67-48767 Mall 800 South Gay Street Knoxville, TN 37929 381 Charlottesvil Jefferson National Bank 16302-0345-01 le P.O. Box 711 Charlottesville, VA 22902-0711 382 Greenville First Union Bank of SC 2010000140369 652 Haywood Road Greenville, SC 29607 383 Carmel Place Bank of America 6395-01497 Carmel by the Sea Branch 7th & Mission Street Carmel, CA 93921 384 Greenhills Third National Bank 1761625 P.O. Box 305110 Nashville, TN 37230- 5110 385 Highland Park Nations Bank 109-15538 P.O. Box 831547 Dallas, TX 75283-7547 386 Erieview Dollar Bank 266-081-4986 1301 E. Ninth St. Cleveland, OH 44114 387 Larchmont, NY Bank of New York 6701157247 124 Chatsworth Avenue Larchmont, NY 10538 388 Washington First Interstate Bank 5270159530 Square 9200 S.W.Washington Sq.Rd P.O. Box 23037 Tigard, OR 97223-0008 389 Circle Center National City Bank 501877347 101 West Washington Street Indianapolis, IN 46255 390 University First Interstate Bank 4040045306 Village 1661 South University Drive Ft. Worth, TX 76107 391 Seminole Town Sun Bank 0039004023633 Center 4240 W. Lake Mary Boulevard Lake Mary, FL 32746 392 Woodfield NBD 003700001-15479 Higgins & Meacham Roads (312) 882-6400 Schaumburg, IL 60196 393 Eastview Mall Canandaigua National 09-502521-01 Bank 338 Eastview Mall Victor, NY 14564 394 Southdale First Bank 1-367-30735026 7001 France Avenue South Edina, MN 55435 395 Northridge Bank of America 24404-04783 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 396 Walt Whitman Republic Bank for 1366001368 Savings (516) 423-7200 Walt Whitman Mall Route 110 Hungtington Station, NY 11746 397 South Street Citibank 49615556 Seaport 30 Fulton Street New York, NY 10038 398 The Gardens First Federal of the 2070000757 Palm Beaches (800) 221-8511 P.O. Drawer F West Palm Beach, FL 33402-3515 401 Mayfair Mall Firstar Bank 112047743 2300 North Mayfair Road (414) 258-1440 Wauwatosa, WI 53226 402 Danbury Fair First Fidelity Bank 2-082-007 Sugar Hollow Rd. 744-1230, ext. Danbury, CT 06810 2221 Irene 403 St. Louis Commerce Bank 270177458 Galleria 7910 Clayton Road St. Louis MO 63117-1385 404 Citicorp Bank of America 1233-1-54959 Plaza Attn: Robert Simpson (213) 735-1144 P.O. Box 27128 Concord, CA 94520 406 North Park Trustmark 1001447374 Mall P.O. Box 1200 Jackson, MS 39215 407 Fashion Ctr Chevy Chase 1074300513 Pentagon 1100 S. Hayes Street (800) 825-9000 Arlington, VA 22202 Brian 409 West Shore Barnett Bank 1407137925 Plaza Correspondence P.O. Box 30318 Tampa, FL 33633-0663 410 Oaks Mall Gainesville State Bank 0400502901 2814 S.W. 34th Street P.O. Box 147002 Gainesville, FL 32614- 7002 412 Montclair Wells Fargo Bank 0984041046 Plaza PO Box 340214 Sacramento, CA 95834- 0214 502 Kenwood Town Fifth Third Bank 71652268 Ctr 7708 Montgomery Rd. Cincinnati, OH 45236 503 Columbus Bank One 0236515 Center 65 East State Street Columbus, OH 43271- 1040 504 Beverly National Bank of 2519291 Center California 145 S. Fairfax Ave. Los Angeles, CA 90036 505 La Cumbre II Bank of America 1233-0-19239 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 506 Georgetown Riggs National Bank 17187190 Park Service Line Dept. P.O. Box 96758 Washington, DC 20090- 6758 507 The Grove @ Shrewsbury State Bank 011077220 Shrewsbury 465 Broad Street Shrewsbury, NJ 07702 508 Plaza Mark Twain Bank 3614020335 Frontenac 1630 S. Lindbergh Road St. Louis, MO 63131 509 Broadway Bank of America 12333-20533 Plaza Attn: Robert Simpson P.O.Box 27128 Concord, CA 94520 510 Union Station Adams National Bank 0100768801 1627 K Street, NW Washington, D.C. 20006 700 Franklin Mellon Bank 8455628 Mills Mellon Square, Customer Service Pittsburgh, PA 15259- 0003 701 Sawgrass Barnett Bank 387-1201-716 Mills Correspondence P.O. Box 30318 Tampa, FL 33633-0663 704 Gurnee Mills NBD 34000600479 513 Central Avenue Highland Park, IL 60035 705 Potomac Mills Riggs National Bank 1-801-589 Service Line Dept. P.O. Box 96758 Washington, DC 20090- 6758 706 Millstream Fulton Bank 2318-77085 P.O. Box 4887 (717) 291-2591 Lancaster, PA 17604 707 San Marcos State Bank & Trust 1505920 P.O. Box 649 (512) 396-4411 San Marcos, TX 78667 708 Gulf Coast Barnett Bank 195-919-3980 Factory Correspondence (800)628-5677 P.O. Box 30318 Tampa, FL 36333-0663 709 Woodbury Warwick Savings 032-14-20085 Commons P.O. Box 1008 Highland Mills, NY 10930 710 CastleRock First Bank of Castlerock 285-550-2403 P.O. Box 1300 (303) 688-5000 Castlerock, CO 80104 (800) 964-3444 711 Destin AmSouth Bank of Florida 3400071757 San Destin Branch 5050 highway 98 East Destin, FL 32541 712 West Fifth Third Bank 758-86328 Lancaster P.O. Box 182026 426-6384 Columbus, OH 43218 713 Birch Run First of America Bank 3130046661 12010 Church Ave. (800) 736-3534 Birch Run, MI 48708 714 Petaluma Bank of America 1233-1-19526 Attn: Robert Simpson P.O. Box 27128 Concord, CA 715 Gilroy Bank of America 00116-3740 Attn: Robert Simpson (800) 237-8052 P.O. Box 27128 Concord, CA 94520 716 St. Augustine First Union Bank of 2090000394915 Florida (800) 735-1012 P.O. Box 2870 Jacksonville, FL 32231 717 Citadel Bank of California 089002428 Outlets Citadel Office (213) 255-0333 500 Citadel Drive Commerce, CA 90040 718 Osage Beach First Bank Centre 01005784001 One Financial Centre 348-2265 Osage Beach, MO 65065 719 Grove City Integra Bank 0071726391 201 S. Broad St. (800) 352-0186 P.O. Box 349 Grove City, PA 720 Worchester Bank of Boston 541-65139 P.O. Box 15073 Boston, MA 02106 721 Tuscola Tuscola Nat'l Bank 04-674-4 214 Main St. (217) 253-4711 P.O. Box 110 Tuscola, IL 61953 722 Vero Beach First Union Bank of 2090000468113 Florida P.O. Box 1269 Vero Beach, FL 723 Riverhead Suffolk County Nat'l 110125911 Bank 6 West Second Street Riverhead, NY 11901 724 Branson Capital Bank 6411284368 P.O. Box 70 Branson, MO 65616-0070 725 Barstow Bank of America 1233-9-20233 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 726 Gainesville Bank of America Texas 315143632 101 East Broadway Gainesville, TX 76240- 4010 727 Aurora Farms Second National Bank 2006444601 P.O. Box 1311 Warren, OH 44482-1311 728 Fremont Norwest 85575369 P.O. Box 120 Angola, IN 46703-6740 729 Edinburgh Irwin Union Bank & Trust 39698170 500 Washington Street Box 929 Columbus, IN 47202 730 Michigan City First of America Bank 7930011551 800 Lincolnway LaPorte, Indiana 46350 731 Orlando Barnett Bank 2834599958 Correspondence P.O. Box 30318 Tampa, FL 36333-0663 732 Cabazon North County Bank 610103589 1735 W. Ramsey Street Banning, CA 92220 737 Rehoboth Midway Mellon Bank 01029153 4537 Highway One Rehoboth Beach, DE 19971 738 Auburn Seafirst Bank 69727600 Supermall 800 5th Avenue Seattle, WA 98104 739 Napa Bank of America 00315-09435 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 740 San Leandro Bank of America 1233720791 Attn: Robert Simpson P.O. Box 27128 Concord, CA 94520 741 Camarillo Santa Barbara Bank & 32005159 Trust 2310 E. Ponderosa Drive Camarillo, CA 93010 742 Arizona Bank of America 946026509 Factory Shops 3511 W. Peoria Avenue Phoenix, AZ 85029 743 Magnolia Southeastern Bank 705896 Bluffs P.O. Box 455 Darien, GA 31305 798 Milpitas Wells Fargo Bank 4030-010789 3535 Lincoln Plaza 500 North Akard Dallas, TX 75201 - - ------------------------------------------------------------ Exhibit 1.02(a) --------------- [FORM OF BORROWING NOTICE] [Date] PNC Bank, National Association, as Administrator Fifth Avenue and Wood Street Pittsburgh, Pennsylvania 15265 Attention: Robert O. Finley, Jr. Ladies and Gentlemen: Reference is made to the Amended and Restated Receivables Financing Agreement, dated as of October 31, 1995, among the undersigned, AnnTaylor, Inc., as Servicer, Market Street Capital Corp., as Lender, and PNC Bank, National Association, as Administrator (as the same may be further amended, supplemented or otherwise modified from time to time, the "Receivables Financing --------------------- Agreement"). All capitalized terms used but not otherwise - - --------- defined herein which are defined in the Receivables Financing Agreement have the same meanings when used herein. The undersigned, AnnTaylor Funding, Inc., refers to the Receivables Financing Agreement and hereby gives you notice, irrevocably, pursuant to Section 1.02(a) of the Receivables --------------- Financing Agreement, that the undersigned hereby requests that a Loan be made in the aggregate principal amount of $_____________ on _____________, 199_. The undersigned hereby certifies as of the date hereof, and as of the date such Loan is made, as follows: (a) the representations and warranties contained in the Receivables Financing Agreement are correct, before and after giving effect to such Loan and to the application of the proceeds therefrom, as though made on and as of such dates and shall be deemed to have been made on such dates; (b) no event has occurred and is continuing, or would result from such Loan or from the application of the proceeds therefrom, that constitutes an Event of Default or an Unmatured Event of Default; (c) The borrowing Base as of the date hereof is $_________________. (d) after giving effect to such Loan, the Outstanding Principal is $_____________; and (e) the Termination Date has not occurred. IN WITNESS WHEREOF, the undersigned has caused this Borrowing Notice to be executed and delivered by a Responsible Officer on the date first written above. ANNTAYLOR FUNDING, INC. By: __________________ Title: ________________ - - --------------------------------------------------------------- Exhibit 1.04 ------------- [FORM OF NOTE] $40,000,000 New York, New York October 31, 1995 FOR VALUE RECEIVED, the undersigned, ANNTAYLOR FUNDING, INC. (the "Issuer"), hereby promises to pay to the order of MARKET STREET ------ CAPITAL CORP. (together with its successors and assigns, the "Noteholder"), ---------- on or before January 27, 1997, the principal amount of FORTY MILLION DOLLARS ($40,000,000) or, if less, the aggregate unpaid principal amount of all of the Loans (as defined in the Amended and Restated Receivables Financing Agreement, dated as of October 31, 1995, among the Issuer, AnnTaylor, Inc., as Servicer, the Noteholder and PNC Bank, National Association, as Administrator (as the same may be further amended, supplemented or otherwise modified from time to time, the "Amended and ----------- Restated Receivables Financing Agreement") made by the Noteholder to - - ---------------------------------------- the Issuer pursuant to the Amended and Restated Receivables Financing Agreement. The undersigned also promises to pay interest on the unpaid principal amount of each Loan evidenced by this Note from the date of such Loan until such Loan is paid in full, at the rates and payable on the dates specified in the Amended and Restated Receivables Financing Agreement. This Note evidences indebtedness incurred as Loans under, and is entitled to the benefits of, the Amended and Restated Receivables Financing Agreement, to which Amended and Restated Receivables Financing Agreement reference is hereby made for a statement of its terms and conditions, including those under which the maturity of this Note may be accelerated. Upon the occurrence of an Event of Default as specified in the Amended and Restated Receivables Financing Agreement, the principal balance hereof and the interest accrued hereon may be declared to be forthwith due and payable.
Receivables Financing Agreement - AnnTaylor Funding Inc., AnnTaylor Inc., Market Street Capital Corp., and PNC Bank NA
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