NEW YORK, June 18 /PRNewswire-FirstCall/ -- Liz Claiborne, Inc. (the
"Company") (NYSE: LIZ) today announced the pricing of $90 million principal
amount of 6% convertible senior notes due 2014 (the "notes"). Such amount
includes $15 million principal amount of notes issued pursuant to an
over-allotment option, which was exercised in full, granted by the Company to
the initial purchasers to purchase additional notes on the same terms and
conditions.
The notes are unsecured, senior obligations of the Company, will pay interest
semi-annually at a rate of 6% per annum and will mature on June 15, 2014. The
conversion rate will initially be 279.6421 shares of the Company's common
stock per $1,000 principal amount of notes (equivalent to an initial
conversion price of approximately $3.576 per share of common stock), subject
to adjustment in certain circumstances. The initial conversion price
represents a conversion premium of 20% over the last reported sale price of
the Company's common stock on June 18, 2009 of $2.98 per share. Holders of
the notes may convert their notes at their option under certain circumstances.
Upon conversion, the Company will deliver cash, shares of the Company's common
stock, or a combination of cash and shares, at the option of the Company.
Holders of the notes may require the Company to repurchase for cash all or
some of their notes upon the occurrence of a fundamental change (as defined).
The conversion rate will be subject to a "conversion rate cap" in accordance
with the rules of the NYSE. The Company anticipates closing the offering of
the notes (including the notes issuable pursuant to the over-allotment option)
on June 24, 2009.
The Company intends to use the net proceeds from the offering (including
proceeds from the initial purchasers' exercise of the over-allotment option)
to temporarily pay down a portion of the outstanding borrowings under its
amended credit facility.
The notes will be offered in the United States to qualified institutional
buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the
"Securities Act"). The notes have not been registered under the Securities Act
and may not be offered or sold in the United States without registration or an
applicable exemption from the registration requirements.
This press release does not constitute an offer to sell or the solicitation of
an offer to buy the notes or any other securities, nor will there be any sale
of notes or any other securities in any state or jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or jurisdiction. Any
offer of the notes will be made only by means of a private offering
memorandum.
Cautionary Note Regarding Forward-Looking Statements
Information set forth in this press release contains forward-looking
statements involving a number of risks and uncertainties, many of which are
outside the control of the Company. The Company cautions readers that any
forward-looking information is not a guarantee of future performance and that
actual results could differ materially from those contained in the forward
looking information. The Company may change its plans, intentions, belief or
expectations at any time and without notice, based upon any change in the
Company's assumptions or otherwise. Forward-looking statements contained
herein include, but are not limited to, statements regarding the Company's
plans to complete the offering of notes and the implementation of our intended
use of the proceeds thereof. While the Company believes that the assumptions
concerning future events are reasonable, it cautions that there are inherent
difficulties in predicting certain important factors that could impact the
future performance or results of its business. Among the factors that could
cause results to differ materially from those indicated by such
forward-looking statements are: general market conditions, risks associated
with the general economic conditions in the United States, Europe and other
parts of the world; the Company's ability to continue to have access on
favorable terms to sufficient sources of liquidity necessary to fund ongoing
cash requirements, which access may be adversely impacted by a number of
factors, including, the level of the Company's cash flows, which will be
impacted by the level of consumer spending and retailer and consumer
acceptance of its products and the availability of borrowings under the
Company's amended and extended bank credit agreement; further adverse changes
in the Company's credit ratings, the Company's ability to comply with the
financial and other covenants and requirements included in its amended and
restated credit agreement; interest rate and exchange rate fluctuations; risks
associated with the appointment of Li & Fung as the Company's primary global
apparel and accessories sourcing agent and the transfer of its sourcing
function to Li & Fung; risks associated with the Company's efforts to
reorganize its Mexx Europe operations; and risks associated with the Company's
ability to execute successfully on its long-term plans. Additional risks and
factors are identified in the Company's Annual Report on Form 10-K for the
fiscal year ended January 3, 2009, in the section entitled "Risk Factors," as
updated in the Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended April 4, 2009 and in Exhibit 99.2 to the Company's current report on
Form 8-K filed on June 18, 2009, and the Company's other periodic filings with
the U.S. Securities and Exchange Commission. The Company undertakes no
obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
SOURCE Liz Claiborne, Inc.
Investor Relations Contact: Robert J. Vill, Vice President-Finance and
Treasurer, Liz Claiborne, Inc., +1-201-295-7515, Robert_Vill@liz.com; or Media
Relations Contact: Jane Randel, Vice President-Corporate Communications, Liz
Claiborne, Inc., +1-212-626-3408, Jane_Randel@liz.com
