-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VqT3HXTT1+ApvLw0wb3k/eRRlYRUQ1TxPloZhVTypdZTMfc94u2QdFwy/k6cFV1z qPTjhGQpq5Ig5tKhhwo0oQ== 0001012975-97-000221.txt : 19971017 0001012975-97-000221.hdr.sgml : 19971017 ACCESSION NUMBER: 0001012975-97-000221 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19971016 SROS: NYSE GROUP MEMBERS: A.S. ENTERPRISES, LLC GROUP MEMBERS: ARNOLD H. SIMON GROUP MEMBERS: CHARTERHOUSE EQUITY PARTNERS II LP GROUP MEMBERS: COVINO DENIN PARTNERS GROUP MEMBERS: NEW RIO, L.L.C. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: WARNACO GROUP INC /DE/ CENTRAL INDEX KEY: 0000801351 STANDARD INDUSTRIAL CLASSIFICATION: WOMEN'S, MISSES', CHILDREN'S & INFANTS' UNDERGARMENTS [2340] IRS NUMBER: 954032739 STATE OF INCORPORATION: DE FISCAL YEAR END: 0103 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-41889 FILM NUMBER: 97696792 BUSINESS ADDRESS: STREET 1: 90 PARK AVE STREET 2: 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10016 BUSINESS PHONE: 2126611300 FORMER COMPANY: FORMER CONFORMED NAME: W ACQUISITION CORP /DE/ DATE OF NAME CHANGE: 19861117 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CHARTERHOUSE EQUITY PARTNERS II LP CENTRAL INDEX KEY: 0001033355 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 133752442 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O CHARTERHOUSE GROUP INTERNATIONAL INC STREET 2: 535 MADISON AVE CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2124213125 SC 13D/A 1 OMB APPROVAL UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 (Amendment No. 1) THE WARNACO GROUP, INC. (Name of Issuer) Class A Common Stock, par value $0.01 per share (Title of Class of Securities) 934390105 (CUSIP number) Glenn M. Feit, Esq. Proskauer Rose LLP 1585 Broadway New York, New York 10036-8299 (212) 969-3000 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) October 14, 1997 (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d- 1(b)(3) or (4), check the following box [ ]. Note: Six copies of this statement, including all exhibits, should be filed with the Commission. See Rule 13d-1(a) for other parties to whom copies are to be sent. SCHEDULE 13D CUSIP No. 934390105 1 NAME OF REPORTING PERSONS New Rio, L.L.C. S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS 51-0364695 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS* 00 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF 7 SOLE VOTING POWER None SHARES BENEFICIALLY 8 SHARED VOTING POWER 5,267,752(1) OWNED BY EACH 9 SOLE DISPOSITIVE POWER None REPORTING PERSON 10 SHARED DISPOSITIVE POWER 5,267,752(1) WITH 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,267,752(1) 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 8.43%(2) 14 TYPE OF REPORTING PERSON* 00 (1) Represents the number of shares of Common Stock (as hereinafter defined) received by New Rio, L.L.C. upon the Exchange (as hereinafter defined) referred to in Items 3 and 4 below. (2) Gives effect to the total number of outstanding shares of Common Stock, as of September 22, 1997, plus the number of shares of Common Stock to be issued in the Exchange and the Merger referred to in Items 3 and 4 below. CUSIP No. 934390105 1 NAME OF REPORTING PERSONS Charterhouse Equity Partners II, L.P. S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 13-3752442 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS* 00 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF 7 SOLE VOTING POWER 2,602,951(1) SHARES BENEFICIALLY 8 SHARED VOTING POWER None OWNED BY EACH 9 SOLE DISPOSITIVE POWER 2,602,951(1) REPORTING PERSON 10 SHARED DISPOSITIVE POWER None WITH 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,602,951(1) 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.16%(2) 14 TYPE OF REPORTING PERSON* PN (1) Based on the portion of shares of Common Stock allocable to Charterhouse Equity Partners II, L.P. in accordance with the Third Amended and Restated Limited Liability Company Agreement of New Rio, L.L.C., dated as of May 9, 1996, referred to in Item 6 below. (2) Gives effect to the total number of outstanding shares of Common Stock as of September 22, 1997, plus the number of shares of Common Stock to be issued in the Exchange and the Merger referred to in Items 3 and 4 below. CUSIP No. 934390105 1 NAME OF REPORTING PERSONS A.S. Enterprises, LLC S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS* 00 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION New Jersey NUMBER OF 7 SOLE VOTING POWER 98,147(1) SHARES BENEFICIALLY 8 SHARED VOTING POWER None OWNED BY EACH 9 SOLE DISPOSITIVE POWER 98,147(1) REPORTING PERSON 10 SHARED DISPOSITIVE POWER None WITH 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 98,147(1) 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .16%(2) 14 TYPE OF REPORTING PERSON* 00 (1) Based on the portion of shares of Common Stock allocable to A.S. Enterprises, LLC in accordance with the Third Amended and Restated Limited Liability Company Agreement of New Rio, L.L.C., dated as of May 9, 1996, referred to in Item 6 below. (2) Gives effect to the total number of outstanding shares of Common Stock, as of September 22, 1997, plus the number of shares of Common Stock to be issued in the Exchange and the Merger referred to in Items 3 and 4 below. CUSIP No. 934390105 1 NAME OF REPORTING PERSONS Arnold H. Simon S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS* 00 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States NUMBER OF 7 SOLE VOTING POWER 2,529,083(1) SHARES BENEFICIALLY 8 SHARED VOTING POWER 194,400(2) OWNED BY EACH 9 SOLE DISPOSITIVE POWER 2,529,083(1) REPORTING PERSON 10 SHARED DISPOSITIVE POWER 194,400(2) WITH 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,529,083(1) 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [x] See Item 5(a) 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.05%(3) 14 TYPE OF REPORTING PERSON* IN (1) Based on the portion of shares of Common Stock allocable to Arnold H. Simon and A.S. Enterprises, LLC in accordance with the Third Amended and Restated Limited Liability Company Agreement of New Rio, L.L.C., dated as of May 9, 1996, referred to in Item 6 below. (2) Represents shares of Common Stock owned by the Arnold Simon Family Foundation, as described in Item 5, following the Merger(as hereinafter defined). Mr. Simon disclaims beneficial ownership of the 194,400 shares of Common Stock owned by the Arnold Simon Family Foundation. (3) Gives effect to the total number of outstanding shares of Common Stock as of September 22, 1997, plus the number of shares of Common Stock to be issued in the Exchange and the Merger referred to in Items 3 and 4 below. CUSIP No. 934390105 1 NAME OF REPORTING PERSONS Covino Denim Partners S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS* 00 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION New York NUMBER OF 7 SOLE VOTING POWER 73,021(1) SHARES BENEFICIALLY 8 SHARED VOTING POWER None OWNED BY EACH 9 SOLE DISPOSITIVE POWER 73,021(1) REPORTING PERSON 10 SHARED DISPOSITIVE POWER None WITH 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 73,021(1) 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .12%(2) 14 TYPE OF REPORTING PERSON* PN (1) Based on the portion of shares of Common Stock allocable to Covino Denim Partners in accordance with the Third Amended and Restated Limited Liability Company Agreement of New Rio, L.L.C., dated as of May 9, 1996, referred to in Item 6 below. (2) Gives effect to the total number of outstanding shares of Common Stock as of September 22, 1997, plus the number of shares of Common Stock to be issued in the Exchange and the Merger referred to in Items 3 and 4 below. AMENDMENT NO. 1 to Statement on Schedule 13D Pursuant to Rule 13D-1 under the Securities Exchange Act of 1934, as Amended Item 1. Security and Issuer This amends and supplements the statement on Schedule 13D ("Schedule 13D") filed with the Commission jointly on behalf of New Rio, L.L.C. ("New Rio"), Charterhouse Equity Partners II, L.P.("CEP II"), A.S. Enterprises, LLC ("ASE"), Arnold H. Simon ("Mr. Simon") and Covino Denim Partners ("Covino") with respect to the Class A Common Stock, par value $.01 per share (the "Common Stock"), of The Warnaco Group, Inc., a Delaware corporation ("Warnaco"). The address of the principal executive offices of Warnaco is 90 Park Avenue, New York, NY 10016. This statement is Amendment No. 1 to the Schedule 13D. Unless otherwise defined herein, all capitalized terms used herein shall have the meanings ascribed to them in the Schedule 13D. Item 2 of the Schedule 13D is hereby amended and restated in its entirety as follows: Item 2. Identity and Background (a) This Schedule 13D is being filed jointly by New Rio, a Delaware limited liability company, CEP II, a Delaware limited partnership, ASE, a New Jersey limited liability company, Mr. Simon, a U.S. citizen, and Covino, a New York general partnership. (b) The principal executive offices of New Rio is: 1385 Broadway New York, NY 10018 The principal executive offices of CEP II is: 535 Madison Avenue New York, NY 10022 The principal executive offices of ASE is: 1385 Broadway New York, NY 10018 The business address of Mr. Simon is: 1385 Broadway New York, NY 10018 The business address of Covino is: 10 Cottage Place Suite 36 White Plains, NY 10601 (c) New Rio was formed by CEP II and Mr. Simon to invest in Designer Holdings Ltd., a Delaware corporation ("Designer Holdings"), which develops, sources and markets designer sportswear collections under the Calvin Klein Jeans(R), CK/Calvin Klein Jeans(R), and CK/Calvin Klein Khakis(R) labels. CEP II is a Delaware limited partnership. The general partner of CEP II is CHUSA Equity Investors II, L.P., whose general partner is Charterhouse Equity II, Inc. ("Charterhouse Inc."), a wholly-owned subsidiary of Charterhouse Group International, Inc. ("Charterhouse"). Accordingly, the management of CEP II is ultimately controlled by Charterhouse. Charterhouse is a privately owned investment firm that initiates, structures and arranges financing for private equity investments. For certain information concerning the directors and executive officers of Charterhouse Inc. and Charterhouse, reference is made to Schedules I and II, respectively, to this Schedule 13D, which are incorporated herein by reference. ASE is a New Jersey limited liability company formed by Mr. Simon, Debra Simon and Apparel Ventures, Inc. ("Apparel"), a New Jersey corporation, to invest in New Rio. For certain information concerning the directors and executive officers of Apparel, reference is made to Schedule III to this Schedule 13D, which is incorporated herein by reference. Mr. Simon is the President and Chief Executive Officer of Designer Holdings. The address of Designer Holdings is 1385 Broadway, New York, NY 10018. Covino is a New York general partnership. The managing partner of Covino is Michael A. Covino ("Mr. Covino"). Covino was established as a holding company. (d) Not applicable. (e) Not applicable. (f) New Rio is a Delaware limited liability company; CEP II is a Delaware limited partnership; ASE is a New Jersey limited liability company; Mr. Simon is a U.S. Citizen; and Covino is a New York general partnership. Item 3 of the Schedule 13D is hereby amended and restated in its entirety as follows: Item 3. Source and Amount of Funds or Other Consideration Pursuant to a Stock Exchange Agreement, dated as of September 25, 1997 (the "Exchange Agreement"), among Warnaco, New Rio and the members of New Rio (including CEP II, ASE and Mr. Simon), as described in Item 4 below, New Rio exchanged (the "Exchange") all of its 16,258,494 shares of common stock, par value $.01 per share (the "DSH Stock"), of Designer Holdings (which excludes 600,000 shares of DSH Stock beneficially owned by the Simon Foundation, as defined below) for 5,267,752 shares of Common Stock (which excludes 194,400 shares of Common Stock beneficially owned by the Simon Foundation, as defined below, following the Merger). Item 4 of the Schedule 13D is hereby amended as follows: Item 4. Purpose of Transaction In connection with the qualification of the Exchange and the Merger together as a tax-free reorganization under the provisions of Section 368 of the Internal Revenue Code of 1986, as amended, New Rio and each of the members of New Rio have entered into that certain Continuity of Interest Agreement, dated as of September 25, 1997 (the "Continuity Agreement"), which provides among other things, that for a period of one year after the Merger, neither New Rio nor any member will dispose of (i) a number of shares of Common Stock that would reduce such member's ownership of Common Stock to a number of shares that is less than 20% of the number of shares of Common Stock to be received by New Rio in the Exchange and which are beneficially attributable to such member or (ii) more than 80% of such member's percentage interest in New Rio. The Continuity Agreement is included as Exhibit 5 and is incorporated herein by reference thereto. The description of the Continuity Agreement is qualified in its entirety by reference thereto. Item 5 of the Schedule 13D is hereby amended as follows: Item 5. Interest in Securities of the Issuer (a) Upon consummation of the transactions contemplated by the Merger Agreement and the Exchange Agreement, New Rio will own 5,267,752 shares of Common Stock of Warnaco, which represents 8.43% of the outstanding Common Stock of Warnaco based upon (i) the number of shares of Common Stock received by New Rio upon the Exchange and (ii) the total number of outstanding shares of Common Stock as set forth in the Merger Agreement plus the number of shares of Common Stock issued in the Exchange referred to in Items 3 and 4 above. Of the 5,267,752 shares of Common Stock to be owned by New Rio, CEP II will beneficially own 2,602,951 shares of Common Stock of Warnaco, which represents 4.16% of the outstanding Common Stock of Warnaco; ASE will beneficially own 98,147 shares of Common Stock, which represents .16% of the outstanding Common Stock of Warnaco; Mr. Simon will beneficially own 2,529,083 shares of Common Stock (which includes 98,147 shares of Common Stock owned by ASE), which represents 4.05% of the outstanding Common Stock of Warnaco; and Covino will beneficially own 73,021 shares of Common Stock, which represents .12% of the outstanding Common Stock of Warnaco. With respect to Mr. Simon, the 2,529,083 shares of Common Stock does not include 194,400 shares of Common Stock to be owned following the Merger by the Arnold Simon Family Foundation (the "Simon Foundation"), a not-for-profit corporation. Mr. Simon, as one of three trustees of the Simon Foundation, shares voting and disposition rights with two other trustees. Mr. Simon disclaims beneficial ownership of the 194,400 shares to be owned by the Simon Foundation following the Merger. The foregoing number of shares of Common Stock allocable to CEP II, ASE, Mr. Simon and Covino are based on the allocation set forth in that certain Third Amended and Restated Limited Liability Company Agreement of New Rio, dated as of May 9, 1996, and referred to in Item 6 below. (b) As of the Exchange, New Rio has shared voting and disposition power over 5,267,752 shares of Common Stock. Except as otherwise provided in Item 4, CEP II has sole voting and disposition power over 2,602,951 shares of Common Stock acquired in the Exchange, ASE has sole voting and disposition power over 98,147 shares of Common Stock acquired in the Exchange, Mr. Simon has sole voting and disposition power over 2,529,083 shares of Common Stock acquired in the Exchange (which includes 98,147 shares of Common Stock owned by ASE) and Covino has sole voting and disposition power over 73,021 shares of Common Stock acquired in the Exchange. Item 6 of the Schedule 13D is hereby amended as follows: Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer New Rio and Mr. Covino have entered into that certain Escrow Agreement, dated as of September 25, 1997 (the "Escrow Agreement"), pursuant to which, among other things, New Rio agreed to transfer to Mr. Covino, or his order, the number of shares of Common Stock received by New Rio in the Exchange that are beneficially attributable to Mr. Covino. Notwithstanding any such transfer, Mr. Covino is bound by the terms of the Exchange Agreement and the Continuity Agreement. The Escrow Agreement is included as Exhibit 6 and is incorporated herein by reference thereto. The description of the Escrow Agreement is qualified in its entirety by reference thereto. Item 7 of the Schedule 13D is hereby amended as follows: Item 7. Material to Be Filed as Exhibits Exhibit 5 Continuity of Interest Agreement between New Rio and each of the members of New Rio, dated as of September 25, 1997. Exhibit 6 Escrow Agreement between New Rio and Covino, dated as of September 25, 1997. Schedule I DIRECTORS AND EXECUTIVE OFFICERS OF CHARTERHOUSE EQUITY II, INC. Set forth below is the name, office(s) held, business or residence address, and present principal occupation or employment of each director and executive officer of Charterhouse Equity II, Inc. The business address of each person listed below is 535 Madison Avenue, New York, New York 10022. Each person listed below is a citizen of the United States. Name and Offices Present Principal Occupation or Employment Merril M. Halpern Chairman and Chief Executive Chairman, Chief Executive Officer of Charterhouse Group Officer and Director International, Inc. ("Charterhouse") for more than the past five years. Mr. Halpern is also a director of American Disposal Services, Inc., Designer Holdings Ltd., Insignia Financial Group, Inc., and Microwave Power Devices, Inc. A. Lawrence Fagan President and Chief Operating President, Chief Operating Officer of Charterhouse for Officer and Director more than the past five years. Mr. Fagan is also a director of American Disposal Services, Inc., Designer Holdings Ltd., and Microwave Power Devices, Inc. Richard T. Henshaw, III Managing Director of Senior Vice President Charterhouse. Mr. Henshaw is also a director of American Disposal Services, Inc., and Cornell Corrections, Inc. Patricia R. Merrick Senior Vice President of Senior Vice President Charterhouse. Thomas C. Dircks Managing Director of Vice President Charterhouse. Phyllis Haberman Senior Vice President of Vice President Charterhouse. Wai Wah Chin Senior Vice President of Vice President Charterhouse. Cheri E. Lieberman Vice President of Finance of Vice President and Controller Charterhouse. Glenn M. Feit Partner, Proskauer Rose LLP. Secretary Schedule II DIRECTORS AND EXECUTIVE OFFICERS OF CHARTERHOUSE GROUP INTERNATIONAL, INC. Set forth below is the name, office(s) held, business or residence address, and present principal occupation or employment of each director and executive officer of Charterhouse Group International, Inc. Unless otherwise indicated, the business address of each person listed below is 535 Madison Avenue, New York, New York 10022. Unless otherwise indicated, each person listed below is a citizen of the United States. Name and Offices Position with Charterhouse/ Present Principal Occupation or Employment Merril M. Halpern See Schedule I A. Lawrence Fagan See Schedule I John F. Brown Deputy Managing Director of Hobart House CIN Venture Managers Limited, Grosvenor Place advisors to the British Coal London SWIX 7AD Pension Funds, for more than England the past five years. (Citizen of the United Kingdom) Peter Carnwath Managing Director of Electra Electra Fleming, Inc. Fleming Inc., an investment 70 East 55th Street fund, and various other New York, New York 10022 executive positions with its (Citizen of the United Kingdom) affiliates, for more than the past five years. Cees de Bruin Chairman of the Indofin Group, Indofin Group an international group of Veerkade 7 holding and management Postbus 23341 companies, for more than the 3001 KH Rotterdam, past five years. The Netherlands (Citizen of The Netherlands) Sir G. Nigel Mobbs Chairman of the Board and 234 Bath Road Chief Executive Officer of Slough Slough Estates plc, a United Berkshire SL1 YEE Kingdom company engaged England principally in real estate (Citizen of the United Kingdom) activities, for more than the past five years. Alfred Schechter Mr. Schechter was most recently Chairman and Chief Executive Officer of Cryenco Sciences, Inc., a manufacturer of sophisticated leak-tight container systems, from 1991 to 1997 and Charter-Crellin, Inc. from 1985 to 1989. Prior to that time, Mr. Schechter was affiliated in various capacities with Charterhouse and several of its portfolio companies. Coen N. Teulings Chairman of the Merifin Group, Merifin B.V. a Netherlands investment VeerKade 7 banking company, for more 3016 DeRotterdam than the past five years. The Netherlands (Citizen of The Netherlands) Robert L. Berner III Managing Director of Charterhouse Thomas C. Dircks See Schedule I Richard T. Henshaw III See Schedule I David C. Stoller Managing Director of Charterhouse and Chairman and Director of American Disposal Services, Inc. Mr. Stoller is also Of Counsel at the law firm of Millbank, Tweed, Hadley & McCloy. Wai Wah Chin See Schedule I Phyllis Haberman See Schedule I Patricia R. Merrick See Schedule I Cheri E. Lieberman See Schedule I Jay Gates Vice President of Charterhouse Lori Livers Vice President of Charterhouse Glenn M. Feit See Schedule I Schedule III DIRECTORS AND EXECUTIVE OFFICERS OF APPAREL VENTURES, INC. Set forth below is the name, offices(s) held, business or residence address, and present principal occupation or employment of each director and executive officer of Apparel Ventures, Inc. The business address of each person listed below is 1385 Broadway, New York, New York 10018. Each person listed below is a citizen of the United States. Name and Offices Present Principal Occupation or Employment Arnold H. Simon President, Treasurer President and Chief Executive and Sole Director Officer of Designer Holdings, Ltd. Debra Simon Executive Vice President of Vice President Designer Holdings, Ltd. and Secretary Signature After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. October 16, 1997 NEW RIO, L.L.C. By: /s/ Arnold H. Simon Title: Member Manager By: CHARTERHOUSE EQUITY PARTNERS II, L.P. A Member Manager By: CHUSA EQUITY INVESTORS II, L.P. By: CHARTERHOUSE EQUITY II, INC. By: /s/ A. Lawrence Fagan Title: President CHARTERHOUSE EQUITY PARTNERS II, L.P. By: CHUSA EQUITY INVESTORS II, L.P. General Partner By: CHARTERHOUSE EQUITY II, INC. General Partner By: /s/ A. Lawrence Fagan Title: President A.S. ENTERPRISES, LLC By: APPAREL VENTURES, INC. By: /s/ Arnold H. Simon Title: President By: /s/ Arnold H. Simon Title: Member Manager /s/ Arnold H. Simon Arnold H. Simon COVINO DENIM PARTNERS By: /s/ Michael A. Covino Title: Managing Partner EX-99 2 CONTINUITY OF INTEREST AGREEMENT New Rio, L.L.C. ("New Rio"), and each of the undersigned members of New Rio (the "Members" and, including New Rio, the "Shareholders"), hereby enter into this Agreement as of September 25, 1997. WHEREAS, the Shareholders and The Warnaco Group, Inc. ("Warnaco") have entered into a Stock Exchange Agreement, dated as of September 25, 1997 (the "Exchange Agreement"), pursuant to which New Rio will transfer all of its shares of common stock of Designer Holdings Ltd. ("DSH Common Stock") to Warnaco in exchange for certain shares of Warnaco Class A Common Stock (the "Exchange"); WHEREAS, Warnaco, Warnaco Acquisition Corporation ("WAC"), and Designer Holdings Ltd. ("DSH") have entered into an Agreement and Plan of Merger, dated as of September 25, 1997 (the "Merger Agreement"), pursuant to which WAC will merge with and into DSH (the "Merger"); WHEREAS, as an inducement to Warnaco, WAC and DSH to effect the Exchange and consummate the Merger, the Shareholders are executing this Agreement in connection with qualifying the Exchange and the Merger together as a tax-free reorganization under the provisions of Section 368 of the Internal Revenue Code of 1986, as amended (the "Code"). Now, therefore, the parties hereto, intending legally to be bound, hereby agree as follows: 1. Each Shareholder represents that such Shareholder has not purchased, sold, exchanged, distributed, transferred by gift or otherwise disposed of (including through transactions which had the economic effect of a disposition such as through the use of puts and calls, short sales, equity swaps or any similar type of arrangement) (collectively, "dispose" or "disposition") shares of DSH Common Stock or Warnaco Class A Common Stock prior to the date hereof either in contemplation of or as part of the Exchange or the Merger. 2. New Rio represents that it does not have any plan or intention to sell, exchange, distribute, transfer by gift, or otherwise dispose of any interest in a number of shares (as adjusted for stock splits or other similar transactions) of Warnaco Class A Common Stock exceeding 80% of the number of shares (as adjusted for stock splits or other similar transactions) of Warnaco Class A Common Stock to be received in the Exchange, other than a transfer of such shares pursuant to a plan of complete liquidation of New Rio. 3. Each Member represents that it does not have any plan or intention to sell, exchange, transfer by gift, or otherwise dispose of (i) a number of shares of Warnaco Class A Common Stock that would reduce such Member's ownership of Warnaco Class A Common Stock (including any beneficial ownership attributable to such Member's interest in New Rio) to a number of shares (as adjusted for stock splits or other similar transactions) that is less than 20% of the number of shares (as adjusted for stock splits or other similar transactions) of the Warnaco Class A Common Stock to be received by New Rio in the Exchange which are beneficially attributable to such Member, or (ii) more than 80% of such Member's Percentage Interest (as defined in the Third Amended and Restated Limited Liability Company Agreement of New Rio, dated as of May 9, 1996) in New Rio as of the date hereof. 4. Each Shareholder will immediately notify Simpson Thacher & Bartlett ("Simpson") and Skadden, Arps, Slate, Meagher & Flom LLP ("Skadden") if such Shareholder has obtained knowledge or information which indicates that any of the foregoing representations by such Shareholder may cease to be true or accurate. 5. Subject to the provisions of Section 7, except pursuant to a plan of complete liquidation, New Rio, for a period of one year after the Merger, will not sell, exchange, transfer by gift or otherwise dispose of a number of shares (as adjusted for stock splits or other similar transactions) of Warnaco Class A Common Stock exceeding 80% of the number of shares (as adjusted for stock splits or other similar transactions) of Warnaco Class A Common Stock received in the Exchange. 6. Each Member, for a period of one year after the Merger, will not (and, to the extent otherwise permitted, will not direct New Rio to) sell, exchange, distribute, transfer by gift or otherwise dispose of (i) a number of shares of Warnaco Class A Common Stock that would reduce such Member's ownership of Warnaco Class A Common Stock (including any beneficial ownership attributable to such Member's interest in New Rio) to a number of shares (as adjusted for stock splits or other similar transactions) that is less than 20% of the number of shares (as adjusted for stock splits or other similar transactions) of the Warnaco Class A Common Stock to be received by New Rio in the Exchange which are beneficially attributable to such Member, or (ii) more than 80% of such Member's Percentage Interest in New Rio as of the date hereof. 7. A disposition shall not be in contravention of paragraphs 5 and 6 of this Agreement if (i) there has been an unforseen change in circumstances and such Shareholder has obtained the written opinion of Skadden (which opinion will have been delivered to, and found reasonably satisfactory by, Simpson) that such transaction will not prevent the Exchange and the Merger from together qualifying as a tax-free reorganization under the provisions of Section 368 of the Code, or (ii) with respect only to transactions described in paragraph 6, such Shareholder has died or, in the case of a Member classified as a partnership for federal income tax purposes (the distributees of which have agreed in writing, in a form reasonably satisfactory to Skadden and Simpson, to be legally bound by this Agreement), has distributed all of its assets pursuant to a plan of complete liquidation. 8. The Shareholders will, for a period of one year after the Merger, notify Skadden no later than 10 business days after any sale, exchange, transfer by gift or other disposition of any New Rio membership interest or Warnaco Class A Common Stock received pursuant to the Exchange, which notice will describe (i) the number of Warnaco Class A Common Shares disposed of, and (ii) the exact manner of such disposition. 9. Each Shareholder understands that the provisions of this Agreement (i) have been expressly relied upon by Warnaco, WAC and DSH in connection with entering into the Exchange Agreement and the Merger Agreement, and (ii) will be relied upon by Skadden and Simpson in connection with the rendering of their respective opinions concerning certain federal income tax consequences of the Merger, the rendering and delivery of which are conditions precedent to the consummation of the Merger. 10. If the Merger Agreement is terminated at any time or the Merger has not been consummated by September 30, 1998, this Agreement shall automatically terminate and be of no force and effect, and the parties hereto shall not be bound by any of the provisions hereof. 11. This Agreement shall be binding upon and enforceable against the successors and assigns of the parties hereto. 12. This Agreement may not be modified, amended, altered or supplemented except by a written agreement executed by all of the parties hereto and approved in writing by Skadden and Simpson. 13. All notices to Skadden should be sent to: Katherine M. Bristor, Esq. Skadden, Arps, Slate, Meagher & Flom LLP 919 Third Avenue New York, New York 10022 14. All notices to Simpson should be sent to: Charles O. Rappaport, Esq. Simpson Thacher & Bartlett 425 Lexington Avenue New York, New York 10017 15. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. 16. This Agreement constitutes the entire agreement among the parties hereto with respect to the subject matter hereof. In witness whereof, the parties hereto have caused this Agreement to be duly executed on the date first set forth above. NEW RIO, L.L.C. By: A.S. Enterprises, L.L.C. Member Manager By: Apparel Ventures, Inc. By: ______________________________ Name: Title: By: CHARTERHOUSE EQUITY PARTNERS II, L.P. Member Manager By: CHUSA EQUITY INVESTORS II, L.P. General Partner By: CHARTERHOUSE EQUITY II, INC. General Partner By: ______________________________ Name: Title: ______________________________ Arnold H. Simon CHARTERHOUSE EQUITY PARTNERS II, L.P. By: CHUSA EQUITY INVESTORS II, L.P. General Partner By: CHARTERHOUSE EQUITY II, INC. General Partner By: ______________________________ Name: Title: CHEF NOMINEES LIMITED By: ______________________________ Name: Title: A.S. ENTERPRISES, L.L.C. By: Apparel Ventures, Inc. By: ______________________________ Name: Title: ______________________________ Martin L. Berman ______________________________ Phyllis West Berman ______________________________ Steven E. Berman ______________________________ Mark N. Kaplan as Trustee f/b/o Alison A. Berman and Mark K. Berman ______________________________ Michael A. Covino EX-99 3 EXECUTION COPY ESCROW AGREEMENT THIS ESCROW AGREEMENT is dated as of September 25, 1997, by and among WALTER, CONSTON, ALEXANDER & GREEN, P.C., a New York professional corporation ("WCA&G"), NEW RIO, L.L.C., a Delaware limited liability company ("New Rio"), and MICHAEL A. COVINO, an individual ("Covino"). Reference is made to that certain Stock Exchange Agreement dated as of September 25, 1997 between the Warnaco Group, Inc., New Rio, and each of the members of New Rio signatory thereto (the "Exchange Agreement"). Terms used and defined or defined by reference in the Exchange Agreement and not otherwise defined herein shall be used herein as therein defined. R E C I T A L S: WHEREAS, Covino has requested that New Rio make a Transfer to him of his Allocated Shares. WHEREAS, New Rio is willing to make such transfer on the terms and conditions set forth below. NOW, THEREFORE, in consideration of the foregoing pre- mises and the mutual covenants hereinafter contained, the parties hereto agree as follows: ARTICLE I 1. Appointment of Escrow Agent. New Rio and Covino hereby appoint WCA&G, having offices at 90 Park Avenue, New York, New York, as escrow agent for the purposes herein set forth ("Escrow Agent"), and Escrow Agent hereby accepts such appointment and agrees to be bound by the terms and conditions of this Escrow Agreement. ARTICLE II 2. Delivery of the Escrow Documents. Covino and New Rio shall deliver or cause there to be delivered to Escrow Agent, and Escrow Agent shall accept receipt of, the documents set forth on Exhibit A hereto (the "Escrow Documents"). ARTICLE III 3.1 Release of Escrow Documents A. The Escrow Agent is instructed by the parties to deliver, and it hereby agrees to deliver, all of the Escrow Documents (except the Company stock certificate representing 225,337 shares of the Company registered in the name of Covin Denim Partners (the "Stock Certificate")) to the appropriate parties as set forth in Exhibit A upon receipt of all of the Escrow Documents. B. The Escrow Agent is instructed by the parties to deliver, and it hereby agrees to deliver, the Stock Certificate, duly endorsed for transfer, to Parent at Closing. Upon its receipt of the 73,021 shares of Parent Class A Common Stock to be received in exchange therefor, the Escrow Agent is instructed by the parties to deliver, and the Escrow Agent hereby agrees to deliver, the Exchanged Shares to Covino or his order. C. Until the Escrow Agent has received all of the Escrow Documents, it shall continue to hold any such documents received in escrow and shall not release any of them to any person. 3.2 Dispute In the event of a dispute among any of the parties to this Escrow Agreement, Escrow Agent shall not comply with any claims or demands from either Covino or New Rio as long as such dispute may continue, and in so refusing, the Escrow Agent shall make no delivery or other disposition of the Escrow Documents then held by it under this Escrow Agreement until it has received a final court order from a court of competent jurisdiction directing disposition of the Escrow Documents, or until it has received appropriate written instructions signed by both Covino and New Rio. 3.3 Release of the Escrow Documents in accordance with Joint Instructions Notwithstanding the provisions of Sections 3.1 through 3.2 above, Escrow Agent, upon receipt of written in- structions signed by both Covino and New Rio on the release of the Escrow Documents, shall release the Escrow Documents in accordance with such instructions. ARTICLE IV Rights and Responsibilities of Escrow Agent 4.1 Generally To induce Escrow Agent to act hereunder, it is further agreed by Covino and New Rio that: (a) Escrow Agent shall not be under any duty to give any documents held in escrow by it hereunder any greater degree of care than it gives its own similar property. (b) This Escrow sets forth all the duties of the Escrow Agent with respect to any and all matters pertinent hereto, and no implied duties or obligations shall be read into this Escrow Agreement against Escrow Agent. (c) Escrow Agent shall not be liable to New Rio or Covino except for its own gross negligence or willful misconduct. Except with respect to those claims based upon gross negligence or willful misconduct that are successfully asserted against Escrow Agent, the other parties hereto shall jointly and severally indemnify and hold harmless Escrow Agent from and against any and all losses, liabilities, claims, actions, damages and expenses, including reasonable attorneys' fees and disbursements, arising out of and in connection with this Escrow Agreement. (d) Escrow Agent may act pursuant to the advice of counsel with respect to any matter relating to this Escrow Agree- ment and shall not be liable for any action taken or omitted in accordance with such advice. (e) Escrow Agent makes no representation as to the validity, value, genuineness or collectability of any security or other document or instrument held by or delivered to it. (f) Escrow Agent may rely without any liability upon the contents of any writing of any court, arbitrator or other third party contemplated herein as a means to resolve disputes. 4.2 Resignation Escrow Agent may, at any time upon not less than 20 days prior notice, and, upon the joint written request of New Rio and Covino, shall, resign as such by delivering the Escrow Documents then held by it in escrow hereunder to any successor escrow agent jointly designated by Covino and New Rio in writing, or any court of competent jurisdiction, whereupon Escrow Agent shall be discharged of any and all further obligations arising in connection with this Escrow Agreement. The resignation of Escrow Agent shall take effect on the appointment of a successor (including a court of competent jurisdiction) and Escrow Agent shall continue to serve as Escrow Agent hereunder until such appointment has been made. ARTICLE V General 5.1 Expenses. The parties hereto shall bear their own respective expenses incurred in connection with this Escrow Agreement and in connection with all obligations required to be performed by each of them under this Escrow Agreement. 5.2 Amendment and Waiver. No amendment of any provision of this Escrow Agreement shall in any event be effective, unless the same shall be in writing and signed by the parties hereto. 5.3 Notices. Any notices or other communications re- quired to be given pursuant to this Escrow Agreement shall be in writing and shall be deemed given: (i) upon delivery, if by hand; (ii) on the date of mailing, if sent by registered or certified mail, postage prepaid, return receipt requested or by express mail or air courier; or (iii) upon transmission, if sent by telex or facsimile. All notices hereunder shall be given as follows: If to Escrow Agent: Walter, Conston, Alexander & Green, P.C. 90 Park Avenue New York, New York 10036-1387 Attn: William S. Sterns, III Telecopy: (212) 219-9444 If to Covino: 10 Cottage Place Suite 3-G White Plains, New York 10601 Telecopy: (914) 592-0393 If to New Rio: 1338 Broadway New York, New York 10018 Att: John J. Jones, General Counsel Telecopy: (212) 556-0116 Any party may change its address for receiving notice by written notice given to the others named above in the manner provided above. 5.4 Counterparts. This Escrow Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement. 5.5 Parties in Interest. This Escrow Agreement shall bind and inure to the benefit of the parties named herein and their respective heirs, successors and assigns. This Escrow Agreement shall not be assignable by any party without the prior written consent of the other party, and any attempted assignment in violation of this provision shall be null and void and without legal effect. 5.6 Entire Agreement. This Escrow Agreement, together with the exhibits attached hereto contains the entire agreement and understanding of the parties hereto with respect to the matters herein set forth, and all prior negotiations and under- standings relating to the subject matter of this Escrow Agreement are merged herein and are superseded and canceled by this Escrow Agreement. 5.7 Governing Law. This Escrow Agreement shall be governed by and construed in accordance with the internal sub- stantive laws of the State of New York, without giving effect to the principles of conflicts of law thereof. IN WITNESS WHEREOF, this Escrow Agreement has been duly executed by or on behalf of each of the parties hereto as of the date first above written. WALTER, CONSTON, ALEXANDER & GREEN, P.C. AS ESCROW AGENT By_______________________ _____________________________ Name: Michael A. Covino Title: NEW RIO, L.L.C. By___________________________ Name: Title: Exhibit A Escrow Documents - - Stock Exchange Agreement dated as of September 25, 1997 * - - Stock Certificate of Designer Holdings Ltd. ("DHL") representing 225,337 shares (CUSIP 250571.10.6). ** - - Indemnification Agreement executed by Michael A. Covino ("Covino") in favor of Charterhouse Equity Partners II, L.P. ("CEP") *** - - Continuity of Interest Agreement dated as of September 25, 1997. * - - Release dated September 25, 1997 executed by Arnold Simon in favor of Covino. **** - - Release dated September 25, 1997 executed by Debbie Simon in favor of Covino. **** - - Undertaking of Covino dated September 25, 1997 to pay allocable share of certain transaction bonuses. ***** _________________________________ * Each of Covino, The Warnaco Group, Inc. ("Warnaco"), and New Rio, LLC ("New Rio") to receive an original execution copy. ** Escrow Agent to deliver this stock certificate to Warnaco at Closing under the Stock Exchange Agreement. *** Original execution copy to CEP. **** Original execution copy to Covino. ***** Original executed copy to New Rio. -----END PRIVACY-ENHANCED MESSAGE-----