AMENDED SHARE REPURCHASE PROGRAM
THIS
AGREEMENT is entered into as of August 31, 2004 between THE
TALBOTS, INC., a Delaware corporation (“Talbots”) and
AEON (U.S.A.), INC., a Delaware corporation (“AEON
USA”).
WHEREAS,
Talbots originally initiated its share repurchase program in
February 1995 and subsequently extended such program from time to
time up to the date hereof; and
WHEREAS,
as part of the share repurchase program, for each month in which
Talbots repurchased shares from the public shareholders, Talbots
then repurchased such numbers of shares of Common Stock from AEON
USA sufficient to maintain substantially the same percentage
ownership in Talbots between AEON USA and the public shareholders,
with the only exception being the $50 million share repurchase
program established by the Company in October 2001 in which AEON
USA did not participate; and
WHEREAS,
Talbots has completed the most recent share repurchase program and
the Board of Directors of Talbots believes that it is in the best
interests of Talbots and its shareholders to extend the share
repurchase program; and
WHEREAS,
the Board of Directors of Talbots has now authorized the
expenditure of up to an additional $50 million for the repurchase
of shares of Common Stock under the amended share repurchase
program, such repurchases to be made from time to time over a two
year period (the “Program”); and
WHEREAS,
it is agreed that the price to AEON USA for shares repurchased from
AEON USA under the Program will continue to be the weighted average
price paid to the public shareholders for the month;
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