Exhibit 10.6

2002 STOCK OPTION AND RESTRICTED STOCK

AND UNIT AWARD PLAN, AS AMENDED

NON-QUALIFIED STOCK OPTION AGREEMENT

TIME-VESTING OPTIONS

This Non-qualified Stock Option Agreement (this “Agreement”) is entered into as
of «GrantDate» (the “Grant Date”), between AnnTaylor Stores Corporation, a
Delaware corporation (the “Company”), and «Name» (the “Option Holder”).

Pursuant to the AnnTaylor Stores Corporation 2002 Stock Option and Restricted
Stock and Unit Award Plan, as amended (the “Plan”), the Compensation Committee
of the Board of Directors of the Company (the “Committee”) or its designee has
determined that the Option Holder be granted an option under the Plan, upon the
terms and subject to the conditions hereinafter contained. Capitalized terms
used but not defined herein shall have the meanings assigned to them in the
Plan.

1. Number and Price of Shares. The Company hereby grants to the Option Holder an
option (the “Option”) to purchase «Options» shares of its Common Stock (the
“Option Shares”) at a price of $«Price» per share (the “Option Price”).

2. Time of Exercise. Subject to the provisions of Section 4 hereof, the right to
purchase shares pursuant to the Option shall be exercisable in whole or in part,
at any time and from time to time, during the term set forth in Section 4 below
in accordance with the following schedule:

From                      through                     , for up to     % of the
Option Shares;

[insert specifications regarding vesting schedule].

The foregoing notwithstanding, if an Acceleration Event shall occur prior to
termination of the Option pursuant to Section 4 hereof, the Option Holder’s
right to purchase 100% of the Option Shares shall become exercisable
immediately.

3. Method of Exercise. The Option, or any part thereof, shall be exercised by
written notice from the Option Holder to the Secretary of the Company specifying
the number of Option Shares to be purchased (which must be a whole number of
shares) and accompanied by payment in full of the Option Price for the shares
being purchased. Such payment may be made (i) in cash, (ii) in shares of Common
Stock (that you have owned for at least six months) having a Fair Market Value
equal to such Option Price, (iii) in a combination of cash and shares or
(iv) through a “cashless exercise” procedure involving a broker. A minimum of
one hundred (100) shares must be purchased each time the Option is exercised,
unless the Option is being exercised with respect to all Option Shares available
at such time for purchase hereunder. No shares shall be issued until full
payment therefor has been received by the Company and the provisions of
Section 8 hereof shall have been complied with, and the Option Holder shall have
no rights as a stockholder of the Company in respect of such shares

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until the date of the issuance by the Company of a stock certificate
representing such shares, or issuance of the shares in uncertificated form by
book entry on the records of the Company’s Common Stock registrar and transfer
agent.

4. Term of the Option.

(a) The Option shall be exercisable, in accordance with the provisions of
Sections 2 and 3 hereof, through the tenth anniversary of the Grant Date, unless
terminated earlier as provided herein.

(b) Except as may be provided pursuant to paragraph (d) of this Section 4, if
the Option Holder’s employment is terminated by reason of the Option Holder’s
Disability or Retirement, or if the Option Holder shall die while employed by
the Company or a Subsidiary Corporation, the Option may, to the extent otherwise
exercisable pursuant to Section 2 above on the date of such termination or
death, be exercised by the Option Holder or the Option Holder’s estate or the
person who acquired the right to exercise the Option by bequest or inheritance
or otherwise by reason of the death or Disability of the Option Holder, at any
time within three years after the date of death or termination of employment by
reason of Disability or Retirement, but in any event not beyond the date on
which the Option would otherwise expire pursuant to paragraph (a) of this
Section 4. Except as set forth in paragraph (d) of this Section 4, the Option
shall, to the extent not theretofore exercised or terminated, terminate upon the
expiration of such three-year (or shorter) period.

(c) Except as otherwise provided in paragraph (b) of this Section 4, and except
as may be provided in accordance with paragraph (d) of this Section 4, the
Option may not be exercised unless the Option Holder is then in the employ or
service of the Company or one of its divisions or Subsidiary Corporations, and
unless the Option Holder has remained continuously so employed or in service
since the Grant Date. In the event the Option Holder’s employment or service is
terminated or ceases for any reason other than the Option Holder’s death,
Disability, Retirement or a termination voluntarily by the Option Holder or a
termination by the Company for Cause, all Options theretofore granted to such
Option Holder that are exercisable at the time of such termination may, to the
extent not theretofore exercised or canceled, be exercised at any time within
the earlier of when the Options expire pursuant to paragraph (a) of this
Section 4 and three (3) months after such termination of employment or cessation
of service, as applicable; provided, however, that the Committee may in its
discretion extend the period for exercise of such Options to a date later than
three (3) months after such separation or cessation date, but in any event not
beyond the date on which the Option would otherwise expire pursuant to paragraph
(a) of this Section 4. Notwithstanding the foregoing, if the employment of the
Option Holder shall terminate for Cause or the Option Holder voluntarily
terminates his/her employment, all Options theretofore granted to such Option
Holder shall, to the extent not theretofore exercised, terminate on the day
following termination.

(d) The period for exercise of the Option may be extended by, and in the sole
discretion of, the Board in accordance with the Plan, but in any event not
longer than the term set forth in paragraph (a) of this Section 4.

 

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5. Non-Transferability. The Option and the Option Holder’s rights hereunder
shall not be transferable other than by will or the law of descent and
distribution, and during the lifetime of the Option Holder the Option may be
exercised only by the Option Holder or by the Option Holder’s guardian or legal
representative.

6. No Guarantee of Employment. Nothing set forth herein or in the Plan shall
confer upon the Option Holder any right of continued employment for any period
by the Company or any of its divisions or Parent or Subsidiary Corporations, or
shall interfere in any way with the right of the Company or any such division or
Parent or Subsidiary Corporation to terminate such employment.

7. Non-qualified Stock Option. No portion of the Option constitutes an Incentive
Stock Option. The Option granted hereunder constitutes a Non-qualified Stock
Option.

8. Taxes upon Exercise of Options. The Option Holder agrees that:

(a) no later than the date of any exercise of the Option, the Option Holder
shall pay to the Company, or make arrangements satisfactory to the Committee
regarding the payment of, any federal, state or local taxes required by law to
be withheld upon or in connection with such exercise; and

(b) the Company shall, to the extent permitted or required by law, have the
right to deduct all federal, state and local taxes of any kind required by law
to be withheld upon any exercise of the Option or from any payment of any kind
otherwise due to the Option Holder with respect to the Option.

9. Failure to Enforce Not a Waiver. The failure of the Company to enforce at any
time any provision of this Option Agreement shall in no way be construed to be a
waiver of such provision or of any other provision hereof.

10. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to the
conflicts of laws provisions thereof.

11. Stock Option Plan. A copy of the Plan is attached hereto. The Plan is hereby
incorporated herein by reference and made a part of this Agreement, and this
Agreement and the Option shall be subject to the terms of the Plan, as it may be
amended from time to time, provided that such amendment of the Plan is made in
accordance with Section 10 of the Plan.

12. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be an original but all of which together shall represent one
and the same agreement.

 

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ANNTAYLOR STORES CORPORATION     OPTION HOLDER:   By:  

 

   

 

  Name:         «Name»     Title:                    

 

            Date    

 

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