EXECUTION COPY
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LEVI ▇▇▇▇▇▇▇ & CO.
$498,975,000
$380,000,000 11 5/8% Senior Notes Due 2008
125,000,000 Euro Dollars 11 5/8% Senior Notes Due 2008
PURCHASE AGREEMENT
New York, New York
January 12, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
Banc of America Securities LLC
Scotia Capital (USA) Inc.
Chase Securities Inc.
Banc One Capital Markets, Inc.
As Representatives of the Initial Purchasers
c/o ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Levi ▇▇▇▇▇▇▇ & Co., a corporation organized under the laws
of Delaware (the "Company"), proposes to issue an sell to the several
parties named in Schedule I hereto (the "Initial Purchasers"), for whom you (the
"Representatives")are acting as representatives, $380,000,000 principal amount
of its 11 5/8% Senior Notes Due 2008 (the "Dollar Notes") and 125,000,000 euro
dollars principal amount of its 11 5/8% Senior Notes due 2008 (the "Euro Notes"
and together with the Dollar Notes, the "Securities"). The Securities are to be
issued under two indentures, one with regard to the Dollar Notes and one with
regard to the Euro Notes (the "Indentures"), both dated as of January 18, 2001,
between the Company and Citibank, N.A., as trustee (the "Trustee"). The Dollar
Notes and the Euro Notes each have the benefit of a Registration Rights
Agreement (together, the "Registration Rights Agreements"), each dated January
18, 2001, between the Company and the Initial Purchasers, pursuant to which the
Company has agreed to register the Securities under the Act subject to the terms
and conditions therein specified. To the extent there are no additional parties
listed on Schedule I other than you, the term Representatives as used herein
shall mean you as the Initial Purchasers, and the terms Representatives and
Initial Purchasers shall mean either the singular or plural as the context
requires. The use of the neuter in this Agreement shall include the feminine and
masculine wherever appropriate. Certain terms used herein are defined in Section
17 hereof.
The sale of the Securities to the Initial Purchasers will be
made without registration of the Securities under the Act in reliance upon
exemptions from the registration requirements of the Act.
In connection with the sale of the Securities, the Company has
prepared a preliminary offering memorandum, dated October 3, 2000 (as amended
or supplemented at the Execution Time, including any and all exhibits thereto
and any information incorporated by reference therein, the "Preliminary
Memorandum"), and a final offering memorandum, dated January 12, 2001 (as
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amended or supplemented at the Execution Time, including any and all exhibits
thereto and any information incorporated by reference therein, the "Final
Memorandum"). Each of the Preliminary Memorandum and the Final Memorandum sets
forth certain information concerning the Company and the Securities. The Company
hereby confirms that it has authorized the use of the Preliminary Memorandum and
the Final Memorandum, and any amendment or supplement thereto, in connection
with the offer and sale of the Securities by the Initial Purchasers. Unless
stated to the contrary, references herein to the Final Memorandum at the
Execution Time are not meant to include any information incorporated by
reference therein subsequent to the Execution Time, and any references herein to
the terms "amend", "amendment" or "supplement" with respect to the Final
Memorandum shall be deemed to refer to and include any information filed under
the Exchange Act subsequent to the Execution Time which is incorporated by
reference therein.
1. Representations and Warranties. The Company represents
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and warrants to each Initial Purchaser as set forth below in this Section 1.
(a) The Preliminary Memorandum, at the date thereof, did not
contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading. At the
Execution Time and on the Closing Date (as defined in Section 3
hereof), the Final Memorandum did not, and will not (and any amendment
or supplement thereto, at the date thereof and at the Closing Date will
not), contain any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no representation or warranty
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as to the information contained in or omitted from the Preliminary
Memorandum or the Final Memorandum, or any amendment or supplement
thereto, in reliance upon and in conformity with information furnished
in writing to the Company by or on behalf of the Initial Purchasers
through the Representatives specifically for inclusion therein.
(b) Neither the Company, nor any of its Affiliates, nor any
person acting on its or their behalf (other than the Initial
Purchasers, as to whom the Company makes no representations) has,
directly or indirectly, made offers or sales of any security, or
solicited offers to buy any security, under circumstances that would
require the registration of the Securities under the Act.
(c) Neither the Company, nor any of its Affiliates, nor any
person acting on its or their behalf (other than the Initial
Purchasers, as to whom the Company makes no representations) has
engaged in any form of general solicitation or general advertising
(within the meaning of Regulation D) in connection with any offer or
sale of the Securities in the United States.
(d) The Securities satisfy the eligibility requirements of
Rule 144A(d)(3) under the Act.
(e) Neither the Company, nor any of its Affiliates, nor any
person acting on its or their behalf (other than the Initial
Purchasers, as to whom the Company makes no representations) has
engaged in any directed selling efforts with respect to the Securities,
and each of them has complied with the offering restrictions
requirements of Regulation S. Terms used in this paragraph have the
meanings given to them by Regulation S.
(f) The Company has been advised by The Portal Market of the
NASD that both the Dollar Notes and the Euro Notes have been designated
Portal-eligible securities in accordance with the rules and regulations
of the NASD and the Company has applied to
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have the Dollar Notes and the Euro Notes listed on the Luxembourg
Stock Exchange and has been advised by the Luxembourg Stock Exchange
that both the Dollar Notes and the Euro Notes are eligible for approval
subject to notice of issuance and the Company's compliance with the
rules and regulations of that exchange.
(g) The Company is not, and after giving effect to the
offering and sale of the Securities and the application of the proceeds
thereof as described in the Final Memorandum will not be, an
"investment company" within the meaning of the Investment Company Act,
without taking account of any exemption arising out of the number of
holders of the Company's securities.
(h) The Company is subject to and in full compliance with the
reporting requirements of Section 13 or Section 15(d) of the Exchange
Act.
(i) The Company has not paid or agreed to pay to any person
any compensation for soliciting another to purchase any securities of
the Company (except as contemplated by this Agreement).
(j) The Company has not taken, directly or indirectly, any
action designed to or that would constitute or that might reasonably be
expected to cause or result in, under the Exchange Act or otherwise,
the stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(k) Each of the Company and its subsidiaries has been duly
incorporated or organized and is validly existing as a corporation or
other valid legal entity in good standing under the laws of the
jurisdiction in which it is chartered or organized with full corporate
or company power and authority to own or lease, as the case may be, and
to operate its properties and conduct its business as described in the
Final Memorandum, and is duly qualified to do business as a foreign
corporation or other valid legal entity and is in good standing under
the laws of each jurisdiction which requires such qualification, except
in jurisdictions in which the failure to be so qualified or to be in
good standing has not had and would not reasonably be expected to have
a Material Adverse Effect. For purposes of this Agreement, a "Material
Adverse Effect" shall mean a material adverse effect on, or a material
adverse change in, the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries,
taken as a whole.
(l) All the outstanding shares of capital stock of each
subsidiary have been duly and validly authorized and issued and are
fully paid and nonassessable, and, except as otherwise set forth in the
Final Memorandum and other than the Company's subsidiaries in Japan and
Turkey, all outstanding shares of capital stock of the subsidiaries are
owned by the Company either directly or through wholly owned
subsidiaries free and clear of any perfected security interest or any
other security interests, claims, liens or encumbrances.
(m) The Company's authorized equity capitalization is as set
forth in the Final Memorandum, and the Voting Trust Agreement entered
into as of April 15, 1996 among the Voting Trustees and stockholders of
the Company conforms in all material respects to the description
thereof contained in the Final Memorandum.
(n) The statements in the Final Memorandum under the headings
"Important Federal Income Tax Considerations", "Description of Notes",
"Exchange Offer; Registration Rights", "Business--Trademarks",
"Business--Legal Proceedings" and "Risk Factors--Our success depends on
the continued protection of our trademarks and other proprietary
intellectual property rights", insofar as such statements summarize
legal matters, agreements,
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documents or proceedings discussed therein, are, in all materiaL
respects, accurate and fair summaries of such legal matters,
agreements, documents or proceedings.
(o) This Agreement has been duly authorized, executed and
delivered by the Company; the Indentures have been duly authorized and,
assuming due authorization, execution and delivery thereof by the
Trustee, when executed and delivered by the Company, will constitute
legal, valid and binding instruments enforceable against the Company in
accordance with their terms (subject, as to the enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws affecting creditors' rights generally from
time to time in effect and to general principles of equity); the
Securities have been duly authorized, and, when executed and
authenticated in accordance with the provisions of the Indentures and
delivered to and paid for by the Initial Purchasers, will have been
duly executed and delivered by the Company and will constitute the
legal, valid and binding obligations of the Company entitled to the
benefits of the applicable Indenture (subject, as to the enforcement of
remedies, to applicable bankruptcy, insolvency, moratorium or other
laws affecting creditors' rights generally from time to time in effect
and to general principles of equity); and the Registration Rights
Agreements have been duly authorized, executed and delivered by the
Company and, assuming due authorization, execution and delivery thereof
by the other parties thereto, constitute legal, valid and binding
instruments enforceable against the Company in accordance with their
terms (subject, as to the enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, moratorium or other laws
affecting creditors' rights generally from time to time in effect and
to general principles of equity).
(p) No consent, approval, authorization, filing with or order
of any court or governmental agency or body is required in connection
with the transactions contemplated herein or in the Indentures or the
Registration Rights Agreements, except such as will be obtained under
the Act and the Trust Indenture Act in connection with the transactions
contemplated by the Registration Rights Agreements and such as may be
required under the blue sky or securities laws of any jurisdiction in
connection with the transactions contemplated by this Agreement and the
Registration Rights Agreements.
(q) Neither the execution and delivery of the Indentures, this
Agreement or the Registration Rights Agreements, the issue and sale of
the Securities, nor the consummation of any other of the transactions
herein or therein contemplated, nor the fulfillment of the terms hereof
or thereof will conflict with, result in a breach or violation of, or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, (i) the
charter or by-laws of the Company or any of its subsidiaries; (ii) the
terms of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument to which the Company or any of its subsidiaries
is a party or bound or to which any of their respective properties is
subject; or (iii) any statute, law, rule, regulation, judgment, order
or decree applicable to the Company or any of its subsidiaries of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority of the United States or any state thereof
having jurisdiction over the Company, any of its subsidiaries or any of
their respective properties or to the Company's knowledge, any statute,
law, rule, regulation, judgment, order or decree applicable to the
Company or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority
outside of the United States having jurisdiction over the Company, any
of its subsidiaries or any of their respective properties, except, with
respect to (x) clause (ii) and (y) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company or any of its
subsidiaries of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority outside of the United
States described in clause (iii) as to which
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the Company has no knowledge, for conflicts, violations, breaches or
impositions that would not reasonably be expected to have a Material
Adverse Effect.
(r) The consolidated historical financial statements and
schedules of the Company and its consolidated subsidiaries included in
the Final Memorandum present fairly in all material respects the
financial condition, results of operations and cash flows of the
Company as of the dates and for the periods indicated, comply as to
form with the applicable accounting requirements of the Act and have
been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved (except as otherwise noted therein); and the selected
financial data set forth under the caption "Selected Historical
Consolidated Financial Information" in the Final Memorandum fairly
present, on the basis stated in the Final Memorandum, the information
included therein.
(s) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property is pending
or, to the best knowledge of the Company, threatened that (i) could
reasonably be expected to have a material adverse effect on the
performance of this Agreement, the Indentures or the Registration
Rights Agreements, or the consummation of any of the transactions
contemplated hereby or thereby; or (ii) could reasonably be expected to
have a Material Adverse Effect, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated in the Final Memorandum (exclusive of any amendment or
supplement thereto).
(t) The Company and each of its subsidiaries own, lease or
license all such properties as are necessary to the conduct of their
respective operations as presently conducted.
(u) Neither the Company nor any subsidiary is in violation or
default of (i) any provision of its charter or bylaws; (ii) the terms
of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument to which it is a party or bound or to which its
property is subject; or (iii) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company or any of its
subsidiaries of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having jurisdiction
over the Company or such subsidiary or any of its properties, as
applicable, other than such violations or defaults the occurrence of
which would not reasonably be expected to have a Material Adverse
Effect, whether or not arising from the transactions in the ordinary
course of business.
(v) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries and
delivered their report with respect to the audited consolidated
financial statements and schedules included in the Final Memorandum,
are independent public accountants with respect to the Company within
the meaning of the Act and the applicable published rules and
regulations thereunder.
(w) To the Company's knowledge, there are no material stamp or
other issuance or transfer taxes or duties or other material similar
fees or charges required to be paid in connection with the execution
and delivery of this Agreement or the issuance or sale by the Company
of the Securities.
(x) The Company has filed all foreign, federal, state and
local tax returns that are required to be filed or has requested
extensions thereof (except in any case in which the failure so to file
would not have a Material Adverse Effect, whether or not arising from
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transactions in the ordinary course of business, except as set forth in
or contemplated in the Final Memorandum (exclusive of any amendment or
supplement thereto) and has paid all taxes required to be paid by it
and any other assessment, fine or penalty levied against it, to the
extent that any of the foregoing is due and payable, except for any
such tax or other assessment, fine or penalty that is currently being
contested in good faith or as would not have a Material Adverse
Effect, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Final Memorandum (exclusive of any amendment or supplement thereto).
(y) No labor problem or dispute with the employees of the
Company or any of its subsidiaries exists or is threatened or imminent,
and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its or its subsidiaries'
principal suppliers, contractors or customers that in any such case
could have a Material Adverse Effect, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated in the Final Memorandum (exclusive of any amendment or
supplement thereto).
(z) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the
businesses in which they are engaged; all policies of insurance and
fidelity or surety bonds insuring the Company or any of its
subsidiaries or their respective businesses, assets, employees,
officers and directors are in full force and effect; the Company and
its subsidiaries are in compliance with the terms of such policies and
instruments in all material respects; except as would not have a
Material Adverse Effect, there are no claims by the Company or any of
its subsidiaries under any such policy or instrument as to which any
insurance company is denying liability or defending under a reservation
of rights clause; and neither the Company nor any such subsidiary has
any reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue
its business at a cost that would not have a Material Adverse Effect,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Final
Memorandum (exclusive of any amendment or supplement thereto).
(aa) No subsidiary of the Company is currently contractually
prohibited, directly or indirectly, from paying any dividends to the
Company, from making any other distribution on such subsidiary's
capital stock, from repaying to the Company any loans or advances to
such subsidiary from the Company or from transferring any of such
subsidiary's property or assets to the Company or any other subsidiary
of the Company, except as described in or contemplated by the Final
Memorandum or the Company's Bridge Credit Agreement, with Bank of
America, N.A. as administrative agent and collateral agent, dated as of
January 31, 2000, as amended, the Company's Amended and Restated 1999
180 Day Credit Agreement, with Bank of America, N.A. as administrative
agent and collateral agent, dated as of January 31, 2000, as amended,
the Company's Amended and Restated 1997 364 Day Credit Agreement, with
Bank of America, N.A. as administrative agent and collateral agent,
dated as of January 31, 2000, as amended, and the Company's 1997 Second
Amended and Restated Credit Agreement, with Bank of America, N.A. as
administrative agent and collateral agent dated as of January 31, 2000,
as amended (the "Existing Bank Credit Facilities").
(bb) The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by the
appropriate federal, state or foreign regulatory authorities necessary
to conduct their respective businesses, other than such licenses,
certificates, permits or other authorizations, the failure of which to
possess would not have a Material
6
Adverse Effect, and neither the Company nor any such subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a Material Adverse Effect, whether or
not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Final Memorandum
(exclusive of any amendment or supplement thereto).
(cc) The Company and each of its subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; and (iii) the recorded accountability
for assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.
(dd) In the ordinary course of its business, the Company
periodically reviews the effect of applicable foreign, federal, state
and local laws and regulations relating to the protection of human
health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws") on the
business, operations and properties of the Company and its
subsidiaries, in the course of which it identifies and evaluates
associated costs and liabilities (including, without limitation, any
capital or operating expenditures required for clean-up, closure of
properties or compliance with Environmental Laws, or any permit,
license or approval, any related constraints on operating activities
and any potential liabilities to third parties); on the basis of such
review, the Company has reasonably concluded that such associated costs
and liabilities would not, singly or in the aggregate, have a Material
Adverse Effect, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in
the Final Memorandum (exclusive of any amendment or supplement
thereto).
(ee) Except as would not have a Material Adverse Effect, each
of the Company and its subsidiaries has fulfilled its obligations, if
any, under the minimum funding standards of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ Employee Retirement Income Security Act of 1974, as amended
("ERISA"), and the regulations and published interpretations thereunder
with respect to each "plan" (as defined in Section 3(3) of ERISA and
such regulations and published interpretations) in which employees of
the Company and its subsidiaries are eligible to participate and each
such plan is in compliance in all material respects with the presently
applicable provisions of ERISA and such regulations and published
interpretations; the Company and its subsidiaries have not incurred any
unpaid liability to the Pension Benefit Guaranty Corporation (other
than for the payment of premiums in the ordinary course) or to any such
plan under Title IV of ERISA.
(ff) The subsidiaries listed on Annex A attached hereto are
the only significant subsidiaries of the Company as defined by Rule
l-02 of Regulation S-X under the Act (the "Subsidiaries").
(gg) The Company and its subsidiaries own, possess, license or
have other rights to use, on reasonable terms, all patents, patent
applications, trade and service marks (including the Levi's(R),
Dockers(R) and Slates(R) trademarks), trade and service ▇▇▇▇
registrations, trade names, copyrights, licenses, inventions, trade
secrets, technology, know-how and other intellectual property
(collectively, the "Intellectual Property") necessary for the conduct
of the Company's business as now conducted free and clear of any
material security interests, claims, liens or encumbrances, except as
would not have a Material Adverse Effect or as set forth in or
contemplated in (i) the Final Memorandum (exclusive of any amendment or
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supplement thereto) or (ii) the Existing Bank Credit Facilities, and
none of the Intellectual Property, to the best knowledge of the
Company, conflicts with the valid trademark, trade name, copyright,
patent, patent right or intangible asset of any other Person to the
extent that such conflict has or would have a Material Adverse Effect.
Any certificate signed by any officer of the Company and
delivered to the Representatives or counsel for the Initial Purchasers in
connection with the offering of the Securities shall be deemed a representation
and warranty by the Company, as to matters covered thereby, to each Initial
Purchaser.
2. Purchase and Sale. Subject to the terms and conditions and
-----------------
in reliance upon the representations and warranties herein set forth, the
Company agrees to sell to each Initial Purchaser, and each Initial Purchaser
agrees, severally and not jointly, to purchase from the Company:
(a) at a purchase price of 96.337% of the principal amount
thereof, plus accrued interest, if any, from January 18, 2001 to the
Closing Date, the principal amount of Dollar Notes set forth opposite
such Initial Purchaser's name on Schedule I hereto, and
(b) at a purchase price of 96.873% of the principal amount
thereof, plus accrued interest, if any, from January 18, 2001 to the
Closing Date, the principal amount of Euro Notes set forth opposite
such Initial Purchaser's name on Schedule I hereto.
3. Delivery and Payment. Delivery of and payment for the
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Securities shall be made at 10:00 A.M., New York City time, on January 18, 2001,
or at such time on such later date (not later than three Business Days after the
foregoing date) as the Representatives shall designate, which date and time may
be postponed by agreement between the Representatives and the Company or as
provided in Section 9 hereof (such date and time of delivery and payment for the
Securities being herein called the "Closing Date"). Delivery of the Securities
shall be made to the Representatives for the respective accounts of the several
Initial Purchasers against payment by the several Initial Purchasers through the
Representatives of the purchase price thereof to or upon the order of the
Company by wire transfer payable in same-day funds to the account specified by
the Company. Delivery of the Dollar Notes shall be made through the facilities
of The Depository Trust Company and delivery of the Euro Notes shall be made
through the facilities of the Euroclear System and Clearstream, Luxembourg,
unless the Representatives shall otherwise instruct.
4. Offering by Initial Purchasers. Each Initial Purchaser,
------------------------------
severally and not jointly, represents and warrants to and agrees with the
Company that:
(a) It has not offered or sold, and will not offer or sell,
any Securities except (i) to those persons it reasonably believes to be
qualified institutional buyers (as defined in Rule 144A under the Act)
and that, in connection with each such sale, it has taken or will take
reasonable steps to ensure that the purchaser of such Securities is
aware that such sale is being made in reliance on Rule 144A; or (ii) in
accordance with the restrictions set forth in Exhibit A hereto.
(b) Neither it nor any person acting on its behalf has made or
will make offers or sales of the Securities in the United States by
means of any form of general solicitation or general advertising
(within the meaning of Regulation D) in the United States.
5. Agreements. The Company agrees with each Initial Purchaser
----------
that:
(a) The Company will furnish to each Initial Purchaser and to
counsel for the Initial Purchasers, without charge, during the period
referred to in paragraph (c) below, as many
8
copies of the Final Memorandum and any amendments and supplements there
to as you may reasonably request.
(b) The Company will not amend or supplement the Final
Memorandum, other than by filing documents under the Exchange Act that
are incorporated by reference therein, without the prior written
consent of the Representatives; provided, however, that, prior to the
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completion of the distribution of the Securities by the Initial
Purchasers (as determined by the Initial Purchasers), the Company will
not file any document under the Exchange Act that is incorporated by
reference in the Final Memorandum unless, prior to such proposed
filing, the Company has furnished the Representatives with a copy of
such document for their review and the Representatives have not
reasonably objected to the filing of such document. The Company will
promptly advise the Representatives when any document filed under the
Exchange Act that is incorporated by reference in the Final Memorandum
shall have been filed with the Commission.
(c) If at any time prior to the completion of the sale of the
Securities by the Initial Purchasers (as determined by the
Representatives), any event occurs as a result of which the Final
Memorandum, as then amended or supplemented, would include any untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it
shall be necessary to amend or supplement the Final Memorandum to
comply with applicable law, the Company promptly (i) will notify the
Representatives of any such event; (ii) subject to the requirements of
paragraph (b) of this Section 5, will prepare an amendment or
supplement that will correct such statement or omission or effect such
compliance; and (iii) will supply any supplemented or amended Final
Memorandum to the several Initial Purchasers and counsel for the
Initial Purchasers without charge in such quantities as you may
reasonably request.
(d) The Company will arrange, if necessary, for the
qualification of the Securities for sale by the Initial Purchasers
under the laws of such jurisdictions in the United States and the
European Union as the Representatives may reasonably designate and will
maintain such qualifications in effect so long as required for the sale
of the Securities; provided that in no event shall the Company be
--------
obligated to qualify to do business in any jurisdiction where it is not
now so qualified or to take any action that would subject it to service
of process in suits, other than those arising out of the offering or
sale of the Securities, in any jurisdiction where it is not now so
subject. The Company will promptly advise the Representatives of the
receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for
such purpose.
(e) The Company will not, and will not permit any of its
Affiliates (other than the Initial Purchasers, as to whom the Company
makes no covenant) to, resell, under circumstances that would require
the registration of the Securities under the Act, any Securities that
have been acquired by any of them.
(f) Neither the Company, nor any of its Affiliates (other than
the Initial Purchasers, as to whom the Company makes no covenant), nor
any person acting on its or their behalf will, directly or indirectly,
make offers or sales of any security, or solicit offers to buy any
security, under circumstances that would require the registration of
the Securities under the Act.
(g) Neither the Company, nor any of its Affiliates (other than
the Initial Purchasers, as to whom the Company makes no covenant), nor
any person acting on its or their behalf
9
will engage in any form of general solicitation or general advertising
(within the meaning of Regulation D) in connection with any
offer or sale of the Securities in the United States.
(h) So long as any of the Securities are "restricted
securities" within the meaning of Rule 144(a)(3) under the Act, the
Company will, during any period in which it is not subject to and in
compliance with Section 13 or 15(d) of the Exchange Act or it is not
exempt from such reporting requirements pursuant to and in compliance
with Rule 12g3-2(b) under the Exchange Act, provide to each holder of
such restricted securities and to each prospective purchaser (as
designated by such holder) of such restricted securities, upon the
request of such holder or prospective purchaser, any information
required to be provided by Rule 144A(d)(4) under the Act. This covenant
is intended to be for the benefit of the holders, and the prospective
purchasers designated by such holders, from time to time of such
restricted securities.
(i) Neither the Company, nor any of its Affiliates, nor any
person acting on its or their behalf will engage in any directed
selling efforts with respect to the Securities, and each of them will
comply with the offering restrictions requirements of Regulation S.
Terms used in this paragraph have the meanings given to them by
Regulation S.
(j) The Company will cooperate with the Representatives and
use its best efforts to (i) permit the Dollar Notes to be eligible for
clearance and settlement through The Depository Trust Company, (ii)
permit the Euro Notes to be eligible for clearance and settlement
through the Euroclear System and Clearstream, Luxembourg and (iii)
cause both the Dollar Notes and the Euro Notes to be approved for
listing on the Luxembourg Stock Exchange.
(k) The Company will not offer, sell, contract to sell, grant
any other option to purchase or otherwise dispose of, directly or
indirectly, or announce the offering of, or file a registration
statement for, any debt securities issued or guaranteed by the Company
or any of its direct or indirect subsidiaries, or enter into any
agreement to do any of the foregoing (other than (x) the Securities and
the New Securities (as defined in the Registration Rights Agreements),
(y) pursuant to any credit facility permitted under the Indentures and
(z) purchase money debt and any other non-capital markets debt
permitted under the Indentures) for a period of 90 days from the date
the Securities are issued without the prior written consent of ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
(l) The Company will not take, directly or indirectly, any
action designed to or that would constitute or that might reasonably be
expected to cause or result in, under the Exchange Act or otherwise,
the stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(m) The Company will not, at any time prior to the expiration
of three years after the Closing Date, be or become an open-end
investment company, unit investment trust or face-amount certificate
company that is or is required to be registered under Section 8 of the
Investment Company Act, and will not be or become a closed-end
investment company required to be registered but not registered
thereunder.
(n) The Company agrees to pay the costs and expenses relating
to the following matters: (i) the preparation of the Indentures and the
Registration Rights Agreements, the issuance of the Securities and the
fees of the Trustee; (ii) the preparation, printing or reproduction of
the Preliminary Memorandum and Final Memorandum and each amendment or
supplement to either of them; (iii) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for
counting and packaging) of such copies of the
10
Preliminary Memorandum and Final Memorandum, and all amendments or
supplements to either of them, as may, in each case, be reasonably
requested for use in connection with the offering and sale of the
Securities; (iv) the preparation, printing, authentication, issuance
and delivery of certificates for the Securities, including any stamp or
transfer taxes in connection with the original issuance and sale of the
Securities; (v) the printing (or reproduction) and delivery of this
Agreement, any blue sky memorandum and all other agreements or
documents printed (or reproduced) and delivered in connection with the
offering of the Securities; (vi) any registration or qualification of
the Securities for offer and sale under the securities or blue sky laws
of the several states (including filing fees and the reasonable fees
and expenses of counsel for the Initial Purchasers relating to such
registration and qualification); (vii) admitting the Securities for
trading in The Portal Market of the NASD and on the Luxembourg Stock
Exchange; (viii) the transportation and other expenses incurred by or
on behalf of Company representatives in connection with presentations
to prospective purchasers of the Securities; (ix) the fees and expenses
of the Company's accountants and the fees and expenses of counsel
(including local and special counsel) for the Company; and (x) all
other costs and expenses incident to the performance by the Company of
its obligations hereunder. It is understood, however, that, except as
provided in this Section, and Sections 7 and 8 hereof, the Initial
Purchasers will pay all of their own costs and expenses, including the
fees of their counsel, Cravath, Swaine & ▇▇▇▇▇.
6. Conditions to the Obligations of the Initial Purchasers.
---------------------------------------------------------
The obligations of the Initial Purchasers to purchase the Securities shall be
subject to the accuracy of the representations and warranties on the part of the
Company contained herein at the Execution Time and the Closing Date, to the
accuracy of the statements of the Company made in any certificates pursuant to
the provisions hereof, to the performance by the Company of its obligations
hereunder and to the following additional conditions:
(a) The Company shall have requested and caused Wachtell,
Lipton, ▇▇▇▇▇ & ▇▇▇▇, counsel for the Company, to furnish to the
Representatives its opinion, dated the Closing Date and addressed to
the Representatives, to the effect that:
(i) the Indentures have been duly authorized,
executed and delivered, and, assuming due authorization,
execution and delivery by the Trustee, constitute legal, valid
and binding instruments enforceable against the Company in
accordance with their terms (subject, as to the enforcement of
remedies, to applicable bankruptcy, reorganization,
insolvency, moratorium or other laws affecting creditors'
rights generally from time to time in effect and to general
principles of equity, including, without limitation, concepts
of materiality, reasonableness, good faith and fair dealing,
regardless of whether considered in a proceeding in equity or
at law); the Securities have been duly and validly authorized
and, when executed and authenticated in accordance with the
provisions of the Indentures and delivered to and paid for by
the Initial Purchasers under this Agreement, will constitute
legal, valid and binding obligations of the Company entitled
to the benefits of the Indentures (subject, as to the
enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting
creditors' rights generally from time to time in effect and to
general principles of equity, including, without limitation,
concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether considered in a proceeding in
equity or at law); the Registration Rights Agreements have
been duly authorized, executed and delivered and, assuming due
authorization, execution and delivery by the other parties
thereto, constitute legal, valid and binding instruments
enforceable against the Company in accordance with their terms
(subject, as to the enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, moratorium or other
laws affecting
11
creditors' rights generally from time to time in effect
and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness,
good faith and fair dealing, regardless of whether considered
in a proceeding in equity or at law); and the statements set
forth under the heading "Description of Notes" and "Exchange
Offer; Registration Rights" in the Final Memorandum, insofar
as such statements purport to summarize certain provisions
of the Securities, the Indentures and the Registration
Rights Agreements, provide, in all material respects,
a fair summary of such provisions;
(ii) the statements in the Final Memorandum under the
heading "Important Federal Income Tax Considerations", insofar
as such statements summarize legal matters, agreements,
documents or proceedings discussed therein, are accurate and
fair summaries of such legal matters, agreements, documents or
proceedings;
(iii) such counsel has acted as special counsel for
the Company in connection with the transactions contemplated
by the Purchase Agreement, and does not and has not acted for
the Company as regular outside counsel for litigation, ERISA,
antitrust, intellectual property, commercial, corporate or
other matters, and has participated in conferences with
officers and other representatives of the Company, and
representatives and counsel to the Initial Purchasers, all of
whom participated in the preparation of the Final Memorandum,
at which conferences the contents of the Final Memorandum were
discussed, and, although it has not independently verified,
and is not passing upon and assumes no responsibility for, the
accuracy, completeness or fairness of, or otherwise verified,
the statements made in, the Final Memorandum, no facts have
come to its attention which lead it to believe that the Final
Memorandum (other than the financial statements and related
notes thereto and the other financial, statistical, reserve
and accounting data included in or omitted from the Final
Memorandum, all as to which it expresses no opinion), on the
date thereof or at the Closing Date contained an untrue
statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not
misleading;
(iv) this Agreement has been duly authorized,
executed and delivered by the Company;
(v) neither the execution and delivery of the
Indentures, this Agreement or the Registration Rights
Agreements, the issue and sale of the Securities, nor the
consummation of any other of the transactions herein or
therein contemplated, nor the fulfillment of the terms hereof
or thereof will conflict with, result in a breach or violation
of, or imposition of any lien, charge or encumbrance upon any
property or asset of the Company or any of its subsidiaries
pursuant to, (i) the charter or by-laws of the Company; (ii)
the terms of the Company's Existing Bank Credit Facilities,
including any covenant contained therein; or (iii) any law,
rule or regulation of the United States applicable to
securities transactions or the General Corporation Law of the
State of Delaware;
(vi) assuming the accuracy of the representations and
warranties and compliance with the agreements contained
herein, no registration of the Securities under the Act, and
no qualification of an indenture under the Trust Indenture
Act, is required for the offer and sale by the Initial
Purchasers of the Securities in the manner contemplated by
this Agreement; and
12
(vii) the Company is not and, after giving effect to
the offering and sale of the Securities and the application of
the proceeds thereof as described in the Final Memorandum,
will not be an "investment company" as defined in the
Investment Company Act without taking account of any exemption
arising out of the number of holders of the Company's
securities.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than the
States of Delaware and New York or the Federal laws of the United States, to the
extent they deem proper and specified in such opinion, upon the opinion of other
counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Initial Purchasers; and (B) as to matters of
fact, to the extent they deem proper, on certificates of responsible officers of
the Company and public officials. Such opinion may contain customary
assumptions, exceptions, limitations, qualifications and comments. References to
the Final Memorandum in this Section 6(a) include any amendment or supplement
thereto at the Closing Date.
(b) The Company shall have requested and caused ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, Esq., Senior Vice President and General Counsel for the
Company, to furnish to the Representatives his opinion, dated the
Closing Date and addressed to the Representatives, to the effect that:
(i) each of the Company and the subsidiaries listed
on Annex A (individually, a "Subsidiary" and collectively, the
"Subsidiaries") has been duly incorporated or organized and is
validly existing as a corporation or other valid legal entity
in good standing under the laws of the jurisdiction in which
it is chartered or organized, with full corporate or company
power and authority to own or lease, as the case may be, and
to operate its properties and conduct its business as
described in the Final Memorandum, and is duly qualified to do
business as a foreign corporation or other valid legal entity
and is in good standing under the laws of each jurisdiction
which requires such qualification, except in jurisdictions in
which the failure to be so qualified or to be in good standing
has not had and would not reasonably be expected to have a
Material Adverse Effect;
(ii) all the outstanding shares of capital stock of
the Company and each Subsidiary have been duly and validly
authorized and issued and are fully paid and nonassessable,
and, except as otherwise set forth in the Final Memorandum and
other than the Company's subsidiaries in Japan and Turkey, all
outstanding shares of capital stock of the Subsidiaries are
owned by the Company either directly or through wholly owned
subsidiaries free and clear of any perfected security interest
and, to the knowledge of such counsel, after due inquiry, any
other security interests, claims, liens or encumbrances;
(iii) the Company's authorized equity capitalization
is as set forth in the Final Memorandum;
(iv) to the best knowledge of such counsel, there is
no pending or threatened action, suit or proceeding by or
before any court or governmental agency, authority or body or
any arbitrator involving the Company or any of its
subsidiaries or its or their property that is not adequately
disclosed in the Final Memorandum, except in each case for
such proceedings that, if the subject of an unfavorable
decision, ruling or finding would not singly or in the
aggregate, result in a Material Adverse Effect;
(v) such counsel has no reason to believe that at the
Execution Time and on the Closing Date the Final Memorandum
contained or contains any untrue statement
13
of a material fact or omitted or omits to state any material
fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading
(in each case, other than the financial statements and other
financial information contained therein, as to which such
counsel need express no opinion);
(vi) assuming the accuracy of the representations and
warranties of the Initial Purchasers in Section 4 of this
Agreement, no consent, approval, authorization, filing with or
order of any court or governmental agency or body is required
in connection with the transactions contemplated herein or in
the Indentures and the Registration Rights Agreements, except
such as will be obtained under the Act and the Trust Indenture
Act in connection with the transactions contemplated by the
Registration Rights Agreements and such as may be required
under the blue sky or securities laws of any jurisdiction in
connection with the transactions contemplated by this
Agreement and the Registration Rights Agreements and such
other approvals (specified in such opinion) as have been
obtained; and
(vii) neither the execution and delivery of the
Indentures, this Agreement or the Registration Rights
Agreements, the issue and sale of the Securities, nor the
consummation of any other of the transactions herein or
therein contemplated, nor the fulfillment of the terms hereof
or thereof will conflict with, result in a breach or violation
of, or imposition of any lien, charge or encumbrance upon any
property or asset of the Company or any of its subsidiaries
pursuant to, (i) the charter or by-laws of the Company or any
of its subsidiaries; (ii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition, covenant
or instrument to which the Company or any of its subsidiaries
is a party or bound or to which any of their respective
properties is subject; or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to the
Company or any of its subsidiaries of any court, regulatory
body, administrative agency, governmental body, arbitrator or
other authority of the United States or any state thereof
having jurisdiction over the Company, any of its subsidiaries
or any of their respective properties or to the knowledge of
such counsel, any statute, law, rule, regulation, judgment,
order or decree applicable to the Company or any of its
subsidiaries of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority
outside of the United States having jurisdiction over the
Company, any of its subsidiaries or any of their respective
properties, except, with respect to (x) clause (ii) and (y)
any statute, law, rule, regulation, judgment, order or decree
applicable to the Company or any of its subsidiaries of any
court, regulatory body, administrative agency, governmental
body, arbitrator or other authority outside of the United
States described in clause (iii) as to which such counsel has
no knowledge, for conflicts, violations, breaches or
impositions that would not reasonably be expected to have a
Material Adverse Effect.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than the
States of Delaware and California or the Federal laws of the United States, to
the extent he deems proper and specified in such opinion, upon the opinion of
other counsel of good standing whom he believes to be reliable and who are
satisfactory to counsel for the Initial Purchasers; and (B) as to matters of
fact, to the extent he deems proper, on certificates of other responsible
officers of the Company and public officials. Such opinion may contain customary
assumptions, exceptions, limitations, qualifications and comments. References to
the Final Memorandum in this Section 6(a) include any amendment or supplement
thereto at the Closing Date.
14
(c) The Representatives shall have received from Cravath,
Swaine & ▇▇▇▇▇, counsel for the Initial Purchasers, such opinion or
opinions, dated the Closing Date and addressed to the Representatives,
with respect to the issuance and sale of the Securities, the
Indentures, the Registration Rights Agreements, the Final Memorandum
(as amended or supplemented at the Closing Date) and other related
matters as the Representatives may reasonably require, and the Company
shall have furnished to such counsel such documents as they request for
the purpose of enabling them to pass upon such matters.
(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chief Financial Officer and
the Treasurer, dated the Closing Date, to the effect that the signers
of such certificate have carefully examined the Final Memorandum, any
amendment or supplement to the Final Memorandum and this Agreement and
that:
(i) the representations and warranties of the Company
in this Agreement are true and correct in all material
respects on and as of the Closing Date with the same effect as
if made on the Closing Date, and the Company has complied in
all material respects with all the agreements and satisfied
all the conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date; and
(ii) since the date of the most recent financial
statements included in the Final Memorandum (exclusive of any
amendment or supplement thereto), there has been no material
adverse change in the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and
its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business, except
as set forth in or contemplated by the Final Memorandum
(exclusive of any amendment or supplement thereto).
(e) At the Execution Time and at the Closing Date, the Company
shall have requested and caused ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP to furnish to the
Representatives letters, dated respectively as of the Execution Time
and as of the Closing Date, in form and substance satisfactory to the
Representatives, confirming that they are independent accountants
within the meaning of the Act and the Exchange Act and the respective
applicable rules and regulations adopted by the Commission thereunder,
that they have performed a review of the unaudited interim financial
information of the Company for the nine-month period ended August 27,
2000 and as at August 27, 2000 and stating in effect that:
(i) in their opinion the audited financial statements
and financial statement schedules included or incorporated in
the Final Memorandum and reported on by them comply as to form
in all material respects with the applicable accounting
requirements of the Exchange Act and the related rules and
regulations adopted by the Commission thereunder that would
apply to the Final Memorandum if the Final Memorandum were a
prospectus included in a registration statement on Form S-1
under the Act;
(ii) on the basis of a reading of the latest
unaudited financial statements made available by the Company
and its subsidiaries; their limited review, in accordance with
the standards established under Statement on Auditing
Standards No. 71, of the unaudited interim financial
information for the nine-month period ended August 27, 2000
and as at August 27, 2000, as indicated in their report
included or incorporated in the Final Memorandum; carrying out
certain specified procedures (but not an examination in
accordance with generally accepted auditing standards) which
would not necessarily reveal matters of significance with
respect
15
to the comments set forth in such letter; a reading of the
minutes of the meetings of the stockholders, directors and
executive, audit and personnel committees of the Company
and the Subsidiaries; and inquiries of certain officials
of the Company who have responsibility for financial and
accounting matters of the Company and its subsidiaries as
to transactions and events subsequent to November 28, 1999,
nothing came to their attention which caused them to believe
that:
(1) any unaudited financial statements
included or incorporated in the Final Memorandum
do not comply in form in all material respects with
applicable accounting requirements and with the
related rules and regulations adopted by the
Commission with respect to financial statements
included or incorporated in quarterly reports on
Form 10-Q under the Exchange Act; and said unaudited
financial statements are not in conformity with
generally accepted accounting principles applied on a
basis substantially consistent with that of the
audited financial statements included or incorporated
in the Final Memorandum;
(2) with respect to the period subsequent to
August 27, 2000, there were any changes, at a
specified date not more than five days prior to the
date of the letter, in the long-term debt of the
Company and its subsidiaries or capital stock of
the Company or decreases in the stockholders' deficit
of the Company as compared with the amounts shown on
the August 27, 2000 consolidated balance sheet
included or incorporated in the Final Memorandum, or
for the period from August 28, 2000 to such specified
date there were any decreases, as compared with the
corresponding period in the preceding quarter in net
sales, gross profit, operating income, interest
expense, income before taxes or in total or per share
amounts of net income of the Company and its
subsidiaries, except in all instances for changes
or decreases set forth in such letter, in which case
the letter shall be accompanied by an explanation by
the Company as to the significance thereof unless
said explanation is not deemed necessary by the
Representatives; or
(3) the information included in response to
Regulation S-K, Item 301 (Selected Financial Data),
Item 402 (Executive Compensation) and Item 503(d)
(Ratio of Earnings to Fixed Charges) is not in
conformity with the disclosure requirements of
Regulation S-K; and
(iii) they have performed certain other specified
procedures as a result of which they determined that certain
information of an accounting, financial or statistical nature
(which is limited to accounting, financial or statistical
information derived from the general accounting records of the
Company and its subsidiaries) set forth in the Final
Memorandum, including the information set forth under the
captions "Summary", "Risk Factors", "Selected Historical
Consolidated Financial Information", "Management's Discussion
and Analysis of Financial Condition and Results of Operations"
and "Business" in the Final Memorandum, the information
included in the "Management's Discussion and Analysis of
Financial Condition and Results of Operations" included or
incorporated in the Company's Quarterly Reports on Form 10-Q,
incorporated in the Final Memorandum and information included
in the Company's Current Reports on Form 8-K, dated September
19, 2000, June 6, 2000, January 10, 2000 and January 11, 2000,
incorporated in the Final Memorandum agrees with the
accounting records of the Company and its subsidiaries,
excluding any questions of legal interpretation.
16
References to the Final Memorandum in this Section 6(e)
include any amendment or supplement thereto at the date of the
applicable letter. It is understood that the letter dated the Closing
Date will include audited financial statements for the Company's fiscal
year ending November 26, 2000.
(f) Subsequent to the Execution Time or, if earlier, the dates
as of which information is given in the Final Memorandum (exclusive of
any amendment or supplement thereto), there shall not have been (i) any
change or decrease specified in the letter or letters referred to in
paragraph (e) of this Section 6; or (ii) any change, or any development
involving a prospective change, in or affecting the condition
(financial or otherwise), prospects, earnings, business or properties
of the Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as
set forth in or contemplated in the Final Memorandum (exclusive of any
amendment or supplement thereto) the effect of which, in any case
referred to in clause (i) or (ii) above, is, in the sole judgment of
the Representatives, so material and adverse as to make it impractical
or inadvisable to market the Securities as contemplated by the Final
Memorandum (exclusive of any amendment or supplement thereto).
(g) The Securities shall have been designated as
Portal-eligible securities in accordance with the rules and regulations
of the NASD, all filings necessary for the listing of the Securities on
the Luxembourg Stock Exchange shall have been made by the Company or
its counsel, neither the Company nor its listing agent shall have
received notice that the Securities are not eligible for listing or
that the Securities will not be listed on the Luxembourg Stock
Exchange, the application for the listing of the Securities on the
Luxembourg Stock Exchange shall not have been denied, and the
Securities shall be eligible for clearance and settlement through The
Depository Trust Company, in the case of the Dollar Notes, and the
Euroclear System and Clearstream, Luxembourg, in the case of the Euro
Notes.
(h) Subsequent to the Execution Time, there shall not have
been any decrease in the rating of any of the Company's debt securities
by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Act) or any notice given
of any intended or potential decrease in any such rating (including
notice of an adverse change in the outlook for such rating) or of a
possible change in any such rating that does not indicate the direction
of the possible change.
(i) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates
and documents as the Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and counsel for the
Initial Purchasers, this Agreement and all obligations of the Initial Purchasers
hereunder may be canceled at, or at any time prior to, the Closing Date by the
Representatives. Notice of such cancellation shall be given to the Company in
writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 will
be delivered at the office of counsel for the Initial Purchasers, at Cravath,
Swaine & ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, on the Closing Date.
17
7. Reimbursement of Expenses. If the sale of the Securities
--------------------------
provided for herein is not consummated because any condition to the obligations
of the Initial Purchasers set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof other than by reason of a
default by any of the Initial Purchasers, the Company will reimburse the Initial
Purchasers severally through ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. on demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the Securities.
8. Indemnification and Contribution. (a) The Company agrees
--------------------------------
to indemnify and hold harmless each Initial Purchaser, the directors, officers,
employees and agents of each Initial Purchaser and each person who controls any
Initial Purchaser within the meaning of either the Act or the Exchange Act
against any and all losses, claims, damages or liabilities, joint or several, to
which they or any of them may become subject under the Act, the Exchange Act or
other Federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Preliminary Memorandum, the Final
Memorandum (or in any supplement or amendment thereto) or any information
provided by the Company to any holder or prospective purchaser of Securities
pursuant to Section 5(h), or in any amendment thereof or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
-------- -------
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made in the Preliminary Memorandum or
the Final Memorandum, or in any amendment thereof or supplement thereto, in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Initial Purchasers through the Representatives
specifically for inclusion therein; and provided further, however, that with
-------- ------- -------
respect to any untrue statement or omission of a material fact made in the
Preliminary Memorandum, the indemnity agreement contained in this Section 8(a)
shall not inure to the benefit of any Initial Purchaser from whom the person
asserting any such loss, claim, damage or liability purchased the Securities
concerned in any initial resale of the Securities by the Initial Purchaser, to
the extent that any such loss, claim, damage or liability of such Initial
Purchaser occurs under the circumstance where it shall have been determined by a
court of competent jurisdiction by final and nonappealable judgment that (i) the
untrue statement or omission of a material fact contained in the Preliminary
Memorandum was corrected in the Final Memorandum, (ii) the Company had
previously furnished copies of the Final Memorandum to the Initial Purchasers
and (iii) such loss, claim, damage or liability results from the fact that there
was not sent or given to such person at or prior to the written confirmation of
the sale of such Securities to such person, a copy of the Final Memorandum. This
indemnity agreement will be in addition to any liability which the Company may
otherwise have.
(b) Each Initial Purchaser severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors, each of its
officers, and each person who controls the Company within the meaning of either
the Act or the Exchange Act, to the same extent as the foregoing indemnity from
the Company to each Initial Purchaser, but only with reference to written
information relating to such Initial Purchaser furnished to the Company by or
on behalf of such Initial Purchaser through the Representatives specifically
for inclusion in the Preliminary Memorandum or the Final Memorandum (or in any
amendment or supplement thereto). This indemnity agreement will be in addition
to any liability which any Initial Purchaser may otherwise
18
have. The Company acknowledges that the statements set forth in the last
paragraph of the cover page regarding the delivery of the Securities and, under
the heading "Plan of Distribution", (i) the list of Initial Purchasers and
their respective participation in the sale of the Securities; (ii) the
sentences related to concessions and reallowances; and (iii) the paragraph
related to stabilization, syndicate covering transactions and penalty bids in
the Preliminary Memorandum and the Final Memorandum, constitute the only
information furnished in writing by or on behalf of the Initial Purchasers for
inclusion in the Preliminary Memorandum or the Final Memorandum (or in any
amendment or supplement thereto).
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses;
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be reasonably satisfactory to the
-------- -------
indemnified party. Notwithstanding the indemnifying party's election to appoint
counsel to represent the indemnified party in an action, the indemnified party
shall have the right to employ separate counsel (including local counsel), and
the indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel if (i) the use of counsel chosen by the indemnifying party
to represent the indemnified party would present such counsel with a conflict of
interest; (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party; (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of the institution of such action; or (iv) the indemnifying
party shall authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding.
The indemnifying party shall not, in connection with any one action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for fees and
expenses of more than one separate law firm of attorneys (in addition to any
local counsel) for all indemnified parties and all such fees and expenses shall
be reimbursed as incurred. Such firm shall be designated by ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Inc. in the case of the parties indemnified pursuant to Section 8(a) and by the
Company in the case of parties indemnified pursuant to Section 8(b). Each
indemnified party shall use all reasonable efforts to cooperate with the
indemnifying party in the defense of any such action or claim.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Initial Purchasers
severally agree to contribute to the aggregate losses, claims, damages and
19
liabilities (including legal or other expenses reasonably incurred in
connection with investigating or defending same) (collectively "Losses") to
which the Company and one or more of the Initial Purchasers may be subject in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and by the Initial Purchasers on the other from the
offering of the Securities; provided, however, that in no case shall any Initial
-------- -------
Purchaser (except as may be provided in any agreement among the Initial
Purchasers relating to the offering of the Securities) be responsible for any
amount in excess of the purchase discount or commission applicable to the
Securities purchased by such Initial Purchaser hereunder. If the allocation
provided by the immediately preceding sentence is unavailable for any reason,
the Company and the Initial Purchasers severally shall contribute in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company on the one hand and of the Initial Purchasers
on the other in connection with the statements or omissions which resulted in
such Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the offering (after deducting discounts and commissions to the Initial
Purchasers, but before deducting expenses) received by it, and benefits received
by the Initial Purchasers shall be deemed to be equal to the total purchase
discounts and commissions in each case set forth on the cover of the Final
Memorandum. Relative fault shall be determined by reference to, among other
things, whether any untrue or any alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information
provided by the Company on the one hand or the Initial Purchasers on the other,
the intent of the parties and their relative knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission. The
Company and the Initial Purchasers agree that it would not be just and equitable
if contribution were determined by pro rata allocation or any other method of
allocation which does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this paragraph (d), no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person who
controls an Initial Purchaser within the meaning of either the Act or the
Exchange Act and each director, officer, employee and agent of an Initial
Purchaser shall have the same rights to contribution as such Initial Purchaser,
and each person who controls the Company within the meaning of either the Act or
the Exchange Act and each officer and director of the Company shall have the
same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (d).
9. Default by an Initial Purchaser. If any one or more
-------------------------------
Initial Purchasers shall fail to purchase and pay for any of the Securities
agreed to be purchased by such Initial Purchaser hereunder and such failure to
purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Initial Purchasers shall be
obligated severally to take up and pay for (in the respective proportions
which the principal amount of Securities set forth opposite their names on
Schedule I hereto bears to the aggregate principal amount of Securities set
forth opposite the names of all the remaining Initial Purchasers) the
Securities which the defaulting Initial Purchaser or Initial Purchasers
agreed but failed to purchase; provided, however, that in the event
--------- -------
that the aggregate principal amount of Securities which the defaulting
Initial Purchaser or Initial Purchasers agreed but failed to purchase shall
exceed 10% of the aggregate principal amount of Securities set forth on
Schedule I hereto, the remaining Initial Purchasers shall have the right to
purchase all, but shall not be under any obligation to purchase any, of the
Securities, and if such nondefaulting Initial Purchasers do not purchase all
the Securities, this Agreement will terminate without liability to any
nondefaulting Initial Purchaser or the Company. In the event of a default by
any Initial Purchaser as set forth in this Section 9, the Closing Date
shall be postponed for such period, not exceeding five Business Days, as the
Representatives shall determine in order that the required changes in the Final
Memorandum or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Initial
Purchaser of its
20
liability, if any, to the Company or any nondefaulting Initial Purchaser for
damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to
-----------
termination in the absolute discretion of the Representatives, by notice given
to the Company prior to delivery of and payment for the Securities, if at any
time prior to such time (i) trading in securities generally on the New York
Stock Exchange or the Nasdaq National Market shall have been suspended or
limited or minimum prices shall have been established on such Exchange or the
Nasdaq National Market; (ii) a banking moratorium shall have been declared
either by Federal or New York State authorities; or (iii) there shall have
occurred any outbreak or escalation of hostilities, declaration by the United
States of a national emergency or war or other calamity or crisis the effect of
which on financial markets is such as to make it, in the sole judgment of the
Representatives, impracticable or inadvisable to proceed with the offering or
delivery of the Securities as contemplated by the Final Memorandum (exclusive of
any amendment or supplement thereto).
11. Representations and Indemnities to Survive. The respective
------------------------------------------
agreements, representations, warranties, indemnities and other statements of
the Company or its officers and of the Initial Purchasers set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation made by or on behalf of the Initial Purchasers or the Company
or any of the officers, directors, employees, agents or controlling persons
referred to in Section 8 hereof, and will survive delivery of and payment for
the Securities; provided, however, that the representations and warranties of
-------- -------
the Company shall be deemed to be made at the Execution Time and the Closing
Date only. The provisions of Sections 7 and 8 hereof shall survive the
termination or cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing
-------
and effective only on receipt, and, if sent to the Representatives, will be
mailed, delivered or telefaxed to the ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. General Counsel
(fax no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to the General Counsel, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Barney Inc. at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
General Counsel; or, if sent to the Company, will be mailed, delivered or
telefaxed to (▇▇▇) ▇▇▇-▇▇▇▇ and confirmed to it at Levi's Plaza, ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, attention of the Legal Department.
13. Successors. This Agreement will inure to the benefit of
----------
and be binding upon the parties hereto and their respective successors and the
officers, directors, employees, agents and controlling persons referred to in
Section 8 hereof, and, except as expressly set forth in Section 5(h) hereof, no
other person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and
---------------
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
15. Counterparts. This Agreement may be executed in one or
------------
more counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument.
16. Headings. The section headings used herein are for
--------
convenience only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this
-----------
Agreement, shall have the meanings indicated.
21
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Affiliate" shall have the meaning specified in Rule 501(b) of
Regulation D.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or trust
companies are authorized or obligated by law to close in the City of New York.
"Clearstream, Luxembourg" means Clearstream Banking, S.A.
"Commission" shall mean the Securities and Exchange
Commission.
"Euroclear System" means ▇▇▇▇▇▇ Guaranty Trust Company of New
York, Brussels Office, as operator of the Euroclear Clearance System.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"Investment Company Act" shall mean the Investment Company Act
of 1940, as amended, and the rules and regulations of the Commission
promulgated thereunder.
"NASD" shall mean the National Association of Securities
Dealers, Inc.
"Regulation D" shall mean Regulation D under the Act.
"Regulation S" shall mean Regulation S under the Act.
"Trust Indenture Act" shall mean the Trust Indenture Act of
1939, as amended, and the rules and regulations of the Commission promulgated
thereunder.
22
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this Agreement and your acceptance shall represent a binding agreement
between the Company and the several Initial Purchasers.
Very truly yours,
Levi ▇▇▇▇▇▇▇ & Co.
by
__________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
and Chief Financial
Officer
23
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
Banc of America Securities LLC
Scotia Capital (USA) Inc.
Chase Securities Inc.
Banc One Capital Markets, Inc.
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
by
______________________
Name:
Title:
For themselves and the other several Initial
Purchasers named in Schedule I to
the foregoing Agreement.
SCHEDULE I
Principal Principal
Amount of Amount of Euro
Dollar Notes Dollar Notes
Initial Purchasers to be Purchased to be Purchased
------------------ --------------- ---------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. $209,000,000 68,750,000
Banc of America Securities LLC 64,600,000 21,250,000
Scotia Capital (USA) Inc. 64,600,000 21,250,000
Chase Securities Inc. 34,200,000 11,250,000
Banc One Capital Markets, Inc 7,600,000 2,500,000
------------ -----------
Total $380,000,000 125,000,000
Annex A
Significant Subsidiaries
Levi ▇▇▇▇▇▇▇ & Co. (Canada) Inc.
Levi ▇▇▇▇▇▇▇ & Co. Europe ▇.▇.
▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Financial Services
Levi ▇▇▇▇▇▇▇ Financial Center Corporation
Levi ▇▇▇▇▇▇▇ Funding Corp.
Levi's Only Stores, Inc.
Levi ▇▇▇▇▇▇▇ (U.K.) Limited
EXHIBIT A
Selling Restrictions for Offers and
-----------------------------------
Sales outside the United States
-------------------------------
(1)(a) The Securities have not been and will not be registered
under the Act and may not be offered or sold within the United States or to, or
for the account or benefit of, U.S. persons except in accordance with Regulation
S under the Act or pursuant to an exemption from the registration requirements
of the Act. Each Initial Purchaser represents and agrees that, except as
otherwise permitted by Section 4(a)(i) of the Agreement to which this is an
exhibit, it has offered and sold the Securities, and will offer and sell the
Securities, (i) as part of their distribution at any time; and (ii) otherwise
until 40 days after the later of the commencement of the offering and the
Closing Date, only in accordance with Rule 903 of Regulation S under the Act.
Accordingly, each Initial Purchaser represents and agrees that neither it, nor
any of its Affiliates nor any person acting on its or their behalf has engaged
or will engage in any directed selling efforts with respect to the Securities,
and that it and they have complied and will comply with the offering
restrictions requirement of Regulation S. Each Initial Purchaser agrees that, at
or prior to the confirmation of sale of Securities (other than a sale of
Securities pursuant to Section 4(a)(i) of the Agreement to which this is an
exhibit), it shall have sent to each distributor, dealer or person receiving a
selling concession, fee or other remuneration that purchases Securities from it
during the distribution compliance period a confirmation or notice to
substantially the following effect:
"The Securities covered hereby have not been registered under
the U.S. Securities Act of 1933 (the "Act") and may not be
offered or sold within the United States or to, or for the
account or benefit of, U.S. persons (i) as part of their
distribution at any time or (ii) otherwise until 40 days after
the later of the commencement of the offering and January 18,
2001, except in either case in accordance with Regulation S or
Rule 144A under the Act. Terms used above have the meanings
given to them by Regulation S."
(b) Each Initial Purchaser also represents and agrees that it
has not entered and will not enter into any contractual arrangement
with any distributor with respect to the distribution of the
Securities, except with its Affiliates or with the prior written
consent of the Company.
(c) Terms used in this section have the meanings given to them
by Regulation S.
(2) Each Initial Purchaser represents and agrees that (i) it
has not offered or sold, and prior to the expiration of the period of six
months from the issue date of the Securities will not offer or sell, any
Securities in the United Kingdom, other than to persons whose ordinary business
it is to buy, hold, manage or dispose of investments, whether as principal or
as agent, for the purpose of their businesses or in circumstances which do not
constitute an offer to the public within the meaning of the Public Offers of
Securities Regulations 1995 (the "POSR") or the Financial Services ▇▇▇ ▇▇▇▇ of
the United Kingdom (the "FSA"); (ii) it has complied and will comply with all
applicable provisions of the POSR and the FSA with respect to anything done by
it in relation to the Securities in, from or otherwise involving the United
Kingdom; and (iii) it has only issued or passed on and will only issue or pass
on in the United Kingdom any document received by it in connection with the
issue of the Securities to a person who is of a kind described in Article 11(3)
of the Financial Services ▇▇▇ ▇▇▇▇ (Investment Advertisements) (Exemptions)
Order 1996 (as amended) or is a person to whom the document may otherwise
lawfully be issued or passed on.
A-1