Exhibit 10.4
PURCHASE AGREEMENT
April 5, 2011
Merrill Lynch, Pierce, Fenner & Smith Incorporated
  As Representative of the Initial Purchasers
One Bryant Park
New York, New York 10036
Ladies and Gentlemen:
     Introductory. Liz Claiborne, Inc., a Delaware corporation (the “Company”),
has previously entered into a Purchase Agreement (the “Original Purchase
Agreement”), dated as of April 1, 2011, with Merrill Lynch, Pierce, Fenner &
Smith Incorporated (“Merrill Lynch”) and the other several Initial Purchasers
named therein (the “Initial Purchasers”) with respect to the issuance and sale
of $205,000,000 aggregate principal amount of the Company’s 10.50% Senior
Secured Notes due 2019 (the “Original Notes”). The Company now proposes to issue
and sell an additional $15,000,000 aggregate principal amount of the Company’s
10.50% Senior Secured Notes due 2019 (the “Add-On Notes” and together with the
Original Notes, the “Notes”) to the Initial Purchasers, acting severally and not
jointly, in the respective amounts set forth in such Schedule A. Merrill Lynch
has agreed to act as the representative of the several Initial Purchasers (the
“Representative”) in connection with the offering and sale of the Add-On Notes.
     The Securities (as defined below) will be issued pursuant to an indenture,
to be dated as of the Closing Date (the “Indenture”), among the Company, the
Guarantors (as defined below) and U.S. Bank National Association, as trustee
(the “Trustee”). Notes will be issued only in book-entry form in the name of
Cede & Co., as nominee of The Depository Trust Company (the “Depositary”)
pursuant to a letter of representations, to be dated on or before the Closing
Date (as defined in Section 2 hereof) (the “DTC Agreement”), among the Company,
the Trustee and the Depositary.
     The holders of the Notes will be entitled to the benefits of a registration
rights agreement, to be dated as of the Closing Date (the “Registration Rights
Agreement”), among the Company, the Guarantors and the Initial Purchasers,
pursuant to which the Company and the Guarantors will be required to file with
the Commission (as defined below), under the circumstances set forth therein,
(i) a registration statement under the Securities Act (as defined below)
relating to another series of debt securities of the Company with terms
substantially identical to the Notes (the “Exchange Notes”) to be offered in
exchange for the Notes (the “Exchange Offer”) and (ii) a shelf registration
statement pursuant to Rule 415 of the Securities Act relating to the resale by
certain holders of the Notes, and in each case, to use its best efforts to cause
such registration statements to be declared effective. All references herein to
the Exchange Notes and the Exchange Offer are only applicable if the Company and
the Guarantors are in fact required to consummate the Exchange Offer pursuant to
the terms of the Registration Rights Agreement.
     The payment of principal of, premium, if any, and interest on the Notes
will be fully and unconditionally guaranteed on a senior secured basis, jointly
and severally by (i) the Company’s subsidiaries listed on the signature pages
hereof as “Guarantors” and (ii) any subsidiary of the

 

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Company formed or acquired after the Closing Date that executes an additional
guarantee in accordance with the terms of the Indenture, and their respective
successors and assigns (collectively, the “Guarantors”), pursuant to their
guarantees (the “Guarantees”). The Notes and the Guarantees attached thereto are
herein collectively referred to as the “Securities”; and the Exchange Notes and
the Guarantees attached thereto are herein collectively referred to as the
“Exchange Securities.”
     The Securities are being issued to (i) finance the Company’s cash tender
offer (the “Tender Offer”) for a portion of its 5.0% euro notes due July 2013
(the “Euro Notes”) and fees and expenses incurred in connection therewith; and
(ii) use the remaining proceeds for general corporate purposes. The Tender
Offer, the issuance and sale of the Notes, the issuance of the Guarantees and
the payment of transaction costs are referred to herein collectively, as the
“Transactions.”
     The Securities will be secured on a first-priority basis, subject to
Permitted Liens (as defined in the Indenture), by first-priority liens on and
security interests in the Notes Priority Collateral (as defined in the
Indenture, the “Notes Priority Collateral”) and by second-priority liens on and
security interests in the ABL Priority Collateral (as defined in the Indenture,
the “ABL Priority Collateral” and, together with the Notes Priority Collateral,
the “Collateral”) and documented by a security agreement, mortgages and other
instruments evidencing or creating or purporting to create a lien or security
interest (collectively, the “Security Documents”) in favor of U.S. Bank National
Association, as collateral agent (in such capacity, the “Collateral Agent”), for
its benefit and the benefit of the Trustee, the holders of the Securities and
the holders of any Permitted Additional Pari Passu Obligations (as defined in
the Preliminary Offering Memorandum)(the “Permitted Additional Pari Passu
Obligations”).
     The liens on the Collateral securing the Securities will be subject to an
Intercreditor Agreement, dated as of the Closing Date (the “Intercreditor
Agreement”), by and between the Collateral Agent and JPMorgan Chase Bank, N.A.
as collateral agent (the “ABL Collateral Agent”) under the Company’s Second
Amended and Restated Credit Agreement dated as of May 6, 2010, among Liz
Claiborne Inc., Mexx Europe B.V., Liz Claiborne Canada Inc., the other Loan
Parties from time to time party thereto, the Lenders party thereto, the ABL
Collateral Agent, Bank of America, N.A. and SunTrust Bank, as Syndication
Agents, and Wachovia Bank, National Association, as Documentation Agent (the
“ABL Facility”), and acknowledged by the Company and the Guarantors.
     This Agreement, the Registration Rights Agreement, the DTC Agreement, the
Securities, the Exchange Securities, the Security Documents, the Intercreditor
Agreement and the Indenture are referred to herein as the “Transaction
Documents.”
     The Company understands that the Initial Purchasers propose to make an
offering of the Securities on the terms and in the manner set forth herein and
in the Pricing Disclosure Package (as defined below) and agrees that the Initial
Purchasers may resell, subject to the conditions set forth herein, all or a
portion of the Securities to purchasers (the “Subsequent Purchasers”) on the
terms set forth in the Pricing Disclosure Package (the first time when sales of
the Securities are made is referred to as the “Time of Sale”). The Securities
are to be offered and sold to or through the Initial Purchasers without being
registered with the Securities and Exchange

 

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Commission (the “Commission”) under the Securities Act of 1933 (as amended, the
“Securities Act,” which term, as used herein, includes the rules and regulations
of the Commission promulgated thereunder), in reliance upon exemptions
therefrom. Pursuant to the terms of the Securities and the Indenture, investors
who acquire Securities shall be deemed to have agreed that Securities may only
be resold or otherwise transferred, after the date hereof, if such Securities
are registered for sale under the Securities Act or if an exemption from the
registration requirements of the Securities Act is available (including the
exemptions afforded by Rule 144A under the Securities Act (“Rule 144A”) or
Regulation S under the Securities Act (“Regulation S”).
     The Company has prepared and delivered to each Initial Purchaser copies of
an Offering Memorandum, dated April 1, 2011 relating to the issue and sale of
the Original Notes (the “Preliminary Offering Memorandum”), and has prepared and
delivered to each Initial Purchaser copies of a Supplement to Offering
Memorandum, dated April 5, 2011 and attached hereto as Schedule B (the “Pricing
Supplement”) containing certain terms of the Add-On Notes and other amendments
to the information in the Preliminary Offering Memorandum, each for use by such
Initial Purchaser in connection with its solicitation of offers to purchase the
Securities. The Preliminary Offering Memorandum and the Pricing Supplement are
herein referred to as the “Pricing Disclosure Package.” The Pricing Disclosure
Package as amended or supplemented from time is referred to herein as the “Final
Offering Memorandum.”
     All references herein to the terms “Pricing Disclosure Package” and the
“Final Offering Memorandum” shall be deemed to mean and include all information
filed under the Securities Exchange Act of 1934 (as amended, the “Exchange Act,”
which term, as used herein, includes the rules and regulations of the Commission
promulgated thereunder) prior to the Time of Sale and incorporated by reference
in the Pricing Disclosure Package (including the Preliminary Offering
Memorandum) or the Final Offering Memorandum (as the case may be), and all
references herein to the terms “amend,” “amendment” or “supplement” with respect
to the Final Offering Memorandum shall be deemed to mean and include all
information filed under the Exchange Act after the Time of Sale and incorporated
by reference in the Final Offering Memorandum.
     The Company hereby confirms its agreements with the Initial Purchasers as
follows:
     SECTION 1. Representations and Warranties. Each of the Company and the
Guarantors, jointly and severally, hereby represents, warrants and covenants to
each Initial Purchaser that, as of the date hereof and as of the Closing Date
(references in this Section 1 to the “Offering Memorandum” are to (x) the
Pricing Disclosure Package in the case of representations and warranties made as
of the date hereof and (y) the Pricing Disclosure Package and the Final Offering
Memorandum in the case of representations and warranties made as of the Closing
Date):
     (a) No Registration Required. Subject to compliance by the Initial
Purchasers with the representations and warranties set forth in Section 2 hereof
and with the procedures set forth in Section 7 hereof, it is not necessary in
connection with the offer, sale and delivery of the Securities to the Initial
Purchasers and to each Subsequent Purchaser in the manner contemplated by this
Agreement and the Offering Memorandum to register the Securities under the
Securities Act or, until such time as the Exchange Securities are issued
pursuant to an effective registration statement, to qualify the Indenture under
the

 

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Trust Indenture Act of 1939 (the “Trust Indenture Act,” which term, as used
herein, includes the rules and regulations of the Commission promulgated
thereunder).
     (b) No Integration of Offerings or General Solicitation. Neither the
Company, the Guarantors nor any of their respective affiliates (as such term is
defined in Rule 501 under the Securities Act) (each, an “Affiliate”), or any
person acting on its or any of their behalf (other than the Initial Purchasers,
as to whom the Company and the Guarantors make no representation or warranty)
has, directly or indirectly, solicited any offer to buy or offered to sell, or
will, directly or indirectly, solicit any offer to buy or offer to sell, in the
United States or to any United States citizen or resident, any security which is
or would be integrated with the sale of the Securities in a manner that would
require the Securities to be registered under the Securities Act. None of the
Company, the Guarantors nor any of their respective Affiliates, or any person
acting on its or any of their behalf (other than the Initial Purchasers, as to
whom the Company and each Guarantor makes no representation or warranty) has
engaged or will engage, in connection with the offering of the Securities, in
any form of general solicitation or general advertising within the meaning of
Rule 502 under the Securities Act. With respect to those Securities sold in
reliance upon Regulation S, (i) none of the Company, its Affiliates or any
person acting on its or their behalf (other than the Initial Purchasers, as to
whom the Company makes no representation or warranty) has engaged or will engage
in any directed selling efforts within the meaning of Regulation S and (ii) each
of the Company and its Affiliates and any person acting on its or their behalf
(other than the Initial Purchasers, as to whom the Company and each Guarantor
makes no representation or warranty) has complied and will comply with the
offering restrictions set forth in Regulation S.
     (c) Eligibility for Resale under Rule 144A. The Securities are eligible for
resale pursuant to Rule 144A and will not be, at the Closing Date, of the same
class as securities listed on a national securities exchange registered under
Section 6 of the Exchange Act or quoted in a U.S. automated interdealer
quotation system.
     (d) The Pricing Disclosure Package and Offering Memorandum. Neither the
Pricing Disclosure Package, as of the Time of Sale, nor the Final Offering
Memorandum, as of its date or (as amended or supplemented in accordance with
Section 3(a), as applicable) as of the Closing Date, contains or represents an
untrue statement of a material fact or omits to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided that this representation,
warranty and agreement shall not apply to statements in or omissions from the
Pricing Disclosure Package, the Final Offering Memorandum or any amendment or
supplement thereto made in reliance upon and in conformity with information
furnished to the Company in writing by any Initial Purchaser through the
Representative expressly for use in the Pricing Disclosure Package, the Final
Offering Memorandum or amendment or supplement thereto, as the case may be. The
Pricing Disclosure Package contains, and the Final Offering Memorandum will
contain, all the information specified in, and meeting the requirements of,
Rule 144A. The Company has not distributed and will not distribute, prior to the
later of the Closing Date and the completion of the Initial Purchasers’
distribution of the Securities, any offering material in connection

 

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with the offering and sale of the Securities other than the Pricing Disclosure
Package and the Final Offering Memorandum.
     (e) Company Additional Written Communications. The Company has not
prepared, made, used, authorized, approved or distributed and will not prepare,
make, use, authorize, approve or distribute any written communication that
constitutes an offer to sell or solicitation of an offer to buy the Securities
other than (i) the Pricing Disclosure Package (and, solely with respect to the
Original Notes, the “Pricing Disclosure Package” as defined in the Original
Purchase Agreement), (ii) the Final Offering Memorandum and (iii) any electronic
road show or other written communications, in each case used in accordance with
Section 3(a). Each such communication by the Company or its agents and
representatives pursuant to clause (iii) of the preceding sentence (each, a
“Company Additional Written Communication”), when taken together with the
Pricing Disclosure Package, did not as of the Time of Sale, and at the Closing
Date will not, contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided that
this representation, warranty and agreement shall not apply to statements in or
omissions from each such Company Additional Written Communication made in
reliance upon and in conformity with information furnished to the Company in
writing by any Initial Purchaser through the Representative expressly for use in
any Company Additional Written Communication.
     (f) Incorporated Documents. The documents incorporated by reference in the
Offering Memorandum at the time they were or hereafter are filed with the
Commission (collectively, the “Incorporated Documents”) complied and will comply
in all material respects with the requirements of the Exchange Act.
     (g) The Purchase Agreement. This Agreement has been duly authorized,
executed and delivered by the Company and the Guarantors.
     (h) The Registration Rights Agreement and DTC Agreement. The Registration
Rights Agreement has been duly authorized and, on the Closing Date, will have
been duly executed and delivered by, and when duly executed and delivered in
accordance with its terms by each of the other parties thereto, will constitute
a valid and binding agreement of, the Company and the Guarantors, enforceable in
accordance with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by general
equitable principles and except as rights to indemnification may be limited by
applicable law. The DTC Agreement has been duly authorized and, on the Closing
Date, will have been duly executed and delivered by, and when duly executed and
delivered in accordance with its terms by each of the other parties thereto,
will constitute a valid and binding agreement of, the Company, enforceable in
accordance with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by general
equitable principles.

 

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     (i) Authorization of the Notes, the Guarantees and the Exchange Securities.
The Notes to be purchased by the Initial Purchasers from the Company will on the
Closing Date be in the form contemplated by the Indenture, have been duly
authorized for issuance and sale pursuant to this Agreement and the Indenture
and, at the Closing Date, will have been duly executed by the Company and, when
authenticated in the manner provided for in the Indenture and delivered against
payment of the purchase price therefor, will constitute valid and binding
obligations of the Company, enforceable in accordance with their terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles and will be
entitled to the benefits of the Indenture. The Exchange Notes have been duly and
validly authorized for issuance by the Company, and when issued and
authenticated in accordance with the terms of the Indenture, the Registration
Rights Agreement and the Exchange Offer, will constitute valid and binding
obligations of the Company, enforceable against the Company in accordance with
their terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium, or similar laws relating to or affecting
enforcement of the rights and remedies of creditors or by general principles of
equity and will be entitled to the benefits of the Indenture. The Guarantees of
the Notes on the Closing Date and the Guarantees of the Exchange Notes when
issued will be in the respective forms contemplated by the Indenture and have
been duly authorized for issuance pursuant to this Agreement and the Indenture;
the Guarantees of the Notes, at the Closing Date, will have been duly executed
by each of the Guarantors and, when the Notes have been authenticated in the
manner provided for in the Indenture and issued and delivered against payment of
the purchase price therefor, the Guarantees of the Notes will constitute valid
and binding agreements of the Guarantors; and, when the Exchange Notes have been
authenticated in the manner provided for in the Indenture and issued and
delivered in accordance with the Registration Rights Agreement, the Guarantees
of the Exchange Notes will constitute valid and binding agreements of the
Guarantors; in each case, enforceable in accordance with their terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles and will be
entitled to the benefits of the Indenture.
     (j) Authorization of the Indenture. The Indenture has been duly authorized
by the Company and the Guarantors and, at the Closing Date, will have been duly
executed and delivered by the Company and the Guarantors and when duly executed
and delivered in accordance with its terms by each of the other parties thereto,
will constitute a valid and binding agreement of the Company and the Guarantors,
enforceable against the Company and the Guarantors in accordance with its terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles.
     (k) Authorization of the Intercreditor Agreement. The Intercreditor
Agreement has been duly authorized by the Company and each Guarantor and, at the
Closing Date, will have been duly executed and delivered by the Company and each
Guarantor and when duly executed and delivered in accordance with its terms by
each of the

 

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other parties thereto, will constitute a valid and binding agreement of the
Company and each Guarantor, enforceable against the Company and each Guarantor
in accordance with its terms, except as the enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by general
equitable principles.
     (l) Security Documents. Each of the Security Documents has been duly
authorized by the Company and/or the applicable Guarantor, as appropriate, and,
when executed and delivered by the Company and/or the applicable Guarantor, and
when duly executed and delivered in accordance with its terms by each of the
other parties thereto, will constitute a legal and binding agreement of the
Company and/or the applicable Guarantor in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles. The
Security Documents, when executed and delivered in connection with the sale of
the Securities, will create in favor of the Collateral Agent for the benefit of
itself, the Trustee, the holders of the Securities and the holders of any
Permitted Additional Pari Passu Obligations, valid and enforceable security
interests in and liens on the Collateral and, upon the filing or recordation of
mortgages and appropriate Uniform Commercial Code financing statements and the
taking of the other actions, in each case as further described in the Security
Documents, the security interests in and liens on the rights of the Company or
the applicable Guarantor in such Collateral will be perfected security interests
and liens, superior to and prior to the liens of all third persons other than
the liens securing the ABL Facility and Permitted Liens.
     (m) Description of the Transaction Documents. The Transaction Documents
will conform in all material respects to the respective statements relating
thereto contained in the Offering Memorandum.
     (n) No Material Adverse Change. Since the date of the most recent financial
statements of the Company included or incorporated by reference in the Offering
Memorandum, (i) there has not been any change in the capital stock, long-term
debt, notes payable or current portion of long-term debt of the Company or any
of its subsidiaries, or any dividend or distribution of any kind declared, set
aside for payment, paid or made by the Company on any class of capital stock, or
any material adverse change, or any development that is reasonably likely to
result in a prospective material adverse change, in or affecting the business,
properties, management, financial position, stockholders’ equity, results of
operations or prospects of the Company and its subsidiaries taken as a whole;
(ii) neither the Company nor any of its subsidiaries has entered into any
transaction or agreement that is material to the Company and its subsidiaries
taken as a whole or incurred any liability or obligation, direct or contingent,
that is material to the Company and its subsidiaries taken as a whole; and
(iii) neither the Company nor any of its subsidiaries has sustained any material
loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor disturbance or
dispute or any action, order or decree of any court or arbitrator or
governmental or regulatory authority, except, in each case, as otherwise
disclosed in the Pricing Disclosure Package and the Final Offering Memorandum.

 

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     (o) Independent Accountants. Deloitte & Touche LLP, which expressed its
opinion with respect to the financial statements (which term as used in this
Agreement includes the related notes thereto) and supporting schedules filed
with the Commission and incorporated by reference in the Offering Memorandum is
an independent registered public accounting firm within the meaning of the
Securities Act, the Exchange Act and the rules of the Public Company Accounting
Oversight Board, and any non-audit services provided by Deloitte & Touche to the
Company or any of the Guarantors have been approved by the Audit Committee of
the Board of Directors of the Company.
     (p) Preparation of the Financial Statements. The financial statements and
the related notes thereto of the Company and its consolidated subsidiaries
included or incorporated by reference in the Offering Memorandum present fairly
in all material respects the financial position of the Company and its
consolidated subsidiaries as of the dates indicated and the results of their
operations and the changes in their cash flows for the periods specified; such
financial statements have been prepared in conformity with U.S. generally
accepted accounting principles applied on a consistent basis throughout the
periods covered thereby; and the other financial information included or
incorporated by reference in the Offering Memorandum has been derived from the
accounting records of the Company and its consolidated subsidiaries and presents
fairly in all material respects the information shown thereby. Nothing has come
to the attention of the Company that has caused the Company to believe that the
statistical and market-related data included or incorporated by reference in the
Offering Memorandum is not based on or derived from sources that are reliable
and accurate in all material respects.
     (q) Incorporation and Good Standing of the Company and the Guarantors. The
Company and each of the Guarantors have been duly organized and are validly
existing and in good standing under the laws of their respective jurisdictions
of organization, are duly qualified to do business and are in good standing in
each jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification, and have
all power and authority necessary to own or hold their respective properties and
to conduct the businesses in which they are engaged, except where the failure to
be so qualified or in good standing or have such power or authority would not,
individually or in the aggregate, be reasonably expected to have a material
adverse effect on the business, properties, management, financial position,
stockholders’ equity, results of operations or prospects of the Company and its
subsidiaries taken as a whole or on the performance by the Company of its
obligations under the Transaction Documents (a “Material Adverse Effect”). The
jurisdictions in which the Company is required to be qualified to do business,
except for those jurisdictions where the failure to be so qualified would not
have a Material Adverse Effect, are listed on Schedule B. The Company does not
own or control, directly or indirectly, any corporation, association or other
entity other than the subsidiaries listed in Schedule C to this Agreement.
     (r) Capitalization and Other Capital Stock Matters. At January 1, 2011, on
a consolidated basis, after giving pro forma effect to the issuance and sale of
the Securities pursuant hereto, the Company would have had an authorized and
outstanding capitalization as set forth in the Offering Memorandum under the
caption “Capitalization”

 

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(other than for subsequent issuances of capital stock, if any, pursuant to
employee benefit plans described in the Company’s filings with the Commission or
upon exercise of outstanding convertible securities, options or warrants
described in the Company’s filings with the Commission).
     (s) Non-Contravention of Existing Instruments; No Further Authorizations or
Approvals Required. Neither the Company nor any of its subsidiaries is (i) in
violation of its charter or by-laws or similar organizational documents; (ii) in
default, and no event has occurred that, with notice or lapse of time or both,
would constitute such a default, in the due performance or observance of any
term, covenant or condition contained in any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its subsidiaries
is bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject; or (iii) in violation of any law or statute or any
judgment, order, rule or regulation of any court or arbitrator or governmental
or regulatory authority, except, in the case of clauses (ii) and (iii) above,
for any such default or violation that would not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect or that is
disclosed in the Offering Memorandum. Assuming the accuracy of, and the
compliance with, the representations, warranties and agreements set forth in
this Agreement, the execution, delivery and performance by the Company of each
of the Transaction Documents, the issuance and sale of the Securities and the
consummation of the transactions contemplated by the Transaction Documents or
the Offering Memorandum will not (i) conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries pursuant to,
any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is subject (except
as otherwise described in the Offering Memorandum), (ii) result in any violation
of the provisions of the charter or by-laws or similar organizational documents
of the Company or any of its subsidiaries or (iii) result in the violation of
any law or statute or any judgment, order, rule or regulation of any court or
arbitrator or governmental or regulatory authority, except where such default,
violation, lien, charge or encumbrance (in the case of (i) or (iii)) would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect. Except as disclosed in the Offering Memorandum with respect to
the Tender Offer, and assuming the accuracy of, and the compliance with, the
representations, warranties and agreements set forth in this Agreement, no
consent, approval, authorization, order, registration or qualification of or
with any court or arbitrator or governmental or regulatory authority is required
for the execution, delivery and performance of the Transaction Documents by the
Company and the Guarantors to the extent a party thereto, or the issuance and
delivery of the Securities or the Exchange Securities, or consummation of the
transactions contemplated hereby and thereby and by the Offering Memorandum,
except (A) such as have been obtained or made by the Company and the Guarantors,
as applicable, and are in full force and effect under the Securities Act,
applicable securities laws of the several states of the United States or
provinces of Canada and except such as may be required by the securities laws of
the several states of the United

 

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States or provinces of Canada with respect to the Company’s obligations under
the Registration Rights Agreement and (B) filings of financing statements under
the Uniform Commercial Code (the “UCC”) as from time to time in effect in the
relevant jurisdictions and any filing to be made in the United States Patent and
Trademark Office or the United States Copyright Office.
     (t) Legal Proceedings. Except as disclosed in the Offering Memorandum,
there are no legal, governmental or regulatory investigations, actions, suits or
proceedings pending to which the Company or any of its subsidiaries is or may be
a party or to which any property of the Company or any of its subsidiaries is or
may be the subject that, individually or in the aggregate, would reasonably be
expected to have a Material Adverse Effect; no such investigations, actions,
suits or proceedings are threatened or, to the knowledge of the Company,
contemplated by any governmental or regulatory authority or threatened by
others.
     (u) Title to Intellectual Property. Except as disclosed in the Offering
Memorandum, (i) the Company and its subsidiaries own or possess adequate rights
to use all patents, patent applications, trademarks, service marks, trade names,
trademark registrations, service mark registrations, copyrights, licenses and
know-how (including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures) necessary for
the conduct of their respective businesses; and (ii) the conduct of their
respective businesses will not conflict in any material respect with any such
rights of others, and the Company and its subsidiaries have not received any
notice of any claim of infringement of or conflict with any such rights of
others, except, in each case of (i) and (ii), as would not, individually or in
the aggregate, be reasonably expected to have a Material Adverse Change.
     (v) All Necessary Permits, etc. The Company and its subsidiaries possess
all licenses, certificates, permits and other authorizations issued by, and have
made all declarations and filings with, the appropriate federal, state, local or
foreign governmental or regulatory authorities that are necessary for the
ownership or lease of their respective properties or the conduct of their
respective businesses as described in the Offering Memorandum, except where the
failure to possess or make the same would not, individually or in the aggregate,
have a Material Adverse Effect; and except as disclosed in the Offering
Memorandum, neither the Company nor any of its subsidiaries has received notice
of any revocation or modification of any such license, certificate, permit or
authorization or has any reason to believe that any such license, certificate,
permit or authorization will not be renewed in the ordinary course, except as
would not, individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect.
     (w) Title to Real and Personal Property. The Company and its subsidiaries
have good and valid title in fee simple to, or have valid rights to lease or
otherwise use, all items of real and personal property that are material to the
respective businesses of the Company and its subsidiaries, in each case free and
clear of all liens, encumbrances, claims and defects and imperfections of title
except those that (i) do not materially interfere with the use made and proposed
to be made of such property by the Company and its

 

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subsidiaries or (ii) would not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect.
     (x) Tax Law Compliance. The Company and its subsidiaries have paid all
federal, state, local and foreign taxes and filed all tax returns required to be
paid or filed through the date hereof, except where the failure to so pay or so
file would not, individually or in the aggregate, be reasonably expected to have
a Material Adverse Effect; and except as otherwise disclosed in the Offering
Memorandum or as would not, individually or in the aggregate, be reasonably
expected to have a Material Adverse Effect, there is no tax deficiency that has
been, or could reasonably be expected to be, asserted against the Company or any
of its subsidiaries or any of their respective properties or assets.
     (y) Company and Guarantors Not an “Investment Company.” The Company has
been advised of the rules and requirements under the Investment Company Act of
1940, as amended (the “Investment Company Act,” which term, as used herein,
includes the rules and regulations of the Commission promulgated thereunder).
Neither the Company nor any Guarantor is, or after receipt of payment for the
Securities will be, an “investment company” within the meaning of the Investment
Company Act and will conduct its business in a manner so that it will not become
subject to the Investment Company Act.
     (z) Insurance. The Company and its subsidiaries have insurance covering
their respective properties, operations, personnel and businesses, including but
not limited to business interruption insurance, which insurance is in amounts
and insures against such losses and risks as are adequate to protect the Company
and its subsidiaries and their respective businesses, except as would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect; and neither the Company nor any of its subsidiaries has
(i) received notice from any insurer or agent of such insurer that capital
improvements or other expenditures are required or necessary to be made in order
to continue such insurance or (ii) 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 at reasonable cost from similar insurers as may be
necessary to continue its business, except as would not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect.
     (aa) No Price Stabilization or Manipulation. The Company and the Guarantors
have not taken, directly or indirectly, any action designed to or that could
reasonably be expected to cause or result in any stabilization or manipulation
of the price of the Securities.
     (bb) Solvency. (a) The Company is and (b) the Guarantors, on a consolidated
basis, are, and immediately after the Closing Date will be, Solvent. As used
herein, the term “Solvent” means, with respect to any person on a particular
date, that on such date (i) the fair market value of the assets of such person
is greater than the total amount of liabilities (including contingent
liabilities) of such person, (ii) the present fair salable value of the assets
of such person is greater than the amount that will be required to pay the
probable liabilities of such person on its debts as they become absolute and
matured, (iii)

 

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such person is able to realize upon its assets and pay its debts and other
liabilities, including contingent obligations, as they mature and (iv) such
person does not have unreasonably small capital As of the date hereof and at the
Closing Date, neither the Company nor any of the Guarantors has, and will have,
incurred debts beyond its ability to pay such debts as they mature, taking into
account the timing of and amounts of cash to be received by it and the timing of
the amounts of cash to be payable on or in respect of its indebtedness.
     (cc) Compliance with Sarbanes-Oxley. There is and has been no failure on
the part of the Company or (to the knowledge of the Company) any of the
Company’s directors or officers, in their capacities as such, to comply with any
provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith (the “Sarbanes-Oxley Act”), including
Section 402 related to loans and Sections 302 and 906 related to certifications.
     (dd) Company’s Accounting System. The Company and its subsidiaries maintain
systems of “internal control over financial reporting” (as defined in Rule
l3a-15(f) of the Exchange Act) that comply with the requirements of the Exchange
Act and have been designed by, or under the supervision of, their respective
principal executive and principal financial officers, or persons performing
similar functions, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles, including,
but not limited to policies and procedures that (i) pertain to the maintenance
of records that in reasonable detail accurately and fairly reflect the
transactions and dispositions of the assets of the Company, (ii) provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of the Company are
being made only in accordance with authorizations of management and directors of
the Company and (iii) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use or disposition of the
Company’s assets that could have a material effect on the financial statements.
Except as disclosed in the Offering Memorandum, there are no “material
weaknesses” (as defined in Rule 1-02(a)(4) of Regulation S-X) in the Company’s
internal control over financial reporting. The Company’s auditors and the Audit
Committee of the Board of Directors of the Company have been advised of: (i) all
“significant deficiencies” and “material weaknesses” (as defined in
Rule 1-02(a)(4) of Regulation S-X) in internal control over financial reporting;
and (ii) any fraud, whether or not material, that involves management or other
employees who have a significant role in the Company’s internal control over
financial reporting.
     (ee) Disclosure Controls and Procedures. The Company and its subsidiaries
maintain an effective system of disclosure controls and procedures” (as defined
in Rule l3a-15(e) of the Exchange Act) that is designed to ensure that
information required to be disclosed by the Company in reports that it files or
submits under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the Commission’s rules and forms, including
controls and procedures designed to ensure that such information required to be
disclosed in such reports is accumulated and communicated

 

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to the Company’s management as appropriate to allow timely decisions regarding
required disclosure. The Company and its subsidiaries have carried out
evaluations of the effectiveness of their disclosure controls and procedures as
required by Rule 13a-15 of the Exchange Act.
     (ff) Regulations T, U, X. Neither the issuance, sale and delivery of the
Securities nor the application of the proceeds thereof by the Company as
described in the Offering Memorandum will violate Regulation T, U or X of the
Board of Governors of the Federal Reserve System or any other regulation of such
Board of Governors.
     (gg) Compliance with Environmental Laws. (i) The Company and its
subsidiaries (x) are, and at all prior times were, in compliance with any and
all applicable federal, state, local and foreign laws, rules, regulations,
requirements, decisions and orders relating to the protection of human health or
safety, the environment, natural resources, hazardous or toxic substances or
wastes, pollutants or contaminants (collectively, “Environmental Laws”), (y)
have received and are in compliance with all permits, licenses, certificates or
other authorizations or approvals required of them under applicable
Environmental Laws to conduct their respective businesses, and (z) have not
received notice of any actual or potential liability under or relating to any
Environmental Laws, including for the investigation or remediation of any
disposal or release of hazardous or toxic substances or wastes, pollutants or
contaminants, and have no knowledge of any event or condition that would
reasonably be expected to result in any such notice, and (ii) there are no costs
or liabilities associated with Environmental Laws of or relating to the Company
or its subsidiaries; except in the case of each of (i) and (ii) above, for any
such failure to comply, or failure to receive required permits, licenses or
approvals, or cost or liability, as would not, individually or in the aggregate,
be reasonably expected to have a Material Adverse Change; and (iii) except as
disclosed in the Offering Memorandum, (x) there are no proceedings that are
pending, or that are known to be contemplated, against the Company or any of its
subsidiaries under any Environmental Laws in which a governmental entity is also
a party, other than such proceedings regarding which it is reasonably believed
no monetary sanctions of $100,000 or more will be imposed, (y) the Company and
its subsidiaries are not aware of any issues regarding compliance with
Environmental Laws, or liabilities or other obligations under Environmental Laws
or concerning hazardous or toxic substances or wastes, pollutants or
contaminants, that would reasonably be expected to have a Material Adverse
Change, and (z) none of the Company and its subsidiaries anticipates material
capital expenditures relating to any Environmental Laws.
     (hh) Hazardous Substances. Except as disclosed in the Offering Memorandum,
there has been no storage, generation, transportation, handling, treatment,
disposal, discharge, emission, or other release of any kind of toxic wastes or
hazardous substances, including, but not limited to, any naturally occurring
radioactive materials, brine, drilling mud, crude oil, natural gas liquids and
other petroleum materials, by, due to or caused by the Company or any of its
subsidiaries (or, to the best of the Company’s knowledge, any other entity
(including any predecessor) for whose acts or omissions the Company or any of
its subsidiaries is or could reasonably be expected to be liable) upon any of
the property now or previously owned or leased by the Company or any of its
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any other property, in violation of any Environmental Laws or in a manner or to
a location that could reasonably be expected to give rise to any liability under
the Environmental Laws, except for any violation or liability which would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect.
     (ii) Compliance with ERISA. Except as disclosed in the Offering Memorandum,
(i) each employee benefit plan, within the meaning of Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), for which
the Company or any member of its “Controlled Group” (defined as any organization
which is a member of a controlled group of corporations within the meaning of
Section 414 of the Internal Revenue Code of 1986, as amended (the “Code”)) would
have any liability (each, a “Plan”) has been maintained in compliance with its
terms and the requirements of any applicable statutes, orders, rules and
regulations, including but not limited to ERISA and the Code; (ii) no prohibited
transaction, within the meaning of Section 406 of ERISA or Section 4975 of the
Code, has occurred with respect to any Plan excluding transactions effected
pursuant to a statutory or administrative exemption; (iii) for each Plan that is
subject to the funding rules of Section 412 of the Code or Section 302 of ERISA,
no failure to satisfy the minimum funding standards of Section 412 of the Code
or Section 302 of ERISA, has occurred or is reasonably expected to occur;
(iv) the fair market value of the assets of each Plan exceeds the present value
of all benefits accrued under such Plan (determined based on those assumptions
used to fund such Plan); (v) no “reportable event” (within the meaning of
Section 4043(c) of ERISA) has occurred or is reasonably expected to occur; and
(vi) neither the Company nor any member of the Controlled Group has incurred,
nor reasonably expects to incur, any liability under Title IV of ERISA (other
than contributions to the Plan or premiums to the PBGC, in the ordinary course
and without default) in respect of a Plan (including a “multiemployer plan”,
within the meaning of Section 4001(a)(3) of ERISA), except as would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect.
     (jj) No Labor Disputes. Except as disclosed in the Offering Memorandum, no
labor disturbance by or dispute with employees of the Company or any of its
subsidiaries exists or, to the best knowledge of the Company, is contemplated or
threatened and the Company is not aware of any existing or imminent labor
disturbance by, or dispute with, the employees of any of its or its
subsidiaries’ principal suppliers, contractors or customers, except as would not
be reasonably expected to have a Material Adverse Effect.
     (kk) Related Party Transactions. No relationship, direct or indirect,
exists between or among the Company or any of its subsidiaries, on the one hand,
and the directors, officers, stockholders, customers or suppliers of the Company
or any of its subsidiaries, on the other, that is required by Item 404 of
Regulation S-K of the Securities Act to be described in a registration statement
to be filed with the Commission and that is not so described in the Offering
Memorandum.
     (ll) No Unlawful Contributions or Other Payments. Neither the Company nor
any of its subsidiaries nor, to the knowledge of the Company, any director,
officer, agent, employee or affiliate of the Company or any of its subsidiaries
is aware of or has

 

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taken any action, directly or indirectly, that would result in a violation by
such persons of the FCPA, including, without limitation, making use of the mails
or any means or instrumentality of interstate commerce corruptly in furtherance
of an offer, payment, promise to pay or authorization of the payment of any
money, or other property, gift, promise to give, or authorization of the giving
of anything of value to any “foreign official” (as such term is defined in the
FCPA) or any foreign political party or official thereof or any candidate for
foreign political office, in contravention of the FCPA and the Company, its
subsidiaries and, to the knowledge of the Company, its affiliates have conducted
their businesses in compliance with the FCPA and have instituted and maintain
policies and procedures designed to ensure, and which are reasonably expected to
continue to ensure, continued compliance therewith.
     “FCPA” means Foreign Corrupt Practices Act of 1977, as amended, and the
rules and regulations thereunder.
     (mm) No Conflict with Money Laundering Laws. The operations of the Company
and its subsidiaries are and have been conducted at all times in compliance with
applicable financial recordkeeping and reporting requirements of the Currency
and Foreign Transactions Reporting Act of 1970, as amended, the money laundering
statutes of all applicable jurisdictions, the rules and regulations thereunder
and any related or similar rules, regulations or guidelines issued, administered
or enforced by any governmental agency (collectively, the “Money Laundering
Laws”) and 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 with respect to the Money Laundering Laws is pending or, to the
best knowledge of the Company, threatened.
     (nn) No Conflict with OFAC Laws. Neither the Company nor any of its
subsidiaries nor, to the knowledge of the Company, any director, officer, agent,
employee or Affiliate of the Company or any of its subsidiaries is currently
subject to any U.S. sanctions administered by the Office of Foreign Assets
Control of the U.S. Treasury Department (“OFAC”); and the Company will not
directly or indirectly use the proceeds of the offering, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint venture partner
or other person or entity, for the purpose of financing the activities of any
person currently subject to any U.S. sanctions administered by OFAC.
     (oo) Regulation S. The Company, the Guarantors and their respective
Affiliates and all persons acting on their behalf (other than the Initial
Purchasers, as to whom the Company and the Guarantors make no representation)
have complied with and will comply with the offering restrictions requirements
of Regulation S in connection with the offering of the Securities outside the
United States and, in connection therewith, the Final Offering Memorandum will
contain the disclosure required by Rule 902. The Company is a “reporting
issuer,” as defined in Rule 902 under the Securities Act.
Any certificate signed by an officer of the Company or any Guarantor and
delivered to the Initial Purchasers or to counsel for the Initial Purchasers
shall be deemed to be a representation and warranty by the Company or such
Guarantor to each Initial Purchaser as to the matters set forth therein.

 

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     SECTION 2. Purchase, Sale and Delivery of the Securities.
     (a) The Securities. Each of the Company and the Guarantors agrees to issue
and sell to the Initial Purchasers, severally and not jointly, all of the Add-On
Notes (and related Guarantees), and, subject to the conditions set forth herein,
the Initial Purchasers agree, severally and not jointly, to purchase from the
Company and the Guarantors the aggregate principal amount of Add-On Notes (and
related Guarantees) set forth opposite their names on Schedule A hereto, at a
purchase price of 98.625% of the principal amount thereof payable on the Closing
Date, in each case, on the basis of the representations, warranties and
agreements herein contained, and upon the terms herein set forth.
     (b) The Closing Date. Delivery of certificates for the Notes in definitive
form to be purchased by the Initial Purchasers and payment therefor shall be
made at the offices of Cahill Gordon & Reindel llp, 80 Pine Street, New York,
New York 10005 (or such other place as may be agreed to by the Company and
Merrill Lynch) at 9:00 a.m. New York City time, on April 7, 2011, or such other
time and date as Merrill Lynch shall designate by notice to the Company (the
time and date of such closing are called the “Closing Date”).
     (c) Delivery of the Securities. The Company shall deliver, or cause to be
delivered, to Merrill Lynch for the accounts of the several Initial Purchasers
certificates for the Notes at the Closing Date against the irrevocable release
of a wire transfer of immediately available funds for the amount of the purchase
price therefor. The certificates for the Notes shall be in such denominations
and registered in the name of Cede & Co., as nominee of the Depositary, pursuant
to the DTC Agreement, and shall be made available for inspection on the business
day preceding the Closing Date at a location in New York City, as Merrill Lynch
may designate. Time shall be of the essence, and delivery at the time and place
specified in this Agreement is a further condition to the obligations of the
Initial Purchasers.
     (d) Initial Purchasers as Qualified Institutional Buyers. Each Initial
Purchaser severally and not jointly represents and warrants to, and agrees with,
the Company that:
     (i) it will offer and sell Securities only to (a) persons who it reasonably
believes are “qualified institutional buyers” within the meaning of Rule 144A
(“Qualified Institutional Buyers”) in transactions meeting the requirements of
Rule 144A or (b) upon the terms and conditions set forth in Annex I to this
Agreement;
     (ii) it is an institutional “accredited investor” within the meaning of
Rule 501(a)(1), (2), (3) or (7) under the Securities Act; and
     (iii) it will not offer or sell Securities by, any form of general
solicitation or general advertising, including but not limited to the methods
described in Rule 502(c) under the Securities Act.
     SECTION 3. Additional Covenants. Each of the Company and the Guarantors,
jointly and severally, further covenants and agrees with each Initial Purchaser
as follows:
     (a) Preparation of Final Offering Memorandum; Initial Purchasers’ Review of
Proposed Amendments and Supplements and Company Additional Written

 

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Communications. The Company will not amend or supplement the Preliminary
Offering Memorandum (except by the Pricing Supplement) or the Pricing
Supplement. The Company will not amend or supplement the Final Offering
Memorandum prior to the Closing Date unless the Representative shall previously
have been furnished a copy of the proposed amendment or supplement at least two
business days prior to the proposed use or filing, and shall not have objected
to such amendment or supplement. Before making, preparing, using, authorizing,
approving or distributing any Company Additional Written Communication, the
Company will furnish to the Representative a copy of such written communication
for review and will not make, prepare, use, authorize, approve or distribute any
such written communication to which the Representative reasonably objects.
     (b) Amendments and Supplements to the Final Offering Memorandum. If, prior
to the completion of the placement of the Securities by the Initial Purchasers
with the Subsequent Purchasers, any event shall occur or condition exist as a
result of which it is necessary to amend or supplement the Final Offering
Memorandum, as then amended or supplemented, in order to make the statements
therein, in the light of the circumstances when the Final Offering Memorandum is
delivered to a Subsequent Purchaser, not misleading, or if in the judgment of
the Representative or counsel for the Initial Purchasers it is otherwise
necessary to amend or supplement the Final Offering Memorandum to comply with
law, the Company agrees to promptly prepare (subject to Section 3(a) hereof) and
furnish at its own expense to the Initial Purchasers, amendments or supplements
to the Final Offering Memorandum so that the statements in the Final Offering
Memorandum as so amended or supplemented will not, in the light of the
circumstances at the Closing Date and at the time of sale of the Securities, be
misleading or so that the Final Offering Memorandum, as amended or supplemented,
will comply with all applicable law.
     (c) Copies of the Final Offering Memorandum. The Company agrees to furnish
the Initial Purchasers, without charge, as many copies of the Pricing Disclosure
Package and the Final Offering Memorandum and any amendments and supplements
thereto as they shall reasonably request.
     (d) Blue Sky Compliance. Each of the Company and the Guarantors shall
cooperate with the Representative and counsel for the Initial Purchasers to
qualify or register (or to obtain exemptions from qualifying or registering) all
or any part of the Securities for offer and sale under the securities laws of
the several states of the United States, the provinces of Canada or any other
jurisdictions designated by the Representative, shall comply with such laws and
shall continue such qualifications, registrations and exemptions in effect so
long as required for the distribution of the Securities. None of the Company or
any of the Guarantors shall be required to qualify as a foreign corporation or
to take any action that would subject it to general service of process in any
such jurisdiction where it is not presently qualified or where it would be
subject to taxation as a foreign corporation. The Company will advise the
Representative promptly of the suspension of the qualification or registration
of (or any such exemption relating to) the Securities for offering, sale or
trading in any jurisdiction or any initiation or threat of any proceeding for
any such purpose, and in the event of the issuance of any order suspending such
qualification,

 

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registration or exemption, each of the Company and the Guarantors shall use its
best efforts to obtain the withdrawal thereof at the earliest possible moment.
     (e) Use of Proceeds. The Company shall apply the net proceeds from the sale
of the Add-On Notes sold by it in the manner described under the caption “Use of
Proceeds” in the Pricing Disclosure Package.
     (f) The Depositary. The Company will cooperate with the Initial Purchasers
and use its best efforts to permit the Securities to be eligible for clearance
and settlement through the facilities of the Depositary.
     (g) Additional Issuer Information. Prior to the completion of the placement
of the Securities by the Initial Purchasers with the Subsequent Purchasers, the
Company shall file, on a timely basis, with the Commission and the NYSE all
reports and documents required to be filed under Section 13 or 15 of the
Exchange Act, in accordance with the Indenture. Additionally, at any time when
the Company is not subject to Section 13 or 15 of the Exchange Act, for the
benefit of holders and beneficial owners from time to time of the Securities,
the Company shall furnish, at its expense, upon request, to holders and
beneficial owners of Securities and prospective purchasers of Securities
information (“Additional Issuer Information”) satisfying the requirements of
Rule 144A(d), in accordance with the Indenture.
     (h) Agreement Not To Offer or Sell Additional Securities. During the period
of 180 days following the date hereof, the Company will not, without the prior
written consent of Merrill Lynch (which consent may be withheld at the sole
discretion of Merrill Lynch), directly or indirectly, sell, offer, contract or
grant any option to sell, pledge, transfer or establish an open “put equivalent
position” within the meaning of Rule 16a-1 under the Exchange Act, or otherwise
dispose of or transfer, or announce the offering of, or file any registration
statement under the Securities Act in respect of, any debt securities of the
Company or securities exchangeable for or convertible into debt securities of
the Company (other than as contemplated by the Original Purchase Agreement and
this Agreement and to register the Exchange Securities). For purposes of the
Original Purchase Agreement, Merrill Lynch hereby consents to the sale of the
Add-On Notes (and related Guarantees) pursuant to this Agreement.
     (i) Future Reports to the Initial Purchasers. At any time when the Company
is not subject to Section 13 or 15 of the Exchange Act and any Securities or
Exchange Securities remain outstanding, the Company will furnish to the
Representative and, upon request, to each of the other Initial Purchasers all
reports required under the Indenture to be delivered to holders of the Notes, if
such documents are not filed with the Commission within the time periods
specified by the Commission’s rules and regulations under Section 13 or 15 of
the Exchange Act.
     (j) No Integration. The Company agrees that it will not and will cause its
Affiliates not to make any offer or sale of securities of the Company of any
class if, as a result of the doctrine of “integration” referred to in Rule 502
under the Securities Act, such offer or sale would render invalid (for the
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the Company to the Initial Purchasers, (ii) the resale of the Securities by the
Initial Purchasers to Subsequent Purchasers or (iii) the resale of the
Securities by such Subsequent Purchasers to others) the exemption from the
registration requirements of the Securities Act provided by Section 4(2) thereof
or by Rule 144A or by Regulation S thereunder or otherwise.
     (k) No General Solicitation or Directed Selling Efforts. The Company agrees
that it will not and will not permit any of its Affiliates or any other person
acting on its or their behalf (other than the Initial Purchasers, as to which no
covenant is given) to (i) solicit offers for, or offer or sell, the Securities
by means of any form of general solicitation or general advertising within the
meaning of Rule 502(c) of Regulation D or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities Act or (ii) engage
in any directed selling efforts with respect to the Securities within the
meaning of Regulation S, and the Company will and will cause all such persons to
comply with the offering restrictions requirement of Regulation S with respect
to the Securities.
     (l) No Restricted Resales. The Company will not, and will not permit any of
its affiliates (as defined in Rule 144 under the Securities Act) to resell any
of the Notes that have been reacquired by any of them.
     (m) Legended Securities. Each certificate for a Security Note will bear the
legend contained in “Transfer Restrictions” in the Preliminary Offering
Memorandum for the time period and upon the other terms stated in the
Preliminary Offering Memorandum.
     (n) Notwithstanding anything to the contrary contained in this Agreement,
the Indenture or the Security Documents, the Company and the applicable
subsidiaries shall take the actions specified in Schedule E within the time
period set forth therein. The provisions of said Schedule E shall be deemed
incorporated by reference herein as fully as if set forth herein in their
entirety.
     The Representative on behalf of the several Initial Purchasers, may, in its
sole discretion, waive in writing the performance by the Company or any
Guarantor of any one or more of the foregoing covenants or extend the time for
their performance.
     SECTION 4. Payment of Expenses. Each of the Company and the Guarantors,
jointly and severally, agrees to pay all costs, fees and expenses incurred in
connection with the performance of its obligations hereunder and in connection
with the transactions contemplated hereby, including, without limitation,
(i) all expenses incident to the issuance and delivery of the Securities
(including all printing and engraving costs), (ii) all necessary issue, transfer
and other stamp taxes in connection with the issuance and sale of the Securities
to the Initial Purchasers, (iii) all fees and expenses of the Company’s and the
Guarantors’ counsel, independent public or certified public accountants and
other advisors, (iv) all costs and expenses incurred in connection with the
preparation, printing, filing, shipping and distribution of the Pricing
Disclosure Package and the Final Offering Memorandum (including financial
statements and exhibits), and all amendments and supplements thereto, and the
Transaction Documents, (v) all filing fees, attorneys’

 

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fees and expenses incurred by the Company, the Guarantors or the Initial
Purchasers in connection with qualifying or registering (or obtaining exemptions
from the qualification or registration of) all or any part of the Securities for
offer and sale under the securities laws of the several states of the United
States, the provinces of Canada or other jurisdictions designated by the Initial
Purchasers (including, without limitation, the cost of preparing, printing and
mailing preliminary and final blue sky or legal investment memoranda and any
related supplements to the Pricing Disclosure Package or the Final Offering
Memorandum, (vi) the fees and expenses of the Trustee, including the fees and
disbursements of counsel for the Trustee in connection with the Indenture, the
Security Documents, the Intercreditor Agreement, the Securities and the Exchange
Securities, (vii) any fees payable in connection with the rating of the
Securities or the Exchange Securities with the ratings agencies, (viii) any
filing fees incident to, and any reasonable fees and disbursements of counsel to
the Initial Purchasers in connection with the review by FINRA, if any, of the
terms of the sale of the Securities or the Exchange Securities and in connection
with perfecting the security interests in the Collateral (ix) all fees and
expenses (including reasonable fees and expenses of counsel) of the Company and
the Guarantors in connection with approval of the Securities by the Depositary
for “book-entry” transfer, and the performance by the Company and the Guarantors
of their respective other obligations under this Agreement, (x) all expenses
incident to the “road show” for the offering of the Securities (provided that
the Initial Purchasers shall be responsible for half of the cost of any
chartered aircraft) and (xi) all reasonable out of pocket costs and expenses
(including, without limitation, reasonable fees, disbursements and other charges
of legal counsel) incurred in connection with the creation, documentation and
perfection of the security interests in the Collateral. Except as expressly
provided in this Section 4 and Sections 6, 8 and 9 hereof, the Initial
Purchasers shall pay their own expenses, including the fees and disbursements of
their counsel.
     SECTION 5. Conditions of the Obligations of the Initial Purchasers. The
obligations of the several Initial Purchasers to purchase and pay for the Add-On
Notes (and related Guarantees) as provided herein on the Closing Date shall be
subject to the accuracy of the representations and warranties on the part of the
Company and the Guarantors set forth in Section 1 hereof as of the date hereof
and as of the Closing Date as though then made and to the timely performance by
the Company of its covenants and other obligations hereunder, and to each of the
following additional conditions:
     (a) Accountants’ Comfort Letter. On the date hereof, the Initial Purchasers
shall have received from Deloitte & Touche LLP, the independent registered
public accounting firm for the Company, a “comfort letter” dated the date hereof
addressed to the Initial Purchasers, in form and substance satisfactory to the
Representative, covering the financial information in the Pricing Disclosure
Package and other customary matters (which may be in the form of a “bring-down
comfort letter” with respect to the comfort letter delivered under the Original
Purchase Agreement). In addition, on the Closing Date, the Initial Purchasers
shall have received from such accountants a “bring-down comfort letter” dated
the Closing Date addressed to the Initial Purchasers, in form and substance
satisfactory to the Representative, in the form of the “comfort letter”
delivered on the date hereof, except that (i) it shall cover the financial
information in the Final Offering Memorandum and any amendment or supplement
thereto and (ii) procedures shall be brought down to a date no more than 3 days
prior to the Closing Date.

 

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     (b) No Material Adverse Change or Ratings Agency Change. For the period
from and after the date of this Agreement and prior to the Closing Date:
     (i) no event or condition of a type described in Section 1(n) hereof shall
have occurred or shall exist, which event or condition is not disclosed in the
Pricing Disclosure Package (excluding any amendment or supplement thereto) and
the Final Offering Memorandum (excluding any amendment or supplement thereto)
and the effect of which in the judgment of the Representative makes it
impracticable or inadvisable to proceed with the offering, sale or delivery of
the Securities on the Closing Date, on the terms and in the manner contemplated
by this Agreement, the Pricing Disclosure Package and the Final Offering
Memorandum; and
     (ii) there shall not have occurred any downgrading, nor shall any notice
have been given of any intended or potential downgrading or of any review for a
possible change that does not indicate the direction of the possible change, in
the rating accorded the Company or any of its subsidiaries or any of their
securities or indebtedness by any “nationally recognized statistical rating
organization” as such term is defined for purposes of Rule 436 under the
Securities Act.
     (c) Opinion of Counsel for the Company. On the Closing Date, the Initial
Purchasers shall have received an opinion of (i) Paul, Weiss, Rifkind, Wharton &
Garrison, counsel for the Company, dated as of such Closing Date, in form and
substance reasonably satisfactory to the Initial Purchasers, (ii) Nicholas
Rubino, General Counsel of the Company, in form and substance reasonably
satisfactory to the Initial Purchasers, (ii) local counsel in California and
Washington, dated as of the Closing Date, each in form and substance reasonably
satisfactory to the Initial Purchasers.
     (d) Opinion of Counsel for the Initial Purchasers. On the Closing Date, the
Initial Purchasers shall have received the favorable opinion of Cahill Gordon &
Reindel llp, counsel for the Initial Purchasers, dated as of such Closing Date,
with respect to such matters as may be reasonably requested by the Initial
Purchasers.
     (e) Officers’ Certificate. On the Closing Date, the Initial Purchasers
shall have received a written certificate executed by the Chairman of the Board,
Chief Executive Officer or President of the Company and each Guarantor and the
Chief Financial Officer or Chief Accounting Officer of the Company and each
Guarantor, dated as of the Closing Date, to the effect set forth in
Section 5(b)(i) and (ii) hereof, and further to the effect that:
     (i) the representations, warranties and covenants of the Company and the
Guarantors set forth in Section 1 hereof were true and correct as of the date
hereof and are true and correct as of the Closing Date with the same force and
effect as though expressly made on and as of the Closing Date; and

 

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     (ii) the Company has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to the Closing
Date.
     (f) Indenture; Registration Rights Agreement. The Company and the
Guarantors shall have executed and delivered the Indenture, in form and
substance reasonably satisfactory to the Initial Purchasers, and the Initial
Purchasers shall have received executed copies thereof. The Company and the
Guarantors shall have executed and delivered the Registration Rights Agreement,
in form and substance reasonably satisfactory to the Initial Purchasers, and the
Initial Purchasers shall have received such executed counterparts.
     (g) Security Documents and Intercreditor Agreement. The Company and the
Guarantors shall have executed and delivered perfection certificates dated as of
the Closing Date (the “Perfection Certificates”) in form and substance
reasonably satisfactory to the Initial Purchasers. Except as otherwise provided
for in the Security Agreement, the Indenture or the other documents entered into
pursuant to the Transactions, the Representative and the Collateral Agent shall
have received each of the Security Documents and the Intercreditor Agreement, in
form and substance reasonably satisfactory to the Initial Purchasers, and all
other certificates, agreements or instruments necessary to perfect the
Collateral Agent’s security interest in all of the Collateral, including but not
limited to, UCC financing statements in appropriate form for filing and filings
with the United States Patent and Trademark Office and United States Copyright
Office in appropriate form for filing; each such document executed by the
Company and each other party thereto, and each such document shall be in full
force and effect and evidence that all of the liens on the Collateral other than
Permitted Liens have been released. The Representative shall also have received
(i) certified copies of UCC, tax and judgment lien searches or equivalent
reports or searches, each of a recent date listing all effective financing
statements, lien notices or comparable documents that name the Company or any
Guarantor as debtor and that are required by the Perfection Certificates or that
the Representative deem necessary or appropriate, none of which encumber the
Notes Priority Collateral covered or intended to be covered by the Security
Documents (other than Permitted Liens) and (ii) acceptable evidence of payment
or arrangements for payment by the Company and the Guarantors of all applicable
recording taxes, fees, charges, costs and expenses required for the recording of
the Security Documents.
     (h) Additional Documents. On or before the Closing Date, the Initial
Purchasers and counsel for the Initial Purchasers shall have received such
information, documents and opinions as they may reasonably require for the
purposes of enabling them to pass upon the issuance and sale of the Securities
as contemplated herein, or in order to evidence the accuracy of any of the
representations and warranties, or the satisfaction of any of the conditions or
agreements, herein contained.
     (i) Concurrent Sale of Original Notes. Concurrently with the purchase and
sale of the Add-On Notes (and related Guarantees) hereunder, the purchase and
sale of the Original Notes (and related Guarantees) pursuant to the Original
Purchase Agreement shall have been consummated.

 

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     If any condition specified in this Section 5 is not satisfied when and as
required to be satisfied, this Agreement may be terminated by the Representative
by notice to the Company at any time on or prior to the Closing Date, which
termination shall be without liability on the part of any party to any other
party, except that Sections 4, 6, 8 and 9 hereof shall at all times be effective
and shall survive such termination.
     SECTION 6. Reimbursement of Initial Purchasers’ Expenses. If this Agreement
is terminated by the Representative pursuant to Section 5 or 10 hereof,
including if the sale to the Initial Purchasers of the Securities on the Closing
Date is not consummated because of any refusal, inability or failure on the part
of the Company to perform any agreement herein or to comply with any provision
hereof, the Company agrees to reimburse the Initial Purchasers, severally, upon
demand for all out-of-pocket expenses that shall have been reasonably incurred
by the Initial Purchasers in connection with the proposed purchase and the
offering and sale of the Securities, including, without limitation, fees and
disbursements of counsel, printing expenses, travel expenses, postage, facsimile
and telephone charges.
     SECTION 7. Offer, Sale and Resale Procedures. Each of the Initial
Purchasers, on the one hand, and the Company and each of the Guarantors, on the
other hand, hereby agree to observe the following procedures in connection with
the offer and sale of the Securities:
     (a) Offers and sales of the Securities will be made only by the Initial
Purchasers or Affiliates thereof qualified to do so in the jurisdictions in
which such offers or sales are made. Each such offer or sale shall only be made
to persons whom the offeror or seller reasonably believes to be Qualified
Institutional Buyers or non-U.S. persons outside the United States to whom the
offeror or seller reasonably believes offers and sales of the Securities may be
made in reliance upon Regulation S upon the terms and conditions set forth in
Annex I hereto, which Annex I is hereby expressly made a part hereof.
     (b) The Securities will be offered by approaching prospective Subsequent
Purchasers on an individual basis. No general solicitation or general
advertising (within the meaning of Rule 502 under the Securities Act) will be
used in the United States in connection with the offering of the Securities.
     (c) Upon original issuance by the Company, and until such time as the same
is no longer required under the applicable requirements of the Securities Act,
the Notes (and all securities issued in exchange therefor or in substitution
thereof, other than the Exchange Notes) shall bear the following legend:
“THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT

 

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THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF
THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY
EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a) INSIDE THE UNITED
STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE
SECURITIES ACT, (b) OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, (c) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF APPLICABLE) OR (d) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY
IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS
SET FORTH IN CLAUSE (A) ABOVE. NO REPRESENTATION CAN BE MADE AS TO THE
AVAILABILITY OF THE EXEMPTION PROVIDED BY RULE 144 FOR RESALE OF THE SECURITY
EVIDENCED HEREBY.”
     Following the sale of the Securities by the Initial Purchasers to
Subsequent Purchasers pursuant to the terms hereof, the Initial Purchasers shall
not be liable or responsible to the Company for any losses, damages or
liabilities suffered or incurred by the Company, including any losses, damages
or liabilities under the Securities Act, arising from or relating to any resale
or transfer of any Security.
     SECTION 8. Indemnification.
     (a) Indemnification of the Initial Purchasers. Each of the Company and the
Guarantors, jointly and severally, agrees to indemnify and hold harmless each
Initial Purchaser, its affiliates, directors, officers and employees, and each
person, if any, who controls any Initial Purchaser within the meaning of the
Securities Act and the Exchange Act against any loss, claim, damage, liability
or expense, as incurred, to which such Initial Purchaser, affiliate, director,

 

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officer, employee or controlling person may become subject, under the Securities
Act, the Exchange Act or other federal or state statutory law or regulation, or
at common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Company), insofar as such
loss, claim, damage, liability or expense (or actions in respect thereof as
contemplated below) arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in the Preliminary
Offering Memorandum, the Pricing Supplement, any Company Additional Written
Communication or the Final Offering Memorandum (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and to reimburse each
Initial Purchaser and each such affiliate, director, officer, employee or
controlling person for any and all reasonable and documented expenses (including
the fees and disbursements of one counsel chosen by Merrill Lynch in addition to
any local counsel) as such expenses are reasonably incurred by such Initial
Purchaser or such affiliate, director, officer, employee or controlling person
in connection with investigating, defending, settling, compromising or paying
any such loss, claim, damage, liability, expense or action; provided, however,
that the foregoing indemnity agreement shall not apply, with respect to an
Initial Purchaser, to any loss, claim, damage, liability or expense to the
extent, but only to the extent, arising out of or based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with written information furnished to the
Company by such Initial Purchaser through the Representative expressly for use
in the Preliminary Offering Memorandum, the Pricing Supplement, any Company
Additional Written Communication or the Final Offering Memorandum (or any
amendment or supplement thereto). The indemnity agreement set forth in this
Section 8(a) shall be in addition to any liabilities that the Company may
otherwise have.
     (b) Indemnification of the Company and the Guarantors. Each Initial
Purchaser agrees, severally and not jointly, to indemnify and hold harmless the
Company, each Guarantor, each of their respective directors and each person, if
any, who controls the Company or any Guarantor within the meaning of the
Securities Act or the Exchange Act, against any loss, claim, damage, liability
or expense, as incurred, to which the Company, any Guarantor or any such
director or controlling person may become subject, under the Securities Act, the
Exchange Act, or other federal or state statutory law or regulation, or at
common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of such Initial Purchaser),
insofar as such loss, claim, damage, liability or expense (or actions in respect
thereof as contemplated below) arises out of or is based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Preliminary Offering Memorandum, the Pricing Supplement, any Company Additional
Written Communication or the Final Offering Memorandum (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Preliminary Offering
Memorandum, the Pricing Supplement, any Company Additional Written Communication
or the Final Offering Memorandum (or any amendment or supplement thereto), in
reliance upon and in conformity with written information furnished to the
Company by such Initial Purchaser through the Representative expressly for use
therein; and to reimburse the Company, any Guarantor and each such director or
controlling person for any and all reasonable and documented expenses (including
the fees and disbursements of counsel) as

 

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such expenses are reasonably incurred by the Company, any Guarantor or such
director or controlling person in connection with investigating, defending,
settling, compromising or paying any such loss, claim, damage, liability,
expense or action. Each of the Company and the Guarantors hereby acknowledges
that the only information that the Initial Purchasers through the Representative
have furnished to the Company expressly for use in the Preliminary Offering
Memorandum, the Pricing Supplement, any Company Additional Written Communication
or the Final Offering Memorandum (or any amendment or supplement thereto) are
the statements set forth in the fifth, seventh (third sentence) and ninth
paragraphs under the caption “Plan of Distribution” in the Preliminary Offering
Memorandum. The indemnity agreement set forth in this Section 8(b) shall be in
addition to any liabilities that each Initial Purchaser may otherwise have.
     (c) Notifications and Other Indemnification Procedures. 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 an indemnifying party under this Section 8, notify
the indemnifying party in writing of the commencement thereof; provided that the
failure to so notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party under this Section 8 except
to the extent that it has been materially prejudiced by such failure (through
the forfeiture of substantive rights and defenses) and shall not relieve the
indemnifying party from any liability that the indemnifying party may have to an
indemnified party other than under this Section 8. In case any such action is
brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in and, to the extent that it shall elect,
jointly with all other indemnifying parties similarly notified, by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof with counsel
reasonably satisfactory to such indemnified party; provided, however, if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded,
with the advice of counsel, that a conflict may arise between the positions of
the indemnifying party and the indemnified party in conducting the defense of
any such action or 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, the indemnified party or parties shall have the right to
select separate counsel to assume such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of such indemnifying party’s election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 8 for any legal
or other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the immediately preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel (together with local
counsel (in each jurisdiction)), which shall be selected by Merrill Lynch (in
the case of counsel representing the Initial Purchasers or their related
persons), representing the indemnified parties who are parties to such action)
or (ii) the indemnifying party shall not have employed counsel satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of commencement of the action, in each of which cases the fees
and expenses of counsel shall be at the expense of the indemnifying party.

 

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     (d) Settlements. The indemnifying party under this Section 8 shall not be
liable for any settlement of any proceeding effected without its written
consent, which will not be unreasonably withheld, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party against any loss, claim, damage,
liability or expense by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement, compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity was or could have been sought
hereunder by such indemnified party, unless such settlement, compromise or
consent (i) includes an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such action, suit or
proceeding and (ii) does not include any statements as to or any findings of
fault, culpability or failure to act by or on behalf of any indemnified party.
     SECTION 9. Contribution. If the indemnification provided for in Section 8
hereof is for any reason held to be unavailable to or otherwise insufficient to
hold harmless an indemnified party in respect of any losses, claims, damages,
liabilities or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount paid or payable by such indemnified party, as
incurred, as a result of any losses, claims, damages, liabilities or expenses
referred to therein (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Guarantors, on the one hand,
and the Initial Purchasers, on the other hand, from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and the Guarantors, on the
one hand, and the Initial Purchasers, on the other hand, in connection with the
statements or omissions or inaccuracies in the representations and warranties
herein which resulted in such losses, claims, damages, liabilities or expenses,
as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Guarantors, on the one hand, and the Initial
Purchasers, on the other hand, in connection with the offering of the Securities
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses) received by the Company,
and the total discount received by the Initial Purchasers bear to the aggregate
initial offering price of the Securities. The relative fault of the Company and
the Guarantors, on the one hand, and the Initial Purchasers, on the other hand,
shall be determined by reference to, among other things, whether any such untrue
or alleged untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by the Company and the
Guarantors, on the one hand, or the Initial Purchasers, on the other hand, and
the parties’ relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission or inaccuracy.
     The amount paid or payable by a party as a result of the losses, claims,
damages, liabilities and expenses referred to above shall be deemed to include,
subject to the limitations set forth in Section 8 hereof, any legal or other
fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section 8 hereof with respect to notice of commencement of any action shall
apply if a claim for contribution is to be made under this Section 9; provided,
however, that no additional notice shall be

 

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required with respect to any action for which notice has been given under
Section 8 hereof for purposes of indemnification.
     The Company, the Guarantors and the Initial Purchasers agree that it would
not be just and equitable if contribution pursuant to this Section 9 were
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to in this Section 9.
     Notwithstanding the provisions of this Section 9, no Initial Purchaser
shall be required to contribute any amount in excess of the discount received by
such Initial Purchaser in connection with the Securities distributed by it. No
person guilty of fraudulent misrepresentation (within the meaning of Section 11
of the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The Initial Purchasers’
obligations to contribute pursuant to this Section 9 are several, and not joint,
in proportion to their respective commitments as set forth opposite their names
in Schedule A. For purposes of this Section 9, each director, officer and
employee of an Initial Purchaser and each person, if any, who controls an
Initial Purchaser within the meaning of the Securities Act and the Exchange Act
shall have the same rights to contribution as such Initial Purchaser, and each
director of the Company or any Guarantor, and each person, if any, who controls
the Company or any Guarantor with the meaning of the Securities Act and the
Exchange Act shall have the same rights to contribution as the Company and the
Guarantors.
     SECTION 10. Termination of this Agreement. Prior to the Closing Date, this
Agreement may be terminated by the Representative by notice given to the Company
if at any time: (i) trading or quotation in any of the Company’s securities
shall have been suspended or limited by the Commission or by the NYSE, or
trading in securities generally on either the Nasdaq Stock Market or the NYSE
shall have been suspended or limited, or minimum or maximum prices shall have
been generally established on any of such quotation system or stock exchange by
the Commission or FINRA; (ii) a general banking moratorium shall have been
declared by any of federal or New York authorities; (iii) there shall have
occurred any outbreak or escalation of national or international hostilities or
any crisis or calamity, or any change in the United States or international
financial markets, or any substantial change or development involving a
prospective substantial change in United States’ or international political,
financial or economic conditions, as in the judgment of the Representative is
material and adverse and makes it impracticable or inadvisable to proceed with
the offering, sale or delivery of the Securities in the manner and on the terms
described in the Pricing Disclosure Package or to enforce contracts for the sale
of securities; (iv) in the judgment of the Representative there shall have
occurred or shall exist an event or condition of a type described in Section
1(n) hereof, which event or condition is not disclosed in the Pricing Disclosure
Package (excluding any amendment or supplement thereto) and the Final Offering
Memorandum (excluding any amendment or supplement thereto) and the effect of
which in the judgment of the Representative makes it impracticable or
inadvisable to proceed with the offering, sale or delivery of the Securities on
the Closing Date, on the terms and in the manner contemplated by this Agreement,
the Pricing Disclosure Package and the Final Offering Memorandum; or (v) the
Company shall have sustained a loss by strike, fire, flood, earthquake, accident
or other calamity of such character as in the judgment of the Representative may
interfere materially with the conduct of the business and operations of the
Company regardless of

 

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whether or not such loss shall have been insured. Any termination pursuant to
this Section 10 shall be without liability on the part of (i) the Company or any
Guarantor to any Initial Purchaser, except that the Company and the Guarantors
shall be obligated to reimburse the expenses of the Initial Purchasers pursuant
to Sections 4 and 6 hereof, (ii) any Initial Purchaser to the Company, or
(iii) any party hereto to any other party except that the provisions of
Sections 8 and 9 hereof shall at all times be effective and shall survive such
termination.
     SECTION 11. Representations and Indemnities to Survive Delivery. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, the Guarantors, their respective officers and the
several 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 any Initial Purchaser, the Company, any Guarantor or any of their
partners, officers or directors or any controlling person, as the case may be,
and will survive delivery of and payment for the Securities sold hereunder and
any termination of this Agreement.
     SECTION 12. Notices. All communications hereunder shall be in writing and
shall be mailed, hand delivered, couriered or facsimiled and confirmed to the
parties hereto as follows:
     If to the Initial Purchasers:
Merrill Lynch, Pierce, Fenner & Smith Incorporated
One Bryant Park
New York, New York 10036
Facsimile: (212) 901-7897
Attention: Legal Department
     with a copy to:
Cahill Gordon & Reindel llp
80 Pine Street
New York, New York 10005
Facsimile: (212) 701-3849
Attention: James J. Clark and Corey Wright
     If to the Company or the Guarantors:
Liz Claiborne, Inc.
1441 Broadway
New York, New York 10018
Facsimile: (201) 295-6118
Attention: Nicholas Rubino

 

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     with a copy to:
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, New York 10019-6064
Facsimile: (212) 373-7550
Attention: Lawrence G. Wee
     Any party hereto may change the address or facsimile number for receipt of
communications by giving written notice to the others.
     SECTION 13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto, and to the benefit of the indemnified parties
referred to in Sections 8 and 9 hereof, and in each case their respective
successors, and no other person will have any right or obligation hereunder. The
term “successors” shall not include any Subsequent Purchaser or other purchaser
of the Securities as such from any of the Initial Purchasers merely by reason of
such purchase.
     SECTION 14. Authority of the Representative. Any action by the Initial
Purchasers hereunder may be taken by Merrill Lynch on behalf of the Initial
Purchasers, and any such action taken by Merrill Lynch shall be binding upon the
Initial Purchasers.
     SECTION 15. Partial Unenforceability. The invalidity or unenforceability of
any section, paragraph or provision of this Agreement shall not affect the
validity or enforceability of any other section, paragraph or provision hereof.
If any section, paragraph or provision of this Agreement is for any reason
determined to be invalid or unenforceable, there shall be deemed to be made such
minor changes (and only such minor changes) as are necessary to make it valid
and enforceable.
     SECTION 16. Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD
TO CONFLICTS OF LAW PRINCIPLES THEREOF.
     (a) Consent to Jurisdiction. Any legal suit, action or proceeding arising
out of or based upon this Agreement or the transactions contemplated hereby
(“Related Proceedings”) may be instituted in the federal courts of the United
States of America located in the City and County of New York or the courts of
the State of New York in each case located in the City and County of New York
(collectively, the “Specified Courts”), and each party irrevocably submits to
the exclusive jurisdiction (except for suits, actions, or proceedings instituted
in regard to the enforcement of a judgment of any Specified Court in a Related
Proceeding, as to which such jurisdiction is non-exclusive) of the Specified
Courts in any Related Proceeding. Service of any process, summons, notice or
document by mail to such party’s address set forth above shall be effective
service of process for any Related Proceeding brought in any Specified Court.
The parties irrevocably and unconditionally waive any objection to the laying of
venue of any Specified Proceeding in the Specified Courts and irrevocably and
unconditionally waive and agree not to plead or claim in any Specified Court
that any Related Proceeding brought in any Specified Court has been brought in
an inconvenient forum.

 

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     (b) Waiver of Immunity. With respect to any Related Proceeding, each party
irrevocably waives, to the fullest extent permitted by applicable law, all
immunity (whether on the basis of sovereignty or otherwise) from jurisdiction,
service of process, attachment (both before and after judgment) and execution to
which it might otherwise be entitled in the Specified Courts, and with respect
to any Related Judgment, each party waives any such immunity in the Specified
Courts or any other court of competent jurisdiction, and will not raise or claim
or cause to be pleaded any such immunity at or in respect of any such Related
Proceeding or Related Judgment, including, without limitation, any immunity
pursuant to the United States Foreign Sovereign Immunities Act of 1976, as
amended.
     (c) Judgment Currency. If for the purposes of obtaining judgment in any
court it is necessary to convert a sum due hereunder into any currency other
than U.S. dollars, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be the rate at which in
accordance with normal banking procedures the Initial Purchasers could purchase
U.S. dollars with such other currency in The City of New York on the business
day preceding that on which final judgment is given.
     SECTION 17. Default of One or More of the Several Initial Purchasers. If
any one or more of the several Initial Purchasers shall fail or refuse to
purchase Securities that it or they have agreed to purchase hereunder on the
Closing Date, and the aggregate number of Securities which such defaulting
Initial Purchaser or Initial Purchasers agreed but failed or refused to purchase
does not exceed 10% of the aggregate number of the Securities to be purchased on
such date, the other Initial Purchasers shall be obligated, severally, in the
proportions that the number of Securities set forth opposite their respective
names on Schedule A bears to the aggregate number of Securities set forth
opposite the names of all such non-defaulting Initial Purchasers, or in such
other proportions as may be specified by the Initial Purchasers with the consent
of the non-defaulting Initial Purchasers, to purchase the Securities which such
defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused
to purchase on the Closing Date. If any one or more of the Initial Purchasers
shall fail or refuse to purchase Securities and the aggregate number of
Securities with respect to which such default occurs exceeds 10% of the
aggregate number of Securities to be purchased on the Closing Date, and
arrangements satisfactory to the Initial Purchasers and the Company for the
purchase of such Securities are not made within 48 hours after such default,
this Agreement shall terminate without liability of any party to any other party
except that the provisions of Sections 4, 6, 8 and 9 hereof shall at all times
be effective and shall survive such termination. In any such case either the
Initial Purchasers or the Company shall have the right to postpone the Closing
Date, as the case may be, but in no event for longer than seven days in order
that the required changes, if any, to the Final Offering Memorandum or any other
documents or arrangements may be effected.
     As used in this Agreement, the term “Initial Purchaser” shall be deemed to
include any person substituted for a defaulting Initial Purchaser under this
Section 17. Any action taken under this Section 17 shall not relieve any
defaulting Initial Purchaser from liability in respect of any default of such
Initial Purchaser under this Agreement.
     SECTION 18. No Advisory or Fiduciary Responsibility. Each of the Company
and the Guarantors acknowledges and agrees that: (i) the purchase and sale of
the Securities pursuant to this Agreement, including the determination of the
offering price of the Securities and any

 

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related discounts and commissions, is an arm’s-length commercial transaction
between the Company and the Guarantors, on the one hand, and the several Initial
Purchasers, on the other hand, and the Company and the Guarantors are capable of
evaluating and understanding and understand and accept the terms, risks and
conditions of the transactions contemplated by this Agreement; (ii) in
connection with each transaction contemplated hereby and the process leading to
such transaction each Initial Purchaser is and has been acting solely as a
principal and is not the agent or fiduciary of the Company, and the Guarantors
or their respective Affiliates, stockholders, creditors or employees or any
other party; (iii) no Initial Purchaser has assumed or will assume an advisory
or fiduciary responsibility in favor of the Company and the Guarantors with
respect to any of the transactions contemplated hereby or the process leading
thereto (irrespective of whether such Initial Purchaser has advised or is
currently advising the Company and the Guarantors on other matters) or any other
obligation to the Company and the Guarantors except the obligations expressly
set forth in this Agreement; (iv) the several Initial Purchasers and their
respective Affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of the Company and the Guarantors, and
the several Initial Purchasers have no obligation to disclose any of such
interests by virtue of any fiduciary or advisory relationship; and (v) the
Initial Purchasers have not provided any legal, accounting, regulatory or tax
advice with respect to the offering contemplated hereby, and the Company and the
Guarantors have consulted their own legal, accounting, regulatory and tax
advisors to the extent they deemed appropriate.
     This Agreement supersedes all prior agreements and understandings (whether
written or oral) between the Company, the Guarantors and the several Initial
Purchasers, or any of them, with respect to the subject matter hereof. The
Company and the Guarantors hereby waive and release, to the fullest extent
permitted by law, any claims that the Company and the Guarantors may have
against the several Initial Purchasers with respect to any breach or alleged
breach of fiduciary duty. For the avoidance of doubt, this Agreement does not
amend or supersede the Original Purchase Agreement.
     SECTION 19. General Provisions. This Agreement constitutes the entire
agreement of the parties to this Agreement and supersedes all prior written or
oral and all contemporaneous oral agreements, understandings and negotiations
with respect to the subject matter hereof. This Agreement may be executed in two
or more counterparts, each one of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier, facsimile or other electronic transmission (i.e., a “pdf” or “tif”)
shall be effective as delivery of a manually executed counterpart thereof. This
Agreement may not be amended or modified unless in writing by all of the parties
hereto, and no condition herein (express or implied) may be waived unless waived
in writing by each party whom the condition is meant to benefit. The section
headings herein are for the convenience of the parties only and shall not affect
the construction or interpretation of this Agreement.
     If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to the Company the enclosed copies hereof, whereupon this
instrument, along with all counterparts hereof, shall become a binding agreement
in accordance with its terms.

 

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Very truly yours,

            LIZ CLAIBORNE, INC.
      By:   /s/ Nicholas Rubino        Name:   Nicholas Rubino       Title:  
SVP, Chief Legal Officer, General Counsel
and Corporate Secretary    

 

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BOODLE, INC. (F/K/A LCI LAUNDRY)
DB NEWCO CORP.
HAVANA, LLC
JERG, INC. (F/K/A C&C California, Inc.)
JUICY COUTURE, INC.
KATE SPADE LLC
L.C. AUGUSTA, INC.
L.C. CARIBBEAN HOLDINGS, INC.
L.C. LIBRA, LLC
L.C. LICENSING, INC.
L.C. SERVICE COMPANY, INC.
L.C. SPECIAL MARKETS, INC.
LCI ACQUISITION U.S., INC.
LCI HOLDINGS, INC.
LCI INVESTMENTS, INC.
LIZ CLAIBORNE ACCESSORIES, INC.
LIZ CLAIBORNE ACCESSORIES-SALES, INC.
LIZ CLAIBORNE COSMETICS, INC.
LIZ CLAIBORNE EXPORT, INC.
LIZ CLAIBORNE FOREIGN HOLDINGS, INC.
LIZ CLAIBORNE JAPAN, INC.
LIZ CLAIBORNE PUERTO RICO, INC.
LIZ CLAIBORNE SALES, INC.
LIZ CLAIBORNE SHOES, INC.
LUCKY BRAND DUNGAREES, INC.
LUCKY BRAND DUNGAREES STORES, INC.
MONET INTERNATIONAL, INC.
MONET PUERTO RICO, INC.
NONEE I, LLC (F/K/A ENYCE LLC)
NONEE I HOLDING, LLC (F/K/A ENYCE HOLDING, LLC)
SEGRETS, INC.
SKYLARK SPORT MARKETING CORPORATION
WESTCOAST CONTEMPO PROMENADE, INC.
WESTCOAST CONTEMPO RETAIL, INC.
WESTCOAST CONTEMPO USA, INC.

                  By:   /s/ Nicholas Rubino         Name:   Nicholas Rubino    
  Title:   SVP, Chief Legal Officer, General Counsel
and Corporate Secretary    

 

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     The foregoing Purchase Agreement is hereby confirmed and accepted by the
Initial Purchasers as of the date first above written.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
   Acting on behalf of itself
   and as the Representative of
   the several Initial Purchasers

         
By:
  Merrill Lynch, Pierce, Fenner & Smith Incorporated    
 
       
By:
  /s/ Lisa G Clyde     
 
 
 
Managing Director    

 

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SCHEDULE A

              Aggregate Principal Amount Initial Purchasers   of Securities to
be Purchased
Merrill Lynch, Pierce, Fenner & Smith Incorporated
  $ 6,000,000  
J.P. Morgan Securities LLC
    4,500,000  
SunTrust Robinson Humphrey, Inc.
    2,250,000  
Wells Fargo Securities, LLC
    2,250,000  
 
       
Total
  $ 15,000,000  

 

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SCHEDULE B
SUPPLEMENT

 

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SCHEDULE C
LIST OF JURISDICTIONS IN WHICH THE COMPANY
IS REQUIRED TO BE QUALIFIED TO DO BUSINESS
Alabama
New Jersey
New York
Ohio
Pennsylvania
Rhode Island

 

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SCHEDULE D
LIST OF SUBSIDIARIES OF LIZ CLAIBORNE, INC.

     
Boodle, Inc. (f/k/a LCI Laundry)
  Delaware
Claiborne Limited
  Hong Kong
DB Newco Corp.
  Delaware
Handycell Ltd.
  United Kingdom
Havana, LLC
  Delaware
High Mallow Company N.V.
  Netherlands
Jerg, Inc.
  California
Juicy Couture Canada, Inc.
  Canada
Juicy Couture Europe Limited
  United Kingdom
Juicy Couture, Inc.
  California
Kate Spade LLC
  Delaware
Kate Spade U.K. Limited
  United Kingdom
L.C. Augusta, Inc.
  Delaware
L.C. Caribbean Holdings, Inc.
  Delaware
L.C. Libra, LLC
  Delaware
L.C. Licensing, Inc.
  Delaware
L.C. Service Company, Inc.
  Delaware
L.C. Special Markets, Inc.
  Delaware
LCI Acquisition U.S., Inc.
  Delaware
LCI Holdings, Inc.
  Delaware
LCI Investments, Inc.
  Delaware
Liz Claiborne 2 B.V.
  Netherlands
Liz Claiborne 3 B.V.
  Netherlands
Liz Claiborne Accessories, Inc.
  Delaware
Liz Claiborne Accessories-Sales, Inc.
  Delaware
Liz Claiborne Canada Inc.
  Canada
Liz Claiborne Colombia, Ltda.
  Colombia
Liz Claiborne Cosmetics, Inc.
  Delaware
Liz Claiborne De El Salvador, S.A., de C.V.
  El Salvador
Liz Claiborne de Mexico, S.A. de C.V.
  Mexico
Liz Claiborne do Brasil Industria E Comercio Ltda.
  Brazil
Liz Claiborne Europe
  United Kingdom
Liz Claiborne Export, Inc.
  Delaware
Liz Claiborne Foreign Holdings, Inc.
  Delaware
Liz Claiborne International Limited
  Hong Kong
Liz Claiborne (Israel) Ltd.
  Israel
Liz Claiborne Japan, Inc.
  Delaware
Liz Claiborne (Malaysia) SDN.BHD
  Malaysia
Liz Claiborne Operations (Israel) 1993 Limited
  Israel
Liz Claiborne Puerto Rico, Inc.
  Delaware
Liz Claiborne Sales, Inc.
  Delaware
Liz Claiborne, S.A.
  Costa Rica
Liz Claiborne Servicios de Mexico, S.A. de C.V.
  Mexico

 

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Liz Claiborne Shoes, Inc.
  Delaware
Lucky Brand Dungarees, Inc.
  Delaware
Lucky Brand Dungarees Stores, Inc.
  Delaware
Mexx Asia Pacific Limited
  Hong Kong
Mexx Austria GmbH
  Austria
Mexx Belgium N.V.
  Belgium
Mexx Boutique SARL
  France
Mexx Czech Repubic s.r.o.
  Czech Republic
Mexx Deutschland GmbH
  Germany
Mexx Direct GmbH & Co KG
  Germany
Mexx Direct Holding B.V.
  Netherlands
Mexx Europe B.V.
  Netherlands
Mexx Europe Holding B.V.
  Netherlands
Mexx Europe International B.V.
  Netherlands
Mexx Europroduction B.V.
  Netherlands
Mexx Far East Limited
  Hong Kong
Mexx France
  France
Mexx France International SAS
  France
Mexx Group B.V.
  Netherlands
Mexx Hellas EPE
  Greece
Mexx Holding GmbH
  Germany
Mexx Holding International B.V.
  Netherlands
Mexx Holding Netherlands B.V.
  Netherlands
Mexx Hungary Ltd.
  Hungary
Mexx Ireland Ltd.
  Ireland
Mexx Italy S.r.l.
  Italy
Mexx Ltd.
  United Kingdom
Mexx Luxembourg S.a.r.l.
  Luxembourg
Mexx Middle East Center FZE
  Dubai, UAE
Mexx Modehandels AG
  Switzerland
Mexx Modehandels GmbH
  Germany
Mexx Nederland B.V.
  Netherlands
Mexx Nederland Retail B.V.
  Netherlands
Mexx Poland Sp. z.o.o.
  Poland
Mexx Portugal, Unnipessoal, LDA
  Portugal
Mexx Scandinavia AB
  Sweden
Mexx Scandinavia AS
  Norway
Mexx Scandinavia Finland Oy
  Finland
Mexx Southern Europe S.R.L.
  Spain
Mexx Sport Benelux B.V.
  Netherlands
Mexx Switzerland GmbH
  Switzerland
Monet International, Inc.
  Delaware
Monet Puerto Rico, Inc.
  Delaware
Nonee I, LLC (f/k/a Enyce LLC)
  Delaware
Nonee I Holding, LLC (f/k/a Enyce Holding, LLC)
  Delaware
Retrain N.V.
  Belgium

 

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Segrets, Inc.
  Delaware
Shenghui Fashion (Shenzhen) Company Limited
  China
Skylark Sport Marketing Corporation
  California
Verwaltungsgesellschaft Mexx Direct mbh
  Germany
Westcoast Contempo Fashions Limited
  Canada
Westcoast Contempo Promenade, Inc.
  Washington
Westcoast Contempo Retail, Inc.
  Washington
Westcoast Contempo USA, Inc.
  Washington

 

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SCHEDULE E
Post-Closing Requirements Relating to Collateral
     (a) Real Property Collateral Documents. Within 30 days after the Closing
Date, the Initial Purchasers shall have received a mortgage, deed of trust,
assignment of leases and rents, security agreement, fixture filing and financing
statement from the owner or holder of each interest in real property that is
part of the Collateral, in form and substance reasonably acceptable to the
Initial Purchasers (each a “Mortgage”) encumbering each real property that is
part of the Collateral (each a “Mortgaged Property”) in favor of the Collateral
Agent for its benefit and for the the benefit of the other Secured Parties (as
defined in the Security Agreement) executed by the Company and the appropriate
Guarantors.
     (b) Mortgages. Within 30 days after the Closing Date, the Initial
Purchasers shall have received fully executed counterparts of the Mortgages,
which Mortgages shall cover the Mortgaged Property, together with evidence that
counterparts of the Mortgages have been delivered to the title insurance company
insuring the lien of such Mortgages for recording in all places to the extent
necessary or, in the reasonable opinion of the Initial Purchasers, desirable to
effectively create a valid and enforceable mortgage lien on each Mortgaged
Property in favor of the Collateral Agent for its benefit and for the benefit of
the other Secured Parties (as defined in the Security Agreement), securing the
Obligations (as defined in the Preliminary Offering Memorandum) under the
Indenture and the other Security Documents (provided that in jurisdictions that
impose mortgage recording taxes, such Mortgages shall not secure indebtedness in
an amount exceeding 115% of the fair market value of such Mortgaged Property, as
reasonably determined, in good faith, by the Company and reasonably acceptable
to the Initial Purchasers), subject to (i) those liens, encumbrances,
hypothecations and other matters affecting title to such Mortgaged Property and
found reasonably acceptable by the Initial Purchasers, (ii) Permitted Liens (as
defined in the Indenture) and (iii) such other similar items as the Initial
Purchasers may consent to (such consent not to be unreasonably withheld) (the
liens described in clauses (i) through (iii) of this sentence, collectively, the
“Permitted Encumbrances”).
     (c) Title Insurance. Within 30 days after the Closing Date, the Initial
Purchasers shall have received, with respect to each Mortgage intended to
encumber a Mortgaged Property, a policy of title insurance (or commitment to
issue such a policy) having the effect of a policy of title insurance insuring
(or committing to insure) the lien of such Mortgage as a valid and enforceable
mortgage lien on the Mortgaged Properties described therein, in an amount not
less than 115% of the fair market value of such Mortgaged Property as reasonably
determined, in good faith, by the Company and reasonably acceptable to the
Initial Purchasers, (such policies collectively, the “Mortgage Policies”) issued
by such title insurer as shall be reasonably acceptable to Initial Purchasers
(the “Title Company”), which reasonably assures the Collateral Agent that the
Mortgages on such Mortgaged Properties are valid and enforceable mortgage liens
on the respective Mortgaged Properties, free and clear of all defects and
encumbrances except Permitted Encumbrances and such Mortgage Policies shall
otherwise be in form and substance reasonably satisfactory to the Initial
Purchasers and shall have been supplemented by such endorsements as shall be
reasonably requested by the Collateral Agent, including, to the extent included
in the

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title insurance policy issued to the ABL Collateral Agent with respect to the
applicable Mortgaged Property, to the extent currently available and, if only
one Mortgage is granted on a single Mortgaged Property, to the extent
appropriate where only one Mortgage is granted on a single Mortgaged Property,
endorsements on matters relating to usury, first loss, last dollar, zoning,
contiguity, revolving credit, doing business, non-imputation, public road
access, survey, variable rate, environmental lien, subdivision, separate tax
lot, revolving credit, so-called comprehensive coverage over covenants and
restrictions and, to the extent included in the title insurance policy issued to
the ABL Collateral Agent with respect to the applicable Mortgaged Property, to
the extent currently available and, if only one Mortgage is granted on a single
Mortgaged Property, to the extent appropriate where only one Mortgage is granted
on a single Mortgaged Property, for any and all other matters that the
Collateral Agent may request, shall not include an exception for mechanics’
liens to the extent one was not included in the title insurance policy issued to
the ABL Collateral Agent with respect to the applicable Mortgaged Property, and
shall provide for affirmative insurance and such reinsurance (including direct
access agreements) as the Initial Purchasers may reasonably request, to the
extent such affirmative insurance and/or reinsurance was included in the title
insurance policy issued to the ABL Collateral Agent with respect to the
applicable Mortgaged Property.
     (d) Survey. Within 30 days after the Closing Date, with respect to any
Mortgaged Property for which a survey was delivered to the ABL Collateral Agent
and the ABL Collateral Agent received a “comprehensive” endorsement or other
survey-related endorsement, the Initial Purchasers shall have received either
(i) a survey update or (ii) an existing survey and affidavit of no change
addressed to the Title Company, the Trustee and the Collateral Agent in such
form and substance as shall be sufficient to enable the Title Company to issue a
“comprehensive” endorsement and other survey-related endorsements reasonably
requested by the Collateral Agent and to remove the standard survey exception
from the Mortgage Policy with respect to such Mortgaged Property (provided that
Collateral Agent shall not have the option to require such endorsements or
standard survey exception removal unless such endorsements were issued or such
standard survey exception was removed in connection with the title insurance
policy issued in favor of the ABL Collateral Agent with respect to such
Mortgaged Property).
     (e) Fixture filings. Within 30 days after the Closing Date, the Initial
Purchasers shall have received proper fixture filings and as-extracted
collateral under the UCC on Form UCC-1 fully executed for filing under the UCC
in the appropriate jurisdiction in which the Mortgaged Properties are located,
desirable to perfect the security interests purported to be created by the
Mortgages in favor of the Collateral Agent for its benefit and for the the
benefit of the other Secured Parties (as defined in the Security Agreement).
     (f) Mortgage Opinions. Within 30 days after the Closing Date, the Initial
Purchasers shall have received the opinions, addressed to the Initial
Purchasers, the Collateral Agent, the Trustee and the other Secured Parties (as
defined in the Security Agreement), of local counsel in each jurisdiction where
Mortgage Property is located, each in form and substance reasonably satisfactory
to the Initial Purchasers.
     (g) Insurance. Within 30 days after the Closing Date, the Initial
Purchasers shall have received policies or certificates of insurance covering
the property and assets of the Company and the Guarantors, which policies or
certificates shall be in form and substance reasonably

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acceptable to the Initial Purchasers and reflect the Collateral Agent, for its
benefit and the benefit of the other Secured Parties (as defined in the Security
Agreement), as additional insured and loss payee and mortgagee and shall
otherwise bear endorsements of the character reasonably acceptable to the
Initial Purchasers.
     (h) Mortgaged Property Indemnification. Within 30 days after the Closing
Date, the Initial Purchasers shall have received, with respect to each Mortgaged
Property, such affidavits, certificates, information (including financial data)
and instruments of indemnification (including a so-called “gap” indemnification)
as shall be required to induce the Title Company to issue the Mortgage Policies
and endorsements contemplated above.
     (i) Collateral Fees and Expenses. Within 30 days after the Closing Date,
the Initial Purchasers shall have received evidence reasonably acceptable to the
Initial Purchasers of payment by the Company of all Mortgage Policy premiums,
search and examination charges, escrow charges and related charges, mortgage
recording taxes, fees, charges, costs and expenses required for the recording of
the Mortgages and issuance of the Mortgage Policies referred to above.

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ANNEX I
     Resale Pursuant to Regulation S or Rule 144A. Each Initial Purchaser
understands that:
     Such Initial Purchaser agrees that it has not offered or sold and will not
offer or sell the Securities in the United States or to, or for the benefit or
account of, a U.S. Person (other than a distributor), in each case, as defined
in Rule 902 of Regulation S (i) as part of its distribution at any time and
(ii) otherwise until 40 days after the later of the commencement of the offering
of the Securities pursuant hereto and the Closing Date, other than in accordance
with Regulation S or another exemption from the registration requirements of the
Securities Act. Such Initial Purchaser agrees that, during such 40-day
restricted period, it will not cause any advertisement with respect to the
Securities (including any “tombstone” advertisement) to be published in any
newspaper or periodical or posted in any public place and will not issue any
circular relating to the Securities, except such advertisements as are permitted
by and include the statements required by Regulation S.
     Such Initial Purchaser agrees that, at or prior to confirmation of a sale
of Securities by it to any distributor, dealer or person receiving a selling
concession, fee or other remuneration during the 40-day restricted period
referred to in Rule 903 of Regulation S, it will send to such distributor,
dealer or person receiving a selling concession, fee or other remuneration 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, as amended (the “Securities Act”), and may not be
offered and sold within the United States or to, or for the account or benefit
of, U.S. persons (i) as part of your distribution at any time or (ii) otherwise
until 40 days after the later of the date the Securities were first offered to
persons other than distributors in reliance upon Regulation S and the Closing
Date, except in either case in accordance with Regulation S under the Securities
Act (or in accordance with Rule 144A under the Securities Act or to accredited
investors in transactions that are exempt from the registration requirements of
the Securities Act), and in connection with any subsequent sale by you of the
Securities covered hereby in reliance on Regulation S under the Securities Act
during the period referred to above to any distributor, dealer or person
receiving a selling concession, fee or other remuneration, you must deliver a
notice to substantially the foregoing effect. Terms used above have the meanings
assigned to them in Regulation S under the Securities Act.”
 Annex I-1