Exhibit 10.1

 

EXECUTION COPY

 

LEVI STRAUSS & CO.

 

$380,000,000 Floating Rate Senior Notes due 2012

€150,000,000 8-5/8% Senior Notes due 2013

 

PURCHASE AGREEMENT

 

March 7, 2005

 

BANC OF AMERICA SECURITIES LLC

CITIGROUP GLOBAL MARKETS INC.

J.P. MORGAN SECURITIES INC.

GOLDMAN, SACHS & CO.

SCOTIA CAPITAL (USA) INC.

BEAR, STEARNS & CO. INC.

CREDIT SUISSE FIRST BOSTON LLC

 

As Representatives of the Several Floating Rate Notes Purchasers

c/o Banc of America Securities LLC

9 West 57th Street

New York, New York 10019

 

BANC OF AMERICA SECURITIES LIMITED

CITIGROUP GLOBAL MARKETS LIMITED

J.P. MORGAN SECURITIES LTD.

GOLDMAN, SACHS & CO.

SCOTIA CAPITAL INC.

BEAR, STEARNS & CO. INC.

CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED

 

As Representatives of the Several Euro Notes Purchasers

c/o Banc of America Securities Limited

5 Canada Square

London E14 5AQ

United Kingdom

 

Ladies and Gentlemen:

 

Levi Strauss & Co., a corporation organized under the laws of Delaware (the
“Company”), proposes to issue and sell (i) to the several parties named in
Schedule I hereto (the “Floating Rate Notes Purchasers”), $380,000,000 principal
amount of its Senior Notes due 2012 (the “Floating Rate Notes”) and (ii) to the
several parties named in Schedule II hereto (the “Euro Notes Purchasers” and,
together with the Floating Rate Notes Purchasers, the “Initial Purchasers”),
€150,000,000 principal amount of its Senior Notes due 2013 (the “Euro Notes”
and, together with the Floating Rate Notes, the

 

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“Notes”). You are acting as the representatives (the “Representatives”) of the
Floating Rate Notes Purchasers and/or the Euro Notes Purchasers as indicated
above. The Floating Rate Notes are to be issued under an indenture to be dated
as of the Closing Date (the “Floating Rate Notes Indenture”) between the Company
and Wilmington Trust Company, as trustee (the “Floating Rate Notes Trustee”),
and will have the benefit of a registration rights agreement dated as of the
Closing Date (the “Floating Rate Notes Registration Rights Agreement”) between
the Company and the Floating Rate Notes Purchasers pursuant to which the Company
will agree to register the Floating Rate Notes under the Act subject to the
terms and conditions therein specified; and the Euro Notes are to be issued
under an indenture dated as of the Closing Date (the “Euro Notes Indenture” and,
together with the Floating Rate Notes Indenture, the “Indentures”) between the
Company and Wilmington Trust Company, as trustee (the “Euro Notes Trustee” and,
together with the Floating Rate Notes Trustee, the “Trustees”), and will have
the benefit of a registration rights agreement dated as of the Closing Date (the
“Euro Notes Registration Rights Agreement” and, together with the Floating Rate
Notes Registration Rights Agreement, the “Registration Rights Agreements”)
between the Company and the Euro Notes Purchasers pursuant to which the Company
will agree to register the Euro Notes under the Act subject to the terms and
conditions therein specified. The use of the neuter in this Agreement shall
include the feminine and masculine wherever appropriate. Certain terms used
herein are defined in Section 17 hereof.

 

The sale of the Floating Rate Notes to the Floating Rate Notes Purchasers and
the Euro Notes to the Euro Notes Purchasers will be made without registration of
the Floating Rate Notes or the Euro Notes under the Act in reliance upon
exemptions from the registration requirements of the Act.

 

In connection with the sale of the Notes, the Company has prepared a preliminary
offering memorandum, dated February 24, 2005 (as amended or supplemented at the
Execution Time, including any and all exhibits thereto and any information
incorporated by reference therein, the (“Preliminary Offering Memorandum”), and
a final offering memorandum, dated March 7, 2005 (as amended or supplemented at
the Execution Time, including any and all exhibits thereto and any information
incorporated by reference therein, the “Final Offering Memorandum”). Each of the
Preliminary Offering Memorandum and the Final Offering Memorandum sets forth
certain information concerning the Company and the Notes. The Company hereby
confirms that it has authorized the use of the Preliminary Offering Memorandum
and the Final Offering Memorandum, and any amendment or supplement thereto, in
connection with the offer and sale of the Notes by the Initial Purchasers.
Unless stated to the contrary, references herein to the Final Offering
Memorandum at the Execution Time are not meant to include any information
incorporated by reference therein subsequent to the Execution Time, and any
references herein to the terms “amend”, “amendment” or “supplement” with respect
to the Final Offering Memorandum shall be deemed to refer to and include any
information filed under the Exchange Act subsequent to the Execution Time which
is incorporated by reference therein.

 

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1. Representations and Warranties. The Company represents and warrants to each
Initial Purchaser as set forth below in this Section 1.

 

(a) The Preliminary Offering Memorandum, at the date thereof, did not contain
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. At the Execution Time and on the
Closing Date (as defined in Section 3 hereof), the Final Offering Memorandum did
not, and will not (and any amendment or supplement thereto, at the date thereof
and at the Closing Date will not), contain any untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no representation or
warranty as to the information contained in or omitted from the Preliminary
Offering Memorandum or the Final Offering Memorandum, or any amendment or
supplement thereto, in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of the Initial Purchasers
through the Representatives specifically for inclusion therein.

 

(b) All documents filed by the Company under the Exchange Act (the “Exchange Act
Documents”), when they were filed with the Commission, complied as to form in
all material respects with the requirements of the Exchange Act, and the rules
and regulations of the Commission thereunder, and, when they were so filed, did
not contain any untrue statement of material fact or omit to state any material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.

 

(c) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf (other than the Initial Purchasers, as to whom the Company makes
no representations) has, directly or indirectly, made offers or sales of any
security, or solicited offers to buy any security, under circumstances that
would require the registration of the Notes under the Act.

 

(d) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf (other than the Initial Purchasers, as to whom the Company makes
no representations) has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D) in connection with any offer or
sale of the Notes in the United States.

 

(e) The Notes satisfy the eligibility requirements of Rule 144A(d)(3) under the
Act.

 

(f) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf (other than the Initial Purchasers, as to whom the Company makes
no representations) has engaged in any directed selling efforts with respect to
the Notes, and each of them has complied with the offering restrictions
requirements of Regulation S. Terms used in this paragraph have the meanings
given to them by Regulation S.

 

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(g) The Company will use its best efforts to cause both the Floating Rate Notes
and the Euro Notes to be listed on the Luxembourg Stock Exchange.

 

(h) The Company is not, and after giving effect to the offering and sale of the
Notes and the application of the proceeds thereof as described in the Final
Offering Memorandum will not be, an “investment company” within the meaning of
the Investment Company Act, without taking account of any exemption arising out
of the number of holders of the Company’s Notes.

 

(i) The Company is subject to and in full compliance with the reporting
requirements of Section 13 and Section 15(d) of the Exchange Act.

 

(j) The Company has not paid or agreed to pay to any person any compensation for
soliciting another to purchase any Notes of the Company (except as contemplated
by this Agreement and the tender offer and consent solicitation for the
Company’s dollar-denominated 11-5/8% Notes due 2008 and the Company’s
euro-denominated 11-5/8% Notes due 2008 (collectively, the “11-5/8% Notes”).

 

(k) The Company has not taken, directly or indirectly, any action designed to or
that would constitute or that might reasonably be expected to cause or result
in, under the Exchange Act or otherwise, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the
Notes.

 

(l) Each of the Company and its subsidiaries has been duly incorporated or
organized and is validly existing as a corporation or other valid legal entity
in good standing under the laws of the jurisdiction in which it is chartered or
organized with full corporate or company power and authority to own or lease, as
the case may be, and to operate its properties and conduct its business as
described in the Final Offering Memorandum, and is duly qualified to do business
as a foreign corporation or other valid legal entity and is in good standing
under the laws of each jurisdiction which requires such qualification, except in
jurisdictions in which the failure to be so qualified or to be in good standing
has not had and would not reasonably be expected to have a Material Adverse
Effect. For purposes of this Agreement, a “Material Adverse Effect” shall mean a
material adverse effect on, or a material adverse change in, the condition
(financial or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole.

 

(m) All the outstanding shares of capital stock of each subsidiary have been
duly and validly authorized and issued and are fully paid and nonassessable,
and, except as otherwise set forth in the Final Offering Memorandum and other
than the Company’s subsidiaries in Japan and Turkey, all outstanding shares of
capital stock of the subsidiaries are owned by the Company either directly or
through wholly owned subsidiaries free and clear of any perfected security
interest or any other security interests, claims, liens or encumbrances.

 

(n) The Company’s authorized equity capitalization is as set forth in the Final
Offering Memorandum, and the Voting Trust Agreement entered into as of

 

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April 15, 1996, among the Voting Trustees and stockholders of the Company
conforms in all material respects to the description thereof contained in the
Final Offering Memorandum.

 

(o) The statements in the Final Offering Memorandum under the headings
“Important U.S. Federal Income Tax Considerations”, “Description of Notes”,
“Exchange Offer; Registration Rights”, “Risk Factors—Risks Relating to Our
Business—Our success depends on the continued protection of our trademarks and
other proprietary intellectual property rights”, and in the Company’s Annual
Report on Form 10-K for the fiscal year ended November 28, 2004 (the “2004
10-K”) under the headings “Business —Trademarks”, “Business—Government
Regulation” and “Legal Proceedings” insofar as such statements summarize legal
matters, agreements, documents or proceedings discussed therein, are, in all
material respects, accurate and fair summaries of such legal matters,
agreements, documents or proceedings.

 

(p) This Agreement has been duly authorized, executed and delivered by the
Company; each of the Floating Rate Notes Indenture and the Euro Notes Indenture
has been duly authorized and, assuming due authorization, execution and delivery
thereof by the Floating Rate Notes Trustee or the Euro Notes Trustee, as
applicable, when executed and delivered by the Company, will constitute a legal,
valid and binding instrument enforceable against the Company in accordance with
its terms (subject, as to the enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting creditors’ rights
generally from time to time in effect and to general principles of equity); the
Notes have been duly authorized, and, when executed and authenticated in
accordance with the provisions of the Floating Rate Notes Indenture or the Euro
Notes Indenture, as applicable, and delivered to and paid for by the Initial
Purchasers, will have been duly executed and delivered by the Company and will
constitute the legal, valid and binding obligations of the Company entitled to
the benefits of the applicable Indenture (subject, as to the enforcement of
remedies, to applicable bankruptcy, insolvency, moratorium or other laws
affecting creditors’ rights generally from time to time in effect and to general
principles of equity); and each of the Registration Rights Agreements has been
duly authorized, executed and delivered by the Company and, assuming due
authorization, execution and delivery thereof by the other parties thereto,
constitutes a legal, valid and binding instrument enforceable against the
Company in accordance with its terms (subject, as to the enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency, moratorium or
other laws affecting creditors’ rights generally from time to time in effect and
to general principles of equity).

 

(q) No consent, approval, authorization, filing with or order of any court or
governmental agency or body is required in connection with the transactions
contemplated herein or in the Indentures or the Registration Rights Agreements,
except such as will be obtained under the Act and the Trust Indenture Act in
connection with the transactions contemplated by the Registration Rights
Agreements and such as may be required under the blue sky or securities laws of
any jurisdiction in connection with the transactions contemplated by this
Agreement and the Registration Rights Agreements.

 

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(r) Neither the execution and delivery of the Floating Rate Notes Indenture, the
Euro Notes Indenture, this Agreement or the Registration Rights Agreements, the
issue and sale of the Notes, nor the consummation of any other of the
transactions herein or therein contemplated, nor the fulfillment of the terms
hereof or thereof will conflict with, result in a breach or violation of, or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to, (i) the charter or by-laws of
the Company or any of its subsidiaries; (ii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan agreement or
other agreement, obligation, condition, covenant or instrument to which the
Company or any of its subsidiaries is a party or bound or to which any of their
respective properties is subject; or (iii) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company or any of its subsidiaries
of any court, regulatory body, administrative agency, governmental body,
arbitrator or other authority of the United States or any state thereof having
jurisdiction over the Company, any of its subsidiaries or any of their
respective properties or to the Company’s knowledge, any statute, law, rule,
regulation, judgment, order or decree applicable to the Company or any of its
subsidiaries of any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority outside of the United States having
jurisdiction over the Company, any of its subsidiaries or any of their
respective properties, except, with respect to (x) clause (ii) and (y) any
statute, law, rule, regulation, judgment, order or decree applicable to the
Company or any of its subsidiaries of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority outside of the United
States described in clause (iii) as to which the Company has no knowledge, for
conflicts, violations, breaches or impositions that would not reasonably be
expected to have a Material Adverse Effect.

 

(s) The consolidated historical financial statements and schedules of the
Company and its consolidated subsidiaries included in the Final Offering
Memorandum or the Exchange Act Documents present fairly in all material respects
the financial condition, results of operations and cash flows of the Company as
of the dates and for the periods indicated, comply as to form with the
applicable accounting requirements of the Act and the Exchange Act and have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis throughout the periods involved (except as otherwise noted
therein); and the selected financial data set forth under the caption “Selected
Historical Consolidated Financial Data” in the Final Offering Memorandum fairly
present, on the basis stated in the Final Offering Memorandum, the information
included therein. Arthur Andersen LLP audited the financial statements of the
Company as of and for the fiscal year ended November 26, 2000. The Company has
prepared restated financial statements (the “Restated Financial Statements”) for
such fiscal year. The Restated Financial Statements were prepared on a basis
consistent with the restated financial statements of the Company as of and for
the fiscal years ended November 25, 2001 and November 24, 2002 audited by KPMG
LLP. All financial data as of and for the fiscal year ended November 26, 2000
included in the Final Offering Memorandum have been derived from, and are in
agreement with, the Restated Financial Statements.

 

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(t) No action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its
subsidiaries or its or their property is pending or, to the best knowledge of
the Company, threatened that (i) could reasonably be expected to have a material
adverse effect on the performance of this Agreement, the Indentures or the
Registration Rights Agreements, or the consummation of any of the transactions
contemplated hereby or thereby; or (ii) could reasonably be expected to have a
Material Adverse Effect, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the Final
Offering Memorandum (exclusive of any amendment or supplement thereto).

 

(u) The Company and each of its subsidiaries own, lease or license all such
properties as are necessary to the conduct of their respective operations as
presently conducted.

 

(v) Neither the Company nor any subsidiary is in violation or default of (i) any
provision of its charter or bylaws; (ii) the terms of any indenture, contract,
lease, mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which it is a party
or bound or to which its property is subject; or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to the Company or any of its
subsidiaries of any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the Company or such
subsidiary or any of its properties, as applicable, other than such violations
or defaults the occurrence of which would not reasonably be expected to have a
Material Adverse Effect, whether or not arising from the transactions in the
ordinary course of business.

 

(w) KPMG LLP, who have reviewed certain financial statements of the Company and
its consolidated subsidiaries included in the Exchange Act Documents that are
part of the Final Offering Memorandum, are independent registered public
accountants with respect to the Company within the meaning of the Act and the
applicable published rules and regulations thereunder. Arthur Andersen LLP, who
has previously certified certain financial statements of the Company and its
consolidated subsidiaries and previously delivered their report with respect to
the audited consolidated financial statements and schedules included in the
Final Offering Memorandum or the Exchange Act Documents, were at all times
during their engagement by the Company independent public accountants with
respect to the Company within the meaning of the Act and the applicable
published rules and regulations thereunder.

 

(x) To the Company’s knowledge, there are no material stamp or other issuance or
transfer taxes or duties or other material similar fees or charges required to
be paid in connection with the execution and delivery of this Agreement or the
issuance or sale by the Company of the Notes.

 

(y) The Company has filed all foreign, federal, state and local tax returns that
are required to be filed or has requested extensions thereof (except in any case
in which the failure so to file would not have a Material Adverse Effect,
whether or

 

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not arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Final Offering Memorandum (exclusive of any
amendment or supplement thereto) and has paid all taxes required to be paid by
it and any other assessment, fine or penalty levied against it, to the extent
that any of the foregoing is due and payable, except for any such tax or other
assessment, fine or penalty that is currently being contested in good faith or
as would not have a Material Adverse Effect, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Final Offering Memorandum (exclusive of any amendment or
supplement thereto).

 

(z) No labor problem or dispute with the employees of the Company or any of its
subsidiaries exists or is threatened or imminent, and the Company is not aware
of any existing or imminent labor disturbance by the employees of any of its or
its subsidiaries’ principal suppliers, contractors or customers that in any such
case could have a Material Adverse Effect, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Final Offering Memorandum (exclusive of any amendment or
supplement thereto).

 

(aa) The Company and each of its subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are reasonable and customary in the businesses in which they are
engaged; all policies of insurance and fidelity or surety bonds insuring the
Company or any of its subsidiaries or their respective businesses, assets,
employees, officers and directors are in full force and effect, except when the
failure to be in full force and effect would not have a Material Adverse Effect;
the Company and its subsidiaries are in compliance with the terms of such
policies and instruments in all material respects; except as would not have a
Material Adverse Effect, there are no claims by the Company or any of its
subsidiaries under any such policy or instrument as to which any insurance
company is denying liability or defending under a reservation of rights clause;
and neither the Company nor any such subsidiary has any reason to believe that
it will not be able to renew its existing insurance coverage as and when such
coverage expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not have a Material
Adverse Effect, whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the Final Offering
Memorandum (exclusive of any amendment or supplement thereto).

 

(bb) No subsidiary of the Company is currently contractually prohibited,
directly or indirectly, from paying any dividends to the Company, from making
any other distribution on such subsidiary’s capital stock, from repaying to the
Company any loans or advances to such subsidiary from the Company or from
transferring any of such subsidiary’s property or assets to the Company or any
other subsidiary of the Company, except as described in or contemplated by (i)
the Final Offering Memorandum, (ii) the Company’s Credit Agreement dated as of
September 29, 2003, among the Company, Levi Strauss Financial Center
Corporation, the financial institutions listed on the signature pages thereto
and Bank of America, N.A., as agent, as amended on September 30, 2003, October
14, 2003, March 18, 2004, August 13, 2004 and November 24, 2004 and including
the limited waiver dated as of February 15, 2005

 

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granted to the Company with respect to such agreement (the “Revolving Credit
Facility”), and (iii) the Company’s Credit Agreement dated as of September 29,
2003, among the Company, the lender’s party thereto and Bank of America, N.A.,
as administrative agent, as amended on August 30, 2004 (the “Term Loan Facility”
and, together with the Revolving Credit Facility, the “Existing Bank Credit
Facilities”).

 

(cc) The Company and its subsidiaries possess all licenses, certificates,
permits and other authorizations issued by the appropriate federal, state or
foreign regulatory authorities necessary to conduct their respective businesses,
other than such licenses, certificates, permits or other authorizations, the
failure of which to possess would not have a Material Adverse Effect, and
neither the Company nor any such subsidiary has received any notice of
proceedings relating to the revocation or modification of any such certificate,
authorization or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would have a Material Adverse Effect,
whether or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Final Offering Memorandum
(exclusive of any amendment or supplement thereto).

 

(dd) The Company and each of its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; and (iii) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. The Company maintains disclosure controls and procedures (as such
term is defined in Rule 13a-14 under the Exchange Act) that are effective in
ensuring that information required to be disclosed by the Company in the reports
that it files or submits under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the rules and
forms of the Securities and Exchange Commission, including, without limitation,
controls and procedures designed to ensure that information required to be
disclosed by the Company in the reports that it files or submits under the
Exchange Act is accumulated and communicated to the Company’s management,
including its principal executive officer or officers and its principal
financial officer or officers, as appropriate to allow timely decisions
regarding required disclosure.

 

(ee) In the ordinary course of its business, the Company periodically reviews
the effect of applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
(“Environmental Laws”) on the business, operations and properties of the Company
and its subsidiaries, in the course of which it identifies and evaluates
associated costs and liabilities (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws, or any permit, license or approval, any
related constraints on operating activities and any potential liabilities to
third parties); on the basis of such review, the Company has reasonably
concluded that such associated

 

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costs and liabilities would not, singly or in the aggregate, have a Material
Adverse Effect, whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the Final Offering
Memorandum (exclusive of any amendment or supplement thereto).

 

(ff) Except as would not have a Material Adverse Effect, each of the Company and
its subsidiaries has fulfilled its obligations, if any, under the minimum
funding standards of Section 302 of the United States Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), and the regulations and published
interpretations thereunder with respect to each “plan” (as defined in Section
3(3) of ERISA and such regulations and published interpretations) in which
employees of the Company and its subsidiaries are eligible to participate and
each such plan is in compliance in all material respects with the presently
applicable provisions of ERISA and such regulations and published
interpretations; the Company and its subsidiaries have not incurred any unpaid
liability to the Pension Benefit Guaranty Corporation (other than for the
payment of premiums in the ordinary course) or to any such plan under Title IV
of ERISA.

 

(gg) The subsidiaries listed on Annex A attached hereto are the only significant
subsidiaries of the Company as defined by Rule l-02 of Regulation S-X under the
Act (the “Subsidiaries”).

 

(hh) The Company and its subsidiaries own, possess, license or have other rights
to use, on reasonable terms, all patents, patent applications, trade and service
marks (including the Levi’s®, Dockers® and Levi Strauss Signature™ trademarks),
trade and service mark registrations, trade names, copyrights, licenses,
inventions, trade secrets, technology, know-how and other intellectual property
(collectively, the “Intellectual Property”) necessary for the conduct of the
Company’s business as now conducted free and clear of any material security
interests, claims, liens or encumbrances, except as would not have a Material
Adverse Effect or as set forth in or contemplated in (i) the Final Offering
Memorandum (exclusive of any amendment or supplement thereto) or (ii) the
Existing Bank Credit Facilities, and none of the Intellectual Property, to the
best knowledge of the Company, conflicts with the valid trademark, trade name,
copyright, patent, patent right or intangible asset of any other Person to the
extent that such conflict has or would have a Material Adverse Effect.

 

(ii) Except as would not have a Material Adverse Effect, none of the Company,
its subsidiaries or, 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 taken any action, directly or indirectly, that would result in a
violation by such Persons of the Foreign Corrupt Practices Act of 1977, as
amended, and the rules and regulations thereunder (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

 

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FCPA; and except as would not have a Material Adverse Effect, 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.

 

(jj) Except as would not have a Material Adverse Effect, 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 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 except as would not have a Material Adverse Effect, 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
knowledge of the Company, threatened.

 

(kk) Except as disclosed in the Final Offering Memorandum, there is and has been
no failure on the part of the Company and 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, including Section 402 related to loans and Sections 302
and 906 related to certifications.

 

(ll) None of the Company, any of its subsidiaries or, 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. Department of the Treasury
(“OFAC”); and the Company will not directly or indirectly use the proceeds of
the offering of the Notes hereunder, or lend, contribute or otherwise make
available such proceeds to any subsidiary, joint venture partner or, to its
knowledge, any other person or entity, for the purpose of financing the
activities of any person currently subject to any U.S. sanctions administered by
OFAC.

 

(mm) Neither the Company, any of its subsidiaries or, to the knowledge of the
Company, any director, officer, agent, employee or Affiliate of the Company or
any of its subsidiaries has distributed and, prior to the later to occur of (i)
the Closing Date and (ii) the completion of the distribution of the Notes, will
distribute any material referring to the offering and sale of the Notes other
than the Preliminary Offering Memorandum or the Final Offering Memorandum or
other materials, if any, permitted by the Securities Act and the Financial
Services and Markets Act 2000 (the “FSMA”) (or regulations promulgated pursuant
to the Securities Act or the FSMA).

 

(nn) Neither the Company nor any subsidiary has taken any action or omitted to
take any action (such as issuing any press release relating to the Notes without
an appropriate legend) which may result in the loss by any of the Initial
Purchasers of the ability to rely on any stabilization safe harbour provided
under the FSMA. The Company

 

11

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and its subsidiaries have been informed of the existence (and have received a
copy) of the UK Financial Services Authority’s informational guidance referred
to in MAR 2.3.2R(4) of the price stabilizing rules made under Section 144(1) of
the FSMA.

 

Any certificate signed by any officer of the Company and delivered to the
Representatives or counsel for the Initial Purchasers in connection with the
offering of the Notes shall be deemed a representation and warranty by the
Company, as to matters covered thereby, to each Initial Purchaser.

 

2. Purchase and Sale. Subject to the terms and conditions and in reliance upon
the representations and warranties herein set forth:

 

(a) the Company agrees to sell to each Floating Rate Notes Purchaser, and each
Floating Rate Notes Purchaser agrees, severally and not jointly, to purchase
from the Company at the purchase price set forth in Schedule III, the principal
amount of Floating Rate Notes set forth opposite such Floating Rate Notes
Purchaser’s name on Schedule I hereto; and

 

(b) the Company agrees to sell to each Euro Notes Purchaser, and each Euro Notes
Purchaser agrees, severally and not jointly, to purchase from the Company at the
purchase price set forth in Schedule III, the principal amount of Euro Notes set
forth opposite such Euro Notes Purchaser’s name on Schedule II hereto.

 

3. Delivery and Payment. Delivery of and payment for the Euro Notes shall be
made at 10:00 A.M., London time, and delivery of and payment for the Floating
Rate Notes shall be made at 10:00 A.M., New York City time, on March 11, 2005,
or at such time on such later date (not later than three Business Days after the
foregoing date) as the Representatives shall designate, which date and time may
be postponed by agreement between the Representatives and the Company or as
provided in Section 9 hereof (such date and time of delivery and payment for the
Notes being herein called the “Closing Date”). Delivery of the Notes shall be
made to the Representatives for the respective accounts of the several Initial
Purchasers against payment by the several Initial Purchasers through the
Representatives of the purchase price thereof to or upon the order of the
Company by wire transfer payable in same-day funds to the account specified by
the Company. Delivery of the Floating Rate Notes shall be made through the
facilities of The Depository Trust Company and delivery of the Euro Notes shall
be made through the facilities of the Euroclear System and Clearstream,
Luxembourg, unless the Representatives shall otherwise instruct.

 

4. Offering by Initial Purchasers. Each Initial Purchaser, severally and not
jointly, represents and warrants to and agrees with the Company that:

 

(a) It has not offered or sold, and will not offer or sell, any Floating Rate
Notes or Euro Notes, as applicable, except (i) to those persons it reasonably
believes to be qualified institutional buyers (as defined in Rule 144A under the
Act) and that, in connection with each such sale, it has taken or will take
reasonable steps to ensure that

 

12

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the purchaser of such Floating Rate Notes or Euro Notes, as applicable, is aware
that such sale is being made in reliance on Rule 144A; or (ii) in accordance
with the restrictions set forth in Exhibit A hereto.

 

(b) Neither it nor any person acting on its behalf has made or will make offers
or sales of the Floating Rate Notes or Euro Notes, as applicable, in the United
States by means of any form of general solicitation or general advertising
(within the meaning of Regulation D) in the United States.

 

5. Agreements. The Company agrees with each Initial Purchaser that:

 

(a) The Company will furnish to each Initial Purchaser and to counsel for the
Initial Purchasers, without charge, during the period referred to in paragraph
(c) below, as many copies of the Final Offering Memorandum and any amendments
and supplements thereto as you may reasonably request.

 

(b) The Company will not amend or supplement the Final Offering Memorandum
without the prior written consent of Banc of America Securities LLC and
Citigroup Global Markets Inc.

 

(c) If at any time prior to the completion of the sale of the Notes by the
Initial Purchasers (as determined by Banc of America Securities LLC and
Citigroup Global Markets Inc.), any event occurs as a result of which the Final
Offering Memorandum, as then amended or supplemented, would include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it shall be necessary to amend or supplement
the Final Offering Memorandum to comply with applicable law, the Company
promptly (i) will notify the Representatives of any such event; (ii) subject to
the requirements of paragraph (b) of this Section 5, will prepare an amendment
or supplement that will correct such statement or omission or effect such
compliance; and (iii) will supply any supplemented or amended Final Offering
Memorandum to the several Initial Purchasers and counsel for the Initial
Purchasers without charge in such quantities as you may reasonably request.

 

(d) The Company will arrange, if necessary, for the qualification of the Notes
for sale by the Initial Purchasers under the laws of such jurisdictions in the
United States and the European Union as the Representatives may reasonably
designate and will maintain such qualifications in effect so long as required
for the sale of the Notes; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it is not now so
qualified or to take any action that would subject it to service of process in
suits, other than those arising out of the offering or sale of the Notes, in any
jurisdiction where it is not now so subject. The Company will promptly advise
the Representatives of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Notes for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose.

 

13

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(e) The Company will not, and will not permit any of its Affiliates (other than
the Initial Purchasers, as to whom the Company makes no covenant) to, resell,
under circumstances that would require the registration of the Notes under the
Act, any Notes that have been acquired by any of them.

 

(f) Neither the Company, nor any of its Affiliates (other than the Initial
Purchasers, as to whom the Company makes no covenant), nor any person acting on
its or their behalf will, directly or indirectly, make offers or sales of any
security, or solicit offers to buy any security, under circumstances that would
require the registration of the Notes under the Act.

 

(g) Neither the Company, nor any of its Affiliates (other than the Initial
Purchasers, as to whom the Company makes no covenant), nor any person acting on
its or their behalf will engage in any form of general solicitation or general
advertising (within the meaning of Regulation D) in connection with any offer or
sale of the Notes in the United States.

 

(h) So long as any of the Notes are “restricted Notes” within the meaning of
Rule 144(a)(3) under the Act, the Company will, during any period in which it is
not subject to and in compliance with Section 13 or 15(d) of the Exchange Act or
it is not exempt from such reporting requirements pursuant to and in compliance
with Rule 12g3-2(b) under the Exchange Act, provide to each holder of such
restricted Notes and to each prospective purchaser (as designated by such
holder) of such restricted Notes, upon the request of such holder or prospective
purchaser, any information required to be provided by Rule 144A(d)(4) under the
Act. This covenant is intended to be for the benefit of the holders, and the
prospective purchasers designated by such holders, from time to time of such
restricted Notes.

 

(i) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf will engage in any directed selling efforts with respect to the
Notes, and each of them will comply with the offering restrictions requirements
of Regulation S. Terms used in this paragraph have the meanings given to them by
Regulation S.

 

(j) The Company will cooperate with the Representatives and use its best efforts
to (i) permit the Floating Rate Notes to be eligible for clearance and
settlement through The Depository Trust Company, (ii) permit the Euro Notes to
be eligible for clearance and settlement through the Euroclear System and
Clearstream, Luxembourg, and (iii) cause both the Floating Rate Notes and the
Euro Notes to be approved for listing on the Luxembourg Stock Exchange.

 

(k) The Company will not offer, sell, contract to sell, grant any other option
to purchase or otherwise dispose of, directly or indirectly, or announce the
offering of, or file a registration statement for, any debt securities issued or
guaranteed by the Company or any of its direct or indirect subsidiaries, or
enter into any agreement to do any of the foregoing (other than (i) the Notes
and the New Securities (as defined in the Registration Rights Agreements or the
Registration Rights Agreement dated December

 

14

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22, 2004 between the Company and Citigroup Global Markets Inc. and Banc of
America Securities LLC), (ii) pursuant to any credit facility permitted under
the Indentures and (iii) purchase money debt and any other non-capital markets
debt permitted under the Indentures for a period of 60 days from the date the
Notes are issued without the prior written consent of Banc of America Securities
LLC and Citigroup Global Markets Inc.

 

(l) The Company will not take, directly or indirectly, any action designed to or
that would constitute or that might reasonably be expected to cause or result
in, under the Exchange Act or otherwise, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the
Notes.

 

(m) The Company will not, at any time prior to the expiration of three years
after the Closing Date, be or become an open-end investment company, unit
investment trust or face-amount certificate company that is or is required to be
registered under Section 8 of the Investment Company Act, and will not be or
become a closed-end investment company required to be registered but not
registered thereunder.

 

(n) The Company agrees to pay the costs and expenses relating to the following
matters: (i) the preparation of the Floating Rate Notes Indenture, the Euro
Notes Indenture and the Registration Rights Agreements, the issuance of the
Notes and the fees of the Trustees; (ii) the preparation, printing or
reproduction of the Preliminary Offering Memorandum and Final Offering
Memorandum and each amendment or supplement to either of them; (iii) the
printing (or reproduction) and delivery (including postage, air freight charges
and charges for counting and packaging) of such copies of the Preliminary
Offering Memorandum and Final Offering Memorandum, and all amendments or
supplements to either of them, as may, in each case, be reasonably requested for
use in connection with the offering and sale of the Notes; (iv) the preparation,
printing, authentication, issuance and delivery of certificates for the Notes,
including any stamp or transfer taxes in connection with the original issuance
and sale of the Notes; (v) the printing (or reproduction) and delivery of this
Agreement, any blue sky memorandum and all other agreements or documents printed
(or reproduced) and delivered in connection with the offering of the Notes; (vi)
any registration or qualification of the Notes for offer and sale under the
Notes or blue sky laws of the several states (including filing fees and the
reasonable fees and expenses of counsel for the Initial Purchasers relating to
such registration and qualification); (vii) admitting (A) the Floating Rate
Notes for trading in The Portal Market of the NASD and (B) the Floating Rate
Notes and the Euro Notes for listing on the Luxembourg Stock Exchange; (viii)
the transportation and other expenses incurred by or on behalf of Company
representatives in connection with presentations to prospective purchasers of
the Notes; (ix) the fees and expenses of the Company’s accountants and the fees
and expenses of counsel (including local and special counsel) for the Company;
and (x) all other costs and expenses incident to the performance by the Company
of its obligations hereunder. It is understood, however, that, except as
provided in this Section, and Sections 7 and 8 hereof, the Initial Purchasers
will pay all of their own costs and expenses, including the fees of their
counsel, Cravath, Swaine & Moore LLP.

 

15

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6. Conditions to the Obligations of the Initial Purchasers. The obligations of
the Initial Purchasers to purchase the Notes shall be subject to the accuracy of
the representations and warranties on the part of the Company contained herein
at the Execution Time and the Closing Date, to the accuracy of the statements of
the Company made in any certificates pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder and to the following
additional conditions:

 

(a) The Company shall have requested and caused Shearman & Sterling LLP, counsel
for the Company, to furnish to the Representatives its opinion, dated the
Closing Date and addressed to the Representatives, to the effect that:

 

(i) each of the Indentures has been duly authorized, executed and delivered,
and, assuming due authorization, execution and delivery by the Floating Rate
Notes Trustee or the Euro Notes Trustee, as applicable, constitutes a legal,
valid and binding instruments enforceable against the Company in accordance with
its terms (subject, as to the enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting creditors’ rights
generally from time to time in effect and to general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether considered in a proceeding in
equity or at law); the Notes have been duly and validly authorized and, when
executed and authenticated in accordance with the provisions of the Floating
Rate Notes Indenture or the Euro Notes Indenture, as applicable, and delivered
to and paid for by the Floating Rate Notes Purchasers or Euro Notes Purchasers,
as the case may be, under this Agreement, will constitute legal, valid and
binding obligations of the Company entitled to the benefits of the applicable
Indenture (subject, as to the enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting creditors’ rights
generally from time to time in effect and to general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether considered in a proceeding in
equity or at law); each of the Registration Rights Agreements has been duly
authorized, executed and delivered and, assuming due authorization, execution
and delivery by the other parties thereto, constitutes a legal, valid and
binding instrument enforceable against the Company in accordance with its terms
(subject, as to the enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting creditors’ rights
generally from time to time in effect and to general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether considered in a proceeding in
equity or at law, and provided that such counsel need not express any opinion as
to the enforceability of any rights to indemnification which may be violative of
the public policy underlying any Federal or state Notes law, rule or
regulation); and the statements set forth under the heading “Description of
Floating Rate Notes and Euro Notes” and “Exchange Offer; Registration Rights” in
the Final Offering Memorandum, insofar as such statements purport to summarize
certain provisions of the Notes, the Indentures

 

16

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and the Registration Rights Agreements, provide, in all material respects, a
fair summary of such provisions;

 

(ii) the statements in the Final Offering Memorandum under the heading
“Important Federal Income Tax Considerations”, insofar as such statements
summarize legal matters, agreements, documents or proceedings discussed therein,
are accurate and fair summaries of such legal matters, agreements, documents or
proceedings;

 

(iii) no facts have come to the attention of such counsel which give such
counsel reason to believe that the Final Offering Memorandum (other than the
financial statements and other financial data contained therein or omitted
therefrom, as to which such counsel has not been requested to comment), as of
its date or as of the Closing Date, contained or contains an untrue statement of
a material fact or omitted or omits to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading;

 

(iv) this Agreement has been duly authorized, executed and delivered by the
Company;

 

(v) neither the execution and delivery of the Floating Rate Notes Indenture, the
Euro Notes Indenture, this Agreement or the Registration Rights Agreements, the
issue and sale of the Notes, nor the consummation of any other of the
transactions herein or therein contemplated, nor the fulfillment of the terms
hereof or thereof will conflict with, result in a breach or violation of, or
imposition of any lien, charge or encumbrance upon any property or asset of the
Company or any of its subsidiaries pursuant to, (i) the charter or by-laws of
the Company; (ii) the terms of the Existing Bank Credit Facilities, including
any covenant contained therein; (iii) the terms of the Indenture, dated as of
November 6, 1996, between the Company and Citibank, N.A., the U.S. Dollar
Indenture, dated as of January 18, 2001, between the Company and Citibank, N.A.,
the Euro Indenture, dated as of January 18, 2001, between the Company and
Citibank, N.A., and the Indenture, dated as of December 22, 2004, between the
Company and Wilmington Trust Company (together, the “Existing Indentures”), and
any amendments thereto, including any covenant contained therein; or (iv) any
law, rule or regulation of the United States applicable to Notes transactions or
the General Corporation Law of the State of Delaware;

 

(vi) assuming the accuracy of the representations and warranties and compliance
with the agreements contained herein, no registration of the Notes under the
Act, and no qualification of an indenture under the Trust Indenture Act, is
required for the offer and sale by the Initial Purchasers of the Notes in the
manner contemplated by this Agreement; and

 

(vii) the Company is not and, after giving effect to the offering and sale of
the Notes and the application of the proceeds thereof as described in the Final

 

17

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Offering Memorandum, will not be an “investment company” as defined in the
Investment Company Act without taking account of any exemption arising out of
the number of holders of the Company’s Notes.

 

In rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than the States of California,
Delaware and New York or the Federal laws of the United States, to the extent
they deem proper and specified in such opinion, upon the opinion of other
counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Initial Purchasers; and (B) as to matters of
fact, to the extent they deem proper, on certificates of responsible officers of
the Company and public officials. Such opinion may contain customary
assumptions, exceptions, limitations, qualifications and comments reasonably
satisfactory to the Initial Purchasers. References to the Final Offering
Memorandum in this Section 6(a) include any amendment or supplement thereto at
the Closing Date.

 

(b) The Company shall have requested and caused Albert F. Moreno, Esq., Senior
Vice President and General Counsel for the Company, to furnish to the
Representatives his opinion, dated the Closing Date and addressed to the
Representatives, to the effect that:

 

(i) each of the Company and the Subsidiaries has been duly incorporated or
organized and is validly existing as a corporation or other valid legal entity
in good standing under the laws of the jurisdiction in which it is chartered or
organized, with full corporate or company power and authority to own or lease,
as the case may be, and to operate its properties and conduct its business as
described in the Final Offering Memorandum, and is duly qualified to do business
as a foreign corporation or other valid legal entity and is in good standing
under the laws of each jurisdiction which requires such qualification, except in
jurisdictions in which the failure to be so qualified or to be in good standing
has not had and would not reasonably be expected to have a Material Adverse
Effect;

 

(ii) all the outstanding shares of capital stock of the Company and each
Subsidiary have been duly and validly authorized and issued and are fully paid
and nonassessable, and, except as otherwise set forth in the Final Offering
Memorandum and other than the Company’s subsidiaries in Japan and Turkey, all
outstanding shares of capital stock of the Subsidiaries are owned by the Company
either directly or through wholly owned subsidiaries free and clear of any
perfected security interest and, to the knowledge of such counsel, after due
inquiry, any other security interests, claims, liens or encumbrances;

 

(iii) the Company’s authorized equity capitalization is as set forth in the
Final Offering Memorandum;

 

(iv) to the best knowledge of such counsel, there is no pending or threatened
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its

 

18

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subsidiaries or its or their property that is not adequately disclosed in the
Final Offering Memorandum, except in each case for such proceedings that, if the
subject of an unfavorable decision, ruling or finding in such counsel’s judgment
are not reasonably likely, singly or in the aggregate, to result in a Material
Adverse Effect;

 

(v) such counsel has no reason to believe that at the Execution Time or on the
Closing Date the Final Offering Memorandum contained or contains any untrue
statement of a material fact or omitted or omits to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading (in each case, other than the
financial statements and other financial information contained therein, as to
which such counsel need express no opinion);

 

(vi) assuming the accuracy of the representations and warranties of the Initial
Purchasers in Section 4 of this Agreement, no consent, approval, authorization,
filing with or order of any court or governmental agency or body is required in
connection with the transactions contemplated herein or in the Indentures and
the Registration Rights Agreements, except such as will be obtained under the
Act and the Trust Indenture Act in connection with the transactions contemplated
by the Registration Rights Agreements and such as may be required under the blue
sky or securities laws of any jurisdiction in connection with the transactions
contemplated by this Agreement and the Registration Rights Agreements and such
other approvals (specified in such opinion) as have been obtained; and

 

(vii) neither the execution and delivery of the Floating Rate Notes Indenture,
the Euro Notes Indenture, this Agreement or the Registration Rights Agreements,
the issue and sale of the Notes, nor the consummation of any other of the
transactions herein or therein contemplated, nor the fulfillment of the terms
hereof or thereof will conflict with, result in a breach or violation of, or
imposition of any lien, charge or encumbrance upon any property or asset of the
Company or any of its subsidiaries pursuant to, (1) the charter or by-laws of
the Company or any of its subsidiaries; (2) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan agreement or
other agreement, obligation, condition, covenant or instrument to which the
Company or any of its subsidiaries is a party or bound or to which any of their
respective properties is subject; or (3) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company or any of its subsidiaries
of any court, regulatory body, administrative agency, governmental body,
arbitrator or other authority of the United States or any state thereof having
jurisdiction over the Company, any of its subsidiaries or any of their
respective properties or to the knowledge of such counsel, any statute, law,
rule, regulation, judgment, order or decree applicable to the Company or any of
its subsidiaries of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority outside of the United States
having jurisdiction over the Company, any of its subsidiaries or any of their
respective properties, except, with respect to (x) clause (2) and

 

19

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(y) any statute, law, rule, regulation, judgment, order or decree applicable to
the Company or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority outside
of the United States described in clause (3) as to which such counsel has no
knowledge, for conflicts, violations, breaches or impositions that would not
reasonably be expected to have a Material Adverse Effect.

 

In rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than the States of Delaware and
California or the Federal laws of the United States, to the extent he deems
proper and specified in such opinion, upon the opinion of other counsel of good
standing whom he believes to be reliable and who are satisfactory to counsel for
the Initial Purchasers; and (B) as to matters of fact, to the extent he deems
proper, on certificates of other responsible officers of the Company and public
officials. Such opinion may contain customary assumptions, exceptions,
limitations, qualifications and comments. References to the Final Offering
Memorandum in this Section 6 (b) include any amendment or supplement thereto at
the Closing Date.

 

(c) The Representatives shall have received from Cravath, Swaine & Moore LLP,
counsel for the Initial Purchasers, such opinion or opinions, dated the Closing
Date and addressed to the Representatives, with respect to the issuance and sale
of the Notes, the Indentures, the Registration Rights Agreements, the Final
Offering Memorandum (as amended or supplemented at the Closing Date) and other
related matters as the Representatives may reasonably require, and the Company
shall have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.

 

(d) The Company shall have furnished to the Representatives a certificate of the
Company, signed by the Chief Financial Officer and the Treasurer, dated the
Closing Date, to the effect that the signers of such certificate have carefully
examined the Final Offering Memorandum, any amendment or supplement to the Final
Offering Memorandum and this Agreement and that:

 

(i) the representations and warranties of the Company in this Agreement are true
and correct in all material respects on and as of the Closing Date with the same
effect as if made on the Closing Date, and the Company has complied in all
material respects with all the agreements and satisfied all the conditions on
its part to be performed or satisfied hereunder at or prior to the Closing Date;
and

 

(ii) since the date of the most recent financial statements included in the
Final Offering Memorandum (exclusive of any amendment or supplement thereto),
there has been no material adverse change in the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated by the Final
Offering Memorandum (exclusive of any amendment or supplement thereto).

 

20

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(e) The Company shall have furnished to the Representatives such further
certificates and documents as the Representatives may reasonably request
evidencing the derivation from the Company’s accounting books and records of
financial statements or other financial data included in the Final Offering
Memorandum and any amendment or supplement to the Final Offering Memorandum for
periods during which the Company’s financial statements were audited by Arthur
Andersen LLP.

 

(f) At the Execution Time and at the Closing Date, the Company shall have
requested and caused KPMG LLP to furnish to the Representatives letters, dated
respectively as of the Execution Time and as of the Closing Date, in form and
substance satisfactory to the Representatives, confirming that they are
independent accountants within the meaning of the Act and the Exchange Act and
the respective applicable rules and regulations adopted by the Commission
thereunder, and stating in effect that:

 

(i) the audited condensed consolidated financial statements and financial
statement schedules of the Company included in the Final Offering Memorandum and
reported on by them comply in form in all material respects with applicable
accounting requirements and with the related rules and regulations adopted by
the Commission with respect to financial statements included in annual reports
on Form 10-K under the Exchange Act; and said audited condensed consolidated
financial statements are in conformity with generally accepted accounting
principles; and

 

(ii) on the basis of a reading of the latest unaudited financial statements made
available by the Company and its subsidiaries; carrying out certain specified
procedures (but not an examination in accordance with generally accepted
auditing standards), which would not necessarily reveal matters of significance
with respect to the comments set forth in such letter; a reading of the minutes
of the meetings of the Board of Directors and the Human Resources, Audit and
Finance Committees of the Board of Directors of the Company and the
Subsidiaries; and inquiries of certain officials of the Company who have
responsibility for financial and accounting matters of the Company and its
subsidiaries as to transactions and events subsequent to November 28, 2004,
nothing came to their attention which caused them to believe that:

 

(1) with respect to the period from November 28, 2004 to January 31, 2005, there
was any increase in long-term debt or stockholders’ deficit, change in capital
stock, decrease in total assets of the Company as compared with the amounts
shown in the November 28, 2004 audited condensed consolidated balance sheet
included in the Final Offering Memorandum, or for the two-month period ended
January 31, 2005, there were any decreases as compared to the corresponding
two-month period ended January 31, 2004 in consolidated net sales, gross profit,
operating income, interest expense, income before taxes or in the total or per
share amounts of net income of the Company and its subsidiaries, except in all
instances for changes or decreases set forth in such

 

21

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letter, in which case the letter shall be accompanied by an explanation by the
Company as to the significance thereof unless said explanation is not deemed
necessary by the Representatives; or

 

(2) with respect to the period subsequent to January 31, 2005 to a specified
date not more than five days prior to the date of such letter, there was any
increase in long-term debt, or change in capital stock as compared with the
amounts shown in the November 28, 2004 audited condensed consolidated balance
sheet included in the Final Offering Memorandum, or any decrease as compared to
the corresponding period in the fiscal month ended February 28, 2004 in
consolidated net sales, except in all instances for changes or decreases set
forth in such letter, in which case the letter shall be accompanied by an
explanation by the Company as to the significance thereof unless said
explanation is not deemed necessary by the Representatives; and

 

(iii) they have performed certain other specified procedures as a result of
which they determined that certain information of an accounting, financial or
statistical nature (which is limited to accounting, financial or statistical
information derived from the general accounting records of the Company and its
subsidiaries) set forth in the Final Offering Memorandum or the Exchange Act
Documents, including the information set forth under the captions “Summary”,
“Risk Factors” and “Selected Historical Consolidated Financial Data” in the
Final Offering Memorandum, and under the captions “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” and “Business” the
information included in the “Quantitative and Qualitative Disclosures About
Market Risk” included in the 2004 10-K agrees with the accounting records of the
Company and its subsidiaries, excluding any questions of legal interpretation.

 

References to the Final Offering Memorandum in this Section 6(f) include any
amendment or supplement thereto at the date of the applicable letter.

 

(g) Subsequent to the Execution Time or, if earlier, the dates as of which
information is given in the Final Offering Memorandum (exclusive of any
amendment or supplement thereto), there shall not have been (i) any change or
decrease specified in the letter or letters referred to in paragraph (f) of this
Section 6; or (ii) any change, or any development involving a prospective
change, in or affecting the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Final Offering
Memorandum (exclusive of any amendment or supplement thereto) the effect of
which, in any case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to market the Notes as contemplated by the Final
Offering Memorandum (exclusive of any amendment or supplement thereto).

 

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(h) The Floating Rate Notes and the Euro Notes shall have been designated as
Portal-eligible Notes in accordance with the rules and regulations of the NASD;
and the Floating Rate Notes shall be eligible for clearance and settlement
through The Depository Trust Company and the Euro Notes shall be eligible for
clearance and settlement through the Euroclear System and Clearstream,
Luxembourg.

 

(i) Subsequent to the Execution Time, there shall not have been any decrease in
the rating of any of the Company’s debt securities by any “nationally recognized
statistical rating organization” (as defined for purposes of Rule 436(g) under
the Act) or any notice given of any intended or potential decrease in any such
rating (including notice of an adverse change in the outlook for such rating) or
of a possible change in any such rating that does not indicate the direction of
the possible change.

 

(j) Prior to the Closing Date, the Company shall have furnished to the
Representatives such further information, certificates and documents as the
Representatives may reasonably request.

 

(k) Concurrent with the closing of the offering of the Notes, the Company shall
(i) purchase all 11-5/8% Notes validly transferred prior to the Early Consent
Date (as defined in the Offer to Purchase and Consent Solicitation Statement
dated February 24, 2005 (the “Statement”)) in the tender offer and consent
solicitation (the “Tender Offer”) for the 11-5/8% Notes, (ii) apply the net
proceeds of the sale of the Notes to the Tender Offer as described in the Final
Offering Memorandum and (iii) execute supplemental indentures amending or
eliminating certain restrictive covenants and certain other related provisions
(including certain events of default) in the indentures governing the 11-5/8%
Notes; in each case on the terms and conditions set forth in the Statement.

 

(l) The Company shall have entered into an amendment and waiver to the Existing
Bank Credit Facility satisfactory in form and substance to Banc of America
Securities LLC and Citigroup Global Markets Inc., whereby the lenders shall have
granted a waiver to and amended the Existing Bank Credit Facility to permit the
application of the proceeds from the sale of the Notes as described in the
Offering Memorandum and such amendment and waiver shall be in full force and
effect.

 

If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects when and as provided in this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Initial Purchasers,
this Agreement and all obligations of the Initial Purchasers hereunder may be
canceled at, or at any time prior to, the Closing Date by the Representatives.
Notice of such cancelation shall be given to the Company in writing or by
telephone or facsimile confirmed in writing.

 

The documents required to be delivered by this Section 6 will be delivered at
the office of counsel for the Initial Purchasers, at Cravath, Swaine & Moore
LLP, 825 Eighth Avenue, New York, NY 10019, on the Closing Date.

 

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7. Reimbursement of Expenses. If the sale of the Notes provided for herein is
not consummated because any condition to the obligations of the Initial
Purchasers set forth in Section 6 hereof is not satisfied, because of any
termination pursuant to Section 10 hereof or because of any refusal, inability
or failure on the part of the Company to perform any agreement herein or comply
with any provision hereof other than by reason of a default by any of the
Initial Purchasers, the Company will reimburse the Initial Purchasers severally
through Banc of America Securities LLC on demand for all out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been
incurred by them in connection with the proposed purchase and sale of the Notes.

 

8. Indemnification and Contribution. (a) The Company agrees to indemnify and
hold harmless each Initial Purchaser, the directors, officers, employees and
agents of each Initial Purchaser and each person who controls any Initial
Purchaser within the meaning of either the Act or the Exchange Act against any
and all losses, claims, damages or liabilities, joint or several, to which they
or any of them may become subject under the Act, the Exchange Act or other
Federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Preliminary Offering Memorandum,
the Final Offering Memorandum (or in any supplement or amendment thereto) or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made in the Preliminary Offering
Memorandum or the Final Offering Memorandum, or in any amendment thereof or
supplement thereto, in reliance upon and in conformity with written information
furnished to the Company by or on behalf of any Initial Purchasers through the
Representatives specifically for inclusion therein; and provided further,
however, that with respect to any untrue statement or omission of a material
fact made in the Preliminary Offering Memorandum, the indemnity agreement
contained in this Section 8(a) shall not inure to the benefit of any Initial
Purchaser from whom the person asserting any such loss, claim, damage or
liability purchased the Notes concerned in any initial resale of the Notes by
the Initial Purchaser, to the extent that any such loss, claim, damage or
liability of such Initial Purchaser occurs under the circumstance where it shall
have been determined by a court of competent jurisdiction by final and
nonappealable judgment that (i) the untrue statement or omission of a material
fact contained in the Preliminary Offering Memorandum was corrected in the Final
Offering Memorandum, (ii) the Company had previously furnished copies of the
Final Offering Memorandum to the Initial Purchasers and (iii) such loss, claim,
damage or liability results from the fact that there was not sent or given to
such person at or prior to the written confirmation of the sale of such Notes to
such person, a copy of the Final Offering Memorandum. This

 

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indemnity agreement will be in addition to any liability which the Company may
otherwise have.

 

(b) Each Initial Purchaser severally and not jointly agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers, and each
person who controls the Company within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity from the Company to
each Initial Purchaser, but only with reference to written information relating
to such Initial Purchaser furnished to the Company by or on behalf of such
Initial Purchaser through the Representatives specifically for inclusion in the
Preliminary Offering Memorandum or the Final Offering Memorandum (or in any
amendment or supplement thereto). This indemnity agreement will be in addition
to any liability which any Initial Purchaser may otherwise have. The Company
acknowledges that the statements set forth in the last paragraph of the cover
page regarding the delivery of the Notes and, under the heading “Plan of
Distribution”, (i) the list of Initial Purchasers; and (ii) the sentences
related to concessions and reallowances; and (iii) the paragraph related to
overallotment, stabilization and syndicate covering transactions in the
Preliminary Offering Memorandum and the Final Offering Memorandum, constitute
the only information furnished in writing by or on behalf of the Initial
Purchasers for inclusion in the Preliminary Offering Memorandum or the Final
Offering Memorandum (or in any amendment or supplement thereto).

 

(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses; and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party’s choice at the indemnifying party’s expense to represent the
indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be
reasonably satisfactory to the indemnified party. Notwithstanding the
indemnifying party’s election to appoint counsel to represent the indemnified
party in an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party shall
bear the reasonable fees, costs and expenses of such separate counsel if (i) the
use of counsel chosen by the indemnifying party to represent the indemnified
party would present such counsel with a conflict of interest; (ii) the actual or
potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those
available to the indemnifying party; (iii) the indemnifying party shall not have

 

25

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employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of the institution
of such action; or (iv) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
(i) does not include an admission of fault and (ii) includes an unconditional
release of each indemnified party from all liability arising out of such claim,
action, suit or proceeding. The indemnifying party shall not, in connection with
any one action or separate but substantially similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances,
be liable for fees and expenses of more than one separate law firm of attorneys
(in addition to any local counsel) for all indemnified parties and all such fees
and expenses shall be reimbursed as incurred. Such firm shall be designated by
Banc of America Securities LLC and Citigroup Global Markets Inc. in the case of
the parties indemnified pursuant to Section 8(a) and by the Company in the case
of parties indemnified pursuant to Section 8(b). Each indemnified party shall
use all reasonable efforts to cooperate with the indemnifying party in the
defense of any such action or claim.

 

(d) In the event that the indemnity provided in paragraph (a) or (b) of this
Section 8 is unavailable to or insufficient to hold harmless an indemnified
party for any reason, the Company and the Initial Purchasers severally agree to
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating or
defending same) (collectively “Losses”) to which the Company and one or more of
the Initial Purchasers may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and by the
Initial Purchasers on the other from the offering of the Notes; provided,
however, that in no case shall any Initial Purchaser (except as may be provided
in any agreement among the Initial Purchasers relating to the offering of the
Notes) be responsible for any amount in excess of the purchase discount or
commission applicable to the Notes purchased by such Initial Purchaser
hereunder. If the allocation provided by the immediately preceding sentence is
unavailable for any reason, the Company and the Initial Purchasers severally
shall contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
of the Initial Purchasers on the other in connection with the statements or
omissions which resulted in such Losses, as well as any other relevant equitable
considerations. Benefits received by the Company shall be deemed to be equal to
the total net proceeds from the offering (after deducting discounts and
commissions to the Initial Purchasers, but before deducting expenses) received
by it, and benefits received by the Initial Purchasers shall be deemed to be
equal to the total purchase discounts and commissions in each case set forth in
this Agreement. Relative fault shall be determined by reference to, among other
things, whether any untrue or any alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information
provided by the Company on the one hand or the Initial

 

26

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Purchasers on the other, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The Company and the Initial Purchasers agree that it
would not be just and equitable if contribution were determined by pro rata
allocation or any other method of allocation which does not take account of the
equitable considerations referred to above. Notwithstanding the provisions of
this paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 8, each person who controls an Initial Purchaser within the meaning
of either the Act or the Exchange Act and each director, officer, employee and
agent of an Initial Purchaser shall have the same rights to contribution as such
Initial Purchaser, and each person who controls the Company within the meaning
of either the Act or the Exchange Act and each officer and director of the
Company shall have the same rights to contribution as the Company, subject in
each case to the applicable terms and conditions of this paragraph (d).

 

9. Default by an Initial Purchaser. (a) If any one or more Floating Rate Notes
Initial Purchasers shall fail to purchase and pay for any of the Floating Rate
Notes agreed to be purchased by such Floating Rate Notes Initial Purchaser
hereunder and such failure to purchase shall constitute a default in the
performance of its or their obligations under this Agreement, the remaining
Floating Rate Notes Initial Purchasers shall be obligated severally to take up
and pay for (in the respective proportions which the principal amount of
Floating Rate Notes set forth opposite their names on Schedule I hereto bears to
the aggregate principal amount of Floating Rate Notes set forth opposite the
names of all the remaining Floating Rate Notes Initial Purchasers) the Floating
Rate Notes which the defaulting Floating Rate Notes Initial Purchaser or
Floating Rate Notes Initial Purchasers agreed but failed to purchase; provided,
however, that in the event that the aggregate principal amount of Floating Rate
Notes which the defaulting Floating Rate Notes Initial Purchaser or Floating
Rate Notes Initial Purchasers agreed but failed to purchase shall exceed 10% of
the aggregate principal amount of Floating Rate Notes set forth on Schedule I
hereto, the remaining Floating Rate Notes Initial Purchasers shall have the
right to purchase all, but shall not be under any obligation to purchase any, of
the Floating Rate Notes, and if such nondefaulting Floating Rate Notes Initial
Purchasers do not purchase all the Floating Rate Notes, this Agreement will
terminate without liability to any nondefaulting Floating Rate Notes Initial
Purchaser or the Company. In the event of a default by any Floating Rate Notes
Initial Purchaser as set forth in this Section 9, the Closing Date shall be
postponed for such period, not exceeding five Business Days, as Banc of America
Securities LLC and Citigroup Global Markets Inc. shall determine in order that
the required changes in the Final Offering Memorandum or in any other documents
or arrangements may be effected.

 

(b) If any one or more Euro Notes Initial Purchasers shall fail to purchase and
pay for any of the Euro Notes agreed to be purchased by such Euro Notes Initial
Purchaser hereunder and such failure to purchase shall constitute a default in
the performance of its or their obligations under this Agreement, the remaining
Euro Notes Initial Purchasers shall be obligated severally to take up and pay
for (in the respective proportions which the principal amount of Euro Notes set
forth opposite their names on

 

27

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Schedule II hereto bears to the aggregate principal amount of Euro Notes set
forth opposite the names of all the remaining Euro Notes Initial Purchasers) the
Euro Notes which the defaulting Euro Notes Initial Purchaser or Euro Notes
Initial Purchasers agreed but failed to purchase; provided, however, that in the
event that the aggregate principal amount of Euro Notes which the defaulting
Euro Notes Initial Purchaser or Euro Notes Initial Purchasers agreed but failed
to purchase shall exceed 10% of the aggregate principal amount of Euro Notes set
forth on Schedule II hereto, the remaining Euro Notes Initial Purchasers shall
have the right to purchase all, but shall not be under any obligation to
purchase any, of the Euro Notes, and if such nondefaulting Euro Notes Initial
Purchasers do not purchase all the Euro Notes, this Agreement will terminate
without liability to any nondefaulting Euro Notes Initial Purchaser or the
Company. In the event of a default by any Euro Notes Initial Purchaser as set
forth in this Section 9, the Closing Date shall be postponed for such period,
not exceeding five Business Days, as Banc of America Securities LLC and
Citigroup Global Markets Inc. shall determine in order that the required changes
in the Final Offering Memorandum or in any other documents or arrangements may
be effected.

 

(c) Nothing contained in this Agreement shall relieve any defaulting Initial
Purchaser of its liability, if any, to the Company or any nondefaulting Initial
Purchaser for damages occasioned by its default hereunder.

 

10. Termination. This Agreement shall be subject to termination in the absolute
discretion of the Representatives, by notice given to the Company prior to
delivery of and payment for the Notes, if at any time prior to such time (i)
trading in securities generally on the New York Stock Exchange or the Nasdaq
National Market shall have been suspended or limited or minimum prices shall
have been established on such Exchange or the Nasdaq National Market; (ii) a
banking moratorium shall have been declared either by Federal or New York State
authorities; or (iii) there shall have occurred any outbreak or escalation of
hostilities, declaration by the United States of a national emergency or war or
other calamity or crisis the effect of which on financial markets is such as to
make it, in the sole judgment of the Representatives, impracticable or
inadvisable to proceed with the offering or delivery of the Notes as
contemplated by the Final Offering Memorandum (exclusive of any amendment or
supplement thereto).

 

11. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and of the Initial Purchasers set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of the Initial Purchasers or the Company or any of the
officers, directors, employees, agents or controlling persons referred to in
Section 8 hereof, and will survive delivery of and payment for the Notes;
provided, however, that the representations and warranties of the Company shall
be deemed to be made at the Execution Time and the Closing Date only. The
provisions of Sections 7 and 8 hereof shall survive the termination or
cancelation of this Agreement.

 

12. Notices. All communications hereunder will be in writing and effective only
on receipt, and, if sent to the Representatives, will be mailed, delivered or

 

28

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telefaxed to the Banc of America Securities LLC General Counsel (fax no.: (646)
313-4803) and confirmed to the General Counsel, Banc of America Securities LLC
at 40 West 57th Street, New York, New York 10019, Attention: General Counsel,
and the Citigroup Global Markets Inc. General Counsel (fax no.: (212) 816-7912)
and confirmed to the General Counsel, Citigroup Global Markets Inc. at 388
Greenwich Street, New York, New York 10013, Attention: General Counsel; or, if
sent to the Company, will be mailed, delivered or telefaxed to (415) 501-7650
and confirmed to it at Levi’s Plaza, 1155 Battery Street, San Francisco, CA
94111, attention of the Legal Department.

 

13. Successors. This Agreement will inure to the benefit of and be binding upon
the parties hereto and their respective successors and the officers, directors,
employees, agents and controlling persons referred to in Section 8 hereof, and,
except as expressly set forth in Section 5(h) hereof, no other person will have
any right or obligation hereunder.

 

14. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.

 

15. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall constitute an original and all of which together shall
constitute one and the same instrument.

 

16. Headings. The section headings used herein are for convenience only and
shall not affect the construction hereof.

 

17. Definitions. The terms which follow, when used in this Agreement, shall have
the meanings indicated.

 

“Act” shall mean the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.

 

“Affiliate” shall have the meaning specified in Rule 501(b) of Regulation D.

 

“Business Day” shall mean any day other than a Saturday, a Sunday or a legal
holiday or a day on which banking institutions or trust companies are authorized
or obligated by law to close in the City of New York.

 

“Clearstream, Luxembourg” means Clearstream Banking, S.A.

 

“Commission” shall mean the Notes and Exchange Commission.

 

“Euroclear System” means the Euroclear Bank S.A./N.V., as operator of the
Euroclear Clearance System.

 

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission promulgated thereunder.

 

29

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“Execution Time” shall mean the date and time that this Agreement is executed
and delivered by the parties hereto.

 

“Investment Company Act” shall mean the Investment Company Act of 1940, as
amended, and the rules and regulations of the Commission promulgated thereunder.

 

“NASD” shall mean the National Association of Securities Dealers, Inc.

 

“Regulation D” shall mean Regulation D under the Act.

 

“Regulation S” shall mean Regulation S under the Act.

 

“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended,
and the rules and regulations of the Commission promulgated thereunder.

 

30

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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
Agreement and your acceptance shall represent a binding agreement between the
Company and the several Initial Purchasers.

 

Very truly yours, Levi Strauss & Co. by  

/s/ Miguel Silva Gonzalez

   

Name: Miguel Silva Gonzalez

   

Title: Vice President & Treasurer

 

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The foregoing Agreement is hereby confirmed and accepted as of the date first
above written. BANC OF AMERICA SECURITIES LLC
CITIGROUP GLOBAL MARKETS INC.
J.P. MORGAN SECURITIES INC.
GOLDMAN, SACHS & CO.
SCOTIA CAPITAL (USA) INC.
BEAR, STEARNS & CO. INC.
CREDIT SUISSE FIRST BOSTON LLC By:   Banc of America Securities LLC by  

/s/ Bruce R. Thompson

   

Name: Bruce R. Thompson

   

Title: Managing Director

 

32

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By:   Citigroup Global Markets Inc. by  

/s/ Barbara R. Matas

   

Name: Barbara R. Matas

   

Title: Managing Director

For themselves and the other several Initial Purchasers named in Schedule I to
the foregoing Agreement.

 

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The foregoing Agreement is hereby confirmed and accepted as of the date first
above written. BANC OF AMERICA SECURITIES LIMITED
J.P. MORGAN SECURITIES LTD.
GOLDMAN, SACHS & CO.
SCOTIA CAPITAL INC.
BEAR, STEARNS & CO. INC.
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED By:   Banc of America Securities
Limited by  

/s/ Rommie Bhutani

   

Name: Rommie Bhutani

   

Title: Duly Appointed Attorney

 

34

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By:   Citigroup Global Markets Limited by  

/s/ Barbara R. Matas

   

Name: Barbara R. Matas

   

Title:   Managing Director

 

35