Document:

exv10w1

 

EXHIBIT 10.1

EXECUTION COPY

AMENDMENT TO CREDIT AGREEMENT

     THIS AMENDMENT TO CREDIT AGREEMENT, dated as of October 10, 2007 (this “Amendment”), is made
by and between ADVANCED CIRCUITS, INC., a Colorado corporation (the “Borrower”), and COMPASS GROUP
DIVERSIFIED HOLDINGS LLC, a Delaware limited liability company (together with its successors and
permitted assigns, the “Lender”).

RECITALS

     A. Borrower and Lender are parties to that certain Credit Agreement, dated as of May 16, 2006
(the “Original Credit Agreement”).

     B. Borrower has informed Lender of its desire to increase the Term A Loans outstanding by
$47,000,000 (the “Additional Term A Loan”) in order to fund a special distribution to the
shareholders of Compass AC Holdings, Inc. (“Holdings”), and Lender is willing to so increase the
Term A Loans outstanding subject to the terms and conditions provided herein.

     C. The Borrower and the Lender wish to amend the Original Credit Agreement to effect such
amendments, modifications and changes as are hereinafter set forth, including those that are
necessary to provide for the Additional Term A Loan, subject, however to all the terms and
conditions contained herein (the Original Credit Agreement, as amended by this Amendment, being
herein referred to as the “Credit Agreement”).

     D. Unless the context as used herein requires otherwise, capitalized terms used but not
defined herein shall have the meanings given to them in the Original Credit Agreement.

AGREEMENTS

     In order to effect such amendments and in consideration of the premises, and subject to the
terms and conditions, set forth herein, the Borrower and the Lender hereby agree as follows:

     1. Conditions Precedent to Closing. On or prior to the date hereof, each of the
following conditions precedent shall have been satisfied and thereafter this Amendment shall be
binding upon and inure to the benefit of the Borrower and the Lender and their respective
successors and assigns. Borrower agrees that the failure to satisfy any of the conditions set
forth in this Amendment shall in no way affect or impair the obligations of Borrower or be
construed as a waiver by the Lender of any of the Lender’s rights under the Credit Agreement.

     (a) The Lender shall have received each of the following:

 

 

     i. this Amendment, duly authorized and executed by the Borrower;

     ii. an Amended and Restated Promissory Note, dated the date hereof and
otherwise in the form attached hereto as Exhibit A, duly executed by
Borrower;

     iii. an Acknowledgement and Confirmation of Grantors, dated as of the date
hereof and otherwise in the form attached hereto as Exhibit B, duly executed
by Holdings and Borrower;

     iv. resolutions of the board of directors of Borrower approving and authorizing
the execution, delivery and performance by Borrower of this Amendment and the other
Loan Documents contemplated hereby and the borrowing of the Additional Term A Loan
for the purposes specified herein, and signature and incumbency certificates of the
officers of Borrower executing this Amendment and the other Loan Documents delivered
in connection herewith, all certified by Borrower’s secretary or assistant secretary
as being in full force and effect without modification;

     v. such other agreements, documents, instruments and certificates as the Lender
may reasonably request; and

     vi. in connection with the advance of the Additional Term A Loan, cash in the
amount of $705,000, being the additional commitment fee payable pursuant to Section
2.7.2 of the Credit Agreement.

     (b) Borrower shall have duly and properly performed, complied with and observed each of
its covenants, agreements and obligations contained in this Amendment.

     2. Amendments.

          (a) Section 1.1 of the Original Credit Agreement is hereby amended by adding the
following defined terms:

               Amendment Date means October 10, 2007.

               Special Distributions means cash distributions on or after the Amendment Date from the
Borrower to Holdings in the amount of $47,000,000 and from Holdings to or for the benefit of the
shareholders of Holdings in the aggregate amount of $47,000,000.

          (b) Section 1.1 of the Original Credit Agreement is hereby amended by replacing the
definitions of Guarantee and Collateral Agreement, Term A Loan Commitment, Term
A Loan Maturity Date, Term A Loans, Term B Loan Commitment, Term B Loan
Maturity Date and Termination Date in their entirety with the following defined terms:

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     Guarantee and Collateral Agreement means the Guarantee and Collateral
Agreement, dated as of the Closing Date, by each Loan Party in favor of Lender, as
amended, restated or otherwise modified from time to time.

     Term A Loan Commitment means, as of the Closing Date, $23,000,000 and,
on and after the Amendment Date, $54,562,500 plus such additional amounts, if any,
that Lender may, in its sole discretion, from time to time advance as Term A Loans
in connection with one or more Acquisitions; provided, however, that no such
additional Term A Loan Commitment shall exceed that amount which would result in
Borrower’s: (i) Senior Debt to EBITDA Ratio exceeding 3.0 to 1.0; or (ii) Total Debt
to EBITDA Ratio exceeding 4.0 to 1.0, with both such ratios calculated as of the
last day of the Fiscal Quarter immediately proceeding the Fiscal Quarter in which
such additional amount is to be advanced and on a pro forma basis based on EBITDA
for the Computation Period as if the applicable Acquisition had been consummated on
the calculation date, with such adjustments thereto as may be determined necessary
or appropriate by Lender.

     Term A Loan Maturity Date means October 10, 2013 or such earlier date
on which the Commitments terminate pursuant to Section 8.

     Term A Loans means the principal amount outstanding from time to time
of loans from Lender to Borrower pursuant to the Term A Loan Commitment.

     Term B Loan Commitment means $14,000,000 plus, after the Closing Date,
such additional amounts, if any, that Lender may, in its sole discretion, from time
to time advance as Term B Loans in connection with one or more Acquisitions;
provided, however, that no such additional Term B Loan Commitment shall exceed that
amount which would result in Borrower’s Total Debt to EBITDA Ratio exceeding 4.0 to
1.0, with such ratio to be calculated as of the last day of the Fiscal Quarter
immediately proceeding the Fiscal Quarter in which such additional amount is to be
advanced and on a pro forma basis based on EBITDA for the Computation Period as if
the applicable Acquisition had been consummated on the calculation date, with such
adjustments thereto as may be determined necessary or appropriate by Lender.

     Term B Loan Maturity Date means October 10, 2014 or such earlier date
on which the Commitments terminate pursuant to Section 8.

     Termination Date means October 10, 2013 or such earlier date on which
the Revolving Loan Commitment terminates pursuant to Section 2.9 or
Section 8.

          (c) Section 2.1.2 of the Original Credit Agreement is hereby amended and restated so
as to read in its entirety as follows:

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               2.1.2 Term Loan Commitments.

          Lender agrees to make (a) a Term A Loan to Borrower on the Closing Date in an
amount equal to $23,000,000 and, on the Amendment Date, in an amount equal to
$47,000,000, and (b) a Term B Loan to Borrower on the Closing Date in an amount
equal to $14,000,000. Except as expressly provided in this Section 2.1.2,
the Lender shall have no obligation to make Term Loans after the Closing Date. Term
Loans which are repaid or prepaid by Borrower, in whole or in part, may not be
re-borrowed.

          (d) Section 2.10.2 of the Original Credit Agreement is hereby amended and restated so
as to read in its entirety as follows:

               2.10.2 Term A Loans.

          The Term A Loans shall be subject to annual amortization in the principal
amount of $2,728,125, with each such annualized amount being due and payable in
equal quarterly installments of $682,031.25 on the last day of each Fiscal Quarter,
commencing December 31, 2007 and continuing to the Term Loan A Maturity Date, on
which date the then outstanding Term A Loans shall be paid in full.

          (e) The first sentence of Section 7.4 of the Original Credit Agreement is hereby
amended and restated so as to read in its entirety as follows:

               7.4 Restricted Payments.

          Not, and not permit any other Loan Party to, (a) make any dividend or other
distribution to any of its equity holders other than, on or after the Amendment
Date, the Special Distributions, (b) purchase or redeem any of its equity interests
or any warrants, options or other rights in respect thereof, (c) except for
Permitted Management Fees and Permitted Transaction Services Fees, pay any
management fees or similar fees to any of its equity holders or any Affiliate
thereof, (d) make any redemption, prepayment (whether mandatory or optional),
defeasance, repurchase or any other payment in respect of any Non-Senior Debt or (e)
set aside funds for any of the foregoing.

          (f) Section 7.7 of the Original Credit Agreement is hereby amended and restated so as
to read in its entirety as follows:

               7.7 Use of Proceeds.

          Use the proceeds of the Loans solely to prepay or repay the Debt to be Repaid,
for working capital, for Capital Expenditures, to fund the Special Distributions and
for other general business purposes of Borrower and the Subsidiaries; and not use or
permit any proceeds of any Loan to be used, either directly or indirectly, for the
purpose, whether immediate, incidental or ultimate, of “purchasing or carrying” any
Margin Stock.

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          (g) Section 7.14.2 of the Original Credit Agreement is hereby amended and restated so
as to read in its entirety as follows:

               7.14.2 Senior Debt to EBITDA Ratio.

          Not permit the Senior Debt to EBITDA Ratio as of the last day of any
Computation Period to exceed 3.0:1.0; provided, however, that the applicable maximum
for the Computation Periods ending December 31, 2007, March 31, 2008, June 30, 2008
and September 30, 2008 shall be 3.5:1:0 rather than 3.0:1.0.

          (h) ANNEX I of the Original Credit Agreement is hereby amended and restated so as to
read in its entirety as follows:

ANNEX I

Commitments and Pro Rata Shares

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	Revolving	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Commitment	 	 	Pro Rata	 	 	Term A Loan	 	 	Pro Rata	 	 	Term B Loan	 	 	Pro Rata	 
	 	Lender	 	 	Amount	 	 	Share	 	 	Amounts	 	 	Share	 	 	Amounts	 	 	Share	 
	 	Compass Group

Diversified

Holdings LLC

	 	 	$	14,000,000	 	 	 	 	100	%	 	 	$	54,562,500	 	 	 	 	100	%	 	 	$	14,000,000	 	 	 	 	100	%	 
	 	TOTALS
	 	 	$	14,000,000	 	 	 	 	100	%	 	 	$	54,562,500	 	 	 	 	100	%	 	 	$	14,000,000	 	 	 	 	100	%	 
	 

     3. Representations and Warranties. Borrower hereby represents and warrants to
the Lender that:

          (a) the execution, delivery and performance by Borrower of this Amendment are within the
corporate powers of Borrower, have been duly authorized by all necessary company action and require
no action by or in respect of, or filing with, any governmental or regulatory body, agency or
official;

          (b) this Amendment has been duly executed and delivered and constitutes the legal, valid and
binding obligation of Borrower enforceable in accordance with its terms, subject to the effects of
(i) bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditor’s
rights generally and (ii) general equitable principles (regardless of whether enforcement is sought
in equity or at law); and

          (c) as of the date hereof, and after giving effect to this Amendment, all of the covenants,
representations and warranties of Borrower set forth in the Credit Agreement are true and correct
in all material respects, and no Event of Default under or within the meaning of the Credit
Agreement has occurred and is continuing.

     4. Costs and Expenses. Borrower agrees to pay all reasonable costs, internal charges
and out-of-pocket expenses (including reasonable attorneys’ fees and costs) incurred by the Lender
in connection with the preparation, execution and enforcement of this Amendment.

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     5. Governing Law. Each of the undersigned agrees that this Amendment and the rights
and obligations of all parties hereunder shall be governed by and construed under the substantive
laws of the State of New York, without reference to the conflict of laws principles of such state.

     6. Headings. Section headings in this Amendment are included herein for convenience
of reference only and shall not constitute a part of this Amendment for any other purpose.

     7. Counterparts. This Amendment may be executed by one or more of the parties hereto
on any number of separate counterparts and all of said counterparts taken together shall be deemed
to constitute one and the same instrument.

     8. Entire Agreement, Modification, Benefit. The Credit Agreement shall constitute the
entire agreement of the Lender and the Borrower and no provision thereof (including of this
Amendment) may be modified, deleted or amended in any manner except by agreement in writing
executed by each of Lender and Borrower. Except to the extent modified by this Amendment, all of
the covenants, representations, warranties, conditions, agreements and other terms contained in the
Original Credit Agreement and the other Loan Documents shall be and remain in full force and effect
and the same are hereby ratified and confirmed as of the date hereof. All such terms of the
Original Credit Agreement, as amended by this Amendment, are and shall remain binding upon, inure
to the benefit of and be enforceable by the Lender and the Borrower and their respective successors
and assigns. In the event of any inconsistency or conflict between this Amendment and the Original
Credit Agreement, the covenants, representations, warranties, conditions, agreements and other
terms of this Amendment shall govern and control.

{Remainder of this page intentionally left blank}

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     The parties hereto have caused this Amendment to be duly executed and delivered by their duly
authorized officers as of the date first set forth above.

	 	 	 	 	 
	 	 	ADVANCED CIRCUITS, INC.,

as Borrower
	 
	 	 	 	 
	 

	 	By:
	 	/s/ John Yacoub
	 

	 	 	 	 
	 

	 	Name:
	 	John Yacoub
	 

	 	 	 	 
	 

	 	Title:
	 	President
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	COMPASS GROUP DIVERSIFIED HOLDINGS LLC,

as Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ James J. Bottiglieri
	 

	 	 	 	 
	 

	 	Name:
	 	James J. Bottiglieri
	 

	 	 	 	 
	 

	 	Title:
	 	Chief Financial Officer
	 

	 	 	 	 

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Exhibit A

Form of 

Amended and Restated Promissory Note

			
	$82,562,500
	 	October 10, 2007
	 
	 	Westport, Connecticut

     The undersigned (“Borrower”), for value received, promises to pay to the order of
Compass Group Diversified Holdings LLC (“Lender”) at its principal office of 61 Wilton
Road, Westport, Connecticut 06880, the aggregate unpaid amount of all Loans made to Borrower by
Lender pursuant to the Credit Agreement referred to below, such principal amount to be payable on
the dates set forth in the Credit Agreement.

     Borrower further promises to pay interest on the unpaid principal amount of each Loan from the
date of such Loan until such Loan is paid in full, payable at the rate(s) and at the time(s) set
forth in the Credit Agreement. Payments of both principal and interest are to be made in lawful
money of the United States of America.

     This Note evidences indebtedness incurred under, and is subject to the terms and provisions
of, that certain Credit Agreement, dated as of May 16, 2006 and amended as of the date hereof (as
amended and as may be further amended or otherwise modified from time to time, the “Credit
Agreement”; terms not otherwise defined herein are used herein as defined in the Credit
Agreement), between Borrower and Compass Group Diversified Holdings LLC, as lender, to which Credit
Agreement reference is hereby made for a statement of the terms and provisions under which this
Note may or must be paid prior to its due date or its due date accelerated.

     This Note evidences, in part, indebtedness of the undersigned previously evidenced by (i) that
certain Promissory Note dated May 16, 2006 in the original principal amount of $51,000,000 (the
“Prior Note”), which Prior Note is replaced by this Note; provided, however, that this Note shall
not be construed as evidence of repayment or readvance of the indebtedness evidenced by the Prior
Note, it being the intention of the undersigned, and, by its acceptance, Lender, that the
indebtedness evidenced by this Note includes the indebtedness evidenced by the Prior Note. This
Note shall not be construed as a novation or be construed in any manner as an extinguishment of the
obligations arising under the Prior Note or to affect the priority of the security interests, liens
or mortgages granted in connection with the Prior Note.

{Remainder of page blank; execution page follows}

Exhibit A-1

 

 

     This Note is made under and governed by the laws of the State of New York applicable to
contracts made and to be performed entirely within such State.

	 	 	 	 	 
	 	 	ADVANCED CIRCUITS, INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ John Yacoub
	 

	 	 	 	 
	 

	 	Title:
	 	President
	 

	 	 	 	 

Exhibit A-2

 

 

Exhibit B

Form of 

Acknowledgment and Confirmation of Grantors

     Each of the undersigned hereby acknowledges and confirms the terms of that certain Amendment
to Credit Agreement, dated as of the date hereof (the “Amendment”), between Advanced Circuits, Inc.
(“Borrower”) and Compass Group Diversified Holdings LLC (“Lender”). Each of the undersigned
further acknowledges and agrees that (i) the execution of the Amendment by Borrower, the advance of
additional Term A Loans pursuant thereto, and delivery of the Amendment to the Lender will not
adversely affect or impair any of its obligations to the Lender under that certain Guarantee and
Collateral Agreement dated as of May 16, 2006 among the Grantors party thereto and Lender (the
“Guaranty”), and (ii) the Guaranty is in full force and effect as of the date hereof and the same
is hereby ratified and confirmed.

Dated:
October 10, 2007

	 	 	 	 	 
	 	 	COMPASS AC HOLDINGS, INC.,

as a Grantor
	 
	 	 	 	 
	 

	 	By:	 	/s/ James J. Bottiglieri
	 

	 	 	 	 
	 

	 	Title:	 	Chief Financial Officer
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	ADVANCED CIRCUITS, INC.,

as a Grantor
	 
	 	 	 	 
	 

	 	By:	 	/s/ John Yacoub
	 

	 	 	 	 
	 

	 	Title:	 	President
	 

	 	 	 	 

Exhibit B-1exv4w1

 

Exhibit 4.1

LEVIS STRAUSS & CO.

121/4% Senior Notes due 2012

 

FIRST SUPPLEMENTAL INDENTURE

dated as of October 11, 2007

to

INDENTURE

Dated as of December 4, 2002

 

WILMINGTON TRUST COMPANY

Trustee

 

 

     FIRST
SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”),
dated as of October 11, 2007,
between LEVI STRAUSS & CO., a Delaware corporation (the “Company”), and WILMINGTON TRUST COMPANY,
as trustee (the “Trustee”).

     WHEREAS, the Company and the Trustee are parties to an Indenture, dated as of December 4, 2002
(the “Indenture”), pursuant to which the Company issued $575,000,000 aggregate principal amount of
121/4% Senior Notes due 2012 (the “Securities”);

     WHEREAS, pursuant to Section 9.02 of the Indenture, the Company and the Trustee may amend
certain terms of the Indenture with the written consent of the Holders (as defined in the
Indenture) of at least a majority in aggregate principal amount of the Securities then outstanding;

     WHEREAS, the Company has offered to purchase for cash all of the Securities (the “Offer”) and
has solicited consents (the “Solicitation”) to certain amendments to the Indenture (the “Proposed
Amendments”) pursuant to the Company’s Offer to Purchase and Consent Solicitation Statement dated
September 19, 2007;

     WHEREAS, the Company has obtained the written consent to the Proposed Amendments to the
Indenture from the Holders of at least a majority in aggregate principal amount of the Securities;

     WHEREAS, the execution and delivery of this Supplemental Indenture have been duly authorized
by the parties hereto, and all conditions and requirements necessary to make this instrument a
valid and binding agreement have been duly performed and complied with; and

     WHEREAS, the Trustee is indemnified pursuant to Section 7.07 of the Indenture in connection
with the Trustee’s execution of this Supplemental Indenture.

     NOW, THEREFORE, for and in consideration of the foregoing premises, it is mutually covenanted
and agreed, for the equal and proportionate benefit of all Holders of the Securities, as follows:

ARTICLE I

AMENDMENTS TO INDENTURE

     SECTION 1.01. At such time as the Company delivers written notice to the Trustee that
Securities representing at least a majority in aggregate principal amount of the Securities validly
tendered and not validly withdrawn pursuant to the Offer have been accepted for purchase:

     (a)     Section 3.03 of the Indenture shall be amended and restated in its entirety to read as
follows:

	 	          “SECTION 3.03.   Notice of Redemption.   At least 8 days but not more than 60 days
before a date for redemption of Securities, the Company shall mail a notice of redemption by
first-class mail to each Holder of Securities to be redeemed. The notice shall identify the
Securities to be redeemed and shall state:

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        (1) the redemption date;

        (2) the redemption price;

        (3) the name and address of the Paying Agent;

        (4) that Securities called for redemption must be surrendered to the Paying Agent to
collect the redemption price;

        (5) if fewer than all the outstanding Securities are to be redeemed, the identification
and principal amounts of the particular Securities to be redeemed;

        (6) that, unless the Company defaults in making such redemption payment, interest on
Securities (or portion thereof) called for redemption ceases to accrue on and after the
redemption date; and

        (7) that no representation is made as to the correctness or accuracy of the CUSIP, ISIN
or Common Code number, if any, listed in such notice or printed on the Securities.

                At the Company’s request, the Trustee shall give the notice of redemption in the
Company’s name and at the Company’s expense. In such event, the Company shall provide the
Trustee with the information required by this Section at least 15 days before the redemption
date.”

     (b)      Section 4.01 of the Indenture shall be amended and restated in its entirety to read as
follows:

	 	 	 	          “SECTION 4.01.     Covenant Suspension. After such time as:

	 	 	 	                    (a)     the Securities have Investment Grade Ratings from both Rating Agencies and
	 
	 	 	 	                    (b)     no Default or Event of Default has occurred and is continuing under this
Indenture,
	 
	 	 	 	                         the Company and the Restricted Subsidiaries will not be subject to the
following Sections of this Indenture: Section 4.04, Section 4.05, Section 4.07,
Section 4.08, clause (x) of the third paragraph (and as referred to in the first
paragraph) of Section 4.10, and clause (e) of Section 5.01 (collectively, the
“Suspended Covenants”).”

     (c)     Sections 4.03 through 4.06 shall be amended and restated in their entirety to read as
follows:

	 	 	 	                                “SECTION 4.03      [Intentionally Omitted]
	 
	 	 	 	                                  SECTION 4.04      [Intentionally Omitted]

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	 	 	 	               SECTION 4.05      [Intentionally Omitted]
	 
	 	 	 	               SECTION 4.06      [Intentionally Omitted]”

     (d)      Section 4.07 of the Indenture shall be amended and restated in its entirety to read as
follows:

	 	 	 	“SECTION 4.07.      Limitation on Asset Sales.

	 	 	 	     (a)     [Intentionally omitted]
	 
	 	 	 	     (b)     The Net Available Cash (or any portion thereof) from Asset Sales may be applied by
the Company or a Restricted Subsidiary, to the extent the Company or such Restricted
Subsidiary elects (or is required by the terms of any Debt):

	 	 	 	   (i)     to Repay Debt Incurred pursuant to clause (b) of the definition of
Permitted Debt (excluding, in any such case, any Debt owed to the Company or an
Affiliate of the Company); or
	 
	 	 	 	   (ii)     to reinvest in Additional Assets (including by means of an Investment in
Additional Assets by a Restricted Subsidiary with Net Available Cash received by the
Company or another Restricted Subsidiary), provided, however, that the Net Available
Cash (or any portion thereof) from Asset Sales from the Company to any Subsidiary
must be reinvested in Additional Assets of the Company.

	 	 	 	   (c)     Any Net Available Cash from an Asset Sale not applied in accordance with the
preceding paragraph within 360 days from the date of the receipt of such Net Available Cash
shall constitute “Excess Proceeds”.

     When the aggregate amount of Excess Proceeds not previously subject to a Prepayment Offer (as
defined below) exceeds $10.0 million (taking into account income earned on those Excess Proceeds,
if any), the Company will be required to make an offer to purchase the Securities (the “Prepayment
Offer”) which offer shall be in the amount of the Allocable Excess Proceeds, on a pro rata basis
according to principal amount, at a purchase price equal to 100% of the principal amount thereof,
plus accrued and unpaid interest, if any, to the purchase date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant interest payment date),
in accordance with the procedures (including prorating in the event of oversubscription) set forth
in this Indenture. To the extent that any portion of the amount of Net Available Cash remains after
compliance with the preceding sentence and provided that all Holders of Securities have been given
the opportunity to tender their Securities for purchase in accordance with this Indenture, the
Company or such Restricted Subsidiary may use the remaining amount for any purpose permitted by
this Indenture and the amount of Excess Proceeds will be reset to zero.

     The term “Allocable Excess Proceeds” will mean the product of:

	 	 	 	     (a)     the Excess Proceeds and

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	 	 	 	     (b)     a fraction,

	 	 	 	(1)     the numerator of which is the aggregate principal amount of the
Securities outstanding on the date of the Prepayment Offer, and

	 	 	 	(2)     the denominator of which is the sum of the aggregate principal
amount of the Securities outstanding on the date of the Prepayment
Offer and the aggregate principal amount of other Debt of the Company
outstanding on the date of the Prepayment Offer that is pari passu in
right of payment with the Securities and subject to terms and
conditions in respect of Asset Sales similar in all material respects
to the covenant described hereunder and requiring the Company to make
an offer to purchase such Debt at substantially the same time as the
Prepayment Offer.

          (d)(1) Within five Business Days after the Company is obligated to make a Prepayment
Offer as described in the preceding paragraph, the Company shall send a written notice, by
first-class mail, to the Holders of Securities, accompanied by information regarding the
Company and its Subsidiaries as the Company in good faith believes will enable the Holders
to make an informed decision with respect to that Prepayment Offer. The notice shall state,
among other things, the purchase price and the purchase date, which shall be, subject to any
contrary requirements of applicable law, a Business Day no earlier than 30 days nor later
than 60 days from the date the notice is mailed.

     (2)     Not later than the date upon which written notice of a Prepayment Offer is
delivered to the Trustee as provided above, the Company shall deliver to the Trustee
an Officers’ Certificate as to (i) the amount of the Prepayment Offer (the “Offer
Amount”), (ii) the allocation of the Net Available Cash from the Asset Sales
pursuant to which such Prepayment Offer is being made and (iii) the compliance of
such allocation with the provisions of Section 4.07(b). On or before the Purchase
Date, the Company shall also irrevocably deposit with the Trustee or with the Paying
Agent (or, if the Company or a Wholly Owned Subsidiary is the Paying Agent, shall
segregate and hold in trust) in Temporary Cash Investments (other than in those
enumerated in clause (b) of the definition of Temporary Cash Investments), maturing
on the last day prior to the Purchase Date or on the Purchase Date if funds are
immediately available by open of business, an amount equal to the Offer Amount to be
held for payment in accordance with the provisions of this Section. Upon the
expiration of the period for which the Prepayment Offer remains open (the “Offer
Period”), the Company shall deliver to the Trustee for cancellation the Securities
or portions thereof that have been properly tendered to and are to be accepted by
the Company. The Trustee or the Paying Agent shall, on the Purchase Date, mail or
deliver payment to each tendering Holder in the amount of the purchase price. In the
event that the aggregate purchase price of the Securities delivered by the Company
to the Trustee is less than the Offer Amount, the Trustee or the Paying Agent shall
deliver the excess to the Company immediately after the expiration of the Offer
Period for application in accordance with this Section.

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      (3)     Holders electing to have a Security purchased shall be required to
surrender the Security, with an appropriate form duly completed, to the Company or
its agent at the address specified in the notice at least three Business Days prior
to the Purchase Date. Holders shall be entitled to withdraw their election if the
Trustee or the Company receives not later than one Business Day prior to the
Purchase Date, a telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Security that was delivered for
purchase by the Holder and a statement that such Holder is withdrawing its election
to have such Security purchased. If at the expiration of the Offer Period the
aggregate principal amount of Securities surrendered by Holders exceeds the Offer
Amount, the Company shall select the Securities to be purchased on pro rata basis
for all Securities, (with such adjustments as may be deemed appropriate by the
Company so that only Securities in denominations of $1,000, or integral multiples
thereof, shall be purchased). Holders whose Securities are purchased only in part
shall be issued new Securities equal in principal amount to the unpurchased portion
of the Securities surrendered.

      (4)     At the time the Company delivers Securities to the Trustee that are to be
accepted for purchase, the Company shall also deliver an Officers’ Certificate
stating that such Securities are to be accepted by the Company pursuant to and in
accordance with the terms of this Section. A Security shall be deemed to have been
accepted for purchase at the time the Trustee or the Paying Agent mails or delivers
payment therefor to the surrendering Holder.

     (e)     The Company will comply, to the extent applicable, with the requirements of Section
14(e) of the Exchange Act and any other securities laws or regulations in connection with
the repurchase of Securities pursuant to the covenant described hereunder. To the extent
that the provisions of any securities laws or regulations conflict with provisions of this
Section, the Company will comply with the applicable securities laws and regulations and
will not be deemed to have breached its obligations under this Section by virtue thereof.”

     (e)      Sections 4.08 through 4.11 shall be amended and restated in their entirety to read as
follows:

	 	 	 	               “SECTION 4.08     [Intentionally Omitted]
	 
	 	 	 	               SECTION 4.09      [Intentionally Omitted]
	 
	 	 	 	               SECTION 4.10      [Intentionally Omitted]
	 
	 	 	 	               SECTION 4.11      [Intentionally Omitted]”

     (f)     Section 5.01 of the Indenture shall be amended and restated in its entirety to read as
follows:

6

 

               “SECTION 5.01.      When Company May Merge or Transfer Assets. The Company shall
not merge, consolidate or amalgamate with or into any other Person (other than a merger of a
Wholly Owned Restricted Subsidiary into the Company) or sell, transfer, assign, lease,
convey or otherwise dispose of all or substantially all its Property in any one transaction
or series of transactions unless:

          (a)     the Company shall be the surviving Person (the “Surviving Person”) or the Surviving
Person (if other than the Company) formed by that merger, consolidation or amalgamation or
to which that sale, transfer, assignment, lease, conveyance or disposition is made shall be
a corporation organized and existing under the laws of the United States of America, any
State thereof or the District of Columbia;

          (b)      the Surviving Person (if other than the Company) expressly assumes, by supplemental
indenture in form satisfactory to the Trustee, executed and delivered to the Trustee by that
Surviving Person, the due and punctual payment of the principal of, and premium, if any, and
interest on, all the Securities, according to their tenor, and the due and punctual
performance and observance of all the covenants and conditions of this Indenture to be
performed by the Company;

          (c)      in the case of a sale, transfer, assignment, lease, conveyance or other disposition
of all or substantially all the Property of the Company, that Property shall have been
transferred as an entirety or virtually as an entirety to one Person;

          (d)      immediately before and after giving effect to that transaction or series of
transactions on a pro forma basis (and treating, for purposes of this clause (d) and clause
(e) below, any Debt that becomes, or is anticipated to become, an obligation of the
Surviving Person or any Restricted Subsidiary as a result of that transaction or series of
transactions as having been Incurred by the Surviving Person or the Restricted Subsidiary at
the time of that transaction or series of transactions), no Default or Event of Default
shall have occurred and be continuing;

          (e)      [intentionally omitted]

          (f)      the Company shall deliver, or cause to be delivered, to the Trustee, in form and
substance reasonably satisfactory to the Trustee, an Officers’ Certificate and an Opinion of
Counsel, each stating that the transaction and the supplemental indenture, if any, in
respect thereto comply with this Section and that all conditions precedent herein provided
for relating to the transaction have been satisfied; and

          (g)      the Company shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders will not recognize income, gain or loss for Federal income tax purposes as
a result of the transaction and will be subject to Federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if that transaction had
not occurred.

     The Surviving Person shall succeed to, and be substituted for, and may exercise every right
and power of the Company under this Indenture, but the predecessor Company in the case of:

7

 

          (a)      a sale, transfer, assignment, conveyance or other disposition (unless that sale,
transfer, assignment, conveyance or other disposition is of all the assets of the Company as
an entirety or virtually as an entirety), or

          (b)      a lease, shall not be released from any obligation to pay the principal of,
premium, if any, and interest on, the Securities.”

          (g)      Section 6.01 of the Indenture shall be amended and restated in its entirety to read as
follows:

	 	 	 	     “SECTION 6.01.      Events of Default. The following events shall be “Events of
Default”:

	 	 	 	   (1)   the Company defaults in any payment of interest on any Security when the
same becomes due and payable, and such default continues for a period of 30 days;
	 
	 	 	 	   (2)   the Company defaults in the payment of the principal of any Security when
the same becomes due and payable at its Stated Maturity, upon acceleration,
redemption, optional redemption, required repurchase or otherwise;
	 
	 	 	 	   (3)   the Company fails to comply with Article 5;
	 
	 	 	 	   (4)   the Company fails to comply with any covenant or agreement in the
Securities or in this Indenture (other than a failure that is the subject of the
foregoing clause (1), (2) or (3)) and such failure continues for 30 days after
written notice is given to the Company as specified below;
	 
	 	 	 	   (5)   [Intentionally omitted]
	 
	 	 	 	   (6)   the Company or any Significant Subsidiary pursuant to or within the meaning
of any Bankruptcy Law:

	 	 	 	   (A)   commences a voluntary case;
	 
	 	 	 	   (B)   consents to the entry of an order for relief against it in
an involuntary case;
	 
	 	 	 	   (C)   consents to the appointment of a Custodian of it or for any
substantial part of its property; or
	 
	 	 	 	   (D)   makes a general assignment for the benefit of its creditors;
or takes any comparable action under any foreign laws relating to
insolvency;

	 	 	 	   (7)   a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:

8

 

	 	 	 	   (A)   is for relief against the Company or any Significant
Subsidiary in an involuntary case;
	 
	 	 	 	   (B)   appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its property; or
	 
	 	 	 	   (C)   orders the winding up or liquidation of the Company or any
Significant Subsidiary; or
	 
	 	 	 	   (D)   grants any similar relief under any foreign laws; and in
each such case the order or decree remains unstayed and in effect for
30 days

	 	 	 	(8)   [Intentionally omitted].

               The foregoing will constitute Events of Default whatever the reason for any such Event
of Default and whether it is voluntary or involuntary or is effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or regulation of
any administrative or governmental body.

               The term “Bankruptcy Law” means Title 11, United States Code, or any similar Federal or
state law for the relief of debtors. The term “Custodian” means any receiver, trustee,
assignee, liquidator, custodian or similar official under any Bankruptcy Law.

               A Default under clause (4) is not an Event of Default until the Trustee or the Holders
of at least 25% in aggregate principal amount of the Securities then outstanding notify the
Company (and in the case of such notice by Holders, the Trustee) of the Default and the
Company does not cure that Default within the time specified after receipt of such notice.
The notice must specify the Default, demand that it be remedied and state that such notice
is a “Notice of Default”.

               The Company shall deliver to the Trustee, within 30 days after the occurrence thereof,
written notice in the form of an Officers’ Certificate of any Event of Default and any
event that with the giving of notice or the lapse of time would become an Event of Default,
its status and what action the Company is taking or proposes to take with respect thereto.”

          (h)     All references in the Indenture or the Securities to a provision deleted pursuant to the
amendments set forth in Subsections (a) through (g) of this Section 1.01 shall be deleted in their
entirety from the Indenture and the Securities, and any definitions used exclusively in the
provisions of the Indenture deleted pursuant to the amendments set forth in Subsections (a) through
(g) of this Section 1.01 shall be deleted in their entirety from the Indenture. The requirement of
any provision of the Indenture that any action on behalf of the Company or the Trustee be taken in
accordance with or pursuant to any of the provisions of the Indenture that are deleted pursuant to
Subsections (a) through (g) of this Section 1.01 shall be disregarded and the Company or the
Trustee shall be deemed to have taken such action in accordance with and pursuant to such deleted
provision. None of the Company, the Trustee or other parties to or beneficiaries of the Indenture shall have any rights, obligations or
liabilities under any of the provisions of the Indenture that are deleted pursuant to Subsections
(a) through (g) of this Section 1.01, and such deleted provisions shall not be considered in
determining whether an Event of Default has occurred or whether the Company has observed, performed
or complied with the provisions of the Indenture.

9

 

ARTICLE II

GENERAL PROVISIONS

     SECTION 2.01.   The Indenture Ratified.   Except as hereby otherwise expressly provided,
the Indenture is in all respects ratified and confirmed, and all the terms, provisions, and
conditions thereof shall be and remain in full force and effect.

     SECTION 2.02.   Counterparts.   This Supplemental Indenture may be executed in any
number of counterparts, each of which shall be an original, but such counterparts shall together
constitute but one and the same instrument.

     SECTION 2.03.   This Supplemental Indenture is a Supplement to The Indenture.   This
Supplemental Indenture is executed as and shall constitute an indenture supplemental to the
Indenture and shall be construed in connection with and as part of the Indenture.

     SECTION 2.04.   Governing Law.   THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAW OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS SUPPLEMENTAL INDENTURE.

     SECTION 2.05.   References to This Supplemental Indenture.   Any and all notices,
requests, certificates and other instruments executed and delivered after the execution and
delivery of this Supplemental Indenture may refer to the Indenture without making specific
reference to this Supplemental Indenture, but nevertheless all such references shall include this
Supplemental Indenture unless the context otherwise requires.

     SECTION 2.06.   Effect of This Supplemental Indenture.   The Indenture shall be deemed
to be modified as herein provided, but except as modified hereby, the Indenture shall continue in
full force and effect. The Indenture as modified hereby shall be read, taken, and construed as one
and the same instrument.

     SECTION 2.07.   Severability.   In the event that any provisions of this Supplemental
Indenture shall be invalid, illegal, or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

     SECTION 2.08.   Trust Indenture Act.   If any provisions hereof limit, qualify, or
conflict with any provisions of the TIA required under the TIA to be a part of and govern this Supplemental Indenture, the provisions of the TIA shall control. If any provision hereof
modifies or excludes any provision of the TIA that pursuant to the TIA may be so modified or
excluded, the provisions of the TIA as so modified or excluded hereby shall apply.

10

 

     SECTION 2.09.   Trustee Not Responsible for Recitals.   The recitals contained herein
shall be taken as the statements of the Company, and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations as to the validity or sufficiency of this
Supplemental Indenture.

     In entering into this Supplemental Indenture, the Trustee shall be entitled to the benefit of
every provision of the Indenture relating to the conduct or affecting the liability or affording
protection to the Trustee, whether or not elsewhere herein so provided.

     SECTION 2.10.   Effectiveness.   This Supplemental Indenture shall become effective upon
execution by the Company and the Trustee.

[signature page follows]

11

 

     IN WITNESS WHEREOF, each of the parties hereto have caused this Supplemental Indenture to be
duly executed on its behalf by its duly authorized officer as of the day and year first above
written.

	 	 	 	 	 
	 	The Company: 

LEVI STRAUSS & CO. 

 	 
	 	By:  	/s/
Hans Ploos van Amstel	 
	 	 	Name:  	Hans Ploos van Amstel	 
	 	 	Title:  	Senior Vice President and Chief Financial
Officer	 
	 

	 	 	 	 	 
	 	Trustee: 

WILMINGTON TRUST COMPANY 

 	 
	 	By:  	/s/
Michael G. Oller, Jr.	 
	 	 	Name:  	Michael G. Oller, Jr.	 
	 	 	Title:  	Senior Financial Services Officer	 
	 

12

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