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Levi Strauss amends credit facility ahead of restructuring
New York, Jan. 30 - Levi Strauss & Co. said it amended its credit agreement to account for expected restructuring costs and modify some covenants.
The San Francisco-based clothing company said in a filing with the Securities and Exchange Commission the amendment changes the calculation of earnings for covenant compliance purposes to exclude cash expenses and non-cash costs for potential plant closures in the U.S. and Scotland. Levi Strauss noted it has not made final decisions about plant closures.
The amendment also reduces by 0.25 the required tightening in the leverage ratio beginning in the fourth quarter of 2002.
Finally, the amendment, which was effective Monday, tightens the senior secured leverage ratio.
Levi Strauss said the size of the credit facility, the interest rate and the required payments were left unchanged by the amendment. However it did have to pay a 25 basis points amendment fee.
The company's facility is with Bank of America, NA as administrative agent and collateral agent, Bank of America Securities LLC and Salomon Smith Barney Inc. as co-lead arrangers and joint book managers, Citicorp USA, Inc. as syndication agent, and The Bank of Nova Scotia as documentation agent.
The new leverage ratio required by the credit facility is as follows:
Period Ratio Previous ratio
Nov. 25, 2001 - May 25, 2002 4.00:1.00 4.00:1.00
May 26, 2002 - Nov. 23, 2002 3.75:1.00 3.75:1.00
Nov. 24, 2002 - May 24, 2003 3.50:1.00 3.25:1.00
May 25, 2003 - Aug. 23, 2003 3.25:1.00 3.00:1.00
Aug. 24, 2003 - Aug. 29, 2003 3.00:1.00 3.00:1.00
The new senior secured leverage ratio required by the credit facility is as follows:
Period Ratio Previous ratio
Nov. 25, 2001 - May 25, 2002 1.50:1.00 2.25:1.00
May 26, 2002 - Nov. 23, 2002 1.50:1.00 2.00:1.00
Nov. 24, 2002 - May 24, 2003 1.25:1.00 1.75:1.00
May 25, 2003 - Aug. 29, 2003 1.00:1.00 1.50:1.00
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