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Luxottica Group, S.p.A. (LUX)

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LUX » Topics » RECENT DEVELOPMENTS AND OTHER EVENTS

This excerpt taken from the LUX 6-K filed Jun 26, 2009.

RECENT DEVELOPMENTS AND OTHER EVENTS

In June 2009, we renegotiated our 18 month Euro 150.0 million unsecured credit facility with Banca Nazionale del Lavoro dated April 9, 2008. The new facility is a 2 year unsecured credit facility that is a revolving loan that provides borrowing availability of up to Euro 150.0 million. Amounts borrowed under the revolving loan can be borrowed and repaid until final maturity. We can select interest periods of one, three or six months.

On May 27, 2009, we entered into an agreement with Multiopticas Internacional S.L., a company that currently owns over 390 eyewear stores operating under the GMO, Econoptics and SunPlanet retail brands in Chile, Peru, Ecuador and Colombia, pursuant to which Luxottica will acquire a 40 percent participation in Multiopticas Internacional. Under the terms of the agreement, which is expected to close around the end of June, we will have a call option for the remaining 60 percent of Multiopticas Internacional. The call option will be exercisable by us between 2012 and 2014 at a price to be determined on the basis of Multiopticas' consolidated sales and EBITDA values at the time of the exercise.

Pursuant to the PSP plan adopted in 2008, on May 7, 2009, the Board of Directors granted certain of our key employees 1,435,600 rights to receive ordinary shares ("PSP 2009").

On the same day the Board of Directors authorized the reassignment of new options to employees who are currently beneficiaries of the stock option grants approved in 2006 and 2007 whose exercise price, considering present market conditions and the financial crisis, was significantly higher than the present market price at such time, undermining the performance incentives that typically form the foundation of these plans. The Board of Directors therefore approved the grant of new options to the beneficiaries of the abovementioned stock option grants, which will be exercisable—conditional upon the surrender of the options granted in 2006 and/or 2007—upon vesting at an exercise price determined pursuant to the provisions of the 2001 and 2006 Stock Option Plans and, therefore, consistent with the market values of Luxottica shares on the date of grant of the new options.

In connection with the reassignment of options to employees not domiciled in the United States:

(1) 85 employee-beneficiaries of the 2006 and 2007 stock option grants surrendered the options previously granted to them under the abovementioned grants in order to be assigned new options granted by the Board of Directors on May 7, 2009. Each such beneficiary was assigned options granting the right to purchase the same number of Luxottica Group ordinary shares that were subject to the options he or she previously held pursuant to the abovementioned grants, for a total amount of 2,060,000 options. The new options were granted under the 2006 stock option plan at an exercise price of Euro 13.45 per share.

(2) 10 employee-beneficiaries of the 2006 3-year extraordinary stock option grant surrendered the options previously granted to them under the abovementioned grant in order to be assigned new options granted by the Board of Directors on May 7, 2009. Each such beneficiary was assigned options granting the right to purchase the same number of Luxottica Group ordinary shares that were subject to the options he or she previously held pursuant to the abovementioned grant, reduced by 50%, for a total amount of 4,250,000 options. The new performance options were granted under the 2006 stock option plan at an exercise price of Euro 13.45 per share.

The reassignment of options for employees domiciled in the U.S. was structured as a tender offer. The offer expired on June 12, 2009.

Pursuant to the terms of the reassignment program, Luxottica accepted for cancellation options to purchase 3,725,000 ordinary shares, representing approximately 99.6% of the shares underlying all eligible options held by U.S. employees. Of this amount, 825,000 shares were subject to options issued under the 2006 and 2007 stock option grants, while 2,900,000 shares were subject to options issued under the 2006 3-year extraordinary performance stock option grant. Pursuant to the terms and conditions of the reassignment program, on June 12, 2009, Luxottica issued new options to purchase an aggregate of 2,275,000 ordinary shares to U.S. employees who properly tendered eligible options, consisting of options issued under the Luxottica 2001 Stock Option Plan to purchase an aggregate of 825,000 ordinary shares and new performance options issued under the Luxottica 2006 Stock Option Plan to purchase an aggregate of 1,450,000 ordinary shares.

The new options issued under the Luxottica 2001 Stock Option Plan have an exercise price of Euro 15.03 per share. The new performance options issued under the Luxottica 2006 Stock Option Plan have an exercise price of Euro 15.11 per share.

On June 25, 2008, our subsidiary Ray Ban Indian Holdings Inc., which owns approximately 70.5 percent of RayBan Sun Optics India Limited, a company listed on the Bombay Stock Exchange, proposed to make a voluntary delisting offer to the public stockholders of RayBan Sun Optics India Limited pursuant to the SEBI (delisting of securities) Guidelines 2003. On July 25, 2008 the Ray Ban Sun Optics India Limited stockholders' meeting approved the delisting offer. During the bid period, the stockholders tendered 2,521,841 shares, and Ray Ban Indian Holdings Inc. reached the required quota for the delisting. On August 26, 2008 the exit price of Rs 140 was determined and on September 11, 2008, the last day for tendering shares, an additional number of 1,813,872 tendered shares were exchanged. During 2009 the Company continued its tendered offer for the remaining outstanding shares. As of March 31, 2009 the Company has acquired an additional 929,218 shares. As a result, Ray Ban Indian Holdings Inc. owns approximately 92.0 percent of RayBan Sun Optics India Limited. However, the Company continued the tendered offer until May 20, 2009 and upon transfer of the remaining tendered shares Ray Ban Indian Holdings Inc. will own 93.3 percent of the equity shares of RayBan Sun Optics India Limited.

On April 9, 2009, Donna Karan International Inc. agreed to a five-year extension through December 2014, with an option for a further five-year extension, of its license agreement for the design,

manufacture and worldwide distribution of prescription frames and sunglasses under the Donna Karan and DKNY brands.

On January 30, 2009, Salvatore Ferragamo Italia S.p.A., which controls Gruppo Ferragamo, agreed to a three-year extension through December 2011, with an option for a further two-year extension, of its license agreement with us for the design, manufacture and the worldwide distribution of prescription frames and sunglasses under the Salvatore Ferragamo brand.

On January 28, 2009, we entered into a new six-year license agreement, with an option for a four-year extension, with Tory Burch LLC for the design, manufacture and worldwide distribution of prescription frames and sunglasses under Tory Burch and TT, two emerging American fashion and lifestyle brands. The first collection is expected to launch in fall 2009.

We and our subsidiaries become involved in legal and regulatory proceedings from time to time, some of which are significant. The timing and outcome of these proceedings are inherently uncertain and the outcomes could have a material adverse effect on our business, financial position or operating results. See Item 3—"Key Information—Risk Factors" in our annual report on Form 20-F for our fiscal year ended December 31, 2008.

This excerpt taken from the LUX 6-K filed Dec 15, 2008.

RECENT DEVELOPMENTS AND OTHER EVENTS

Effective July 31, 2008, our subsidiary, Sunglass Hut (UK) Limited, which operates our UK retail business, acquired 100 percent of the shares of Optika Holdings Ltd., a company in which we previously owned only a 50 percent interest, in exchange for the issuance of new shares from Sunglass Hut (UK) Limited. As a consequence of the above transaction, we now own approximately 66 percent of Sunglass Hut (UK) Limited and 34 percent is owned by the former third party Optika Holdings Ltd's shareholders. As a result of the above transaction, we now operate 65 optical and sun retail stores operating under the name David Clulow in the UK.

On November 4, 2008 we announced that we will enter the retail market in India with the proposed opening of over 100 Sunglass Hut stores at select high-end malls and other premium retail locations across India. We will open the stores through a landmark franchising agreement with DLF Group, the leading real estate developer based in New Delhi. The first India-based store opened in November of this year.

This excerpt taken from the LUX 6-K filed Oct 1, 2008.

RECENT DEVELOPMENTS AND OTHER EVENTS

On April 17, 2008, we signed a long-term exclusive license agreement for the design, production and worldwide distribution of sunglasses under the luxury lifestyle brand Stella McCartney. The agreement, which will begin on January 1, 2009, is for an initial term of six years, automatically renewable for an additional five-year term. The first collection will be launched in the summer of 2009.

In May 2008, a Performance Shares Plan for top managers within the Group as identified by the Board of Directors of the Group (the "Board") (the "2008 PSP") was adopted. The 2008 PSP is intended to strengthen the loyalty of the Group's key employees and to recognize their contribution to the Group's success on a medium-to long-term basis. The beneficiaries of the 2008 PSP are granted the right to receive ordinary shares, without consideration, at the end of the three-year vesting period, and subject to achievement of certain Group performance targets to be determined by the Board. The 2008 PSP has a term of five years, during which time the Board may resolve to issue different grants to the 2008 PSP's beneficiaries. The 2008 PSP covers a maximum of 6,500,000 ordinary shares. Each annual grant will not exceed 2,000,000 ordinary shares. On May 13, 2008, the Board granted 1,203,600 rights to receive ordinary shares.

This excerpt taken from the LUX 6-K filed Jun 30, 2008.

RECENT DEVELOPMENTS AND OTHER EVENTS

On April 17, 2008, we signed a long-term exclusive license agreement for the design, production and worldwide distribution of sunglasses under the luxury lifestyle brand Stella McCartney. The

agreement, which will begin on January 1, 2009, is for an initial term of six years, automatically renewable for an additional five-year term. The first collection will be launched in the summer of 2009.

On January 30, 2008, we signed a new license agreement with Chanel. This marks the further extension of a long-term relationship between the two companies, which started in 1999 with the launch of Chanel's first eyewear collections and now seeks to capture the additional growth opportunities for this exclusive and iconic luxury-fashion brand.

In May 2008, a Performance Shares Plan for top managers within the group to be identified by the Board (the "2008 PSP") was adopted. The 2008 PSP is intended to strengthen the loyalty of our key employees and to recognize their contribution to our success on a medium-to long-term basis. The beneficiaries of the 2008 PSP will be granted the right to receive ordinary shares, without consideration, at the end of the three-year vesting period, and subject to achievement of certain Company performance targets to be determined by our Board. The 2008 PSP will have a term of five years, during which the Board may resolve to issue different grants to the 2008 PSP's beneficiaries. The 2008 PSP covers a maximum of 6,500,000 ordinary shares. Each annual grant will not exceed 2,000,000 ordinary shares. On May 14, 2008, the Board granted 1,203,600 rights to receive ordinary shares.

In April 2008, we Company entered into a new unsecured credit facility with Banca Nazionale del Lavoro of Euro 150.0 million. The 18-month credit facility is a revolving facility that provides borrowing availability of up to Euro 150.0 million. The amounts borrowed under the revolving facility can be borrowed and repaid until final maturity. Interest accrues at Euribor plus 0.375 percent. We can select interest periods of one, three or six months. The final maturity of the credit facility is October 8, 2009.

On April 29, 2008, we and our subsidiary Luxottica U.S. Holdings Corp. entered into an amendment and transfer agreement to the U.S. $500.0 million short-term bridge loan facility entered into to finance the Oakley acquisition. The terms of such amendment agreement, among other things, reduced the total facility amount from U.S. $500.0 million to U.S. $150.0 million, and provide for a final maturity date that is 18 months from the effective date of the agreement. Interest will accrue at LIBOR (as defined in the agreement) plus 0.60 percent.

On May 29, 2008, we entered into a Euro 250.0 million revolving credit facility, guaranteed by our subsidiary Luxottica U.S. Holdings Corp. with Intesa Sanpaolo S.p.A., as agent, and Intesa Sanpaolo S.p.A., Banca Popolare di Vicenza S.c.p.A. and Banca Antonveneta S.p.A., as lenders. The final maturity of the credit facility is May 29, 2013. The credit facility will require repayment of equal quarterly installments of principal of Euro 30.0 million starting August 29, 2011, and a repayment of Euro 40.0 million on the final maturity date. Interest accrues at Euribor (as defined in the agreement) plus a margin between 0.40 percent and 0.60 percent based on the "Net Debt/EBITDA" ratio, as defined in the agreement.

On June 25, 2008, our subsidiary Ray Ban Indian Holdings, Inc., which owns approximately 70.5 percent of RayBan Sun Optics Limited, a company listed on the Bombay Stock Exchange, proposed to make a voluntary delisting offer to the public shareholders of RayBan Sun Optics Limited pursuant to the SEBI (Delisting of Securities) Guidelines 2003.

This excerpt taken from the LUX 6-K filed Dec 21, 2007.

RECENT DEVELOPMENTS AND OTHER EVENTS

On November 14, 2007, we completed our merger with Oakley, a worldwide specialist in sport performance optics with brands including Dragon, Eye Safety Systems, Fox Racing, Mosley Tribes, Oliver Peoples and Paul Smith Spectacles, and retail chains including Bright Eyes, Oakley Stores, Sunglass Icon and The Optical Shop of Aspen, for a total purchase price of approximately U.S. $2.1 billion. In accordance with the terms of the merger agreement, Oakley's outstanding shares of common stock were converted into the right to receive U.S. $29.30 per share in cash. As a result of the completion of the merger, Oakley is now a wholly-owned subsidiary of our Group and Oakley's shares have ceased to be traded on the New York Stock Exchange.

To finance the acquisition on October 12, 2007, we and our subsidiary U.S. Holdings entered into two credit facilities with a group of banks providing for certain term loans and a bridge loan for an aggregate principal amount of U.S. $2.0 billion. The term loan facility is an amortizing term loan of U.S. $1.5 billion, with a five-year term, with options to extend the maturity on two occasions for one year each time. The Mandated Lead Arrangers and Bookrunners for the term loan are Citigroup N.A. (acting also as Documentation Agent), Intesa San Paolo S.p.A., The Royal Bank of Scotland plc and UniCredit Markets and Investment Banking (acting through Bayerische Hypo—und Vereinsbank AG—Milan Branch) (acting also as Facility Agent). The term loan facility is divided into two facilities, Facility D and Facility E. Facility D consists of an amortizing term loan in an aggregate amount of U.S. $1.0 billion, made available to U.S. Holdings, and Facility E consists of a bullet term loan in an aggregate amount of U.S. $500 million, made available to the Company. Each facility has a five-year term, with options to extend the maturity on two occasions for one year each time. The term loan has a spread of between 20 and 40 basis points over LIBOR, depending on the Group's ratio of debt to EBITDA. Interest accrues on the term loan at LIBOR (as defined in the agreement) plus 0.40 percent (5.06 percent on November 14, 2007, the date of our first utilization) The final maturity of the credit facility is October 12, 2012. These credit facilities contain certain financial and operating covenants.

The short term bridge loan facility is for an aggregate principal amount of U.S. $500 million. This facility is underwritten by Bank of America Securities Limited and UniCredit Market and Investment Banking (acting through Bayerische Hypo—und Vereinsbank AG—Milan Branch). Interest accrues on the short term bridge loan at LIBOR (as defined in the agreement) plus 0.15 percent (4.80 percent on November 14, 2007, the date of our first utilization). The final maturity of the credit facility is eight months from the first utilization date.

The balance of the purchase price (equal to U.S. $100 million) has been financed by drawing on Tranche C of the June 3, 2004 credit facility.

On November 15, 2007, in connection with the merger, we paid in full Oakley's existing credit facility for an amount of U.S. $250 million by drawing on Tranche C of the June 3, 2004 credit facility. Interest accrues on Tranche C at LIBOR (as defined in the agreement) plus 0.20 percent.

On July 18, 2007, the trial court in People v. Cole entered a Final Judgment and Permanent Injunction, pursuant to a stipulation of the parties, dismissing the case. The Judgment requires modification to Pearle Vision's advertising, and the payment by the Company of U.S. $2.5 million for attorneys' fees and costs of investigation. The Judgment does not bar Pearle Vision from advertising the availability of eye exams and other optometric services provided by Pearle VisionCare at Pearle Vision optical stores. For further information on People v. Cole, please see our annual report on Form 20-F.

The Company and its subsidiaries become involved in legal and regulatory proceedings from time to time, some of which are significant. The timing and outcome of these proceedings are inherently uncertain and the outcomes could have a material adverse effect on the Company's business, financial position or operating results. See Item 3—"Key Items—Risk Factors" in the Company's annual report on Form 20-F for its fiscal year ended December 31, 2006.

This excerpt taken from the LUX 6-K filed Oct 1, 2007.

RECENT DEVELOPMENTS AND OTHER EVENTS

On June 20, 2007, the Company announced that it had entered into a definitive merger agreement with Oakley, Inc. ("Oakley"), a worldwide specialist in sport performance optics with brands including Dragon, Eye Safety Systems, Fox Racing, Mosley Tribes, Oliver Peoples and Paul Smith Spectacles, and retail chains including Bright Eyes, Oakley Stores, Sunglass Icon and The Optical Shop of Aspen. Pursuant to the merger agreement, the Company will acquire all of the outstanding shares of Oakley for a cash purchase price of U.S. $29.30 per share, together with the purchase of all outstanding options and other equity rights at the same price per share less the exercise price. The total purchase price will be approximately U.S. $2.1 billion (Euro 1.6 billion).

On August 24, 2007, the Company and Oakley jointly announced that the United States Federal Trade Commission had granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act ("HSR") in connection with the Company's proposed acquisition of Oakley without a second request for additional information. Termination of the HSR waiting period satisfies one of the conditions to the closing of the transaction as specified in the merger agreement. Other conditions to the closing specified in the merger agreement still remain outstanding, including obtaining certain other antitrust and competition law clearances outside the United States as well as the required approval of the transaction by Oakley's shareholders at a special meeting to be called and held for such purpose. The transaction is expected to close in the fourth quarter of 2007.

On August 3, 2007, the Company announced that it had mandated a group of banks to arrange, underwrite and provide credit facilities for an aggregate of U.S. $2.0 billion to finance the acquisition of Oakley. The facilities will consist of:

—		An amortizing term loan of U.S. $1.5 billion, with a five-year term, with options to extend the maturity on two occasions for one year each time. Consistent with the Group's main existing facilities, the term loan will have a spread of between 20 and 40 basis points over LIBOR, depending on the Group's ratio of debt to EBITDA. The Mandated Lead Arrangers and Bookrun- ners for the term loan are Citigroup N.A. (acting also as Documentation Agent), Intesa San Paolo S.p.A., The Royal Bank of Scotland plc and UniCredit Markets and Investment Banking (acting through Bayerische Hypo—und Vereinsbank AG—Milan Branch) (acting also as Facility Agent).
—		A short-term bridge loan of U.S. $500 million. The facility may be partially refinanced with a U.S. private placement assuming favorable market conditions. This facility will be underwritten by Bank of America Securities Limited and UniCredit Market and Investment Banking (acting through Bayerische Hypo—und Vereinsbank AG—Milan Branch).

Funding under these facilities will be subject to the closing of the Company's proposed acquisition of Oakley, Inc.

On April 25, 2007, in compliance with a December 12, 2006 decision of the Supreme Court of India, the Company launched a public offer through its subsidiary, RayBan Indian Holdings, Inc., to acquire up to 4,895,900 shares, representing approximately 20 percent of the equity share capital of RayBan Sun Optics India Ltd. ("RayBan Sun Optics"), which we subsequently increased to 7,545,240 shares, representing approximately 31 percent of the equity share capital of RayBan Sun Optics. 6,454,280 shares were tendered in the offer, which closed on May 14, 2007. Effective upon the entry of the share transfers in the share register on June 26, 2007 the Company's stake in RayBan Sun Optics increased to 70.5 percent. The Company paid consideration of approximately Euro 13.0 million for the tendered shares. RayBan Sun Optics is listed on the Bombay Stock Exchange. The Company acquired its interest in RayBan Sun Optics in connection with the purchase of the Ray-Ban eyewear business from Bausch & Lomb in 1999.

During the second quarter of 2007, we completed the acquisitions of two specialty sun chains in South Africa, with a total of 65 stores, for approximately Euro 10 million. The two acquisitions represent an important step in the expansion of our sun retail presence worldwide.

This excerpt taken from the LUX 6-K filed Jul 2, 2007.

RECENT DEVELOPMENTS AND OTHER EVENTS

On June 20, 2007, the Company announced that it had entered into a definitive merger agreement with Oakley, Inc, a worldwide specialist in sport performance optics with brands including Dragon, Eye Safety Systems, Fox Racing, Mosley Tribes, Oliver Peoples and Paul Smith Spectacles, and retail chains including Bright Eyes, Oakley Stores, Sunglass Icon and The Optical Shop of Aspen. As part of the merger, the Company will acquire all of the outstanding shares of Oakley for a cash purchase price of U.S. $29.30 per share, together with the purchase of all outstanding options and other equity rights at the same price per share less the exercise price. The total purchase price will be approximately U.S. $2.1 billion (Euro 1.6 billion). The transaction is expected to close in the second half of 2007 and is subject to certain conditions, including regulatory approvals.

On April 25, 2007, in compliance with a December 12, 2006 decision of the Supreme Court of India, the Company launched a public offer through its subsidiary, RayBan Indian Holdings, Inc., to acquire up to 4,895,900 shares, representing approximately 20 percent of the equity share capital of RayBan Sun Optics, which we subsequently increased of up to 7,545,200 shares, representing approximately 31 percent of the equity share capital of RayBan Sun Optics. 6,454,280 shares were tendered in the offer, which closed on May 14, 2007. Effective upon the entry of the share transfers in the share register on June 26, 2007, the Company's stake in RayBan Sun Optics India Ltd. increased to 70.5 percent. The Company paid a total consideration of approximately Euro 13.0 million for the tendered shares. RayBan Sun Optics is listed on the Bombay Stock Exchange. The Company acquired its interest in RayBan Sun Optics in connection with the purchase of the Ray-Ban eyewear business from Bausch & Lomb in 1999.

During the second quarter of 2007, we completed the acquisitions of two prominent specialty sun chains in South Africa, with a total of 65 stores, for approximately Euro 10 million. The two acquisitions represent an important step in the expansion of our sun retail presence worldwide.

In February 2007, the Company completed the acquisition of the optical retail business of D.O.C Optics, with approximately 100 stores located primarily in the midwest United States, for approximately Euro 83.7 million (U.S. $110 million) in cash. The Company expects to rebrand the acquired stores as "LensCrafters" and "Pearle Vision."

This excerpt taken from the LUX 6-K filed Dec 26, 2006.

RECENT DEVELOPMENTS AND OTHER EVENTS

On February 27, 2006, the Company announced that it entered into a 10-year license agreement for the design, production and worldwide distribution of prescription frames and sunglasses under the Polo Ralph Lauren name. The agreement commences on January 1, 2007.

On March 10, 2006, the Company, its subsidiary, U.S. Holdings, and the bank group parties to their three-tranche credit agreement signed on June 3, 2004 agreed to amend the outstanding credit agreement. The amended agreement reduces the interest margin as defined in the agreement, extends the termination date of Tranches B and C to five years from the date the amendment was signed, gives the option at the end of the first and second anniversaries to extend the termination for additional one-year periods, and increases the borrowing capacity of Tranche C to Euro 725 million from Euro 335 million.

In April 2006, the Company completed the acquisition it announced in July 2005 of the Beijing Xueliang Optical Technology Co. Ltd. for a purchase price of Chinese RenMinBi ("RMB") 169 million (approximately Euro 17 million), plus RMB 40 million (approximately Euro 4 million) in assumed liabilities. Xueliang Optical has 79 stores in Beijing.

In June 2006, the Company completed the acquisition it announced in May 2006 of Shoppers Optical, a 74-store Canadian-based optical chain owned by King Optical Group Inc. As a result of the transaction, Luxottica Group manages a total of 268 optical stores in Canada. In addition, this acquisition added the Company's first full-service Canada-based central lens finishing lab with antireflective coating capability.

In July 2006, the Company completed the acquisition it announced in October 2005 of Ming Long Optical, an optical chain in the province of Guangdong, China for a purchase price of RMB 290 million (approximately Euro 29 million). Ming Long Optical operates a total of 278 locations in two of the top premium optical markets in mainland China, as well as in Hong Kong.

In June 2006, the Company announced that it will acquire Modern Sight Optics, a leading premium optical chain that operates a total of 28 stores in Shanghai, China. Modern Sight Optics has an existing clear position in the premium segment of the optical market and brings to the Company 28 high-end stores in Shanghai. These stores are located in premium and high-end commercial centers and shopping malls situated primarily in Shanghai's downtown area and affluent residential areas. The Company will acquire 100 percent of the equity interest in Modern Sight Optics for a total consideration of RMB 140 million (approximately Euro 14 million). As is customary, completion of the transaction was subject to approval by the relevant Chinese governmental authorities. In November 2006, the Company completed the acquisition of Modern Sight Optics.

In June 2006, the Company announced that over the next two years its Sunglass Hut chain will have up to 50 stores in the Middle East due to new openings under a five-year franchising agreement with Azal Group. In the Middle East, Sunglass Hut will operate in several high-end shopping malls, mainly in the United Arab Emirates and Saudi Arabia. Stores will only carry the Company's leading brands of premium sunglasses, including Bvlgari, Chanel, Dolce & Gabbana, Prada, Versace and Ray-Ban. Azal Group carries a strong and diverse franchise portfolio featuring over 30 of the industry's most recognizable brands. Azal Group has operations in the Middle East and Europe.

In November 2006, the Company announced an expansion of its retail operations in North America through the signing of a definitive agreement to acquire D.O.C Optics, an optical retail business with approximately 100 stores located primarily in the Midwest United States. D.O.C Optics stores operate in Michigan, Ohio, Missouri, Wisconsin, Florida and Illinois with a majority of its retail locations in and around the Detroit metropolitan area. D.O.C Optics has estimated annual revenues for its full 2006 fiscal year in excess of US$100 million. As the acquisition was structured as an acquisition of certain assets and assumption of certain liabilities of the existing business, Luxottica Group expects the total purchase price, net of expected tax benefits, to approximate US$90 million. The closing of the transaction is expected to occur during the first quarter of 2007, subject to customary closing conditions and U.S. regulatory approvals.

In December 2006, the Company announced the signing of a 10-year license agreement for the design, manufacturing and worldwide distribution of exclusive ophthalmic and sun collections under the Tiffany & Co. name. The launch of the first collections is expected for early 2008. The distribution of Tiffany's collections will start with Tiffany's own stores as well as in North America, Japan, Hong Kong, South Korea, key Middle East markets and Mexico and will extend over time to additional markets and through new distribution channels.

This excerpt taken from the LUX 6-K filed Jun 29, 2006.

RECENT DEVELOPMENTS AND OTHER EVENTS

On March 10, 2006, the Company, its subsidiary, U.S. Holdings, and the bank group parties to their three-Tranche credit agreement signed on June 3, 2004, agreed to amend the outstanding credit agreement. The amended and restated agreement reduces the interest margin as defined in the agreement, extends the termination date of Tranches B and C to five years from the date the amendment

was signed, gives the option at the end of the first and second anniversaries to extend the termination for additional one-year periods and increases the borrowing capacity of Tranche C to Euro 725.0 million from Euro 335.0 million.

In April 2006, the Company completed the acquisition it announced in July 2005 of the Beijing Xueliang Optical Technology Co. Ltd. for a purchase price of RMB 169 million (approximately Euro 17 million), plus RMB 40 million (approximately Euro 4 million) in assumed liabilities. Xueliang Optical has 79 stores in Beijing.

On May 18, 2006, the Company announced that it entered into an agreement to acquire Shoppers Optical, a 74-store Canadian-based optical chain owned by King Optical Group Inc. After the closing of the transaction, Luxottica Group will manage a total of 268 optical stores in Canada. In addition, this acquisition will bring into the organization the first full-service Canada-based central lens finishing lab with anti-reflective coating capability. The closing of the transaction, which is subject to customary closing conditions, is expected to take place in June 2006.

The Company continues to await customary approvals by the relevant Chinese governmental authorities in connection with its announced agreement to acquire 100 percent of the equity interests in Ming Long Optical, an optical chain in the province of Guangdong, China for a purchase price of RMB 290 million (approximately Euro 29 million). Upon completion of the acquisition, Luxottica Group will operate a total of 278 locations in two of the top premium optical markets in mainland China, as well as in Hong Kong. These approvals are expected in July 2006.

In June 2006, the Company announced that it will acquire Modern Sight Optics, a leading premium optical chain that operates a total of 28 stores in Shanghai, China. Modern Sight Optics has an existing clear position in the premium segment of the optical market and will bring to Luxottica Group 28 high-end stores in Shanghai. These stores are located in premium and high-end commercial centers and shopping malls mainly in the city downtown area and affluent residential areas. The Company will acquire 100 percent of the equity interest in Modern Sight Optics for a total consideration of RMB 140 million (approx. Euro 14 million). As customary, completion of the transaction remains subject to approval by the relevant Chinese governmental authorities. The Company currently anticipates receiving such approvals by the end of 2006.

In June 2006, the Company announced that over the next two years its Sunglass Hut chain will have up to 50 stores in the Middle East thanks to new openings under a five-year franchising agreement with Azal Group. In the Middle East, Sunglass Hut will be present in important high-end shopping malls, mainly in the United Arab Emirates and Saudi Arabia. Stores will only carry Luxottica Group leading brands of premium sunglasses, including Bvlgari, Chanel, Dolce & Gabbana, Prada, Versace as well as Ray-Ban. Azal Group carries a strong franchise portfolio of over 30 diverse brands that features some of the industry's most recognizable brands. Azal Group has operations in the Middle East and Europe.

These excerpts taken from the LUX 6-K filed Dec 23, 2005.

RECENT DEVELOPMENTS AND OTHER EVENTS

On August 31, 2005, the Company agreed with the plaintiffs in the previously disclosed action commenced in May 2001 (the "Action") pending in the U.S. District Court for the Eastern District of New York relating to its acquisition of Sunglass Hut International, Inc. ("SGHI"), to a full and final settlement and release (the "Settlement") of all claims made in the Action. In the Action, the plaintiffs' principal claim was that certain payments made to the former Chairman of SGHI under a consulting, non-disclosure and non-competition agreement violated the "best price" rule under U.S. securities laws. The Settlement, for a payment of $14.5 million, is subject to final approval by the judge presiding over the Action. The amount of the settlement payment is not material and will not affect the Company's outlook for fiscal year 2005 previously communicated.

On January 4, 2005, the Company launched the off-market takeover offer for all the Australian Stock Exchange listed OPSM Group shares it did not already own. At the close of the offer on February 7, 2005, the Company held 98.5 percent of OPSM Group's shares, which is in excess of the compulsory acquisition threshold. On February 8, 2005, the Company announced the start of the compulsory acquisition process for all remaining shares in OPSM Group not already owned by the Company.

On February 15, 2005, the Australian Stock Exchange suspended trading in OPSM Group shares and on February 21, 2005 it delisted OPSM Group shares from the Australian Stock Exchange. The compulsory acquisition process was completed on March 23, 2005.

On January 5, 2005, the Company announced that its subsidiary, Cole National Corporation, sold all its shares in Pearle Europe B.V., representing approximately 21 percent of that company's outstanding shares, to HAL Investments B.V., a subsidiary of HAL Holding N.V., for a cash purchase price of Euro 144 million (or approximately U.S. $191 million calculated for convenience at the January 4, 2005 noon buying rate). HAL Investments held the balance of Pearle Europe's outstanding shares (except for approximately one percent held by management). The Company gained control of the Pearle Europe shares in October 2004, as a result of its acquisition of the Cole National business. The sale was required by the Articles of Association of Pearle Europe in connection with the acquisition.

On July 7, 2005, the Company announced that its subsidiary, SPV Zeta S.r.l., will acquire 100 percent of the equity interest in Beijing Xueliang Optical Technology Co. Ltd. for a purchase price of RMB 169 million (approximately Euro 17 million), plus RMB 40 million (approximately Euro 4 million) in assumed liabilities. Xueliang Optical had unaudited sales for the 2004 fiscal year of RMB 102 million (approximately Euro 10 million). Xueliang Optical has 79 stores in Beijing. Completion of the transaction remains subject to customary approvals by the relevant Chinese governmental authorities. The Company currently anticipates receiving such approvals by the beginning of 2006.

On October 4, 2005, the Company announced that its subsidiary, SPV Eta S.r.l., will acquire 100 percent of the equity interests in Ming Long Optical, the largest premium optical chain in the

province of Guangdong, China, for a purchase price of RMB 290 million (approximately Euro 29 million). As a result, the Group becomes the leading operator of premium optical stores in China, with a total of 278 locations in two of the top three premium optical markets in mainland China, as well as in Hong Kong, the most important market in Asia for luxury goods.

On October 7, 2005, the Company announced the signing of a 10-year license agreement for the design, production and worldwide distribution of prescription frames and sunglasses under the Burberry name. The agreement will begin on January 1, 2006. The first Burberry eyewear collections under the agreement will be introduced in October 2006.

RECENT DEVELOPMENTS AND OTHER EVENTS

On October 4, 2005, the Company announced that its subsidiary, SPV Eta S.r.l., will acquire 100 percent of the equity interests in Ming Long Optical, the largest premium optical chain in the

This excerpt taken from the LUX 6-K filed Sep 29, 2005.

RECENT DEVELOPMENTS AND OTHER EVENTS

These excerpts taken from the LUX 6-K filed Jun 27, 2005.

RECENT DEVELOPMENTS AND OTHER EVENTS

Luxottica Group, S.p.A. (LUX)

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