Exhibit 1.1
__,000,000 Shares
Toys "R" Us, Inc.
Common Stock
($0.10 par value)
UNDERWRITING AGREEMENT
May __, 2002
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXXX XXXXX XXXXXX INC.
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. Toys "R" Us, Inc., a Delaware corporation ("Company"),
proposes to issue and sell _,000,000 shares ("Firm Securities") of its common
stock, par value $0.10 per share ("Securities"), and also proposes to issue and
sell to the Underwriters, at the option of the Underwriters, an aggregate of not
more than _,000,000 additional shares ("Optional Securities") of its Securities
as set forth below. The Firm Securities and the Optional Securities are herein
collectively called the "Offered Securities." The Company hereby agrees with the
several Underwriters named in Schedule A hereto ("Underwriters") as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333-84258) relating to the
Offered Securities, including a form of prospectus, has been filed with
the Securities and Exchange Commission ("Commission") and either (i)
has been declared effective under the Securities Act of 1933, as
amended ("Act"), and is not proposed to be amended or (ii) is proposed
to be amended by amendment or post-effective amendment. If such
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registration statement ("initial registration statement") has been
declared effective, either (i) an additional registration statement
("additional registration statement") relating to the Offered
Securities may have been filed with the Commission pursuant to Rule
462(b) ("Rule 462(b)") under the Act and, if so filed, has become
effective upon filing pursuant to such Rule and the Offered Securities
all have been duly registered under the Act pursuant to the initial
registration statement and, if applicable, the additional registration
statement or (ii) such an additional registration statement is proposed
to be filed with the Commission pursuant to Rule 462(b) and will become
effective upon filing pursuant to such Rule and upon such filing the
Offered Securities will all have been duly registered under the Act
pursuant to the initial registration statement and such additional
registration statement. If the Company does not propose to amend the
initial registration statement or if an additional registration
statement has been filed and the Company does not propose to amend it,
and if any post-effective amendment to either such registration
statement has been filed with the Commission prior to the execution and
delivery of this Agreement, the most recent amendment (if any) to each
such registration statement has been declared effective by the
Commission or has become effective upon filing pursuant to Rule 462(c)
("Rule 462(c)") under the Act or, in the case of the additional
registration statement, Rule 462(b). For purposes of this Agreement,
"Effective Time" with respect to the initial registration statement or,
if filed prior to the execution and delivery of this Agreement, the
additional registration statement means (i) if the Company has advised
the Representatives that it does not propose to amend such registration
statement, the date and time as of which such registration statement,
or the most recent post-effective amendment thereto (if any) filed
prior to the execution and delivery of this Agreement, was declared
effective by the Commission or has become effective upon filing
pursuant to Rule 462(c), or (ii) if the Company has advised the
Representatives that it proposes to file an amendment or post-effective
amendment to such registration statement, the date and time as of which
such registration statement, as amended by such amendment or
post-effective amendment, as the case may be, is declared effective by
the Commission. If an additional registration statement has not been
filed prior to the execution and delivery of this Agreement but the
Company has advised the Representatives that it proposes to file one,
"Effective Time" with respect to such additional registration statement
means the date and time as of which such registration statement is
filed and becomes effective pursuant to Rule 462(b). "Effective Date"
with respect to the initial registration statement or the additional
registration statement (if any) means the date of the Effective Time
thereof. The initial registration statement, as amended at its
Effective Time, including all material incorporated by reference
therein, including all information contained in the additional
registration statement (if any) and deemed to be a part of the initial
registration statement as of the Effective Time of the additional
registration statement pursuant to the General Instructions of the Form
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on which it is filed and including all information (if any) deemed to
be a part of the initial registration statement as of its Effective
Time pursuant to Rule 430A(b) ("Rule 430A(b)") under the Act, is
hereinafter referred to as the "Initial Registration Statement." The
additional registration statement, as amended at its Effective Time,
including the contents of the initial registration statement
incorporated by reference therein and including all information (if
any) deemed to be a part of the additional registration statement as of
its Effective Time pursuant to Rule 430A(b), is hereinafter referred to
as the "Additional Registration Statement." The Initial Registration
Statement and the Additional Registration Statement are herein referred
to collectively as the "Registration Statements" and individually as a
"Registration Statement." The form of prospectus relating to the
Offered Securities, as first filed with the Commission pursuant to and
in accordance with Rule 424(b) ("Rule 424(b)") under the Act or (if no
such filing is required) as included in a Registration Statement,
including all documents incorporated by reference in such prospectus,
is hereinafter referred to as the "Prospectus." No document has been or
will be prepared or distributed in reliance on Rule 434 under the Act.
(b) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement: (i)
on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all material respects to
the requirements of the Act and the rules and regulations of the
Commission ("Rules and Regulations") and did not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; (ii) on the Effective Date of the Additional
Registration Statement (if any), each Registration Statement conformed,
or will conform, in all material respects to the requirements of the
Act and the Rules and Regulations and did not include, or will not
include, any untrue statement of a material fact and did not omit, or
will not omit, to state any material fact required to be stated therein
or necessary to make the statements therein, not misleading; and (iii)
on the date of this Agreement, the Initial Registration Statement and,
if the Effective Time of the Additional Registration Statement is prior
to the execution and delivery of this Agreement, the Additional
Registration Statement each conforms, and at the time of filing of the
Prospectus pursuant to Rule 424(b) or (if no such filing is required)
at the Effective Date of the Registration Statement in which the
Prospectus is included, each Registration Statement and the Prospectus
will conform, in all material respects to the requirements of the Act
and the Rules and Regulations, and the Registration Statement when it
became effective did not contain, any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and the
Prospectus will not include any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
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misleading. If the Effective Time of the Initial Registration Statement
is subsequent to the execution and delivery of this Agreement: on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement and the Prospectus will conform in all material
respects to the requirements of the Act and the Rules and Regulations,
the Initial Registration Statement will not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading and the Prospectus will not include any untrue
statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in light of the circumstances
under which they were made, not misleading, and no Additional
Registration Statement has been or will be filed. The two preceding
sentences do not apply to statements in or omissions from a
Registration Statement or the Prospectus based upon written information
furnished to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the
only such information is that described as such in Section 7(b) hereof.
(c) The documents incorporated or deemed to be incorporated by
reference in the Registration Statements and the Prospectus, at the
time they were or hereafter are filed with the Commission, complied or
will comply, as the case may be, as to form in all material respects
with the requirements of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the rules and regulations of the
Commission thereunder.
(d) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
with corporate power and authority to own its properties and conduct
its business as described in the Prospectus; and the Company is duly
qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except where
the failure to be in good standing or to be so qualified would not,
individually or in the aggregate, have a material adverse effect on the
financial condition, business, properties and results of operations of
the Company and its subsidiaries taken as a whole ("Material Adverse
Effect").
(e) Each subsidiary of the Company listed on Schedule B hereto
(that purports to identify each subsidiary of the Company that
constitutes a "significant subsidiary" as such term is defined in Rule
1-02 of Regulation S-X) ("Significant Subsidiary") has been duly
incorporated and is an existing corporation in good standing under the
laws of the jurisdiction of its incorporation, with corporate power and
authority to own its properties and conduct its business as described
in the Prospectus; and each Significant Subsidiary of the Company is
duly qualified to do business as a foreign corporation in good standing
in all other jurisdictions in which its ownership or lease of property
or the conduct of its business requires such qualification, except
where the failure to be in good standing or to be so qualified would
not, individually or in the aggregate, have a Material Adverse Effect;
all of the issued and outstanding capital stock of each Significant
Subsidiary of the Company has been duly authorized and validly issued
and is fully paid and nonassessable; and the capital stock of each
Significant Subsidiary owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and security
interests, except as would not, individually or in the aggregate, have
a Material Adverse Effect.
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(f) The Company has the authorized, issued and outstanding
capitalization as set forth in the Prospectus as of the dates set forth
therein; all of the issued and outstanding shares of capital stock of
the Company have been duly authorized and validly issued, are fully
paid and nonassessable and conform in all material respects to the
description thereof contained in the Prospectus; none of the
outstanding shares of capital stock of the Company was issued in
violation of the preemptive or other similar rights of any security
holder of the Company.
(g) The Offered Securities and all other outstanding shares of
capital stock of the Company to be issued and sold by the Company
pursuant hereto have been duly authorized and at the applicable Closing
Date (as defined below), after payment therefor and delivery thereof in
accordance with this Agreement, will be validly issued, fully paid and
nonassessable and will conform in all material aspects to the
description thereof contained in the Prospectus; and the stockholders
of the Company have no preemptive or other similar rights with respect
to the Offered Securities.
(h) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
Underwriter for a brokerage commission, finder's fee or other like
payment in connection with this offering.
(i) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act with respect to any securities of
the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to a Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act.
(j) The Securities are listed on the The New York Stock
Exchange, subject to notice of issuance.
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(k) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
for the consummation by the Company of the transactions contemplated by
this Agreement in connection with the issuance and sale of the Offered
Securities by the Company, except such as have been obtained or made
under the Act and such as may be required under state or foreign
securities or Blue Sky laws or where the failure to obtain such
consent, approval, authorization or filing would not have a Material
Adverse Effect.
(l) The execution, delivery and performance of this Agreement,
and the issuance and sale of the Offered Securities will not result in
a breach or violation of any of the terms and provisions of, or
constitute a default under, (a) any statute, any rule, regulation or
order of any governmental authority, agency or body or any court,
(domestic or foreign,) having jurisdiction over the Company or any
Significant Subsidiary of the Company or any of their properties, or
(b) any agreement or instrument to which the Company or any such
Significant Subsidiary is a party or by which the Company or any such
Significant Subsidiary is bound or to which any of the properties of
the Company or any such Significant Subsidiary is subject, or (c) the
charter or by-laws of the Company, except, in the case of clauses (a)
and (b) only, for such breaches, violations or defaults that would not,
individually or in the aggregate, have a Material Adverse Effect.
(m) This Agreement has been duly authorized, executed and
delivered by the Company.
(n) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties and
all personal property owned by them, in each case free from liens,
encumbrances and defects that would materially affect the value thereof
or materially interfere with the use made or to be made thereof by
them; and except as disclosed in the Prospectus, the Company and its
Significant Subsidiaries hold any leased real property or buildings
under valid and enforceable leases with no material exceptions that
would materially interfere with the use made or to be made thereof by
them.
(o) The Company and its Significant Subsidiaries possess or
have obtained all licenses, certificates, authorizations or permits
issued by appropriate governmental agencies or bodies necessary to
conduct the business now operated by them and have not received any
notice of proceedings relating to the revocation or modification of any
such license, certificate, authorization or permit that, would,
individually or in the aggregate, have a Material Adverse Effect.
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(p) No labor dispute with the employees of the Company or any
of its Significant Subsidiaries exists or, to the knowledge of the
Company, is threatened that would, individually or in the aggregate,
have a Material Adverse Effect.
(q) The Company and its subsidiaries own, possess or can
acquire on reasonable terms, adequate trademarks, trade names and other
rights to inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively,
"intellectual property rights") necessary to conduct the business now
operated by them, or presently employed by them, and have not received
any notice of infringement of or conflict with asserted rights of
others with respect to any intellectual property rights that would,
individually or in the aggregate, have a Material Adverse Effect.
(r) Except as disclosed in the Prospectus, there are no legal
or government actions, suits or proceedings pending against or
affecting the Company, any of its Significant Subsidiaries or any of
their respective properties that, would, individually or in the
aggregate, have a Material Adverse Effect, or would materially and
adversely affect the ability of the Company to perform its obligations
under this Agreement; and to the Company's knowledge, no such actions,
suits or proceedings are threatened or, contemplated by governmental
authorities or threatened by others.
(s) Ernst & Young LLP, who have certified the audited
financial statements of the Company and its subsidiaries incorporated
by reference in each Registration Statement and the Prospectus are
independent public accountants as required by the Act and the Rules and
Regulations.
(t) The financial statements incorporated by reference in each
Registration Statement and the Prospectus present fairly in all
material respects the financial position of the Company and its
consolidated subsidiaries as of the dates shown and their consolidated
results of operations and changes in consolidated cash flows, for the
periods shown, and, except as otherwise disclosed in the Prospectus,
such financial statements have been prepared in conformity with the
generally accepted accounting principles in the United States applied
on a consistent basis.
(u) Except as disclosed in the Prospectus, since February 2,
2002, there has been no material adverse change, nor any development or
event involving a prospective material adverse change in the financial
condition, business, properties or results of operations of the Company
and its subsidiaries taken as a whole, and, except as disclosed in or
contemplated by the Prospectus, since February 2, 2002, there has been
no dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
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(v) The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the application of the
proceeds thereof as described in the Prospectus, will not be an
"investment company" as defined in the Investment Company Act of 1940.
(w) The Company and its Significant Subsidiaries have filed
all federal, state, local and foreign tax returns that have been
required to be filed or has duly requested extensions thereof, except
to the extent that any failure to file or request for extension, or any
incorrectness, would not, individually or in the aggregate, have a
Material Adverse Effect. The Company and its Significant Subsidiaries
have paid all taxes shown as due on such filed tax returns (including
any related assessments), except to the extent that any such taxes or
assessments are being contested in good faith and by appropriate
proceedings, or to the extent that any failure to pay would not,
individually or in the aggregate, have a Material Adverse Effect.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of $____ per share, the respective numbers
of shares of Firm Securities set forth opposite the names of the Underwriters in
Schedule A hereto.
The Company will deliver the Firm Securities to the Representatives for
the accounts of the Underwriters, against payment of the purchase price in
Federal (same day) funds by wire transfer to an account at a bank reasonably
acceptable to Credit Suisse First Boston Corporation ("CSFBC") and Xxxxxxx Xxxxx
Xxxxxx Inc. ("SSB") drawn to the order of the Company at the office of Shearman
& Sterling, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, X.X. 00000, at 9:00 A.M., New York
City time, on May _, 2002, or at such other time not later than seven full
business days thereafter as CSFBC and the Company determine, such time being
herein referred to as the "First Closing Date." For purposes of Rule 15c6-1
under the Securities Exchange Act of 1934, the First Closing Date (if later than
the otherwise applicable settlement date) shall be the settlement date for
payment of funds and delivery of securities for all the Offered Securities sold
pursuant to the offering. The certificates for the Firm Securities so to be
delivered will be in definitive form, in such denominations and registered in
such names as CSFBC and SSB request and will be made available for checking and
packaging at the above office of Shearman & Sterling at least 24 hours prior to
the First Closing Date.
In addition, upon written notice from CSFBC and SSB given to the
Company from time to time not more than 30 days subsequent to the date of the
Prospectus, the Underwriters may purchase all or less than all of the Optional
Securities at the purchase price per Security to be paid for the Firm
Securities. The Company agrees to sell to the Underwriters the number of shares
of Optional Securities specified in such notice and the Underwriters agree,
severally and not jointly, to purchase such Optional Securities. Such Optional
Securities shall be purchased for the account of each Underwriter in the same
proportion as number of shares of Firm Securities set forth opposite such
Underwriter's name bears to the total number of shares of Firm Securities
(subject to adjustment by CSFBC and SSB to eliminate fractions) and may be
purchased by the Underwriters only for the purpose of covering over-allotments
made in connection with the sale of the Firm Securities. No Optional Securities
shall be sold or delivered unless the Firm Securities previously have been, or
simultaneously are, sold and delivered. The right to purchase the Optional
Securities or any portion thereof may be exercised from time to time and to the
extent not previously exercised may be surrendered and terminated at any time
upon notice by CSFBC and SSB to the Company.
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Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "Optional Closing Date," which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "Closing Date"), shall be determined by CSFBC
and SSB but shall be not later than five full business days after written notice
of election to purchase Optional Securities is given. The Company will deliver
the Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters, against payment of
the purchase price therefor in Federal (same day) funds by wire transfer to an
account at a bank reasonably acceptable to CSFBC and SSB drawn to the order of
the Company, at the above office of Shearman & Sterling. The certificates for
the Optional Securities being purchased on each Optional Closing Date will be in
definitive form, in such denominations and registered in such names as CSFBC and
SSB request upon reasonable notice prior to such Optional Closing Date and will
be made available for checking and packaging at the above office of Shearman &
Sterling at a reasonable time in advance of such Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company. The Company agrees with the
several Underwriters that:
(a) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement, the
Company will file the Prospectus with the Commission pursuant to and in
accordance with the applicable subparagraph (as consented to by CSFBC
and SSB, which such consent shall not be unreasonably withheld) of Rule
424(b) not later than the second business day following the execution
and delivery of this Agreement). The Company will advise CSFBC and SSB
promptly of any such filing pursuant to Rule 424(b). If the Effective
Time of the Initial Registration Statement is prior to the execution
and delivery of this Agreement and an additional registration statement
is necessary to register a portion of the Offered Securities under the
Act but the Effective Time thereof has not occurred as of such
execution and delivery, the Company will file the additional
registration statement or, if filed, will file a post-effective
amendment thereto with the Commission pursuant to and in accordance
with Rule 462(b) on or prior to 10:00 P.M., New York City time, on the
date of this Agreement or, if earlier, on or prior to the time the
Prospectus is printed and distributed to any Underwriter, or will make
such filing at such later date as shall have been consented to by CSFBC
and SSB.
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(b) The Company will advise CSFBC and SSB promptly of any
proposal to amend or supplement the initial or any additional
registration statement as filed or the related prospectus or the
Initial Registration Statement, the Additional Registration Statement
(if any) or the Prospectus and will not effect such amendment or
supplementation without CSFBC's and SSB's consent, which such consent
shall not be unreasonably withheld; and the Company will also advise
CSFBC and SSB promptly of the effectiveness of each Registration
Statement (if its Effective Time is subsequent to the execution and
delivery of this Agreement) and of any amendment or supplementation of
a Registration Statement or the Prospectus and of the institution by
the Commission of any stop order proceedings in respect of a
Registration Statement and will use its reasonable best efforts to
prevent the issuance of any such stop order and to obtain as soon as
possible its lifting, if issued.
(c) If, at any time when a prospectus (not in excess of 12
months from the date hereof) relating to the Offered Securities is
required to be delivered under the Act in connection with sales by any
Underwriter, any event occurs as a result of which the Prospectus as
then amended or supplemented would include an 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 is necessary at any time when a
prospectus (not in excess of 12 months from the date hereof) relating
to the Offered Securities is required to be delivered under the Act in
connection with sales by any Underwriter to amend the Prospectus to
comply with the Act, the Company will promptly notify CSFBC and SSB of
such event and will promptly prepare and file with the Commission, at
its own expense, an amendment or supplement which will correct such
statement or omission or an amendment which will effect such
compliance. Neither CSFBC's and SSB's consent to, nor the Underwriters'
delivery of, any such amendment or supplement shall constitute a waiver
of any of the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the
Availability Date (as defined below), the Company will make generally
available to its securityholders an earnings statement covering a
period of at least 12 months beginning after the Effective Date of the
Initial Registration Statement (or, if later, the Effective Date of the
Additional Registration Statement) which will satisfy the provisions of
Section 11(a) of the Act (including, at the option of the Company, Rule
158 under the Act). For the purpose of the preceding sentence,
"Availability Date" means the 45th day after the end of the fourth
fiscal quarter following the fiscal quarter that includes such
Effective Date, except that, if such fourth fiscal quarter is the last
quarter of the Company's fiscal year, "Availability Date" means the
90th day after the end of such fourth fiscal quarter.
(e) The Company will furnish to the Representatives copies of
each Registration Statement (three of which will include all exhibits),
each related preliminary prospectus, and, so long as a prospectus
relating to the Offered Securities is required to be delivered under
the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in
each case in such quantities as CSFBC and SSB reasonably request. The
Prospectus shall be so furnished on or prior to 3:00 P.M., New York
City time, on the business day following the later of the execution and
delivery of this Agreement or the Effective Time of the Initial
Registration Statement. All other documents shall be so furnished as
soon as available. The Company will pay the expenses of printing and
distributing to the Underwriters all such documents.
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(f) The Company will use its reasonable best efforts to
arrange for the qualification of the Offered Securities for sale under
the laws of such jurisdictions as CSFBC and SSB reasonably designate
and will continue such qualifications in effect so long as required for
the distribution of the Offered Securities; provided that the Company
and its subsidiaries shall not be obligated to qualify as foreign
corporations in any jurisdiction in which they are not so qualified or
to file a general consent to service of process in any jurisdiction.
(g) During the period of three years hereafter, the Company
will furnish to the Representatives and, upon request, to each of the
other Underwriters, as soon as practicable after the end of each fiscal
year, a copy of its annual report to stockholders for such year; and
the Company will furnish to the Representatives as soon as available, a
copy of each report and any definitive proxy statement of the Company
filed with the Commission under the Exchange Act or mailed to
stockholders; provided, however, that this Section 5(g) shall not apply
to the extent that any such report or other document is available
through the Commission's XXXXX system.
(h) The Company will pay all expenses incident to the
performance of its obligations under this Agreement, for any filing
fees and other expenses (including reasonable fees and disbursements of
counsel) incurred in connection with qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFBC and
SSB reasonably designate and the printing of memoranda relating
thereto, for the filing fee incident to the review by the National
Association of Securities Dealers, Inc. of the Offered Securities, for
any travel expenses of the Company's officers and employees and any
other expenses of the Company in connection with attending or hosting
meetings with prospective purchasers of the Offered Securities and for
expenses incurred in distributing preliminary prospectuses and the
Prospectus (including any amendments and supplements thereto) to the
Underwriters.
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(i) For a period of 90 days after the date of this Agreement,
the Company will not offer, sell, contract to sell, pledge or otherwise
dispose of, directly or indirectly, or file with the Commission a
registration statement under the Act relating to, any additional shares
of its Securities or securities convertible into or exchangeable or
exercisable for any shares of its Securities, or publicly disclose its
intention to make any such offer, sale, pledge, disposition or filing,
without the prior written consent of CSFBC and SSB, except for (A)
issuances of Securities pursuant to the conversion or exchange of
convertible or exchangeable securities or the exercise of warrants or
options, in each case outstanding on the date hereof, (B) grants of
employee or non-employee director stock options pursuant to the terms
of a plan in effect on the date hereof, (C) issuances of Securities
pursuant to the exercise of such options or the exercise of any other
employee or non-employee director stock options outstanding on the date
hereof or issuances of Securities pursuant to the Company's dividend
reinvestment plan, (D) transfers of Securities to charitable
organizations, provided the transferee(s) agree(s) to be bound by the
terms of this provision, (E) any Securities or common stock purchase
rights issued under the Company's stockholder rights plan, (F) the
filing of any registration statements in connection with the
registration and sale of shares of Securities pursuant to employee and
non-employee director benefit plans, (G) the sale of the Company's
equity security units to the Underwriters in the concurrent offering
and sale of such securities and, in connection therewith, any issuance
and sale of Securities and the creation of stripped units or normal
units (as each of such terms are used in the prospectus relating to
such equity security units) which may be created or recreated as
described in such prospectus, (H) any registration statement filed with
the Commission relating to such equity security units pursuant to Rule
462(b) under the Act, (I) issuances of Securities to directors of the
Company in lieu of fees and (J) any offering or sale of Securities by
the Company in connection with the vesting of restricted stock awards
granted to employees, and the filing of any registration statements in
connection therewith.
6. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, as of the date hereof and as of
the Closing Date, to the accuracy of the statements of Company officers 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:
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(a) The Representatives shall have received a letter, dated
the date of delivery thereof (which, if the Effective Time of the
Initial Registration Statement is prior to the execution and delivery
of this Agreement, shall be on or prior to the date of this Agreement
or, if the Effective Time of the Initial Registration Statement is
subsequent to the execution and delivery of this Agreement, shall be
prior to the filing of the amendment or post-effective amendment to the
registration statement to be filed shortly prior to such Effective
Time), of Ernst & Young, LLP confirming that they are independent
public accountants within the meaning of the Act and the applicable
published Rules and Regulations thereunder and stating substantially to
the effect that:
(i) in their opinion the financial statements and
schedules examined by them and included or incorporated by
reference in the Registration Statements comply as to form in
all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations;
(ii) have performed the procedures specified by the
American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements included in
the Registration Statements;
(iii) on the basis of the review referred to in
clause (ii) above, a reading of the latest available interim
financial statements of the Company, inquiries of officials of
the Company who have responsibility for financial and
accounting matters and other specified procedures, nothing
came to their attention that caused them to believe that:
(A) the unaudited financial statements and
summary of earnings included in the
Registration Statements do not comply as to
form in all material respects with the
applicable accounting requirements of the
Act and the related published Rules and
Regulations or any material modifications
should be made to such unaudited financial
statements for them to be in conformity with
generally accepted accounting principles;
(B) at the date of the latest available
balance sheet read by such accountants, or
at a subsequent specified date not more than
three business days prior to the date of
this Agreement, there was any change in the
capital stock or any increase in short-term
indebtedness or long-term debt of the
Company and its consolidated subsidiaries
or, at the date of the latest available
balance sheet read by such accountants,
there was any decrease in consolidated net
current assets or net assets, as compared
with amounts shown on the latest balance
sheet included in the Prospectus; or
13
(C) for the period from the closing date of
the latest income statement included in the
Prospectus to the closing date of the latest
available income statement read by such
accountants there were any decreases, as
compared with the corresponding period of
the previous year in consolidated net sales
or net operating income or consolidated net
income,
except in all cases set forth in clauses (B) and (C) above for
changes, increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such
letter; and
(iv) they have compared specified dollar
amounts (or percentages derived from such dollar
amounts) and other financial information contained in
the Registration Statements (in each case to the
extent that such dollar amounts, percentages and
other financial information are derived from the
general accounting records of the Company and its
subsidiaries subject to the internal controls of the
Company's accounting system or are derived directly
from such records by analysis or computation) with
the results obtained from inquiries, a reading of
such general accounting records and other procedures
specified in such letter and have found such dollar
amounts, percentages and other financial information
to be in agreement with such results, except as
otherwise specified in such letter.
For purposes of this subsection, (i) if the Effective Time of the
Initial Registration Statement is subsequent to the execution and
delivery of this Agreement, "Registration Statements" shall mean the
initial registration statement as proposed to be amended by the
amendment or post-effective amendment to be filed shortly prior to its
Effective Time, (ii) if the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement but
the Effective Time of the Additional Registration is subsequent to such
execution and delivery, "Registration Statements" shall mean the
Initial Registration Statement and the additional registration
statement as proposed to be filed or as proposed to be amended by the
post-effective amendment to be filed shortly prior to its Effective
Time, and (iii) "Prospectus" shall mean the prospectus included in the
Registration Statements. All financial statements and schedules
included in material incorporated by reference into the Prospectus
shall be deemed included in the Registration Statements for purposes of
this subsection.
14
(b) If the Effective Time of the Initial Registration
Statement is not prior to the execution and delivery of this Agreement,
such Effective Time shall have occurred not later than 10:00 P.M., New
York City time, on the date of this Agreement or such later date as
shall have been consented to by CSFBC and SSB, which consent shall not
be unreasonably withheld. If the Effective Time of the Additional
Registration Statement (if any) is not prior to the execution and
delivery of this Agreement, such Effective Time shall have occurred not
later than 10:00 P.M., New York City time, on the date of this
Agreement or, if earlier, the time the Prospectus is printed and
distributed to any Underwriter, or shall have occurred at such later
date as shall have been consented to by CSFBC and SSB, which consent
shall not be unreasonably withheld. If the Effective Time of the
Initial Registration Statement is prior to the execution and delivery
of this Agreement, the Prospectus shall have been filed with the
Commission in accordance with the Rules and Regulations and Section
5(a) of this Agreement. Prior to such Closing Date, no stop order
suspending the effectiveness of a Registration Statement shall have
been issued and no proceedings for that purpose shall have been
instituted or, to the knowledge of the Company or the Representatives,
shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any
development or event involving a prospective change, in the financial
condition, business, prospects, properties, or results of operations of
the Company and its subsidiaries taken as a whole which, in the
judgment of a majority in interest of the Underwriters including the
Representatives, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the
sale of and payment for the Offered Securities; (ii) any downgrading to
below investment grade in the rating of any debt securities of the
Company by Moody's Investor's Service, Inc. or Standard and Poor's
Ratings Services, a Division of the McGraw Hill Companies, Inc.; (iii)
any material and adverse change in U.S. or international financial,
political or economic conditions as would, in the judgment of a
majority in interest of the Underwriters including the Representatives,
be likely to prejudice materially the success of the proposed issue,
sale or distribution of the Offered Securities, whether in the primary
market or in respect of dealings in the secondary market; (iv) any
material suspension or material limitation of trading in securities
generally on the New York Stock Exchange, or any setting of minimum
prices for trading on such exchange, or any suspension of trading of
any securities of the Company on any exchange or in the
over-the-counter market; (v) any banking moratorium declared by U.S.
Federal or New York authorities; (vi) any major disruption of
settlements of securities or clearance services in the United States or
(vii) any attack on, outbreak or escalation of hostilities or material
act of terrorism involving the United States, any declaration of war by
Congress or any other national or international calamity or emergency
if, in the judgment of a majority in interest of the Underwriters
including the Representatives, the effect of any such attack, outbreak,
escalation, act, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
15
(d) At the Closing Date, the Representatives shall have
received an opinion, dated such Closing Date, of Xxxxxxx Xxxxxxx &
Xxxxxxxx, counsel for the Company, dated as of the Closing Date
substantially to the effect that:
(i) The Company has been duly incorporated and is
validly existing and in good standing as a corporation under
the laws of the State of Delaware and has full corporate power
and authority to conduct its business as described in the
Registration Statement and Prospectus.
(ii) The Offered Securities delivered on such Closing
Date have been duly authorized and, upon payment and delivery
in accordance with this Agreement, will be validly issued,
fully paid and nonassessable.
(iii) The statements made in the Prospectus under the
caption "Description of Common Stock", insofar as they purport
to constitute summaries of the terms of the Securities
(including the Offered Securities), constitute accurate
summaries of the terms of the Securities in all material
respects.
(iv) This Agreement has been duly authorized,
executed and delivered by the Company.
(v) The issue and sale of the Offered Securities by
the Company and the compliance by the Company with all of the
provisions of this Agreement will not breach or result in a
default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument filed or
incorporated by reference as an exhibit to the Registration
Statement, nor will such action violate the Restated
Certificate of Incorporation or Amended and Restated By-laws
of the Company or any federal or New York state statute or the
Delaware General Corporation Law or any rule or regulation
that has been issued pursuant to any federal or New York state
statute or the Delaware General Corporation Law or any order
known to such counsel issued pursuant to any federal or New
York state statute or the Delaware General Corporation Law by
any court or governmental agency or body or court having
jurisdiction over the Company or any its Significant
Subsidiaries or any of their properties.
16
(vi) No consent, approval, authorization, order,
registration or qualification of or with any federal or New
York state governmental agency or body or any Delaware state
governmental agency or body acting pursuant to the Delaware
General Corporation Law or, to such counsel's knowledge, any
federal or New York state court or any Delaware state court
acting pursuant to the Delaware General Corporation Law is
required for the issue and sale of the Offered Securities by
the Company and the compliance by the Company with all of the
provisions of this Agreement, except for the registration
under the Act and the Exchange Act of the Offered Securities,
and such consents, approvals, authorizations, registrations or
qualifications as have been obtained or made or as may be
required under state securities or Blue Sky laws in connection
with the purchase and distribution of the Offered Securities
by the Underwriters.
(vii) The Registration Statement has become effective
under the Act and the Prospectus was filed on the date
specified in such opinion pursuant to the subsection of Rule
424(b) of the rules and regulations of the Commission under
the Act specified in such opinion and, to such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued or proceeding for that
purpose has been instituted or threatened by the Commission.
(viii) There are no preemptive rights under the
federal or New York state law or under the Delaware General
Corporation Law or pursuant to the Company's Restated
Certificate of Incorporation or Amended and Restated By-laws
to subscribe for or purchase shares of the Securities.
(ix) The Company is not an "investment company"
within the meaning of, and subject to regulation under, the
Investment Company Act of 1940, as amended.
Such opinion shall also include a statement
substantially to the effect that: Such counsel has not
independently verified the accuracy, completeness or fairness
of the statements made or included in the Registration
Statement, the Prospectus or the Exchange Act documents
incorporated by reference therein and takes no responsibility
therefor, except as and to the extent set forth in paragraph
(iii) above. In the course of the preparation by the Company
of the Registration Statement and the Prospectus (excluding
the Exchange Act documents incorporated by reference therein),
17
such counsel participated in conferences with certain officers
and employees of the Company, with representatives of Ernst &
Young LLP and with counsel to the Company. Such counsel did
not participate in the preparation of the Exchange Act
documents incorporated by reference in the Registration
Statement and the Prospectus, except that such counsel had an
opportunity to review the Company's Annual Report on Form 10-K
for the fiscal year ended February 2, 2002 prior to its filing
with the Commission. Based upon such counsel's examination of
the Registration Statement, the Prospectus and the Exchange
Act documents incorporated by reference therein, such
counsel's investigations made in connection with the
preparation of the Registration Statement and the Prospectus
(excluding the Exchange Act documents incorporated by
reference therein) and such counsel's participation in the
conferences referred to above, (i) such counsel is of the
opinion that the Registration Statement, as of its effective
date and as of such Closing, and the Prospectus, as of its
date, complied as to the form in all material respects with
the requirements of the Act and the applicable rules and
regulations of the Commission thereunder and that the Exchange
Act documents incorporated by reference in the Registration
Statement and the Prospectus complied as to form when filed in
all material respects with the requirements of the Exchange
Act and the applicable rules and regulations of the Commission
thereunder, except that in each case such counsel shall
express no opinion with respect to the financial statements or
other financial data contained or incorporated by reference in
the Registration Statement, the Prospectus or the Exchange Act
documents incorporated by reference therein, and (ii) such
counsel has no reason to believe that the Registration
Statement, as of its effective date (including the Exchange
Act documents incorporated by reference therein on file with
the Commission on such effective date), contained any untrue
statement of a material fact or omitted to state any material
fact required to be stated therein or necessary in order to
make the statements therein not misleading or that the
Prospectus or any amendment or supplement thereto, as of its
date or as of such Closing Date (including the Exchange Act
documents incorporated by reference therein) contains any
untrue statement of a material fact or omits to state any
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading, or any amendment or supplement
thereto, as of its date or as of such Closing Date except that
in each case such counsel shall express no belief with respect
to the financial statements or other financial data contained
or incorporated by reference in the Registration Statement,
the Prospectus or the Exchange Act documents incorporated
therein.
18
Such opinion shall be limited in all respects to
matters governed by the laws of the State of New York, the
Delaware General Corporation Law and the Federal laws of the
United States of America. Such counsel may rely as to certain
matters of fact, to the extent they deem proper, on
certificates of officers of the Company and public officials.
(e) The Representatives shall have received an opinion, dated
such Closing Date, of Xxxxxxxxxxx X. Xxx, Esq., Executive Vice
President-Operations and General Counsel of the Company, substantially
to the effect that:
(i) To such counsel's knowledge, the Company is duly
qualified to do business as a foreign corporation in good
standing in all jurisdictions in which the ownership or lease
of property or the conduct of its business requires such
qualification, except where the failure to be so qualified
would, individually or in the aggregate, not reasonably be
expected to have a Material Adverse Effect.
(ii) All outstanding shares of the Securities of the
Company and Significant Subsidiaries have been duly authorized
and validly issued and are fully paid and nonassessable.
(iii) To such counsel's knowledge, there are no
contracts or agreements between the Company and any person
granting such person the right (other than rights which have
been waived or satisfied) to require the Company to include
any securities of the Company owned or to be owned by such
person in the securities registered pursuant to the
Registration Statement.
(iv) to the knowledge of such counsel, there is no
pending or threatened action, suite 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 of a character required to be disclosed
in the Registration Statement or the Prospectus which is not
adequately described as required, and there is no franchise,
contract or other document of a character required to be
described in the Registration Statement or Prospectus, or to
be filed as an exhibit thereto, which is not described or
filed as required.
Such opinion shall be limited in al respects
to matters governed by the Delaware General Corporation Law
and the Federal laws of the United States of America. Such
counsel may rely as to certain matters of fact, to the extent
he deems proper, on certificates of officers of the Company
and public officials.
19
(f) The Representatives shall have received from Shearman &
Sterling, counsel for the Underwriters, such opinion or opinions, dated
such Closing Date, with respect to the incorporation of the Company,
the validity of the Offered Securities delivered on such Closing Date,
the Registration Statements, the Prospectus and other related matters
as the Representatives may reasonably require, and the Company shall
have furnished to such counsel such documents as they reasonably
request for the purpose of enabling them to pass upon such matters.
(g) The Representatives shall have received a certificate,
dated such Closing Date, of the President or any Vice President and a
principal financial or accounting officer of the Company in which such
officers, to the best of their knowledge after reasonable
investigation, shall state that: the representations and warranties of
the Company in this Agreement are true and correct; the Company has
complied with all agreements and satisfied all conditions on its part
to be performed or satisfied hereunder at or prior to such Closing
Date; no stop order suspending the effectiveness of any Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are contemplated by the Commission; the Additional
Registration Statement (if any) satisfying the requirements of
subparagraphs (1) and (3) of Rule 462(b) was filed pursuant to Rule
462(b), including payment of the applicable filing fee in accordance
with Rule 111(a) or (b) under the Act, prior to the time the Prospectus
was printed and distributed to any Underwriter; and, subsequent to
February 2, 2002 (the date of the most recent audited financial
statements incorporated by reference in the Prospectus), there has been
no material adverse change, nor any development or event involving a
prospective material adverse change, in the financial condition,
business, properties, or results of operations of the Company and its
subsidiaries taken as a whole except as set forth in or contemplated by
the Prospectus or as described in such certificate.
(h) The Representatives shall have received a letter, dated
such Closing Date, of Ernst & Young, LLP which meets the requirements
of subsection (a) of this Section 6, except that the specified date
referred to in such subsection will be a date not more than three days
prior to such Closing Date for the purposes of this subsection.
(i) If an of the conditions specified in the Section 6 shall
not have been fulfilled in all material respects when and as provided
in this Agreement, this Agreement and all obligations of the
Underwriters hereunder may be cancelled at, or at any time prior to,
the Closing Date by the Underwriters. Notice of such cancellation shall
be given to the Company in writing or by telephone or facsimile
confirmed in writing.
20
(j) On or prior to the date of this Agreement, the
Representatives shall have received lock-up letters from each of the
executive officers and directors of the Company set forth on Schedule C
hereto.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. CSFBC and SSB may in their sole discretion waive on behalf of the
Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
7. Indemnification and Contribution. (a) The Company will
indemnify and hold harmless each Underwriter, its partners, directors
and officers and each person, if any, who controls such Underwriter
within the meaning of Section 15 of the Act, against any losses,
claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act 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 any material fact contained in any Registration
Statement, the Prospectus, or any amendment or supplement thereto, or
any related preliminary prospectus, 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 not misleading, and will, subject to subsection (c) of this
Section 7, reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred (it being understood, however,
that the Company shall, in connection with any one such 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 the reasonable fees and expenses of only
one separate firm of attorneys (in addition to any local counsel) at
any time for all such Underwriters, directors, partners, officers and
controlling persons, which firm shall be designated in writing by CSFBC
and SSB); 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 an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents
in reliance upon and in conformity with written information furnished
to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the
only such information furnished by any Underwriter consists of the
information described as such in subsection (b) below; provided
further, that with respect to any untrue statement or alleged untrue
statement or omission or alleged omission of material fact made in any
Preliminary Prospectus, the indemnity agreement contained in this
Section 7(a) shall not inure to the benefit of any Underwriter (or its
partners, directors, officers or controlling persons) from whom the
person asserting any such loss, claim, damage or liability purchased
the securities concerned, to the extent that any such loss, claim,
damage or liability of such Underwriter (for its partners, directors,
officers, or controlling persons) occurs under the circumstance the
untrue statement or alleged statement or omission or alleged omission
of a material (or its partners, directors, officers or controlling
persons) fact contained in the Preliminary Prospectus was corrected in
the Prospectus and there was not sent or given to such person, at or
prior to the written confirmation of the sale of such securities to
such person, a copy of the Prospectus.
21
(b) Each Underwriter will severally and not jointly indemnify
and hold harmless the Company, its directors and officers and each
person, if any who controls the Company within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, against any losses,
claims, damages or liabilities to which the Company may become subject,
under the Act 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 any material
fact contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus,
or arise out of or are based upon the omission or the alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to
the Company by such Underwriter through the Representatives
specifically for use therein, and will reimburse any legal or other
expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred, it being understood and agreed
that the only such information furnished by any Underwriter consists of
the following information in the Prospectus furnished on behalf of each
Underwriter: the concession and reallowance figures appearing in the
fourth paragraph under the caption "Underwriting," the information
contained in the ninth, tenth, eleventh, twelfth and thirteenth
paragraphs under the caption "Underwriting" and the penultimate
paragraph on the cover page.
(c) Promptly after receipt by an indemnified party under this
Section 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 subsection (a) or (b) above, notify the
indemnifying party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any liability
which it may have to any indemnified party otherwise than under
subsection (a) or (b) above. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party
(who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party will not be liable
to such indemnified party under this Section 9 for any legal or other
expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation.
No indemnifying party shall, without the prior written consent of the
indemnified party (which consent shall not be unreasonably withheld),
effect any settlement of any pending or threatened action in respect of
which any indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party unless such
settlement (i) includes an unconditional release of such indemnified
party from all liability on any claims that are the subject matter of
such action and (ii) does not include a statement as to, or an
admission of, fault, culpability or a failure to act by or on behalf of
an indemnified party. No indemnifying party shall be liable for any
settlement of any such action effected without the indemnifying party's
written consent (which consent shall not be unreasonably withheld),
unless (i) such settlement is entered into more than 30 days after
receipt by the indemnifying party of written notice of the proposed
settlement, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 20 days prior to such settlement
being entered into and (iii) such indemnifying party shall not have
reimbursed such indemnified party in accordance with such request prior
to the date of such settlement.
22
(d) If the indemnification provided for in this Section 9 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a
result of the losses, claims, damages or liabilities referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand
and the Underwriters on the other from the offering of the Securities
or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted
in such losses, claims, damages or liabilities as well as any other
relevant equitable considerations. The relative benefits received by
the Company on the one hand and the Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from the
offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions received by the
Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information supplied by the Company or the Underwriters
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission.
The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of
this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the
subject of this subsection (d). Notwithstanding the provisions of this
subsection (d), no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. 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. The Underwriters'
obligations in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations and not joint.
23
(e) The obligations of the Company under this Section 9 shall
be in addition to any liability which the Company may otherwise have
and shall extend, upon the same terms and conditions, to each person,
if any, who controls any Underwriter within the meaning of the Act; and
the obligations of the Underwriters under this Section shall be in
addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to
each director of the Company, to each officer of the Company who has
signed a Registration Statement and to each person, if any, who
controls the Company within the meaning of the Act or the Exchange Act.
8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase Offered Securities hereunder on either the
First or any Optional Closing Date and the aggregate number of shares of Offered
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of Offered Securities
that the Underwriters are obligated to purchase on such Closing Date, CSFBC and
SSB may make arrangements satisfactory to the Company for the purchase of such
Offered Securities by other persons, including any of the Underwriters, but if
no such arrangements are made by such Closing Date, the non-defaulting
Underwriters shall be obligated severally, in proportion to their respective
commitments hereunder, to purchase the Offered Securities that such defaulting
Underwriters agreed but failed to purchase on such Closing Date. If any
Underwriter or Underwriters so default and the aggregate number of shares of
Offered Securities with respect to which such default or defaults occur exceeds
10% of the total number of shares of Offered Securities that the Underwriters
are obligated to purchase on such Closing Date and arrangements satisfactory to
CSFBC and SSB and the Company for the purchase of such Offered Securities by
other persons are not made within 36 hours after such default, this Agreement
will terminate without liability on the part of any non-defaulting Underwriter
or the Company, except as provided in Section 9 (provided that if such default
occurs with respect to Optional Securities after the First Closing Date, this
Agreement will not terminate as to the Firm Securities or any Optional
Securities purchased prior to such termination). As used in this Agreement, the
term "Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
24
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If this Agreement is terminated pursuant
to Section 8 or if for any reason the purchase of the Offered Securities by the
Underwriters is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company and the Underwriters pursuant to Section 7 shall
remain in effect, and if any Offered Securities have been purchased hereunder
the representations and warranties in Section 2 and all obligations under
Section 5 shall also remain in effect. If the purchase of the Offered Securities
by the Underwriters is not consummated for any reason other than solely because
of the termination of this Agreement pursuant to Section 8 or the occurrence of
any event specified in clause (iii), (iv), (v), (vi) or (vii) of Section 6(c),
the Company will reimburse the Underwriters for all out-of-pocket expenses
(including reasonable fees and disbursements of counsel to the Underwriters)
reasonably incurred by them in connection with the offering of the Offered
Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representatives c/o Credit Suisse First Boston Corporation, Eleven
Madison Avenue, New York, N.Y. 10010-3629, Attention: Transactions Advisory
Group, and Xxxxxxx Xxxxx Xxxxxx Inc., at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx, 00000, Attention: General Counsel; or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at 000 Xxxx Xxxx, Xxxxxxx,
Xxx Xxxxxx 00000, Attention: General Counsel; provided, however, that any notice
to an Underwriter pursuant to Section 7 will be mailed, delivered or telegraphed
and confirmed to such Underwriter. The Representatives shall promptly furnish
the address of any Underwriter upon the request of the Company.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7, and no other
person will have any right or obligation hereunder.
12. Representation of Underwriters. The Representatives will act for
the several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly will be binding upon all the
Underwriters.
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13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York.
26
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
If the foregoing is in accordance with the Representatives'
understanding of our agreement, kindly sign and return to the Company one of the
counterparts hereof, whereupon it will become a binding agreement between the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
TOYS "R" US, INC.
By: __________________
[Title]
The foregoing Underwriting Agreement is
hereby confirmed and accepted as of the date
first above written
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXXX XXXXX BARNEY INC.
By: CREDIT SUISSE FIRST BOSTON
CORPORATION
By: ________________________
[Title]
By: XXXXXXX XXXXX XXXXXX INC.
By: ________________________
[Title]
Acting on behalf of themselves and as
the Representatives of the
several Underwriters.
27
SCHEDULE A
Number of
Firm Securities
Underwriter to be Purchased
----------- ---------------
Credit Suisse First Boston Corporation.......................................
Xxxxxxx Xxxxx Barney Inc. ...................................................
X.X. Xxxxxx Securities Inc...................................................
Xxxxxxx, Sachs & Co..........................................................
BNY Capital Markets, Inc.....................................................
Xxxxx Xxxxxx & Co., Inc......................................................
Xxxxxx Xxxxxx Xxxxxxxx & Co., Inc............................................
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated.........................................
XX Xxxxx Securities Corporation..............................................
Xxxxx Fargo Securities, LLC..................................................
-------------
Total ............................................................
SCHEDULE B
List of persons and entities subject to lock-up
SCHEDULE C
List of Company's Significant Subsidiaries
