<PAGE>
As filed with the Securities and Exchange Commission on February 6, 1997
Registration No. 333-20521
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
THE ESTEE LAUDER COMPANIES INC.
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<S> <C> <C>
Delaware 2844 11-2408943
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer Identification No.)
Incorporation or Organization) Classification Number)
</TABLE>
------------------------
767 Fifth Avenue
New York, New York 10153
(212) 572-4200
(Address, Including Zip Code, and Telephone Number,
including Area Code, of Registrant's Principal Executive Offices)
------------------------
Saul H. Magram, Esq.
Senior Vice President, General Counsel and Secretary
The Estee Lauder Companies Inc.
767 Fifth Avenue
New York, New York 10153
(212) 572-4200
(Name and Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent For Service)
------------------------
Please send copies of communications to:
<TABLE>
<S> <C>
Jeffrey J. Weinberg, Esq. Jean E. Hanson, Esq.
Akiko Mikumo, Esq. Fried, Frank, Harris, Shriver &
Weil, Gotshal & Manges LLP Jacobson
767 Fifth Avenue One New York Plaza
New York, New York 10153 New York, New York 10004
(212) 310-8000 (212) 859-8000
</TABLE>
------------------------
Approximate date of commencement of proposed sale of the securities to the
public: As soon as practicable after this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended ('Securities Act'), other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. / /
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
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- --------------------------------------------------------------------------------
<PAGE>
INTRODUCTORY NOTE
This Amendment No. 1 to Registration Statement No. 333-20521 is being filed
with the Securities and Exchange Commission in order to include Exhibits 1.1,
5.1 and 23.2 thereto. The Prospectus which forms a part of this Amendment No. 1
is identical to the Prospectus as filed with the Securities and Exchange
Commission on January 28, 1997, which Prospectus is not separately included in
this Amendment No. 1.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the expenses expected to be incurred in
connection with the Offerings described in this Registration Statement, other
than the underwriting discount. All amounts, except the SEC registration fees,
the National Association of Securities Dealers, Inc. ('NASD') filing fee and the
New York Stock Exchange additional listing fee, are estimated.
<TABLE>
<S> <C>
SEC registration fee......................................... $ 98,215
NASD filing fee.............................................. 30,500
Printing, engraving and postage fees......................... 200,000
Legal fees and expenses...................................... 150,000
Accounting fees and expenses................................. 50,000
Miscellaneous................................................ 1,285
-----------
Total...................................................... $ 530,000
-----------
-----------
</TABLE>
The Selling Stockholders have agreed to bear their proportionate share of
the expenses.
Item 15. Indemnification of Directors and Officers
Generally, Section 145 of the General Corporation Law of the State of
Delaware (the 'GCL') permits a corporation to indemnify certain persons made a
party to an action, by reason of the fact that such person is or was a director,
officer, employee or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation or enterprise. To the extent that person has been successful in any
such matter, that person shall be indemnified against expenses actually and
reasonably incurred by him. In the case of an action by or in the right of the
corporation, no indemnification may be made in respect of any matter as to which
that person was adjudged liable unless and only to the extent that the Delaware
Court of Chancery or the court in which the action was brought determines that
despite the adjudication of liability that person is fairly and reasonably
entitled to indemnity for proper expenses.
The Company's By-laws provide for indemnification of its directors and
officers to the fullest extent permitted by law.
Section 102(b)(7) of the GCL enables a Delaware corporation to include a
provision in its certificate of incorporation limiting a director's liability to
the corporation or its stockholders for monetary damages for breaches of
fiduciary duty as a director. The Company has adopted a provision in its
Certificate of Incorporation that provides for such limitation to the full
extent permitted under Delaware law.
The directors and officers of the Company are covered by insurance policies
indemnifying against certain liabilities, including certain liabilities arising
under the Securities Act which might be incurred by them in such capacities and
against which they may not be indemnified by the Company.
II-1
<PAGE>
Item 16. Exhibits and Financial Schedules
(a) Exhibits:
Exhibits identified in parentheses below are on file with the SEC and are
incorporated herein by reference to such previous filings. All other exhibits
are filed as part of this Registration Statement.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- ------- ----------------------
<S> <C> <C>
1.1 -- Form of Underwriting Agreement.**
(3.1) -- Restated Certificate of Incorporation (filed as Exhibit 3.1 to Amendment No. 3 to the
Company's Registration Statement on Form S-1 (No. 33-97180) on November 13, 1995 (the
'S-1')).
(3.2) -- Form of Amended and Restated By-Laws (filed as Exhibit 3.2 to the S-1).
5.1 -- Opinion of Weil, Gotshal & Manges LLP with respect to legality of the Class A Common
Stock.**
23.1 -- Consent of Arthur Andersen LLP.
23.2 -- Consent of Weil, Gotshal & Manges LLP (included in the opinion filed as Exhibit 5.1).**
24.1 -- Power of Attorney.
</TABLE>
- ------------------
** Filed with this amendment.
Item 17. Undertakings
The Registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Registrant's Annual
Report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of
1934, as amended (the 'Exchange Act') (and where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in the Registration Statement shall be
deemed to be a new registration statem ent relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in New York, New York, on this 6 day of February, 1997.
THE ESTEE LAUDER COMPANIES INC.
By: /s/ ROBERT J. BIGLER
-------------------------------
Name: Robert J. Bigler
Title: Senior Vice President and
Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title
--------- -----
<C> <S>
* Chief Executive Officer and Director
- ---------------------------------------- (principal executive officer)
Leonard A. Lauder
* Director
- ----------------------------------------
Ronald S. Lauder
* Director
- ----------------------------------------
William P. Lauder
* Director
- ----------------------------------------
Fred H. Langhammer
* Director
- ----------------------------------------
Marshall Rose
* Director
- ----------------------------------------
P. Roy Vagelos
Director
- ----------------------------------------
Faye Wattleton
* Senior Vice President and Chief Financial Officer (principal
- ---------------------------------------- financial and accounting officer)
Robert J. Bigler
*By /s/ ROBERT J. BIGLER
- ----------------------------------------
Robert J. Bigler
Attorney-in-Fact
</TABLE>
Dated: February 6, 1997
II-3
<PAGE>
EXHIBITS
The following is a complete list of Exhibits filed as part of this
Registration Statement, which are incorporated herein:
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit
- ------ ----------------------
<S> <C>
1.1 Form of Underwriting Agreement.**
3.1 Restated Certificate of Incorporation (filed as Exhibit 3.1 to Amendment No. 3 to the Company's
Registration Statement on Form S-1 (No. 33-97180) on November 13, 1995 (the 'S-1')).
3.2 Form of Amended and Restated By-Laws (filed as Exhibit 3.2 to the S-1).
5.1 Opinion of Weil, Gotshal & Manges LLP with respect to legality of the Class A Common Stock.**
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Weil, Gotshal & Manges LLP (included in the opinion filed as Exhibit 5.1).**
24.1 Power of Attorney.
</TABLE>
- ------------------
** Filed with this amendment.
<PAGE>
Exhibit 1.1
THE ESTEE LAUDER COMPANIES INC.
Class A Common Stock
(par value $.01 per share)
-----------------------
Underwriting Agreement
(U.S. Version)
-----------------------
February __, 1997
Goldman, Sachs & Co.,
Dillon, Read & Co. Inc.,
Merrill Lynch, Pierce, Fenner & Smith
Incorporated,
J.P. Morgan Securities Inc.
As representatives of the several
Underwriters named in Schedule I hereto
c/o Goldman, Sachs & Co.,
85 Broad Street,
New York, New York 10004
Ladies and Gentlemen:
Certain stockholders of The Estee Lauder Companies Inc., a Delaware
corporation (the "Company"), named in Schedule II hereto (the "Selling
Stockholders") propose, subject to the terms and conditions stated herein, to
sell to the Underwriters named in Schedule I hereto (the "Underwriters") an
aggregate of 4,532,000 shares of Class A Common Stock, par value $.01 per share
("Stock"), of the Company, and the Company proposes, subject to the terms and
conditions stated herein, to issue and sell to the Underwriters at their
election up to an aggregate of 679,800 shares of Stock. The 4,532,000 shares to
be sold by the Selling Stockholders are herein called the "Firm Shares," and the
679,800 additional shares to be sold by the Company are herein called the
"Optional Shares". The Firm Shares and the Optional Shares that the Underwriters
elect to purchase pursuant to Section 2 hereof are herein collectively called
the "Shares".
It is understood and agreed to by all parties that the Company and the
Selling Stockholders are concurrently entering into an agreement (the
"International Underwriting Agreement") providing for the sale by the Selling
Stockholders and, with respect to the overallotment option thereunder, the
Company of up to a total of 1,302,950 shares of Stock (the "International
Shares"), including the overallotment option thereunder, through arrangements
with certain underwriters outside the United States (the "International
Underwriters") for whom Goldman Sachs International, Dillon Read & Co. Inc.,
Merrill Lynch International and J.P. Morgan Securities Ltd. are acting as lead
managers. Anything herein or therein to the contrary notwithstanding, the
respective closings under this Agreement and the International Underwriting
Agreement are hereby expressly made conditional on one another. The Underwriters
hereunder and the International Underwriters are simultaneously entering into an
<PAGE>
Agreement between U.S. and International Underwriting Syndicates (the "Agreement
between Syndicates") which provides, among other things, for the transfer of
shares of Stock between the two syndicates. Two forms of prospectus are to be
used in connection with the offering and sale of shares of Stock contemplated by
the foregoing, one relating to the Shares hereunder and the other relating to
the International Shares. The latter form of prospectus will be identical to the
former except for certain substitute pages as included in the registration
statement and amendments thereto as mentioned below. Except as used in Sections
2, 3, 4, 9 and 11 herein, and except as the context may otherwise require,
references hereinafter to the Shares shall include all the shares of Stock which
may be sold pursuant to either this Agreement or the International Underwriting
Agreement, and references herein to any prospectus whether in preliminary or
final form, and whether as amended or supplemented, shall include both the U.S.
and the international versions thereof.
1. (a) The Company represents and warrants to, and agrees with,
each of the Underwriters that:
(i) A registration statement on Form S-3 (File No. 333-20521)
(the "Initial Registration Statement") in respect of the Shares has
been filed with the Securities and Exchange Commission (the
"Commission"); the Initial Registration Statement and any
post-effective amendment thereto, each in the form heretofore delivered
to you, and, excluding exhibits thereto, but including all documents
incorporated by reference in the prospectus contained therein, to you
for each of the other Underwriters, have been declared effective by the
Commission in such form; other than a registration statement, if any,
increasing the size of the offering (a "Rule 462(b) Registration
Statement"), filed pursuant to Rule 462(b) under the Securities Act of
1933, as amended (the "Act"), which became effective upon filing, no
other document with respect to the Initial Registration Statement or
document incorporated by reference therein has heretofore been filed
with the Commission; and no stop order suspending the effectiveness of
the Initial Registration Statement, any post-effective amendment
thereto or the Rule 462(b) Registration Statement, if any, has been
issued and no proceeding for that purpose has been initiated or
threatened by the Commission (any preliminary prospectus included in
the Initial Registration Statement or filed with the Commission
pursuant to Rule 424(a) of the rules and regulations of the Commission
under the Act, is hereinafter called a "Preliminary Prospectus"; the
various parts of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, including all exhibits thereto and
including (i) the information contained in the form of final prospectus
filed with the Commission pursuant to Rule 424(b) under the Act in
accordance with Section 5(a) hereof and deemed by virtue of Rule 430A
under the Act to be part of the Initial Registration Statement at the
time it was declared effective or such part of the Rule 462(b)
Registration Statement, if any, became or hereafter becomes effective
and (ii) the documents incorporated by reference in the prospectus
contained in the registration statement at the time such part of the
registration statement became effective, each as amended at the time
such part of the registration statement became effective, are
hereinafter collectively called the "Registration Statement"; and such
final prospectus, in the form first filed pursuant to Rule 424(b) under
the Act, is hereinafter called the "Prospectus"); any reference herein
to any Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Act, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any reference
to any amendment or supplement to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include any documents filed
after the date of such Preliminary Prospectus or Prospectus, as the
case may be, under the Securities Exchange Act of
2
<PAGE>
1934, as amended (the "Exchange Act"), and incorporated by reference in
such Preliminary Prospectus or Prospectus, as the case may be; and any
reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Initial Registration Statement that is
incorporated by reference in the Registration Statement.
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and did not contain an 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, in
the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter through Goldman, Sachs & Co. expressly for use
therein;
(iii) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the requirements of
the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and any further documents so filed
and incorporated by reference in the Prospectus or any further
amendment or supplement thereto, when such documents become effective
or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission
thereunder and will not contain an 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; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through Goldman, Sachs & Co. expressly for use therein;
(iv) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or
the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and the Registration Statement and any amendment thereto do
not and will not, as of the applicable effective date, contain an
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 does not, and as amended or
supplemented will not, as of the applicable filing date, contain an
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, in light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter through Goldman, Sachs & Co. expressly for use
therein;
(v) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material
loss or interference with its business from fire, explosion,
3
<PAGE>
flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus; and,
since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any
change in the capital stock or long-term debt of the Company or any of
its subsidiaries or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
general affairs, management, financial position, stockholders' equity
or results of operations of the Company and its subsidiaries taken as a
whole, in each case, otherwise than as set forth or contemplated in the
Prospectus;
(vi) The Company and its subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title
to all personal property owned by them, in each case free and clear of
all liens, encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of such
property and do not interfere with the use made and proposed to be made
of such property by the Company and its subsidiaries or such as do not
and would not, individually or in the aggregate, have a material
adverse effect on the business, prospects, operations, financial
condition or results of operations of the Company and its subsidiaries
taken as a whole (a "Material Adverse Effect"); and any real property
and buildings held under lease by the Company and its subsidiaries are
held by them under valid, subsisting and enforceable leases with such
exceptions as are not material and do not interfere with the use made
and proposed to be made of such property and buildings by the Company
and its subsidiaries or such as do not and would not, individually or
in the aggregate, have a Material Adverse Effect;
(vii) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and
has been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, except where failure to
be so qualified would not have a Material Adverse Effect; and each
subsidiary of the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, except where failure to be in such good
standing would not have a Material Adverse Effect;
(viii) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable and conform to the description of the Stock
contained in the Prospectus; and all of the issued shares of capital
stock of each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and (except
for directors' qualifying shares and as disclosed in the Prospectus)
are owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims;
(ix) The unissued Optional Shares to be issued and sold by the
Company to the Underwriters hereunder and to the International
Underwriters under the International Underwriting Agreement have been
duly and validly authorized and, when issued and delivered against
payment therefor as provided herein, will be duly and validly issued
and fully paid and non-assessable and will conform to the description
of the Stock contained in the Prospectus;
4
<PAGE>
(x) The issue and sale of the Optional Shares to be sold by the
Company hereunder and under the International Underwriting Agreement
and the compliance by the Company with all of the provisions of this
Agreement, the International Underwriting Agreement and the Custody
Agreement (as defined below) and the consummation of the transactions
herein and therein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such action
result in any violation of the provisions of the Certificate of
Incorporation or By-laws of the Company or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of
their properties, except for foreign and state securities and Blue Sky
laws, and except for breaches, violations or defaults (other than any
relating to the Certificate of Incorporation or By-laws of the Company)
that would not, individually or in the aggregate, have a Material
Adverse Effect or in the aggregate impair the Company's ability to
consummate the transactions herein contemplated; and no consent,
approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body is required for the
issue and sale of the Shares or the consummation by the Company of the
transactions contemplated by this Agreement, the International
Underwriting Agreement and the Custody Agreement, except the
registration under the Act of the Shares, the registration under the
Exchange Act of the Stock and such consents, approvals, authorizations,
registrations or qualifications as may be required under state or
foreign securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters and the International
Underwriters;
(xi) Neither the Company nor any of Estee Lauder Inc., Aramis
Inc., Clinique Laboratories, Inc., Estee Lauder International, Inc.,
Estee Lauder Cosmetics Ltd., Clinique Laboratories K.K., Estee Lauder
K.K., Estee Lauder N.V. and Estee Lauder A.G. Lachen (each, a
"Principal Subsidiary" and collectively, the "Principal Subsidiaries")
is in violation of its Certificate of Incorporation or By-laws and
neither the Company nor any of its subsidiaries is in default in the
performance or observance of any material obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument to which
it is a party or by which it or any of its properties may be bound,
which default would have a Material Adverse Effect;
(xii) The statements set forth in the Prospectus under the
caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Stock, and under the caption
"Certain Relationships and Related Transactions" set forth in the
Company's proxy statement dated September 30, 1996 and incorporated by
reference into the Company's Annual Report on Form 10-K for the year
ended June 30, 1996, insofar as they purport to summarize the
provisions of the laws, documents and transactions referred to therein
for purposes of complying with the requirements of Form S-3, are
accurate and correct in all material respects;
(xiii) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company
or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, would individually
or in the aggregate have a Material Adverse Effect; and, to the
Company's
5
<PAGE>
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(xiv) There are no contracts or documents of a character
required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement
that are not so described or filed;
(xv) Each of the Company and its subsidiaries owns or has rights
to adequate foreign and domestic patents, patent licenses, trademarks,
service marks, trade names, inventions, copyrights and know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures)
(collectively, the "Intellectual Property") necessary to carry on their
respective businesses as of the date hereof, and neither the Company
nor any of its subsidiaries is aware that it would interfere with,
infringe upon or otherwise come into conflict with any Intellectual
Property rights of third parties as a result of the operation of the
business of the Company or any subsidiary as of the date hereof that,
individually or in the aggregate, if subject to an unfavorable
decision, ruling or finding would have a Material Adverse Effect;
(xvi) Except as disclosed in the Prospectus, there are no
holders of securities (debt or equity) of the Company or any of its
subsidiaries, or holders of rights (including, without limitation,
preemptive rights), warrants or options to obtain securities of the
Company or any of its subsidiaries, who have the right to request the
Company or any of its subsidiaries to register securities held by them
under the Act;
(xvii) The Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company" or
an entity "controlled" by an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act"); and
(xviii) Arthur Andersen & Co. LLP, who have certified certain
financial statements of the Company and its subsidiaries, are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder.
(b) Each of the Selling Stockholders severally and not jointly
represents and warrants to, and agrees with, each of the Underwriters and the
Company that:
(i) With respect to each of the LAL 4000 Trust, the LAL 4001
Trust, the L and G Trust, the RSL 4200 Trust and the WPL 3800 Trust
only, such Selling Stockholder has been duly created, is validly
existing as a trust under the laws of the Jurisdiction of its
organization, has the power and authority to own its property and to
conduct its business and has been duly qualified for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, or is subject to no
material liability or disability by reason of the failure to be so
qualified in any such jurisdiction;
(ii) With respect to the Ronald S. Lauder Foundation only, such
Selling Stockholder has been duly incorporated, is validly existing as
a not-for-profit corporation under the laws of the State of New York,
has the power and authority to own its property and to conduct its
business and has been duly qualified for the transaction of business
and is in good standing under the laws of each other jurisdiction in
which it owns or leases properties or conducts any business so as to
require such qualification, or is subject to no material liability or
disability by reason of the failure to be so qualified in any such
jurisdiction;
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(iii) No consent, approval, authorization or order of any court
or governmental agency or body is required to be obtained by such
Selling Stockholder for the execution and delivery by such Selling
Stockholder of this Agreement, the International Underwriting
Agreement, the Custody Agreement (and, if such Selling Stockholder's
name on Schedule II hereto is followed by an asterisk, the Power of
Attorney hereinafter referred to) and for the sale and delivery by such
Selling Stockholder of the Firm Shares to be sold by such Selling
Stockholder hereunder and under the International Underwriting
Agreement, except such as have been obtained, the registration of the
sale of such Firm Shares under the Act, the registration under the
Exchange Act of the Stock, and such as may be required under foreign
and state securities and Blue Sky Laws; and such Selling Stockholder
has full right, power and authority to enter into this Agreement, the
International Underwriting Agreement, the Custody Agreement (and, if
such Selling Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney) and to sell, assign, transfer and
deliver the Firm Shares to be sold by such Selling Stockholder
hereunder and under the International Underwriting Agreement (subject
to the Custody Agreement, the Power of Attorney, if applicable, the
Company's Restated Certificate of Incorporation and the Stockholders'
Agreement, dated November 22, 1995, as amended, among certain Lauder
Family Members (as defined in the Registration Statement));
(iv) The sale of the Firm Shares to be sold by such Selling
Stockholder hereunder and under the International Underwriting
Agreement and the compliance by such Selling Stockholder with all of
the obligations of such Selling Stockholder under this Agreement, the
International Underwriting Agreement, the Custody Agreement (and, if
such Selling Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney) and the consummation by such Selling
Stockholder of the transactions herein and therein contemplated will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default (A) in the case of each
of the LAL 4000 Trust, the LAL 4001 Trust, the L and G Trust, the RSL
4200 Trust, the WPL 3800 Trust and The Ronald S. Lauder Foundation
only, the constitutive documents of such Selling Stockholder, or (B)
under any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which such Selling Stockholder is a party or
by which such Selling Stockholder is bound, or to which any of the
property or assets of such Selling Stockholder is subject, nor will
such action result in any violation of the provisions of any statute or
any order, rule or regulation of any court or governmental agency or
body having jurisdiction over such Selling Stockholder or the property
of such Selling Stockholder, except that such Selling Stockholder makes
no representation under this paragraph as to the registration or filing
requirements or disclosure provisions of the securities laws of the
United States or the securities or Blue Sky laws of any other
jurisdiction;
(v) Such Selling Stockholder has, and immediately prior to First
Time of Delivery (as defined in Section 4 hereof) of such Firm Shares
by such Selling Stockholder, such Selling Stockholder will have, good
and valid title to the Firm Shares to be sold by such Selling
Stockholder hereunder and under the International Underwriting
Agreement, free and clear of all liens, encumbrances, equities or
claims; and, upon delivery of the Firm Shares to be sold by such
Selling Stockholder hereunder and under the International Underwriting
Agreement and payment therefor pursuant hereto and thereto, good and
valid title to such Firm Shares, free and clear of all liens,
encumbrances, equities or claims, will be transferred by such Selling
Stockholder to the several Underwriters or the International
Underwriters, as the case may be;
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(vi) During the period beginning from the date hereof and
continuing to and including the date 90 days after the date of the
Prospectus, not to offer, sell, contract to sell or otherwise dispose
of, except as provided hereunder or under the International
Underwriting Agreement, any securities of the Company that are
substantially similar to the Shares, including but not limited to any
securities that are convertible into or exchangeable for, or that
represent the right to receive, Stock or any such substantially similar
securities (other than dispositions among Lauder Family Members who are
stockholders of the Company (other than The Lauder Foundation) and
Morgan Guaranty Trust Company of New York or pursuant to employee stock
option plans existing on, or upon the conversion or exchange of
convertible or exchangeable securities outstanding as of, the date of
this Agreement, provided that this provision shall continue to apply
with respect to the securities received upon such conversion or
exchange) without your prior written consent;
(vii) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares;
(viii) To the extent that any statements or omissions made in
the Registration Statement, any Preliminary Prospectus, the Prospectus
or any amendment or supplement thereto are made in reliance upon and in
conformity with written information furnished to the Company by such
Selling Stockholder expressly for use therein, such Preliminary
Prospectus and the Registration Statement did, and the Prospectus and
any further amendments or supplements to the Registration Statement and
the Prospectus, when they become effective or are filed with the
Commission, as the case may be, will conform in all material respects
to the requirements of the Act and the rules and regulations of the
Commission thereunder and will not contain 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;
(ix) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated, such Selling Stockholder will deliver to you prior to or
at the First Time of Delivery of Shares by such Selling Stockholder a
properly completed and executed United States Treasury Department Form
W-9 (or other applicable form or statement specified by Treasury
Department regulations in lieu thereof);
(x) Such Selling Stockholder has duly executed and delivered a
custody agreement appointing the Company, as custodian, (the
"Custodian"), for the Firm Shares being sold by such Selling
Stockholder (the "Custody Agreement") and certificates in negotiable
form representing all of the Firm Shares to be sold by such Selling
Stockholder hereunder and under the International Underwriting
Agreement have been deposited with and are being held by the Company,
as Custodian. If such Selling Stockholder's name on Schedule II hereto
is followed by an asterisk, such Selling Stockholder has duly executed
and delivered a Power of Attorney in the form heretofore furnished to
you (the "Power of Attorney"), appointing the person(s) indicated in
Schedule II hereto as such Selling Stockholder's attorney(s)-in-fact
(the "Attorney in Fact") with authority to authorize the delivery of
the Firm Shares to be sold by such Selling Stockholder hereunder and
otherwise to act on behalf of such Selling Stockholder in connection
with the transactions contemplated by this Agreement and the
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International Underwriting Agreement to the extent set forth in the
Power of Attorney; and;
(xi) The Firm Shares represented by the certificates held in
custody for such Selling Stockholder under the Custody Agreement are
subject to the interests of the Underwriters hereunder and the
International Underwriters under the International Underwriting
Agreement; the arrangements made by such Selling Stockholder for such
custody, and the appointment by such Selling Stockholder of the
Attorneys-in-Fact by the Power of Attorney, are to that extent
irrevocable; the obligations of the Selling Stockholder hereunder shall
not be terminated by operation of law, whether by the death or
incapacity of such Selling Stockholder if an individual or, in the case
of an estate or trust, by the death or incapacity of any executor or
trustee or the termination of such estate or trust, or in the case of a
partnership or corporation, by the dissolution of such partnership or
corporation, or by the occurrence of any other event; if any individual
Selling Stockholder or any such executor or trustee should die or
become incapacitated, or if any such estate or trust should be
terminated, or if any such partnership or corporation should be
dissolved, or if any other such event should occur, before the delivery
of the Firm Shares hereunder, certificates representing the Firm Shares
shall be delivered by or on behalf of such Selling Stockholder in
accordance with the terms and conditions of this Agreement, the
International Underwriting Agreement and the Custody Agreement; and
actions taken by the Attorneys-in-Fact pursuant to the Power of
Attorney shall be as valid as if such death, incapacity, termination,
dissolution or other event had not occurred, regardless of whether or
not the Custodian, the Attorneys-in-Fact, or any of them, shall have
received notice of such death, incapacity, termination, dissolution or
other event.
2. Subject to the terms and conditions herein set forth, (a) each of
the Selling Stockholders agree, severally and not jointly, to sell to each of
the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from each of the Selling Stockholders, at a purchase price
per share of $_________, the number of Firm Shares (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying the aggregate number
of Firm Shares to be sold by each of the Selling Stockholders as set forth
opposite their respective names in Schedule II hereto by a fraction, the
numerator of which is the aggregate number of Firm Shares to be purchased by
such Underwriter as set forth opposite the name of such Underwriter in Schedule
I hereto and the denominator of which is the aggregate number of Firm Shares to
be purchased by all of the Underwriters from all of the Selling Stockholders
hereunder and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Shares as provided below, the Company
agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
the purchase price per share set forth in clause (a) of this Section 2, that
portion of the number of Optional Shares as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying such number of Optional Shares by a fraction the
numerator of which is the maximum number of Optional Shares which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to purchase
hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to 769,800 Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering
overallotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised only by written notice from you to
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the Company, given within a period of 30 calendar days after the date of this
Agreement and setting forth the aggregate number of Optional Shares to be
purchased and the date on which such Optional Shares are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery (as
defined in Section 4 hereof) or, unless you and the Company otherwise agree in
writing, earlier than two or later than ten business days after the date of such
notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4 (a) The Shares to be purchased by each Underwriter hereunder in
definitive form, and in such authorized denominations and registered in such
names as Goldman, Sachs & Co. may request upon at least forty-eight hours' prior
notice to the Company shall be delivered by or on behalf of the Company and the
Selling Stockholders to Goldman, Sachs & Co., through the facilities of the
Depository Trust Company ("DTC"), for the account of such Underwriter, against
payment by or on behalf of such Underwriter of the purchase price therefor by
wire transfer, payable to the order of the Company and each of the Selling
Stockholders, as their interests may appear, in Federal (same day) funds. The
Company will cause the certificates representing the Shares to be made available
for checking and packaging at least twenty-four hours prior to each Time of
Delivery with respect thereto at the office of Goldman, Sachs & Co. or DTC or
its designated custodian, as the case may be (the "Designated Office"). The time
and date of such delivery and payment shall be (i) with respect to the Firm
Shares, 9:30 a.m., New York City time, on __________, 1997 or such other time
and date as Goldman, Sachs & Co. and the Selling Stockholders may agree upon in
writing, and (ii) with respect to the Optional Shares, 9:30 a.m., New York City
time, on the date specified by Goldman, Sachs & Co. in the written notice given
by Goldman, Sachs & Co. of the Underwriters' election to purchase such Optional
Shares, or such other time and date as Goldman, Sachs & Co. and the Company may
agree upon in writing. Such time and date for delivery of the Firm Shares is
herein called the "First Time of Delivery", such time and date for delivery of
the Optional Shares, if not the First Time of Delivery, is herein called the
"Second Time of Delivery", and each such time and date for delivery is herein
called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(k) hereof, will be delivered at the offices
of Weil, Gotshal & Manges LLP, 767 Fifth Avenue, New York, New York 10153 (the
"Closing Location"), and the Shares will be delivered at the Designated Office,
all at each Time of Delivery. A meeting will be held at the Closing Location at
2:00 p.m., New York City time, on the New York Business Day next preceding each
Time of Delivery, at which meeting the final drafts of the documents to be
delivered pursuant to the preceding sentence will be available for review by the
parties hereto. For the purposes of this Section 4, "New York Business Day"
shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not a
day on which banking institutions in New York are generally authorized or
obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file
such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus prior to
the last
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Time of Delivery which shall be disapproved by you promptly after reasonable
notice thereof; to advise you, promptly after it receives notice thereof, of the
time when any amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus has been
filed and to furnish you with copies thereof; to file promptly all reports and
any definitive proxy or information statements required to be filed by the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering or sale of
the Shares; to advise you, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or Prospectus, of the
suspension of the qualification of the Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or supplementing
of the Registration Statement or Prospectus or for additional information; and,
in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or Prospectus or suspending any
such qualification, promptly to use its best efforts to obtain the withdrawal of
such order;
(b) If the Company elects to rely upon Rule 462(b), the Company shall
file a Rule 462(b) Registration Statement with the Commission in compliance with
Rule 462(b) by 10:00 p.m., Washington, D.C. time, on the date of this Agreement,
and the Company shall at the time of filing either pay to the Commission the
filing fee for the Rule 462(b) Registration Statement or give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b) under the Act.
(c) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with such
laws so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution of
the Shares, provided that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to file a general consent to
service of process, or take any action that would subject the Company to any
tax, in any jurisdiction;
(d) Prior to 10:00 a.m., New York City time, on the New York Business
Day next succeeding the date of this Agreement and from time to time, to use its
best efforts to furnish the Underwriters with copies of the Prospectus in New
York City in such quantities as you may reasonably request, and, if the delivery
of a prospectus is required at any time prior to the expiration of nine months
after the time of issue of the Prospectus in connection with the offering or
sale of the Shares and if at such time any events shall have occurred 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
in order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary during such period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the Act or
the Exchange Act, to notify you and upon your request to file such document and
to prepare and furnish without charge to each Underwriter and to any dealer in
securities as many copies as you may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance, and in case any Underwriter is
required to deliver a prospectus in connection with sales of any of the Shares
at any time nine months or more after the time of issue of the Prospectus, upon
your request but at the expense of such Underwriter, to prepare and deliver to
such Underwriter as
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many copies as you may request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Act;
(e) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Company, Rule
158);
(f) During the period beginning from the date hereof and continuing to
and including the date 90 days after the date of the Prospectus, not to offer,
sell, contract to sell or otherwise dispose of, except as provided hereunder and
under the International Underwriting Agreement, any securities of the Company
that are substantially similar to the Shares, including but not limited to any
securities that are convertible into or exchangeable for, or that represent the
right to receive, Stock or any such substantially similar securities (other than
pursuant to employee stock option plans and employment agreements, in each case,
existing on, or upon the conversion or exchange of convertible or exchangeable
securities outstanding as of, the date of this Agreement), or to file any
registration statement with the Commission under the Act relating to any such
securities without your prior written consent;
(g) To make available to its stockholders as soon as practicable after
the end of each fiscal year an annual report (including a balance sheet and
statements of income, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants) and, to
make available to its stockholders as soon as practicable after the end of each
of the first three quarters of each fiscal year (beginning with the fiscal
quarter ending after the effective date of the Registration Statement),
consolidated summary financial information of the Company and its subsidiaries
for such quarter in reasonable detail;
(h) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to stockholders, and to deliver to
you (i) as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company is listed; and (ii)
such additional information concerning the business and financial condition of
the Company as you may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries are consolidated in reports furnished to its
stockholders generally or to the Commission);
(i) To use the net proceeds received by it from the sale of the
Optional Shares pursuant to this Agreement and the International Underwriting
Agreement in the manner specified in the Prospectus under the caption "Use of
Proceeds"; and
(j) To use its best efforts to list, subject to notice of issuance, the
Shares on the New York Stock Exchange (the "Exchange").
6. The Company and each of the Selling Stockholders covenant and agree
with one another and with the several Underwriters that (a) the Company and each
Selling Stockholder will pay or cause to be paid a pro rata share (based on the
number of Shares to be sold by the Company and such Selling Stockholders
hereunder) of the following: (i) the fees, disbursements and expenses of the
Company's counsel and accountants in connection with the registration of the
Shares under the Act and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, any Preliminary Prospectus
and
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the Prospectus and amendments and supplements thereto and the mailing and
delivering of copies thereof to the Underwriters and dealers; (ii) the cost of
printing or producing any Agreement among Underwriters, this Agreement, the
International Underwriting Agreement, the Agreement between Syndicates, the
Selling Agreements, the Blue Sky Memorandum, closing documents (including any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Shares; (iii) all expenses in connection with
the qualification of the Shares for offering and sale under state securities
laws as provided in Section 5(c) hereof, including the fees and disbursements of
counsel for the Underwriters in connection with such qualification and in
connection with the Blue Sky survey; and (iv) the filing fees incident to, and
the fees and disbursements of counsel for the Underwriters in connection with,
securing any required review by the National Association of Securities Dealers,
Inc. of the terms of the sale of the Shares; and (b) the Company will pay or
cause to be paid: (i) the cost of preparing stock certificates; (ii) the cost
and charges of any transfer agent or registrar; (iii) all expenses and taxes
incident to the sale and delivery of the Shares to be sold by the Company to the
Underwriters hereunder; (iv) all fees and expenses in connection with listing
the Optional Shares on the Exchange; and (v) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section 6; and (c) such Selling Stockholder
will pay or cause to be paid all costs and expenses incident to the performance
of such Selling Stockholder's obligations hereunder which are not otherwise
specifically provided for in this Section 6, including (i) any fees and expenses
of counsel for such Selling Stockholder, (ii) such Selling Stockholder's pro
rata share of the fees and expenses of the Attorney-in-Fact, and (iii) all
expenses and taxes incident to the sale and delivery of the Shares to be sold by
such Selling Stockholder to the Underwriters hereunder. In connection with
clause (iii) of each of the preceding sentence and the second preceding
sentence, Goldman, Sachs & Co. agrees to pay New York State stock transfer tax,
and each of the Selling Stockholders and the Company, respectively, agrees to
reimburse Goldman, Sachs & Co. for associated carrying costs if such tax payment
is not rebated on the day of payment and for any portion of such tax payment not
rebated. It is understood, however, that, except as provided in this Section 6,
and Sections 8 and 11 hereof, the Underwriters will pay all of their own costs
and expenses, including the fees of their counsel, stock transfer taxes on
resale of any of the Shares by them, and any advertising expenses connected with
any offers they may make.
7. The obligations of the Underwriters hereunder, as to the Shares to
be delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and the Selling Stockholders herein are, at and as of such Time of
Delivery, true and correct, the condition that the Company and the Selling
Stockholders shall have performed all of its and their obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing by
the rules and regulations under the Act and in accordance with Section 5(a)
hereof; if the Company has elected to rely upon Rule 462(b), the Rule 462(b)
Registration Statement shall have become effective by 10:00 p.m., Washington,
D.C. time, on the date of this Agreement; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to your reasonable
satisfaction;
(b) Fried, Frank, Harris, Shriver & Jacobson, counsel for the
Underwriters, shall have furnished to you such opinion or opinions (a draft of
each such opinion is attached as Annex
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II(a) hereto), dated such Time of Delivery, with respect to the matters covered
in paragraphs (i), (ii), (vi), (x) (including with respect to the caption
"Underwriting") and (xiii) of subsection (c) below as well as such other related
matters as you may reasonably request, and such counsel shall have received such
papers and information as they may reasonably request to enable them to pass
upon such matters;
(c) Weil, Gotshal & Manges, LLP counsel for the Company, shall have
furnished to you their written opinion (a draft of such opinion is attached as
Annex II(b) hereto), dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a 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;
(ii) The Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital
stock of the Company (including the Shares being delivered at
such Time of Delivery) have been duly and validly authorized and
issued and are fully paid and non-assessable; and the Shares
conform to the description of the Stock contained in the
Prospectus;
(iii) The Company is duly qualified to transact business
and in good standing under the laws of each other jurisdiction
where it owns or leases properties or conducts any business so
as to require such qualification, except where the failure to be
in good standing would not have a Material Adverse Effect (such
counsel being entitled to rely in respect of the opinion in this
clause upon opinions of local counsel and in respect of matters
of fact upon certificates of officers of the Company, provided
that such counsel shall state that they believe that both you
and they are justified in relying upon such opinions and
certificates);
(iv) Each of the U.S. Principal Subsidiaries has been
duly incorporated and is validly existing as a corporation in
good standing under the laws of its jurisdiction of
incorporation; and, to the best of such counsel's knowledge, all
of the issued shares of capital stock of each U.S. Principal
Subsidiary have been duly and validly authorized and issued, are
fully paid and non-assessable, and (except for directors'
qualifying shares) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances or claims;
(v) To such counsel's knowledge and other than as set
forth in the Prospectus, there are no legal or governmental
proceedings pending or overtly threatened against the Company or
any of its subsidiaries or involving the Company or any of its
subsidiaries or any property of the Company or any of its
subsidiaries which would be required to be disclosed in the
Prospectus;
(vi) This Agreement and the International Underwriting
Agreement have been duly authorized, executed and delivered
by the Company;
(vii) The Custody Agreement has been duly authorized,
executed and delivered by the Company and constitutes a valid
and binding obligation of the Company enforceable against the
Company in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws affecting the enforcement of
creditors' rights generally and subject to general principles of
equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law);
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(viii)The issue and sale of the Optional Shares being
delivered at such Time of Delivery to be sold by the Company and
the compliance by the Company with all of the provisions of this
Agreement, the International Underwriting Agreement and the
Custody Agreement and the consummation of the transactions
herein and therein contemplated will not conflict with or result
in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to
such counsel to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, and that is material to
the Company and its subsidiaries taken as a whole, nor will such
action result in any violation of the provisions of the
Certificate of Incorporation or By-laws of the Company or any
New York, Delaware corporate or Federal law, rule or regulation
(other than foreign and state securities or Blue Sky laws, as to
which such counsel expresses no opinion, and other than Federal
securities laws, as to which such counsel expresses no opinion
except as otherwise set forth herein), or any judgment, writ,
injunction, decree, order or ruling of any court or governmental
authority binding on the Company of which such counsel is aware;
(ix) No consent, approval, authorization, order,
registration or qualification of or with any New York, Delaware
corporate or Federal governmental authority is required for the
issue and sale of the Optional Shares or the consummation by the
Company of the transactions contemplated by this Agreement, the
International Underwriting Agreement and the Custody Agreement,
except the registration under the Act of the Shares, the
registration under the Exchange Act of the Stock, and such
consents, approvals, authorizations, registrations or
qualifications as may be required under state or foreign
securities or Blue Sky laws as to which such counsel need
express no opinion;
(x) The statements set forth in the Prospectus under the
caption "Description of Capital Stock", insofar as they purport
to constitute a summary of the terms of the Stock, and under the
caption, "Certain United States Tax Consequences to Non-United
States Holders", insofar as they purport to summarize the
provisions of the laws referred to therein, are accurate and
correct in all material respects;
(xi) The Company is not an "investment company" or an
entity "controlled" by an "investment company", as such terms
are defined in the Investment Company Act;
(xii) The documents incorporated by reference in the
Prospectus (other than the financial statements and related
notes, the financial statement schedules and other financial and
accounting data therein, as to which such counsel need express
no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all
material respects with the requirements of the Act or the
Exchange Act, as applicable and the rules and regulations of the
Commission thereunder; and
(xiii)The Registration Statement and the Prospectus and
any further amendments and supplements thereto made by the
Company prior to such Time of Delivery (other than the financial
statements and related notes, the financial statement schedules
and other financial and accounting data included in the
Registration Statement or Prospectus, as to which such counsel
need express no
15
<PAGE>
opinion) comply as to form in all material respects with the
requirements of the Act and the rules and regulations
thereunder.
In addition, such counsel shall state that it has participated in
conferences with directors, officers and other representatives of the Company,
various of the Selling Stockholders, representatives of the independent public
accountants for the Company, representatives of the Underwriters and
representatives of counsel for the Underwriters, at which conferences the
contents of the Registration Statement and the Prospectus and related matters
were discussed, and, although such counsel has not independently verified and is
not passing upon and assumes no responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement and
Prospectus, except to the extent specified in subsection (ix) of this Section
7(c), no facts have come to such counsel's attention which leads such counsel to
believe that the Registration Statement (including any documents incorporated by
reference therein), on the effective date thereof (or in the case of documents
incorporated by reference, when such documents became effective or were filed),
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements contained
therein not misleading or that the Prospectus, on the date thereof or on the
date hereof, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact required to be stated therein or
necessary to make the statements contained therein, in light of the
circumstances under which they were made, not misleading (it being understood
that such counsel expresses no view with respect to the financial statements and
related notes, the financial statement schedules and the other financial and
accounting data included in the Registration Statement or Prospectus); and they
do not know of any contracts or other documents of a character required to be
filed as an exhibit to the Registration Statement or required to be incorporated
by reference into the Prospectus or required to be described in the Registration
Statement or the Prospectus which are not filed or described as required.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction outside the United States;
(d) Debevoise & Plimpton, counsel to Louis Begley, as trustee, u/a/d
January 28, 1997, between Ronald S. Lauder, as settlor, and such trustee (the
"RSL 4200 Trust"), shall have furnished to you their written opinion (a draft of
each such opinion is attached as Annex II(c) hereto), dated such Time of
Delivery, in form and substance satisfactory to you, to the effect that:
(i) Such Selling Stockholder validly exists as a trust
under, and is governed by, the laws of the State of New York;
and the trustee of such Selling Stockholder has the requisite
power and authority, on behalf of such Selling Stockholder to
enter into this Agreement, the International Underwriting
Agreement and the Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney), and to consummate the
transactions contemplated hereby and thereby in connection with
the Firm Shares to be sold by such Selling Stockholder under
this Agreement and the International Underwriting Agreement;
(ii) The Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney) has been duly executed and
delivered by such Selling Stockholder and constitutes the valid
and binding agreement of such Selling Stockholder in accordance
with its terms;
(iii) This Agreement and the International Underwriting
Agreement have been duly executed and delivered by such Selling
Stockholder; and the sale by
16
<PAGE>
such Selling Stockholder of the Firm Shares to be sold by such
Selling Stockholder hereunder and thereunder and the compliance
by such Selling Stockholder with all of the obligations of such
Selling Stockholder under this Agreement, the International
Underwriting Agreement and the Custody Agreement (and if such
Selling Stockholder's name on Schedule II hereto is followed by
an asterisk, the Power of Attorney) and the consummation by such
Selling Stockholder of the transactions herein and therein
contemplated will not conflict with or result in a breach or
violation of any terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument known to such counsel to which
such Selling Stockholder is a party or by which such Selling
Stockholder is bound, or to which any of the property or assets
of such Selling Stockholder is subject, nor will such action
result in any violation of the provisions of any statute or
order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over such
Selling Stockholder or the property of such Selling Stockholder,
except that such counsel need not express any opinion as to
compliance with the registration or filing requirements or
disclosure provisions of the securities laws of the United
States or the securities or Blue Sky laws of any other
jurisdiction;
(iv) No consent, approval, authorization or order of any
court or governmental agency or body is required to be obtained
by such Selling Stockholder for the consummation by such Selling
Stockholder of the transactions contemplated by this Agreement,
the International Underwriting Agreement and the Custody
Agreement (and if such Selling Stockholder's name on Schedule II
hereto is followed by an asterisk, the Power of Attorney) in
connection with the Firm Shares to be sold by such Selling
Stockholder hereunder or under the International Underwriting
Agreement, except such as have been duly obtained and are in
full force and effect, the registration of the Firm Shares under
the Act, the registration of the Stock under the Exchange Act
and such as may be required under state or foreign securities or
Blue Sky laws in connection with the purchase and distribution
of such Shares by the Underwriters or the International
Underwriters;
(v) Such Selling Stockholder has full right, power and
authority to sell, assign, transfer and deliver the Firm Shares
to be sold by such Selling Stockholder under this Agreement and
the International Underwriting Agreement; and
(vi) Upon delivery to the Underwriters by such Selling
Stockholder (either directly or by an Attorney-in-Fact) of a
certificate or certificates for the Firm Shares to be sold by
such Selling Stockholder, duly endorsed in blank or accompanied
by stock powers duly endorsed in blank, against receipt of the
purchase price therefor as provided in this Agreement and the
International Underwriting Agreement, such Selling Stockholder
will transfer to the Underwriters who have purchased such Firm
Shares pursuant to this Agreement and the International
Underwriting Agreement valid title to such Firm Shares, free and
clear of any security interests, claims, liens, equities or
other encumbrances whatsoever, provided that the Underwriters
are without notice of any adverse claim, as defined in the
Uniform Commercial Code as adopted in the State of New York (the
"Code") and are purchasers for value in good faith for purposes
of the Code, and that the Underwriters' rights are not limited
by subsection (4) of Section 8-302 of the Code.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction other than the laws of the State of
New York and the Federal laws of
17
<PAGE>
the United States and in rendering its opinion such counsel may rely upon a
certificate of such Selling Stockholder in respect of matters of fact as to
ownership of, and liens, encumbrances, equities or claims on the Firm Shares
sold by such Selling Stockholder, provided that such counsel shall state that
they believe that both you and they are justified in relying upon such
certificate;
(e) Debevoise & Plimpton, counsel to The Ronald S. Lauder Foundation
shall have furnished to you their written opinion (a draft of such opinion is
attached as Annex II(d) hereto), dated such Time of Delivery, in form and
substance satisfactory to you, to the effect that:
(i) Such Selling Stockholder is duly incorporated and is
validly existing as a not-for-profit corporation under the laws
of the State of New York, with corporate power and authority to
enter into this Agreement, the International Underwriting
Agreement and the Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney), and to consummate the
transactions contemplated hereby and thereby in connection with
the Firm Shares to be sold by such Selling Stockholder under
this Agreement and the International Underwriting Agreement;
(ii) The Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney) has been duly executed and
delivered by such Selling Stockholder and constitutes the valid
and binding agreement of such Selling Stockholder in accordance
with its terms;
(iii) This Agreement and the International Underwriting
Agreement have been duly executed and delivered by such Selling
Stockholder; and the sale by such Selling Stockholder of the
Firm Shares to be sold by such Selling Stockholder hereunder and
thereunder and the compliance by such Selling Stockholder with
all of the obligations of such Selling Stockholder under this
Agreement, the International Underwriting Agreement and the
Custody Agreement (and if such Selling Stockholder's name on
Schedule II hereto is followed by an asterisk, the Power of
Attorney) and the consummation by such Selling Stockholder of
the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which such Selling
Stockholder is a party or by which such Selling Stockholder is
bound, or to which any of the property or assets of such Selling
Stockholder is subject, nor will such action result in any
violation of the provisions of any statute or order, rule or
regulation known to such counsel of any court or governmental
agency or body having jurisdiction over such Selling Stockholder
or the property of such Selling Stockholder, except that such
counsel need not express any opinion as to compliance with the
registration or filing requirements or disclosure provisions of
the securities laws of the United States or the securities or
Blue Sky laws of any other jurisdiction;
(iv) No consent, approval, authorization or order of any
court or governmental agency or body is required to be obtained
by such Selling Stockholder for the consummation by such Selling
Stockholder of the transactions contemplated by this Agreement,
the International Underwriting Agreement and the Custody
Agreement (and if such Selling Stockholder's name on Schedule II
hereto is followed by an asterisk, the Power of Attorney) in
connection with the Firm Shares to be sold by such Selling
Stockholder hereunder or under the International Underwriting
Agreement, except such as have been duly obtained
18
<PAGE>
and are in full force and effect, the registration of the Firm
Shares under the Act, the registration of the Stock under the
Exchange Act and such as may be required under state or foreign
securities or Blue Sky laws in connection with the purchase and
distribution of such Shares by the Underwriters or the
International Underwriters;
(v) Such Selling Stockholder has full right, power and
authority to sell, assign, transfer and deliver the Firm Shares
to be sold by such Selling Stockholder under this Agreement and
the International Underwriting Agreement; and
(vi) Upon delivery to the Underwriters by such Selling
Stockholder (either directly or by an Attorney-in-Fact) of a
certificate or certificates for the Firm Shares to be sold by
such Selling Stockholder, duly endorsed in blank or accompanied
by stock powers duly endorsed in blank, against receipt of the
purchase price therefor as provided in this Agreement and the
International Underwriting Agreement, such Selling Stockholder
will transfer to the Underwriters who have purchased such Firm
Shares pursuant to this Agreement and the International
Underwriting Agreement valid title to such Firm Shares, free and
clear of any security interests, claims, liens, equities or
other encumbrances whatsoever, provided that the Underwriters
are without notice of any adverse claim, as defined in the Code
and are purchasers for value in good faith for purposes of the
Code, and that the Underwriters' rights are not limited by
subsection (4) of Section 8-302 of the Code.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction other than the laws of the State of
New York and the Federal laws of the United States and in rendering its opinion
such counsel may rely upon a certificate of such Selling Stockholder in respect
of matters of fact as to ownership of, and liens, encumbrances, equities or
claims on the Firm Shares sold by such Selling Stockholder, provided that such
counsel shall state that they believe that both you and they are justified in
relying upon such certificate;
(f) Weil, Gotshal & Manges LLP, counsel to (i) [ ] and [ ], as
trustees, u/a/d __________, between Leonard A. Lauder, as settlor, and such
trustees (the "LAL 4000 Trust"), (ii) [ ] and [ ], as trustees, u/a/d _________,
between Leonard A. Lauder, as settlor, and such trustees (the "LAL 4001 Trust"),
(iii) [ ] and [ ], as trustees, u/a/d ___________, between Leonard A. Lauder and
Gary Lauder, as settlors, and such trustees (the "L and G Trust"), and (iv) [ ]
and [ ], as trustees, u/a/d _____________, between William P. Lauder, as
settlor, and such trustees (the "WPL 3800 Trust"), shall have furnished to you
their written opinion (a draft of such opinion is attached as Annex II(e)
hereto), with respect to each of the Selling Stockholders for whom they are
acting as counsel, dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) Such Selling Stockholder validly exists as a trust
under, and is governed by, the laws of the State of
___________________; and the trustee(s) has (have) the requisite
power and authority, on behalf of such Selling Stockholder to
enter into this Agreement, the International Underwriting
Agreement and the Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney), and to consummate the
transactions contemplated hereby and thereby in connection with
the Firm Shares to be sold by such Selling Stockholder under
this Agreement and the International Underwriting Agreement;
19
<PAGE>
(ii) The Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney) has been duly executed and
delivered by such Selling Stockholder and constitutes the valid
and binding agreement of such Selling Stockholder in accordance
with its terms;
(iii) This Agreement and the International Underwriting
Agreement have been duly executed and delivered by or on behalf
of such Selling Stockholder; and the sale of the Firm Shares to
be sold by such Selling Stockholder hereunder and thereunder and
the compliance by such Selling Stockholder with all of the
obligations of such Selling Stockholder under this Agreement,
the International Underwriting Agreement and the Custody
Agreement (and, if such Selling Stockholder's name on Schedule
II hereto is followed by an asterisk, the Power of Attorney) and
the consummation by such Selling Stockholder of the transactions
herein and therein contemplated will not conflict with or result
in a breach or violation of any terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to
such counsel to which such Selling Stockholder is a party or by
which such Selling Stockholder is bound or to which any of the
property or assets of such Selling Stockholder is subject, nor
will such action result in any violation of the provisions of
any New York, Delaware corporate or Federal law, rule or
regulation known to such counsel (other than foreign and state
securities or Blue Sky laws, as to which such counsel expresses
no opinion, and other than Federal securities laws, as to which
such counsel expresses no opinion except as otherwise set forth
herein), or any judgment, writ, injunction, decree, order or
ruling of any court or governmental authority binding on such
Selling Stockholder of which such counsel is aware;
(iv) No consent, approval, authorization or order of any
New York, Delaware corporate or Federal governmental agency or
body is required to be obtained by such Selling Stockholder for
the consummation by such Selling Stockholder of the transactions
contemplated by this Agreement, the International Underwriting
Agreement and the Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney) or, in connection with the Firm
Shares to be sold by such Selling Stockholder hereunder or under
the International Underwriting Agreement, except such as have
been duly obtained and are in full force and effect, the
registration of the Firm Shares under the Act, the registration
of the Stock under the Exchange Act, and such as may be required
under state or foreign securities or Blue Sky laws in connection
with the purchase and distribution of such Firm Shares by the
Underwriters or the International Underwriters (as to which such
counsel need express no opinion);
(v) Such Selling Stockholder has full right, power and
authority to sell, assign, transfer and deliver the Firm Shares
to be sold by such Selling Stockholder under this Agreement and
the International Underwriting Agreement; and
(vi) Upon delivery to the Underwriters by such Selling
Stockholder (either directly or by an Attorney-in-Fact) of a
certificate or certificates for the Firm Shares to be sold by
such Selling Stockholder, duly endorsed in blank or accompanied
by stock powers duly endorsed in blank, against receipt of the
purchase price therefor as provided in this Agreement and the
International Underwriting Agreement, such Selling Stockholder
will transfer to the Underwriters who have purchased such Firm
Shares pursuant to this Agreement and the International
Underwriting
20
<PAGE>
Agreement valid title to such Firm Shares, free and clear of any
security interests, claims, liens, equities or other
encumbrances whatsoever, provided that the Underwriters are
without notice of any adverse claim, as such term is used in
Section 8-302 of the Code and are purchasers for value in good
faith for purposes of the Code, and that the Underwriters'
rights are not limited by subsection (4) of Section 8-302 of the
Code.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction outside the United States
and in rendering the opinion in subparagraph (vi) such counsel may rely upon a
certificate of such Selling Stockholder in respect of matters of fact as to
ownership of, and liens, encumbrances, equities or claims on the Firm Shares
sold by such Selling Stockholder, provided that such counsel shall state that
they believe that both you and they are justified in relying upon such
certificate;
(g) Weil, Gotshal & Manges LLP, counsel to Leonard A. Lauder and Gary
M. Lauder, each in his capacity as a Selling Stockholder, shall have furnished
to you their written opinion (a draft of such opinion is attached as Annex II(f)
hereto), with respect to each of the Selling Stockholders for whom they are
acting as counsel, dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) The Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney) has been duly executed and
delivered by such Selling Stockholder and constitutes the valid
and binding agreement of such Selling Stockholder in accordance
with its terms;
(ii) This Agreement and the International Underwriting
Agreement have been duly executed and delivered by or on behalf
of such Selling Stockholder; and the sale of the Firm Shares to
be sold by such Selling Stockholder hereunder and thereunder and
the compliance by such Selling Stockholder with all of the
obligations of such Selling Stockholder under this Agreement,
the International Underwriting Agreement and the Custody
Agreement (and, if such Selling Stockholder's name on Schedule
II hereto is followed by an asterisk, the Power of Attorney)
and the consummation by such Selling Stockholder of
the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which such Selling
Stockholder is a party or by which such Selling Stockholder is
bound or to which any of the property or assets of such Selling
Stockholder is subject, nor will such action result in any
violation of the provisions of any New York, Delaware corporate
or Federal law, rule or regulation known to such counsel (other
than foreign and state securities or Blue Sky laws, as to which
such counsel expresses no opinion, and other than Federal
securities laws, as to which such counsel expresses no opinion
except as otherwise set forth herein), or any judgment, writ,
injunction, decree, order or ruling of any court or governmental
authority binding on such Selling Stockholder of which such
counsel is aware;
(iii) No consent, approval, authorization or order of any
New York, Delaware corporate or Federal governmental agency or
body is required to be obtained by such Selling Stockholder for
the consummation by such Selling Stockholder of the transactions
contemplated by this Agreement, the International Underwriting
Agreement and the Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of
21
<PAGE>
Attorney) or, in connection with the Firm Shares to be sold by
such Selling Stockholder hereunder or under the International
Underwriting Agreement, except such as have been duly obtained
and are in full force and effect, the registration of the Firm
Shares under the Act, the registration of the Stock under the
Exchange Act, and such as may be required under state or foreign
securities or Blue Sky laws in connection with the purchase and
distribution of such Firm Shares by the Underwriters or the
International Underwriters (as to which such counsel need
express no opinion);
(iv) Such Selling Stockholder has full right, power and
authority to sell, assign, transfer and deliver the Firm Shares
to be sold by such Selling Stockholder under this Agreement and
the International Underwriting Agreement; and
(v) Upon delivery to the Underwriters by such Selling
Stockholder (either directly or by an Attorney-in-Fact) of a
certificate or certificates for the Firm Shares to be sold by
such Selling Stockholder, duly endorsed in blank or accompanied
by stock powers duly endorsed in blank, against receipt of the
purchase price therefor as provided in this Agreement and the
International Underwriting Agreement, such Selling Stockholder
will transfer to the Underwriters who have purchased such Firm
Shares pursuant to this Agreement and the International
Underwriting Agreement valid title to such Firm Shares, free and
clear of any security interests, claims, liens, equities or
other encumbrances whatsoever, provided that the Underwriters
are without notice of any adverse claim, as such term is used in
Section 8-302 of the Code and are purchasers for value in good
faith for purposes of the Code, and that the Underwriters'
rights are not limited by subsection (4) of Section 8-302 of the
Code.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction outside the United States
and in rendering the opinion in subparagraph (v) such counsel may rely upon a
certificate of such Selling Stockholder in respect of matters of fact as to
ownership of, and liens, encumbrances, equities or claims on the Firm Shares
sold by such Selling Stockholder, provided that such counsel shall state that
they believe that both you and they are justified in relying upon such
certificate;
(h) Patterson, Belknap, Webb & Tyler, LLP, counsel to Aerin Lauder and
Jane Lauder, each in her capacity as a Selling Stockholder, shall have furnished
to you their written opinion (a draft of each such opinion is attached as Annex
II(g) hereto) with respect to each of the Selling Stockholders for whom they are
acting as counsel, dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) The Custody Agreement (and if such Selling
Stockholder's name on Schedule II hereto is followed by an
asterisk, the Power of Attorney) has been duly executed and
delivered by such Selling Stockholder and constitutes the valid
and binding agreement of such Selling Stockholder in accordance
with its terms;
(ii) This Agreement and the International Underwriting
Agreement have been duly executed and delivered by such Selling
Stockholder; and the sale by such Selling Stockholder of the
Firm Shares to be sold by such Selling Stockholder hereunder and
thereunder and the compliance by such Selling Stockholder with
all of the obligations of such Selling Stockholder under this
Agreement, the International Underwriting Agreement and the
Custody Agreement (and if such Selling Stockholder's name on
Schedule II hereto is followed by an asterisk, the Power of
Attorney) and the consummation by such Selling Stockholder of
the transactions herein and therein contemplated will not
conflict with or result in a
22
<PAGE>
breach or violation of any terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to such counsel
to which such Selling Stockholder is a party or by which such
Selling Stockholder is bound, or to which any of the property or
assets of such Selling Stockholder is subject, nor will such
action result in any violation of the provisions of any statute
or order, rule or regulation known to such counsel of any court
or governmental agency or body having jurisdiction over such
Selling Stockholder or the property of such Selling Stockholder,
except that such counsel need not express any opinion as to
compliance with the registration or filing requirements or
disclosure provisions of the securities laws of the United
States or the securities or Blue Sky laws of any other
jurisdiction;
(iii) No consent, approval, authorization or order of any
court or governmental agency or body is required to be obtained
by such Selling Stockholder for the consummation by such Selling
Stockholder of the transactions contemplated by this Agreement,
the International Underwriting Agreement and the Custody
Agreement (and if such Selling Stockholder's name on Schedule II
hereto is followed by an asterisk, the Power of Attorney) in
connection with the Firm Shares to be sold by such Selling
Stockholder hereunder or under the International Underwriting
Agreement, except such as have been duly obtained and are in
full force and effect, the registration of the Firm Shares under
the Act, the registration of the Stock under the Exchange Act
and such as may be required under state or foreign securities or
Blue Sky laws in connection with the purchase and distribution
of such Shares by the Underwriters or the International
Underwriters;
(iv) Such Selling Stockholder has full right, power and
authority to sell, assign, transfer and deliver the Firm Shares
to be sold by such Selling Stockholder under this Agreement and
the International Underwriting Agreement; and
(v) Upon delivery to the Underwriters by such Selling
Stockholder (either directly or by an Attorney-in-Fact) of a
certificate or certificates for the Firm Shares to be sold by
such Selling Stockholder, duly endorsed in blank or accompanied
by stock powers duly endorsed in blank, against receipt of the
purchase price therefor as provided in this Agreement and the
International Underwriting Agreement, such Selling Stockholder
will transfer to the Underwriters who have purchased such Firm
Shares pursuant to this Agreement and the International
Underwriting Agreement valid title to such Firm Shares, free and
clear of any security interests, claims, liens, equities or
other encumbrances whatsoever, provided that the Underwriters
are without notice of any adverse claim, as defined in the Code
and are purchasers for value in good faith for purposes of the
Code, and that the Underwriters' rights are not limited by
subsection (4) of Section 8-302 of the Code.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction other than the laws of the State of
New York and the Federal laws of the United States and in rendering its opinion
such counsel may rely upon a certificate of such Selling Stockholder in respect
of matters of fact as to ownership of, and liens, encumbrances, equities or
claims on the Firm Shares sold by such Selling Stockholder, provided that such
counsel shall state that they believe that both you and they are justified in
relying upon such certificate;
(i) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the
23
<PAGE>
Registration Statement filed subsequent to the date of this Agreement and also
at each Time of Delivery, Arthur Andersen & Co., LLP shall have furnished to you
a letter or letters, dated the respective dates of delivery thereof, in form and
substance satisfactory to you, to the effect set forth in Annex I hereto (the
executed copy of the letter delivered prior to the execution of this Agreement
is attached as Annex I(a) hereto and a draft of the form of letter to be
delivered on the effective date of any post-effective amendment to the
Registration Statement and as of each Time of Delivery is attached as Annex I(b)
hereto);
(j) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not covered
by insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Prospectus, and
(ii) since the respective dates as of which information is given in the
Prospectus there shall not have been any change in the capital stock or
long-term debt of the Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity, results of operations, or
Intellectual Property of the Company and its subsidiaries, otherwise than as set
forth or contemplated in the Prospectus, the effect of which, in any such case
described in Clause (i) or (ii), is in the judgment of the Representatives so
material and adverse as to make it impracticable or inadvisable to proceed with
the public offering or the delivery of the Shares being delivered at such Time
of Delivery on the terms and in the manner contemplated in the Prospectus;
(k) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in securities
generally on the Exchange; (ii) a suspension or material limitation in trading
in the Company's securities on the Exchange; (iii) a general moratorium on
commercial banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national emergency or
war, if the effect of any such event specified in this clause (iv) in the
judgment of the Representatives makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Shares being delivered at such
Time of Delivery on the terms and in the manner contemplated in the Prospectus;
(l) The Shares to be sold by the Company and the Selling Stockholders
at such Time of Delivery shall have been duly listed, subject to notice of
issuance, on the Exchange;
(m) The Company shall have obtained and delivered to the Underwriters
executed copies of an agreement from all Lauder Family Members which own shares
of Common Stock (other than The Lauder Foundation), from each trustee of a trust
that is a Lauder Family Member and from Morgan Guaranty Trust Company of New
York, to the effect set forth in Subsection 1(b)(vi) hereof in form and
substance satisfactory to you;
(n) The Company and the Selling Stockholders shall have furnished or
caused to be furnished to you at such Time of Delivery certificates of officers
of the Company and of the Selling Stockholders, respectively, satisfactory to
you as to the accuracy of the representations and warranties of the Company and
the Selling Stockholders, respectively, herein at and as of such Time of
Delivery, as to the performance by the Company and the Selling Stockholders of
all of their respective obligations hereunder to be performed at or prior to
such Time of Delivery, and as to such other matters as you may reasonably
request, and the Company shall have furnished or caused to be furnished
certificates as to the matters set forth in subsections (a) and (j) of this
Section 7, and as to such other matters as you may reasonably request;
24
<PAGE>
(o) The Company shall have complied with the provisions of Section 5(d)
hereof with respect to the furnishing of prospectuses on the New York Business
Day next succeeding the date of this Agreement; and
(p) Each of the Selling Stockholders shall have delivered to the
Underwriters certificates required by Treasury Regulation section 1.1445-2(b)(2)
in order to avoid withholding of tax under Section 1445 of the Internal Revenue
Code of 1986, as amended.
8. (a) The Company and each of the Selling Stockholders, jointly and
severally, will indemnify and hold harmless each Underwriter 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 an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such action or claim as such expenses are incurred; provided, however, that the
Company and the Selling Stockholders shall 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 or omission or alleged
omission made in any Preliminary Prospectus, the Registration Statement or the
Prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
through Goldman, Sachs & Co. expressly for use therein. Notwithstanding the
provisions of this subsection (a), no Selling Stockholder shall be required to
pay an amount in excess of the gross proceeds received by such Selling
Stockholder from the Shares sold by it hereunder.
(b) Each Underwriter will indemnify and hold harmless the Company and
each Selling Stockholder against any losses, claims, damages or liabilities to
which the Company or such Selling Stockholder 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 an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein 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 any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through Goldman, Sachs & Co.
expressly for use therein; and will reimburse the Company and each Selling
Stockholder for any legal or other expenses reasonably incurred by the Company
or such Selling Stockholder in connection with investigating or defending any
such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against an indemnifying party
under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof,
25
<PAGE>
the indemnifying party shall be entitled to participate therein and, to the
extent that it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (which 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 shall not be liable to such indemnified
party under such subsection for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim 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 any indemnified
party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Stockholders on the
one hand and the Underwriters on the other from the offering of the Shares. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company and the Selling Stockholders 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 (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Selling Stockholders 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 of the Shares purchased
under this Agreement (before deducting expenses) received by the Company and the
Selling Stockholders bear to the total underwriting discounts and commissions
received by the Underwriters with respect to the Shares purchased under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus. 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 Selling Stockholders on the one hand or the
Underwriters on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company, each of the Selling Stockholders and each of the Underwriters agree
that it would not be just and equitable if contributions pursuant to this
subsection (d) were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this subsection (d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in 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 such action or claim.
26
<PAGE>
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 Shares 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.
(e) The obligations of the Company and the Selling Stockholders under
this Section 8 shall be in addition to any liability which the Company and the
respective Selling Stockholders 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 8 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 officer and director of the Company and to each person, if
any, who controls the Company or any Selling Stockholder within the meaning of
the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six hours
after such default by any Underwriter you do not arrange for the purchase of
such Shares, then the Company and the Selling Stockholders shall be entitled to
a further period of thirty-six hours within which to procure another party or
other parties satisfactory to you to purchase such Shares on such terms. In the
event that, within the respective prescribed periods, you notify the Company and
the Selling Stockholders that you have so arranged for the purchase of such
Shares, or the Company and the Selling Stockholders notify you that they have so
arranged for the purchase of such Shares, you or the Company and the Selling
Stockholders shall have the right to postpone such Time of Delivery for a period
of not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus which in your opinion
may thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like effect as if
such person had originally been a party to this Agreement with respect to such
Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased does not exceed one-eleventh of
the aggregate number of all of the Shares to be purchased at such Time of
Delivery, then the Company and the Selling Stockholders shall have the right to
require each non-defaulting Underwriter to purchase the number of Shares which
such Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased exceeds one-eleventh of the
aggregate number of all of the Shares to be
27
<PAGE>
purchased at such Time of Delivery, or if the Company and the Selling
Stockholders shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase Shares of a defaulting
Underwriter or Underwriters, then the obligations of the Underwriters to
purchase and of the Company and, if applicable, any Selling Stockholders to sell
the Shares to be sold at such Time of Delivery shall thereupon terminate,
without liability on the part of any non-defaulting Underwriter or the Company
or the Selling Stockholders, except for the expenses to be borne by the Company
and the Selling Stockholders and the Underwriters as provided in Section 6
hereof and the indemnity and contribution agreements in Section 8 hereof; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Stockholders and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company, or any of the Selling Stockholders, or any officer
or director or controlling person of the Company, or any controlling person of
any Selling Stockholder, and shall survive delivery of and payment for the
Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Selling Stockholders shall then be under any
liability to any Underwriter except as provided in Sections 6 and 8 hereof; but,
if for any other reason any Shares are not delivered by or on behalf of the
Company and the Selling Stockholders as provided herein, the Company and each of
the Selling Stockholders pro rata (based on the number of Shares to be sold by
the Company and such Selling Stockholder hereunder), will reimburse the
Underwriters through you for all out-of-pocket expenses approved in writing by
you, including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered, but the Company and the Selling Stockholders shall then
be under no further liability to any Underwriter in respect of the Shares not so
delivered except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Goldman, Sachs & Co. on behalf of you as the
representatives; and in all dealings with any Selling Stockholder hereunder, you
and the Company shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of such Selling Stockholder made or given by any
or all of the Attorneys-in-Fact for such Selling Stockholder.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representatives in care of Goldman, Sachs &
Co., 85 Broad Street, New York, New York 10004, Attention: Registration
Department; if to any Selling Stockholder shall be delivered or sent by mail,
telex or facsimile transmission to counsel for such Selling Stockholder at its
address set forth in Schedule II hereto; and if to the Company shall be
delivered or sent by mail, telex or facsimile transmission to the address of the
Company set forth in the Registration Statement, Attention: General Counsel;
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
hereof shall be delivered or sent by mail, telex or facsimile transmission to
such Underwriter at its address set forth in its Underwriters' Questionnaire or
telex constituting such Questionnaire, which address will be supplied to the
Company or the Selling Stockholders by you upon request. Any such statements,
requests, notices or agreements shall take effect upon receipt thereof.
28
<PAGE>
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and the Selling Stockholders and, to
the extent provided in Sections 8 and 10 hereof, the officers and directors of
the Company and each person who controls the Company, any Selling Stockholder or
any Underwriter, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No purchaser of any of the Shares from any
Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence of this Agreement. As used herein,
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
16. This Agreement may be executed by any one or more of the parties
hereto 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
instrument.
If the foregoing is in accordance with your understanding, please sign
and return to us ten counterparts hereof, and upon the acceptance hereof by you,
on behalf of each of the Underwriters, this letter and such acceptance hereof
shall constitute a binding agreement among each of the Underwriters, the Company
and each of the Selling Stockholders. It is understood that your acceptance of
this letter on behalf of each of the Underwriters is pursuant to the authority
set forth in a form of Agreement among Underwriters (U.S. Version), the form of
which shall be submitted to the Company and the Selling Stockholders for
examination upon request, but without warranty on your part as to the authority
of the signers thereof.
29
<PAGE>
Any person executing and delivering this Agreement as Attorney-in-Fact
for a Selling Stockholder represents by so doing that he has been duly appointed
as Attorney-in-Fact by such Selling Stockholder pursuant to a validly existing
and binding Power of Attorney which authorizes such Attorney-in-Fact to take
such action.
Very truly yours,
THE ESTEE LAUDER COMPANIES INC.
By:
-------------------------------
Leonard A. Lauder
Chief Executive Officer
[Selling Stockholders]
Accepted as of the date hereof:
Goldman, Sachs & Co.
Dillon, Read & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
J.P. Morgan Securities Inc.
By:
--------------------------------------
(Goldman, Sachs & Co.)
On behalf of each of the Underwriters
30
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Number of Optional
Shares to be
Total Number of Purchased if
Firm Shares Maximum Option
Underwriter to be Purchased Exercised
----------- ------------------- -------------------
<S> <C> <C>
Goldman, Sachs & Co................................................
Dillon, Read & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated.........................................
J.P. Morgan Securities Inc.........................................
------------------- -------------------
Total................................................... 4,532,000 679,800
=================== ===================
</TABLE>
<PAGE>
SCHEDULE II
<PAGE>
ANNEX I
FORM OF COMFORT LETTER OF
ARTHUR ANDERSEN & CO., LLP
Pursuant to Section 7(i) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included or incorporated by reference in the Prospectus or the
Registration Statement comply as to form in all material respects with
the applicable accounting requirements of the Act and the related
published rules and regulations thereunder; and, if applicable, they
have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the unaudited
consolidated interim financial statements, selected financial data, pro
forma financial information, financial forecasts and/or condensed
financial statements derived from audited financial statements of the
Company for the periods specified in such letter, as indicated in their
reports thereon, copies of which have been separately furnished to the
representatives of the Underwriters (the "Representatives");
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included in the Company's quarterly
report on Form 10-Q incorporated by reference into the Prospectus as
indicated in their reports thereon copies of which have been separately
furnished to the Representatives; and on the basis of specified
procedures including inquiries of officials of the Company who have
responsibility for financial and accounting matters regarding whether
the unaudited condensed consolidated financial statements referred to
in paragraph (vi)(A)(i) below comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations, nothing
came to their attention that caused them to believe that the unaudited
condensed consolidated financial statements do not comply as to form in
all material respects with the applicable accounting requirements of
the Act and the Exchange Act and the related published rules and
regulations;
(iv) The unaudited selected financial information with respect
to the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the
Prospectus and included or incorporated by reference in Item 6 of the
Company's Annual Report on Form 10-K for the most recent fiscal year
incorporated by reference into the Prospectus agrees with the
corresponding amounts (after restatements where applicable) in the
audited consolidated financial statements for such five fiscal years
which were included or incorporated by reference in the Company's
Annual Report on Form 10-K for such fiscal years;
I-1
<PAGE>
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified in such letter nothing
came to their attention as a result of the foregoing procedures that
caused them to believe that this information does not conform in all
material respects with the disclosure requirements of Items 301, 302,
402 and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available
interim financial statements of the Company and its subsidiaries,
inspection of the minute books of the Company and its subsidiaries
since the date of the latest audited financial statements incorporated
by reference into the Prospectus, inquiries of officials of the Company
and its subsidiaries responsible for financial and accounting matters
and such other inquiries and procedures as may be specified in such
letter, nothing came to their attention that caused them to believe
that:
(A) (i) the unaudited consolidated statements of income,
consolidated balance sheets and consolidated statements of cash
flows included in the Prospectus and/or included or incorporated
by reference in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus 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 (ii) any material modifications should be made
to the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash
flows incorporated by reference into the Prospectus for them to
be in conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance
sheet items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and any
such unaudited data and items were not determined on a basis
substantially consistent with the basis for the corresponding
amounts in the audited consolidated financial statements
included or incorporated by reference in the Company's Annual
Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived any
unaudited condensed financial statements referred to in Clause
(A) and any unaudited income statement data and balance sheet
items included in the Prospectus and referred to in Clause (B)
were not determined on a basis substantially consistent with the
basis for the audited consolidated financial statements included
or incorporated by reference in the Company's Annual Report on
Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed
financial statements included or incorporated by reference in
the Prospectus do not comply as to form in all material respects
with the applicable accounting requirements of the Act and the
published rules and regulations thereunder or the pro forma
adjustments have not been properly applied to the historical
amounts in the compilation of those statements;
(E) as of a specified date not more than five days prior
to the date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital
stock upon exercise of options and stock appreciation rights,
I-2
<PAGE>
upon earn-outs of performance shares and upon conversions of
convertible securities, in each case which were outstanding on
the date of the latest balance sheet included or incorporated by
reference in the Prospectus) or any increase in the consolidated
long-term debt of the Company and its subsidiaries, or any
decreases in consolidated net current assets or stockholders'
equity or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each
case as compared with amounts shown in the latest balance sheet
included or incorporated by reference into the Prospectus,
except in each case for changes, increases or decreases which
the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference into the
Prospectus to the specified date referred to in Clause (E) there
were any decreases in consolidated net revenues or operating
profit or the total or per share amounts of consolidated net
income or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each
case as compared with the comparable period of the preceding
year and with any other period of corresponding length specified
by the Representatives, except in each case for decreases or
increases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(vii) In addition to the examination referred to in their
report(s) included or incorporated by reference into the Prospectus and
the limited procedures, inspection of minute books, inquiries and other
procedures referred to in paragraphs (iii) and (vi) above, they have
carried out certain specified procedures, not constituting an
examination in accordance with generally accepted auditing standards,
with respect to certain amounts, percentages and financial information
specified by the Representatives, which are derived from the general
accounting records of the Company and its subsidiaries, which appear in
the Prospectus (excluding documents incorporated by reference), or in
Part II of, or in exhibits and schedules to, the Registration Statement
specified by the Representatives or in documents incorporated by
reference in the Prospectus specified by the Representatives, and have
compared certain of such amounts, percentages and financial information
with the accounting records of the Company and its subsidiaries and
have found them to be in agreement.
I-2
<PAGE>
THE ESTEE LAUDER COMPANIES INC.
Class A Common Stock
(par value $.01 per share)
Underwriting Agreement
(International Version)
February __, 1997
Goldman Sachs International,
Dillon, Read & Co. Inc.,
Merrill Lynch International,
J.P. Morgan Securities Ltd.
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman Sachs International,
Peterborough Court,
133 Fleet Street,
London EC4A 2BB, England.
Ladies and Gentlemen:
Certain stockholders of the Estee Lauder Companies Inc., a Delaware
corporation (the "Company"), named in Schedule II hereto (the "Selling
Stockholders"), propose, subject to the terms and conditions stated herein, to
sell to the Underwriters named in Schedule I hereto (the "Underwriters") an
aggregate of 1,133,000 shares of Class A Common Stock, par value $.01 per share
("Stock"), of the Company and the Company proposes, subject to the terms and
conditions stated herein, to issue and sell to the Underwriters at their
election an aggregate of 169,950 shares of Stock. The 1,133,000 shares to be
sold by the Selling Stockholders are herein called the "Firm Shares" and the
169,950 additional shares to be sold by the Company are herein called the
"Optional Shares". The Firm Shares and the Optional Shares that the Underwriters
elect to purchase pursuant to Section 2 hereof are herein collectively called,
the "Shares".
It is understood and agreed to by all parties that the Company and the
Selling Stockholders are concurrently entering into an agreement, a copy of
which is attached hereto (the "U.S. Underwriting Agreement"), providing for the
sale by the Selling Stockholders and, with respect to the overallotment option
thereunder, by the Company, of up to a total of 5,211,800 shares of Stock (the
"U.S. Shares"), including the overallotment option thereunder, through
arrangements with certain underwriters in the United States (the "U.S.
Underwriters"), for whom Goldman, Sachs & Co., Dillon, Read & Co. Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated and J.P. Morgan Securities Inc. are
acting as representatives. Anything herein or therein to the contrary
notwithstanding, the respective closings under this Agreement and the U.S.
Underwriting Agreement are hereby expressly made conditional on one another. The
<PAGE>
Underwriters hereunder and the U.S. Underwriters are simultaneously entering
into an Agreement between U.S. and International Underwriting Syndicates (the
"Agreement between Syndicates") which provides, among other things, for the
transfer of shares of Stock between the two syndicates. Two forms of prospectus
are to be used in connection with the offering and sale of shares of Stock
contemplated by the foregoing, one relating to the Shares hereunder and the
other relating to the U.S. Shares. The latter form of prospectus will be
identical to the former except for certain substitute pages as included in the
registration statement and amendments thereto as mentioned below. Except as used
in Sections 2, 3, 4, 10 and 12 herein, and except as context may otherwise
require, references hereinafter to the Shares shall include all of the shares of
Stock which may be sold pursuant to either this Agreement or the U.S.
Underwriting Agreement, and references herein to any prospectus whether in
preliminary or final form, and whether as amended or supplemented, shall include
both the U.S. and the international versions thereof.
In addition, this Agreement incorporates by reference certain
provisions from the U.S. Underwriting Agreement (including the related
definitions of terms, which are also used elsewhere herein) and, for purposes of
applying the same, references (whether in these precise words or their
equivalent) in the incorporated provisions to the "Underwriters" shall be to the
Underwriters hereunder, to the "Shares" shall be to the Shares hereunder as just
defined, to "this Agreement" (meaning therein the U.S. Underwriting Agreement)
shall be to this Agreement (except where this Agreement is already referred to
or as the context may otherwise require) and to the representatives of the
Underwriters or to Goldman, Sachs & Co. shall be to the addressees of this
Agreement and to Goldman Sachs International ("GSI"), and, in general, all such
provisions and defined terms shall be applied mutatis mutandis as if the
incorporated provisions were set forth in full herein having regard to their
context in this Agreement as opposed to the U.S. Underwriting Agreement.
1. The Company and each of the several Selling Stockholders hereby make
to the Underwriters the same respective representations, warranties and
agreements as are set forth in Section 1 of the U.S. Underwriting Agreement,
which Section is incorporated herein by this reference.
2. Subject to the terms and conditions herein set forth, (a) the
Company and each of the Selling Stockholders agree, severally and not jointly,
to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company and each of the Selling
Stockholders, at a purchase price per share of $____, the number of Firm Shares
(to be adjusted by you so as to eliminate fractional shares) determined by
multiplying the aggregate number of Firm Shares to be sold by each of the
Selling Stockholders as set forth opposite their respective names in Schedule II
hereto by a fraction, the numerator of which is the aggregate number of Firm
Shares to be purchased by such Underwriter as set forth opposite the name of
such Underwriter in Schedule I hereto and the denominator of which is the
aggregate number of Firm Shares to be purchased by all the Underwriters from the
Company and all the Selling Stockholders hereunder and (b) in the event and to
the extent that the Underwriters shall exercise the election to purchase
Optional Shares as provided below, the Company agrees to issue and sell to each
of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the purchase price per share set forth
in clause (a) of this Section 2, that portion of the number of Optional Shares
as to which such election shall have been exercised (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying such number of
Optional Shares by a fraction the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto
2
<PAGE>
and the denominator of which is the maximum number of Optional Shares that all
of the Underwriters are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to 169,950 Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering
overallotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised only by written notice from you to the Company,
given within a period of 30 calendar days after the date of this Agreement and
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery (as defined in Section 4
hereof) or, unless you and the Company otherwise agree in writing, earlier than
two or later than ten business days after the date of such notice.
3. Upon the authorization by GSI of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus and in the forms of Agreement among
Underwriters (International Version) and Selling Agreements, which have been
previously submitted to the Company by you. Each Underwriter hereby makes to and
with the Company and the Selling Stockholders the representations and agreements
of such Underwriter as a member of the selling group contained in Sections 3(d),
3(e) and 3(f) of the form of Selling Agreements.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Goldman, Sachs & Co. may request upon at least forty-eight hours' prior
notice to the Company shall be delivered by or on behalf of the Company to
Goldman, Sachs & Co., through the facilities of The Depository Trust Company
("DTC"), for the account of such Underwriter, against payment by or on behalf of
such Underwriter of the purchase price therefor by wire transfer, payable to the
order of the Company in Federal (same day) funds. The Company will cause the
certificates representing the Shares to be made available for checking and
packaging at least twenty-four hours prior to each Time of Delivery with respect
thereto at the office of Goldman, Sachs & Co. or DTC or its designated
custodian, as the case may be (the "Designated Office"). The time and date of
such delivery and payment shall be (i) with respect to the Firm Shares, 9:30
a.m., New York City time, on ____________, 1997 on such other time and date as
Goldman, Sachs & Co. and the Company may agree upon in writing, and (ii) with
respect to the Optional Shares, 9:30 a.m., New York City time, on the date
specified by Goldman, Sachs & Co. in the written notice given by Goldman, Sachs
& Co. of the Underwriters' election to purchase such Optional Shares, or such
other time and date as Goldman, Sachs & Co. and the Company may agree upon in
writing. Such time and date for delivery of the Firm Shares is herein called the
"First Time of Delivery", such time and date for delivery of the Optional
Shares, if not the First Time of Delivery, is herein called the "Second Time of
Delivery", and each such time and date for delivery is herein called a "Time of
Delivery".
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 of the U.S. Underwriting
Agreement, including the cross-receipt for the Shares and any additional
documents requested by the Underwriters pursuant to Section 7(k) of the U.S.
Underwriting Agreement, will be delivered at the offices of Weil, Gotshal &
Manges LLP, 767 Fifth Avenue, New York, New York 10153 (the "Closing Location"),
and the Shares will be delivered at the Designated Office, all at each Time of
Delivery. A meeting will be held at the Closing Location at 2:00.p.m., New York
City time, on the New York Business Day next preceding each Time of Delivery, at
which meeting the final drafts of the documents to be delivered pursuant to the
preceding sentence will be available for review by
3
<PAGE>
the parties hereto. For the purposes of this Section 4, "New York Business
Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is
not a day on which banking institutions in New York are generally authorized or
obligated by law or executive order to close.
5. The Company hereby makes with the Underwriters the same agreements
as are set forth in Section 5 of the U.S. Underwriting Agreement, which Section
is incorporated herein by this reference.
6. The Company, each of the Selling Stockholders, and the Underwriters
hereby agree with respect to certain expenses on the same terms as are set forth
in Section 6 of the U.S. Underwriting Agreement, which Section is incorporated
herein by this reference.
7. Subject to the provisions of the Agreement between Syndicates, the
obligations of the Underwriters hereunder, as to the Shares to be delivered at
each Time of Delivery, shall be subject, in their discretion, to the condition
that all representations and warranties and other statements of the Company and
of the Selling Stockholders herein are, at and as of such Time of Delivery, true
and correct, the condition that the Company and the Selling Stockholders shall
have performed all of its and their obligations hereunder theretofore to be
performed, and additional conditions identical to those set forth in Section 7
of the U.S. Underwriting Agreement, which Section is incorporated herein by this
reference.
8. (a) The Company and each of the Selling Stockholders, jointly and
severally, will indemnify and hold harmless each Underwriter against any losses,
claims, damages or liabilities, joint or several, to which such Underwriter may
become subject, under the Securities Act of 1933, as amended (the "Act") or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company and the Selling
Stockholders shall 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 or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through GSI expressly
for use therein. Notwithstanding the provisions of this subsection (a), no
Selling Stockholder shall be required to pay an amount in excess of the gross
proceeds received by such Selling Stockholder from the Shares sold by it
hereunder.
(b) Each Underwriter will indemnify and hold harmless the Company and
each Selling Stockholder against any losses, claims, damages or liabilities to
which the Company or such Selling Stockholder 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 an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein 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 any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or
4
<PAGE>
supplement in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through GSI expressly for use
therein; and will reimburse the Company and each Selling Stockholder for any
legal or other expenses reasonably incurred by the Company or such Selling
Stockholder in connection with investigating or defending any such action or
claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b)` above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against an indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel 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 shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim 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
any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Stockholders on the
one hand and the Underwriters on the other from the offering of the Shares. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company and the Selling Stockholders 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 (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Selling Stockholders 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 of the Shares purchased
under this Agreement (before deducting expenses) received by the Company and the
Selling Stockholders bear to the total underwriting discounts and commissions
received by the Underwriters with respect to the Shares purchased under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to, among other
things, whether the untrue or
5
<PAGE>
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
Selling Stockholders on the one hand or the Underwriters on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company, each of the Selling
Stockholders and each of the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (d) were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in 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 such action or claim. 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 Shares 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.
(e) The obligations of the Company and the Selling Stockholders under
this Section 8 shall be in addition to any liability which the Company and the
respective Selling Stockholders 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 8 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 officer and director of the Company and to each person, if
any, who controls the Company or any Selling Stockholder within the meaning of
the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six hours
after such default by any Underwriter you do not arrange for the purchase of
such Shares, then the Company and the Selling Stockholders shall be entitled to
a further period of thirty-six hours within which to procure another party or
other parties satisfactory to you to purchase such Shares on such terms. In the
event that, within the respective prescribed periods, you notify the Company and
the Selling Stockholders that you have so arranged for the purchase of such
Shares, or the Company and the Selling Stockholders notify you that they have so
arranged for the purchase of such Shares, you or the Company and the Selling
Stockholders shall have the right to postpone such Time of Delivery for a period
of not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus which in your opinion
may thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like effect as if
such person had originally been a party to this Agreement with respect to such
Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains
6
<PAGE>
unpurchased does not exceed one-eleventh of the aggregate number of all the
Shares to be purchased at such Time of Delivery, then the Company and the
Selling Stockholders shall have the right to require each non-defaulting
Underwriter to purchase the number of shares which such Underwriter agreed to
purchase hereunder at such Time of Delivery and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the number
of Shares which such Underwriter agreed to purchase hereunder) of the Shares of
such defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased exceeds one-eleventh of the
aggregate number of all the Shares to be purchased at such Time of Delivery, or
if the Company and the Selling Stockholders shall not exercise the right
described in subsection (b) above to require non-defaulting Underwriters to
purchase Shares of a defaulting Underwriter or Underwriters, then the
obligations of the Underwriters to purchase and of the Company and, if
applicable, any Selling Stockholders to sell the Shares to be sold at such Time
of Delivery shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company or the Selling Stockholders, except
for the expenses to be borne by the Company and the Selling Stockholders and the
Underwriters as provided in Section 6 hereof and the indemnity and contribution
agreements in Section 8 and 9 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Stockholders and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company or any of the Selling Stockholders, or any officer
or director or controlling person of the Company or any controlling person of
any Selling Stockholders, and shall survive delivery of and payment for the
Shares.
11. If this Agreement shall be terminated pursuant to Section 10
hereof, neither the Company nor the Selling Stockholders shall then be under any
liability to any Underwriter except as provided in Sections 6, 8 and 9 hereof;
but, if for any other reason, any Shares are not delivered by or on behalf of
the Company and the Selling Stockholders as provided herein, the Company and
each of the Selling Stockholders pro rata (based on the number of Shares to be
sold by the Company and such Selling Stockholder hereunder),will reimburse the
Underwriters through GSI for all out-of-pocket expenses approved in writing by
GSI, including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered, but the Company and the Selling Stockholders shall then
be under no further liability to any Underwriter in respect of the Shares not so
delivered except as provided in Sections 6, 8 and 9 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by GSI; and in all dealings with any Selling Stockholder
hereunder, you and the Company shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of such Selling Stockholder
made or given by any or all of the Attorneys-in-Fact for such Selling
Stockholder.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the
7
<PAGE>
Underwriters in care of GSI, Peterborough Court, 133 Fleet Street, London EC4A
2BB, England, Attention: Equity Capital Markets, Telex No. 94012165, facsimile
transmission No. (071) 774-1550; if to any Selling Stockholder shall be
delivered or sent by mail, telex or facsimile transmission to counsel for such
Selling Stockholder at its address set forth in Schedule II hereto; and if to
the Company shall be delivered or sent by mail, telex or facsimile transmission
to the address of the Company set forth in the Registration Statement,
Attention: Secretary; provided, however, that any notice to an Underwriter
pursuant to Section 8(c) hereof shall be delivered or sent by mail, telex or
facsimile transmission to such Underwriter at its address set forth in its
Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company or the Selling Stockholders by GSI upon
request. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and the Selling Stockholders and, to
the extent provided in Sections 8, 9 and 11 hereof, the officers and directors
of the Company and each person who controls the Company, any Selling Stockholder
or any Underwriter, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No purchaser of any of the Shares from any
Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence of this Agreement.
15. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, United States of America.
16. This Agreement may be executed by any one or more of the parties
hereto 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
instrument.
8
<PAGE>
If the foregoing is in accordance with your understanding, please sign
and return to us 10 counterparts hereof, and upon the acceptance hereof by you,
on behalf of each of the Underwriters, this letter and such acceptance hereof
shall constitute a binding agreement among each of the Underwriters, the Company
and each of the Selling Stockholders. It is understood that your acceptance of
this letter on behalf of each of the Underwriters is pursuant to the authority
set forth in a form of Agreement among Underwriters (International Version), the
form of which shall be furnished to the Company and the Selling Stockholders for
examination upon request, but without warranty on your part as to the authority
of the signers thereof.
Any person executing and delivering this Agreement as Attorney-in-Fact
for a Selling Stockholder represents by so doing that he has been duly appointed
as Attorney-in-Fact by such Selling Stockholder pursuant to a validly existing
and binding Power of Attorney which authorizes such Attorney-in-Fact to take
such action.
Very truly yours,
THE ESTEE LAUDER COMPANIES INC.
By:
------------------------------
Leonard A. Lauder
Chief Executive Officer
[Selling Stockholders]
Accepted as of the date hereof:
Goldman Sachs International
Dillon, Read & Co. Inc.
Merrill Lynch International
J.P. Morgan Securities Ltd.
By: Goldman Sachs International
By:
------------------------------
(Attorney-in-fact)
On behalf of each of the Underwriters
9
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Number of Optional
Shares to be
Total Number of Purchased if
Firm Shares Maximum Option
Underwriter to be Purchased Exercised
----------- --------------- -------------------
<S> <C> <C>
Goldman Sachs International........................................
Dillon, Read & Co. Inc.............................................
Merrill Lynch International........................................
J.P. Morgan Securities Ltd.........................................
-------------- ------------------
Total...................................................... 1,133,000 169,950
============== ==================
</TABLE>
<PAGE>
SCHEDULE II
<PAGE>
Exhibit 5.1
Weil, Gotshal & Manges LLP
A limited liability partnership
including professional corporations
767 Fifth Avenue, New York, NY 10153-0019
TEL: (212) 310-8000
FAX: (212) 310-8007
February 6 1997
The Estee Lauder Companies Inc.
767 Fifth Avenue
New York, NY 10153
Ladies and Gentlemen:
We have acted as counsel to The Estee Lauder Companies Inc., a
Delaware corporation (the "Company"), in connection with the preparation and
filing of the Registration Statement (File No. 333-20521) of the Company on Form
S-3 (as amended, the "Registration Statement") under the Securities Act of 1933,
as amended (the "Securities Act"), relating to the public offering (the
"Offering") by the Selling Stockholders identified as such in the Registration
Statement of an aggregate of 5,665,000 shares of Class A Common Stock, par
value $.01 per share (the "Class A Common Stock"), of the Company (together with
(i) an additional 849,750 shares of Class A Common Stock subject to an
over-allotment option granted by the Company to the underwriters and (ii) any
shares of Class A Common Stock which may be registered in any related
registration statement pursuant to Section 462(b) of the Securities Act, the
"Shares").
In so acting, we have reviewed the Registration Statement,
including the Prospectus contained therein (the "Prospectus"), the Amended and
Restated Certificate of Incorporation of the Company and the Bylaws of the
Company. In addition, we have examined originals or copies, certified or
otherwise identified to our satisfaction, of such corporate records, agreements,
documents and other instruments, and such certificates or comparable documents
of public officials and of officers and representatives of the Company, and have
made such inquiries of such officers and representatives, as we have deemed
relevant and necessary as a basis for the opinions hereinafter set forth.
<PAGE>
The Estee Lauder Companies, Inc.
February 6, 1997
Page 2
In such examination, we have assumed the genuineness of all
signatures, the legal capacity of natural persons, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified, conformed or photostatic copies and
the authenticity of the originals of such latter documents. As to all questions
of fact material to this opinion that have not been independently established,
we have relied upon certificates or comparable documents of officers and
representatives of the Company.
Based on the foregoing, and subject to the qualifications
stated herein, we are of the opinion that the Shares registered for sale by the
Company and the Selling Stockholders under the Registration Statement and any
related registration statement filed pursuant to Rule 462(b) of the Securities
Act have been duly authorized, and the Shares being sold by the Selling
Stockholders, are, and the Shares being sold by the Company, when issued and
paid for as contemplated by the Prospectus, will be, validly issued, fully paid
and nonassessable.
The opinions expressed herein are limited to the corporate
laws of the State of Delaware, and we express no opinion as to the effect on the
matters covered by this letter of the laws of any other jurisdiction.
The opinions expressed herein are rendered solely for your
benefit in connection with the transactions described herein. These opinions may
not be used or relied upon by any other person, nor may this letter or any
copies thereof be furnished to a third party, filed with a governmental agency,
quoted, cited or otherwise referred to without our prior written consent.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the references to this firm under the
heading "Legal Opinions" in the Prospectus, without admitting that we are
"experts" under the Securities Act or the rules and regulations promulgated
thereunder with respect to any part of the Registration Statement.
<PAGE>
The Estee Lauder Companies, Inc.
February 4, 1997
Page 3
We also consent to the incorporation by reference of this
opinion in any related registration statement filed by the Company pursuant to
Rule 462(b) of the Securities Act.
Very truly yours,
/s/ Weil, Gotshal & Manges
