Exhibit 10.3

TAX MATTERS AGREEMENT

BY AND BETWEEN

ARGOS INTERMEDIATE HOLDCO I INC.,

PETSMART, INC.

AND

CHEWY, INC.

Dated as of June 13, 2019

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TABLE OF CONTENTS

 

          Page  

ARTICLE I

     1  

Section 1.01

   Definitions      1  

ARTICLE II

     4  

Section 2.01

   Separate Tax Liabilities      4  

Section 2.02

   Allocation of Consolidated Federal Tax Liability and Use of Attributes      4
 

Section 2.03

   Treatment of Income from Cancellation of Indebtedness      5  

Section 2.04

   Pre-IPO Tax Attributes      5  

Section 2.05

   Estimated Tax Payments      5  

Section 2.06

   Calculations; Timing      6  

Section 2.07

   Adjustments      6  

Section 2.08

   Non-U.S. Federal Income Taxes      6  

ARTICLE III

     6  

Section 3.01

   Tax Return Preparation      6  

Section 3.02

   Refunds      8  

ARTICLE IV

     8  

Section 4.01

   Audits      8  

ARTICLE V

     9  

Section 5.01

   Cooperation: Tax Information      9  

Section 5.02

   Retention of Records      10  

ARTICLE VI

     10  

Section 6.01

   Interpretation of Agreement and Resolution of Disputes      10  

Section 6.02

   Miscellaneous      11  

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TAX MATTERS AGREEMENT

This Tax Matters Agreement (this “Agreement”), dated as of June 13, 2019, is
entered into by and between Argos Intermediate Holdco I Inc., a Delaware
corporation (“Parent”), PetSmart, Inc., a Delaware corporation (“PetSmart”) and
Chewy, Inc., a Delaware corporation (“Chewy”) (each a “Party” and, collectively,
the “Parties”).

RECITALS

WHEREAS, Chewy Group Members (as defined below) file Income Tax Returns (as
defined below) on a consolidated, combined and/or unitary basis for certain
federal, state, local and non-U.S. Income Tax (as defined below) purposes;

WHEREAS, PetSmart Group Members (as defined below) file Income Tax Returns on a
consolidated, combined and/or unitary basis for certain federal, state, local
and non-U.S. Income Tax purposes;

WHEREAS, PetSmart prepares and files, or causes to be prepared and filed, the
Income Tax Returns of each PetSmart Group Member and each Chewy Group Member,
whether or not such PetSmart Group Member or Chewy Group Member files such
Income Tax Return on a consolidated, combined or unitary basis with any Parent
Group Member;

WHEREAS, Chewy intends to undertake an initial public offering (the “IPO”);

WHEREAS, in contemplation of the IPO, Parent, PetSmart and Chewy desire to
(i) agree upon the method of determining the financial consequences to each
Party resulting from the preparation and filing of Tax Returns, (ii) provide for
the payment of Tax liabilities associated with Tax Returns and entitlement to
refunds thereof, (iii) allocate responsibility for, and cooperation in, the
filing and defense of Tax Returns and (iv) provide for certain other matters
relating to Taxes.

ARTICLE I

Section 1.01 Definitions. For purposes of this Agreement, the following
capitalized terms shall have the meanings set forth below:

“Accounting Firm” shall mean a recognized independent public accounting firm,
mutually agreed upon by the Parties.

“Adjustment” shall mean any final change in the Tax liability of any Person.

“Chewy Group” shall mean, collectively, Chewy and its subsidiaries that are part
of any consolidated, combined, or unitary tax group that includes Chewy. With
respect to any Taxable Period beginning before the IPO, the Chewy Group shall be
determined as if the Chewy Group came into existence on the first day of such
Taxable Period.

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“Chewy Group Member” shall mean each Entity in the Chewy Group (including, for
the avoidance of doubt, any entity that is a “disregarded entity” for U.S.
federal income tax purposes).

“Chewy Separate Tax Liability” shall have the meaning provided in Section 2.01.

“Code” shall mean the Internal Revenue Code of 1986, as amended, and any rules
or regulations promulgated thereunder.

“Control” shall mean the possession, control or ownership, directly or
indirectly, by Parent or one or more of the subsidiaries of Parent or any
combination thereof, of more than 50% of the total voting power of shares of
capital stock entitled to vote in the election of directors of Chewy.

“Due Date” means, with respect to any Tax Return, and as context requires,
either (a) the date any payment would be owed to the applicable Taxing Authority
with respect to such Tax Return, or (b) the date a Tax Return must be filed with
an applicable Taxing Authority, in each case, taking into account any available
extension of time actually requested for the filing of a Tax Return.

“Entity” shall mean a partnership (whether general or limited), a corporation, a
limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization or any other entity, without
regard to whether it is treated as a disregarded entity for U.S. federal tax
purposes.

“Final Determination” shall mean the final resolution of any Tax matter,
including, but not limited to, a closing agreement with the IRS or other
relevant Taxing Authority, a claim for refund which has been allowed, a recovery
of an erroneously-granted refund, a deficiency notice with respect to which the
period for filing a petition with the United States Tax Court or the relevant
foreign, state or local tribunal has expired, or a decision of any court of
competent jurisdiction that is not subject to appeal or as to which the time for
appeal has expired.

“Income Tax Return” shall mean any Tax Return filed or required to be filed with
any Taxing Authority with respect to Income Taxes.

“Income Taxes” shall mean all Taxes imposed on or measured in whole or in part
by income, capital or net worth or a taxable base in the nature of income,
capital or net worth, including franchise Taxes based on such factors, and shall
include any addition to Tax, additional amount, interest and penalty imposed
with respect to such Taxes. For the avoidance of doubt, Income Taxes do not
include sales, use, real or personal property, or transfer or similar Taxes.

“IPO Date” shall mean the date Chewy undertakes the IPO.

“IRS” shall mean the United States Internal Revenue Service or any successor
thereto, including but not limited to its agents, representatives and attorneys.

“Parent Consolidated Group” shall mean, collectively, Parent and its
subsidiaries that are part of any consolidated, combined, or unitary tax group
that includes Parent (including, for the avoidance of doubt, any entity that is
a “disregarded entity” for U.S. federal income Tax purposes, any PetSmart Group
Member and any Chewy Group Member).

 

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“Parent Group” shall mean the Parent Consolidated Group, but excluding any Chewy
Group Member.

“Parent Group Member” shall mean each Entity in the Parent Group.

“Parent Separate Tax Liability” shall have the meaning provided in Section 2.01.

“Person” shall mean an individual or any Entity.

“PetSmart Group Member” shall mean, collectively, PetSmart and its subsidiaries
that are part of any consolidated, combined, or unitary tax group that includes
PetSmart (including, for the avoidance of doubt, any Entity that is a
“disregarded entity” for U.S. federal income Tax purposes), but excluding any
Chewy Group Member.

“Refund” shall mean any refund (or credit in lieu thereof) of Taxes (including
any overpayment of Taxes that can be refunded or, alternatively, applied to
other Taxes payable), including any interest paid on or with respect to such
refund of Taxes.

“Schedule” shall have the meaning provided in Section 2.06.

“Tax” or “Taxes” means any and all U.S. federal, state or local, or non-U.S.,
income, gross receipts, license, payroll, employment, excise, severance, stamp,
occupation, premium, windfall profits, environmental, customs duties, capital
stock, franchise, profits, withholding, social security (or similar),
unemployment, disability, real property, personal property, sales, use,
transfer, registration, estimated, or other tax of any kind whatsoever
(including any assessment, duty, fee or other charge in the nature of or in lieu
of any such tax) and any interest, penalty, or addition thereto, whether
disputed or not.

“Tax Attributes” shall mean net operating losses, capital losses, investment tax
credit carryovers, earnings and profits, foreign tax credit carryovers, overall
foreign losses, previously taxed income, separate limitation losses, excess
business interest and any other losses, deductions, credits or other comparable
items that could reduce a Tax liability for a past or future taxable period.

“Tax Proceeding” means any audit, assessment, pre-filing agreement, other
examination by any Taxing Authority, proceeding, appeal of a proceeding or
litigation, whether administrative or judicial, including proceedings relating
to competent authority determinations, in each case, relating to Taxes.

“Tax Return” shall mean any return, report, form, declaration or other
information filed or required to be filed with any Taxing Authority with respect
to Taxes, including elections, estimates or amendments thereof, and any
attachment, exhibit, schedule or supplement thereto.

“Taxable Period” shall mean any taxable year or portion thereof.

“Taxing Authority” shall mean, with respect to any Tax, the government or
governmental or regulatory body thereof, or political subdivision thereof,
whether federal, state, local or foreign, or any agency, instrumentality or
authority thereof, that imposes such Tax and the agency (if any) charged with
the collection of such Tax, including the IRS.

 

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“Treasury Regulations” shall mean the proposed, final, and temporary income
United States Treasury Regulations promulgated by the United States Department
of Treasury pursuant to and in respect of the Code. All references to any
particular Treasury Regulations shall be interpreted to include any
corresponding provisions of succeeding, similar or substitute, final or
temporary Treasury Regulations.

ARTICLE II

Section 2.01 Separate Tax Liabilities.

(a) In General. The Chewy Group shall be solely responsible for any Tax of a
Chewy Group Member (and any other direct or indirect subsidiary of Chewy) that
is not determined on a consolidated, combined, or unitary basis with any Parent
Group Member (a “Chewy Separate Tax Liability”). The Parent Group shall be
solely responsible for any Tax of a Parent Group Member (and any other direct or
indirect subsidiary of Parent, but excluding any Chewy Group Member and any
other direct or indirect subsidiary of Chewy) that is not determined on a
consolidated, combined, or unitary basis with any Chewy Group Member (a “Parent
Separate Tax Liability”).

(b) Indemnification. In the event the Chewy Group is required to pay any Parent
Separate Tax Liability, or the Parent Group is required to pay any Chewy
Separate Tax Liability, then the Parent Group or the Chewy Group, as the case
may be, shall indemnify the Chewy Group or the Parent Group, as the case may be,
for such Parent Separate Tax Liability or Chewy Separate Tax Liability and any
reasonable costs (including accounting and legal fees) incurred in connection
with such liability and payment.

Section 2.02 Allocation of Consolidated Federal Tax Liability and Use of
Attributes.

(a) In General. The consolidated U.S. federal income tax liability (if any) of
the Parent Consolidated Group, and use of Tax Attributes of the Parent
Consolidated Group (if any), shall be determined consistent with the provisions
of Section 1552(a)(1) of the Code and Treasury Regulations §§ 1.1502-12,
1.1502-33(d)(3), 1.1502-32(b)(3)(iv)(D), and 1.1552-1(a)(1)(ii) applied as if
the Parent Consolidated Group consisted of two members: the Parent Group and the
Chewy Group.

(b) Allocation of Consolidated Tax Liability. Each of the Parent Group and the
Chewy Group shall be allocated a portion of the consolidated U.S. federal income
tax liability (if any) of the Parent Consolidated Group by applying the
provisions of Section 1552(a)(1) of the Code, determined utilizing the
hypothetical taxable income of the Parent Group and the Chewy Group calculated
in accordance with the provisions of Treasury Regulations §§ 1.1502-12 and
1.1552-1(a)(1)(ii). The amount calculated under this Section 2.02(b) is the
amount that the Parent Group and the Chewy Group, as the case may be, must
contribute to the payment of the Parent Consolidated Group’s consolidated U.S.
federal income tax liability, with such payment being made in a manner that is
consistent with Section 2.06.

 

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(c) Additional Payment Obligation. Subject to the limitation in Section 2.04, in
the event the Parent Group or the Chewy Group, as applicable, has a “separate
return tax liability” under Treasury Regulations §§ 1.1502-12 and
1.1552-1(a)(1)(ii) that exceeds its portion of the consolidated income tax
liability of the Parent Consolidated Group as determined pursuant to
Section 2.02(b), then the Parent Group or the Chewy Group, as applicable, shall
pay to the Chewy Group or the Parent Group, as applicable, the amount of such
excess, in accordance with Treasury Regulation § 1.1502-32(b)(3)(iv)(D) and in a
manner that is consistent with Section 2.06. This Section 2.02(c) is intended to
result in compensation for the use of Tax Attributes attributable to the Parent
Group or the Chewy Group, as the case may be, in the Taxable Period in which
they are utilized.

(d) Treatment of Compensation. For the avoidance of doubt, to the extent any
employee compensation (including in the form of equity or any equity-like
instrument) is issued by the Parent Group or the Chewy Group, as the case may
be, the Parent Group or the Chewy Group, as the case may be, shall be entitled
to include any allowable deduction with respect to such employee compensation,
without regard to whether the applicable employee is employed by the Parent
Group or the Chewy Group; provided, however, that if the Parent Group or the
Chewy Group, as the case may be, compensates the Chewy Group or the Parent
Group, as the case may be, for the issuance of such employee compensation, then
the Parent Group or the Chewy Group, as the case may be, shall be entitled to
such deduction.

Section 2.03 Treatment of Income from Cancellation of Indebtedness.
Notwithstanding anything in this Agreement to the contrary, for any Taxable
Period, a reduction in Tax Attributes resulting from the application of Treasury
Regulation § 1.1502-28 shall not give rise to a payment or reimbursement
obligation under this Agreement.

Section 2.04 Pre-IPO Tax Attributes. Notwithstanding anything in this Agreement
to the contrary, no payment liability shall arise as a result of any use by the
Parent Group in any Taxable Period of net operating losses, capital losses and
business credits (excluding, for the avoidance of doubt, any depreciation,
deferred intercompany transactions and intercompany obligations under Treasury
Regulation § 1.1502-13) attributable to the Chewy Group (determined in
accordance with Treasury Regulation § 1.1502-21) for any Taxable Period (or
portion thereof) ending on or prior to the IPO Date, determined as if a “closing
of the books” occurred (and any relevant Taxable Periods ended) at the end of
the IPO Date.

Section 2.05 Estimated Tax Payments. The provisions of Sections 2.02—2.04 shall
be applied to determine the allocation of responsibility for the amount of any
estimated U.S. federal income tax payments (including quarterly or extension
payments, as the case may be) required to be made by the Parent Consolidated
Group. Any amounts paid hereunder in connection with any estimated Tax payment
shall be treated as a credit against any final payment obligation due under
Section 2.02. To the extent amounts paid hereunder in connection with any
estimated Tax payments exceed any final payment obligation due under
Section 2.02, such excess amount shall be refunded pursuant to Section 3.02.

 

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Section 2.06 Calculations; Timing.

(a) Calculations. For each Taxable Period beginning after the date of the IPO, a
schedule (the “Schedule”) shall be prepared by PetSmart showing in reasonable
detail PetSmart’s application of Sections 2.02—2.04, including any payment
obligations owed under Sections 2.07 and 3.02, and taking into account any
payments made under Section 2.05.

(b) Payment. If any payment obligation of a Party is reflected on the Schedule,
and a cash payment is owed to the applicable Taxing Authority with respect to
such Taxable Period, then such payment as reflected on the Schedule shall be
made in accordance with Section 2.06 to the applicable Party at least five
(5) days prior to the Due Date of the applicable Tax Return (or, if later,
within ten (10) days after the receipt of the Schedule). Except as otherwise
provided herein, all other payments to be made pursuant to this Agreement shall
be made within fifteen (15) days of written notice of a request for payment by
(or on behalf of) the applicable Party, which notice shall be accompanied by a
computation of the amount due. If any payment required to be made pursuant to
this Agreement is not made when due, such payment shall bear interest at the
prevailing long-term applicable federal rate compounded monthly as determined
under Section 1274 of the Code.

Section 2.07 Adjustments. If, as a result of a Final Determination, there is an
Adjustment, then a payment shall be made by the applicable Party to the other
Party in the amount of the net difference (if any) between the amounts
previously paid by the first Party pursuant to this Agreement with respect to
any Taxable Period(s) directly or indirectly affected by the Adjustment, on one
hand, and the amount that would have been paid by such Party under this
Agreement with respect to such Taxable Period(s) had the Tax Return(s) for such
Taxable Period(s) been prepared in accordance with such Adjustment; plus an
additional amount to account for any interest or penalties imposed by the
applicable Taxing Authority as a result of such Adjustment.

Section 2.08 Non-U.S. Federal Income Taxes. To the extent practicable as
determined by PetSmart in its reasonable discretion, responsibility for any Tax
other than U.S. federal income Tax that is not a Chewy Separate Tax Liability or
Parent Separate Tax Liability shall be determined in accordance with the
principles of Section 2.02—Section 2.07, giving appropriate consideration to any
differences in the application and determination of the applicable Tax, on one
hand, and U.S. federal income Tax, on the other hand.

ARTICLE III

Section 3.01 Tax Return Preparation.

(a) Consolidated Returns. PetSmart shall prepare and file, or cause to be
prepared and filed, all Tax Returns that include any Chewy Group Member and are
required to be filed on a consolidated, combined, or unitary basis with any
Parent Group Member, and shall be responsible for remitting (or causing to be
remitted) to the applicable Taxing Authority all Taxes shown as due on such Tax
Returns (including Taxes for which the Chewy Group Members are responsible
pursuant to this Agreement).

 

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(b) Separate Returns. PetSmart shall prepare and file, or cause to be prepared
and filed, all Tax Returns related to Parent Separate Tax Liabilities, and shall
be responsible for remitting (or causing to be remitted) to the applicable
Taxing Authority all Taxes shown as due on such Tax Returns. Chewy shall prepare
and file, or cause to be prepared and filed, all Tax Returns related to Chewy
Separate Tax Liabilities, and shall be responsible for remitting (or causing to
be remitted) to the applicable Taxing Authority all Taxes shown as due on such
Tax Returns.

(c) Right to Review.

(i) In the case of any Tax Return described in Section 3.01(a) PetSmart shall
provide (or shall cause to be provided) a draft of such Tax Return and the
applicable Schedule to Chewy for its review and comment at least thirty
(30) days prior to the Due Date for such Tax Return or, in the case of any such
Tax Return filed on a monthly basis or a property Tax Return, at least ten
(10) days prior to such Due Date. PetSmart shall consider in good faith any
reasonable comment received from Chewy at least five (5) days prior to the Due
Date for such Tax Return.

(ii) In the case of any Income Tax Return or other material Tax Return prepared
by Chewy pursuant to Section 3.01(b), Chewy shall provide a draft of such Tax
Return to PetSmart for its review and comment at least thirty (30) days prior to
the Due Date for such Tax Return or, in the case of any such Tax Return filed on
a monthly basis or property Tax Return, at least ten (10) days prior to such Due
Date. Chewy shall consider in good faith any reasonable comment received from
PetSmart at least five (5) days prior to the Due Date for such Tax Return.

(iii) The Parties shall negotiate in good faith to resolve all disputed issues
with respect to Tax Returns prepared pursuant to this Section 3.01. Any disputes
that the Parties are unable to resolve shall be resolved pursuant to Article 6.
In the event that any dispute is not resolved (whether pursuant to good faith
negotiations among the Parties or pursuant to Section 6.01) prior to the Due
Date for the filing of any Tax Return, such Tax Return shall be timely filed as
prepared by the respective Party, and such Tax Return shall be amended as
necessary to reflect the resolution of such dispute in a manner consistent with
such resolution.

(iv) In the event any of the time periods set forth in Section 3.01 are
determined to be insufficient to adequately comply with relevant Tax filing
obligations while providing the Parties a commercially reasonable period of time
to review materials they are otherwise entitled to review under Section 3.01,
then the Parties shall mutually agree to an adjustment to the applicable time
periods to permit such compliance and a commercially reasonable period of time
to review such materials.

 

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Section 3.02 Refunds.

(a) Parent shall be entitled to all Refunds of Taxes for which (i) Parent or any
Parent Group Member is responsible pursuant to Section 2.02 or Section 2.08;
(ii) which relate to any Parent Separate Tax Liability; or (iii) which relate to
any Taxable Period ending on or prior to the IPO Date. Chewy shall be entitled
to all Refunds of Taxes for which Chewy or any Chewy Group Member is responsible
pursuant to Section 2.02 or Section 2.08 or which relate to any Chewy Separate
Tax Liability (other than any Refund relating to any Taxable Period ending on or
prior to the IPO Date).

(b) A Party receiving a Refund to which the other Party is entitled pursuant to
this Agreement shall pay to the other Party the amount to which such other Party
is entitled within ten (10) days after the receipt of the Refund (or, in the
case of any Refund received in the form of a credit, within ten (10) days after
application of such credit to reduce an amount of Taxes payable).

ARTICLE IV

Section 4.01 Audits.

(a) The Party that is responsible for preparing and filing an applicable Tax
Return pursuant to Section 3.01 (the “Controlling Party”) shall have sole
responsibility for, and control over, any Tax Proceeding relating to such Tax
Return; provided however that PetSmart shall be the Controlling Party with
respect to (i) any Tax Proceeding that could reasonably be expected to affect
Tax Attributes of the Chewy Group described in Section 2.04 and (ii) any Taxable
Period beginning before the date of the IPO.

(b) In the case of any Tax Proceeding described in Section 4.01(a) that would
reasonably be expected to adversely affect any Tax liability or liability under
this Agreement of a Party not in control of such Tax Proceeding (a
“Non-Controlling Party”), the Controlling Party shall provide notice to such
Non-Controlling Party within fifteen (15) days after receiving notice of such
Tax Proceeding; provided that any failure to provide such notice shall not
affect the obligations of such Non-Controlling Party with respect to Taxes
addressed by such Tax Proceeding except to the extent such Non-Controlling Party
is materially prejudiced by such failure. With respect to any such Tax
Proceeding, (i) the Non-Controlling Party shall be entitled to participate in
any such Tax Proceeding (at its sole expense, to the extent expenses are not
otherwise allocated pursuant to this Agreement or another agreement), (ii) the
Controlling Party shall keep the Non-Controlling Party reasonably informed and
consult in good faith with the Non-Controlling Party with respect to any issue
relating to such Tax Proceeding that is reasonably expected to materially affect
the Non-Controlling Party, (iii) the Controlling Party shall provide the
Non-Controlling Party with a copy of any written submission to be sent to the
applicable Taxing Authority with respect to such Tax Proceeding prior to such
sending, and shall consider in good faith any comments provided by the
Non-Controlling Party with respect thereto and (iv) any disputes arising under
this Section 4.01 shall be resolved in accordance with Article VI.

 

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(c) At the request of the Controlling Party, the Non-Controlling Parties shall
take (and shall cause its subsidiaries to take) any action (e.g., executing a
limited power of attorney) that is reasonably requested by the Controlling Party
in order for the Controlling Party to handle, conduct, or settle the Tax
Proceeding. Each Party shall assist the other Parties in taking (or causing to
be taken) any remedial actions that are necessary or desirable to minimize the
effects of any Adjustment made by any Taxing Authority. The Controlling Party
shall reimburse the Non-Controlling Party for any reasonable out-of-pocket costs
actually incurred by the Non-Controlling Party in complying with this
Section 4.01(c). The Controlling Party shall have no obligation to indemnify the
Non-Controlling Party for any additional Taxes resulting from the Tax
Proceeding, if the Non-Controlling Party fails to provide assistance in
accordance with this Section 4.01(c), to the extent such additional Taxes are
directly attributable to the Non-Controlling Party’s failure to provide such
assistance.

ARTICLE V

Section 5.01 Cooperation: Tax Information.

(a) Chewy shall, and shall cause each Chewy Group Member to, cooperate with
Parent and PetSmart in the preparation and filing of Tax Returns, as described
in Article III, or in the conduct of Tax Proceedings, as described in Article
IV, including by maintaining such books and records and providing on a timely
basis such information as may be necessary or useful in the filing of such Tax
Returns or the conduct of such Tax Proceedings and executing any documents,
providing any further information and taking any actions which Parent may
reasonably request in connection therewith.

(b) If any Chewy Group Member fails to provide any information reasonably
requested pursuant to this Article V on a timely basis, then Parent shall have
the right to engage the Accounting Firm to gather such information. Chewy agrees
to permit the Accounting Firm full access to all Tax Returns and other relevant
information in the possession of any Chewy Group Member during reasonable
business hours, and to reimburse or pay directly all costs and expenses incurred
in connection with such engagement of the Accounting Firm.

(c) Parent shall, and shall cause each Parent Group Member, to cooperate with
Chewy in the preparation and filing of Tax Returns, as described in Article III,
or in the conduct of Tax Proceedings, as described in Article IV, including by
maintaining such books and records and providing on a timely basis such
information as may be necessary or useful in the filing of such Tax Returns or
the conduct of such Tax Proceedings and executing any documents, providing any
further information and taking any actions which Chewy may reasonably request in
connection therewith.

(d) If any Parent Group Member fails to provide any information reasonably
requested pursuant to this Article V on a timely basis, then Chewy shall have
the right to engage the Accounting Firm to gather such information. Parent
agrees to permit the Accounting Firm full access to all Tax Returns and other
relevant information in the possession of any Parent Group Member during
reasonable business hours, and to reimburse or pay directly all costs and
expenses incurred in connection with such engagement of the Accounting Firm.

 

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Section 5.02 Retention of Records. Chewy agrees to retain, and cause each Chewy
Group Member to retain, the appropriate records which may affect the
determination of the Tax liability of any Parent Group Member until such time as
there has been a Final Determination or the applicable statute of limitations
has expired with respect thereto. Any Chewy Group Member intending to destroy
any such materials, records, or documents relating to Taxes of any Parent Group
Member shall provide Parent with ninety (90) days advance notice and the
opportunity to copy or take possession of such materials, records and documents.
Parent agrees to retain, and cause each Parent Group Member to retain, the
appropriate records which may affect the determination of the Tax liability of
any Chewy Group Member until such time as there has been a Final Determination
or the applicable statute of limitations has expired with respect thereto. Any
Parent Group Member intending to destroy any such materials, records, or
documents relating to Taxes of any Chewy Group Member shall provide Chewy with
ninety (90) days advance notice and the opportunity to copy or take possession
of such materials, records and documents.

ARTICLE VI

Section 6.01 Interpretation of Agreement and Resolution of Disputes.

 

  (a)

Technical Matters.

(i) In the event of any dispute among the Parties as to the application of
Sections 2.02-2.05, 2.07, and 2.08, such dispute shall be negotiated in good
faith between the Parties.

(ii) In the event the Parties are unable to resolve any such dispute, PetSmart
shall, in good faith using reasonable discretion, finally determine any such
matter (A) while Parent (or the direct or indirect majority owners of Parent as
of the date of this Agreement) directly or indirectly has Control of Chewy or
(B) with respect to any Taxable Period of which Parent (or the direct or
indirect majority owners of Parent) directly or indirectly has or had Control of
Chewy.

(iii) For disputes not addressed by Section 6.01(a)(ii), the Parties shall
require the Accounting Firm to resolve all disputes no later than thirty
(30) days after the submission of such dispute to the Accounting Firm and agree
that all decisions by the Accounting Firm with respect thereto shall be final
and conclusive and binding on the Parties. The Accounting Firm shall resolve all
disputes in a manner consistent with this Agreement. The Parties shall require
the Accounting Firm to render all determinations in writing and to set forth, in
reasonable detail, the basis for such determination. The fees and expenses of
the Accounting Firm shall be borne equally by the Parties.

 

  (b)

Interpretation of Other Agreement Provisions.

(i) In the event of any dispute among the Parties as to other provisions in this
Agreement (excluding, for the avoidance of doubt, the application of

 

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Sections 2.02-2.05, 2.07, and 2.08 as provided by Section 6.01(a)), such dispute
shall be negotiated in good faith between the Parties.

(ii) In the event the Parties are unable to resolve any such dispute, PetSmart
shall, in good faith using reasonable discretion, finally determine any such
matter (A) while Parent (or the direct or indirect majority owners of Parent as
of the date of this Agreement) directly or indirectly has Control of Chewy or
(B) with respect to any Taxable Period of which Parent (or the direct or
indirect majority owners of Parent) directly or indirectly has or had Control of
Chewy.

(iii) For disputes not addressed by Section 6.01(b)(ii), such dispute shall be
settled by binding arbitration in the state of Delaware or another location
mutually agreeable to the parties. Any decision or award as a result of any such
arbitration proceeding shall be in writing and shall provide an explanation for
all conclusions of law and fact and shall include the assessment of costs,
expenses and reasonable attorneys’ fees.

Section 6.02 Miscellaneous.

(a) Term of the Agreement. This Agreement shall become effective as of the date
of its execution and, except as otherwise expressly provided herein, shall
continue in full force and effect indefinitely.

(b) Injunctions. The parties acknowledge that irreparable damage would occur in
the event that any of the provisions of this Agreement were not performed in
accordance with its specific terms or were otherwise breached. The parties
hereto shall be entitled to an injunction or injunctions to prevent breaches of
the provisions of this Agreement and to enforce specifically the terms and
provisions hereof in any court having jurisdiction, such remedy being in
addition to any other remedy to which they may be entitled at law or in equity.

(c) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect, and shall
in no way be affected, impaired or invalidated. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such which may be hereafter declared invalid, void or unenforceable. In the
event that any such term, provision, covenant or restriction is held to be
invalid, void or unforeseeable, the parties hereto shall use their best efforts
to find and employ an alternate means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction.

(d) Assignment. Except by operation of law or in connection with the sale of all
or substantially all the assets of a party hereto, this Agreement shall not be
assignable, in whole or in part, directly or indirectly, by any party hereto
without the advance written consent of the other party, and any attempt to
assign any rights or obligations arising under

 

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this Agreement without such consent shall be void; provided, however, that the
provisions of this Agreement shall be binding upon, inure to the benefit of and
be enforceable by, the parties hereto and their respective successors and
permitted assigns.

(e) Further Assurances. Subject to the provisions hereof, the parties hereto
shall make, execute, acknowledge and deliver such other instruments and
documents, and take all such other actions, as may be reasonably required in
order to effectuate the purposes of this Agreement and to consummate the
transactions contemplated hereby. Subject to the provisions hereof, each of the
parties shall, in connection with entering into this Agreement, performing its
obligations hereunder and taking any and all actions relating hereto, comply
with all applicable laws, regulations, orders and decrees, obtain all required
consents and approvals and make all required filings with any Taxing Authority,
governmental agency, other regulatory or administrative agency, commission or
similar authority, and promptly provide the other parties with all such
information as they may reasonably request in order to be able to comply with
the provisions of this sentence.

(f) Parties in Interest. Except as herein otherwise specifically provided,
nothing in this Agreement expressed or implied is intended to confer any right
or benefit upon any Person other than the parties hereto, their respective
successors and permitted assigns, and any entity that subsequently becomes a
Parent Group Member, PetSmart Group Member or Chewy Group Member.

(g) Waivers, Etc. No failure or delay on the part of the parties in exercising
any power or right hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. No
modification or waiver of any provision of this Agreement, nor the consent to
any departure by the parties therefrom, shall in any event be effective unless
the same shall be in writing, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given.

(h) Setoff. All payments to be made by any party under this Agreement shall be
made without setoff, counterclaim or withholding, all of which are expressly
waived.

(i) Change of Law. If, due to any change in applicable law or regulations or
their interpretation by any court of law or other governing body having
jurisdiction subsequent to the date of this Agreement, the performance of any
provision of this Agreement or any transaction contemplated hereby shall become
impracticable or impossible, the parties hereto shall use their best efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such provision.

(j) Confidentiality. Subject to any contrary requirement of law and the right of
each party to enforce its rights hereunder in any arbitration or legal action,
each party agrees that it shall keep strictly confidential, and shall cause its
employees and agents to keep strictly confidential, any information which it or
any of its employees or agents may acquire pursuant to, or in the course of
performing its obligations under, any provision of this Agreement.

 

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(k) Headings. Descriptive headings are for convenience only and shall not
control or affect the meaning or construction of any provision of this
Agreement.

(l) Counterparts. For the convenience of the parties, any number of counterparts
of this Agreement may be executed by the parties hereto, and each such executed
counterpart shall be, and shall be deemed to be, an original instrument.

(m) Notices. All notices, consents, requests, instructions, approvals and other
communications provided for herein shall be validly given, made or served, if in
writing and delivered personally or sent by registered mail, postage prepaid, or
by e-mail to:

 

PetSmart at:

  

 

     

 

     

ASchnaid@PetSmart.com                                                         
                                                                             

Attn: Alan Schnaid

  

Chewy at:

  

 

     

 

     

mmarte@chewy.com                                                          
                                         
                                           

Attn: Mario Marte

  

Parent at:

  

 

     

 

     

ASchnaid@PetSmart.com                                                         
                                                                             

Attn: Alan Schnaid

  

or to such other address as any party may, from time to time, designate in a
written notice given in a like manner. Notice delivered personally or given by
telegram shall be deemed delivered when received by the recipient. Notice given
by mail as set out above shall be deemed delivered five (5) days after the date
the same is mailed. Notice given by facsimile transmission shall be deemed
delivered on the day of transmission provided telephone confirmation of receipt
is obtained promptly after completion of transmission.

(n) Costs and Expenses. Unless otherwise specifically provided herein, each
Party agrees to pay its own costs and expenses resulting from the exercise of
its respective rights or the fulfillment of its respective obligations
hereunder.

(o) Applicable Law. This Agreement shall be governed by and construed and
enforced in accordance with the domestic substantive laws of the State of
Delaware without regard to any choice or conflict of laws, rules or provisions
that would cause the application of the domestic substantive laws of any other
jurisdiction.

 

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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly
executed by their respective officers, each of whom is duly authorized, all as
of the day and year first above written.

 

ARGOS INTERMEDIATE HOLDCO I INC. By:  

/s/ Alan M. Schnaid

Name:  

Alan M. Schnaid

Title:  

President and Chief Financial Officer

PETSMART, INC.

By:  

/s/ Alan M. Schnaid

Name:  

Alan M. Schnaid

Title:  

President and Chief Financial Officer

CHEWY, INC.

By:  

/s/ Susan Helfrick

Name:  

Susan Helfrick

Title:  

General Counsel