RE: Advancement and Indemnification Rights

Exhibit 10.1

[Sponsor Name]

[Sponsor Address]

[Date]

Toys “R” Us, Inc.

One Geoffrey Way

Wayne, New Jersey 07470

Attention: David Schwartz, Esq.

                 General Counsel

Dear Mr. Schwartz:

In light of certain recent court decisions concerning the advancement and indemnification rights of corporate directors and officers, including the indemnification rights of directors designated by sponsor shareholder investors, [Sponsor Name] (the “ Sponsor ”) hereby requests that Toys “R” Us, Inc. (the “ Company ” or “Toys”) enter into this Letter Agreement (this “ Agreement ”). Capitalized terms used but not otherwise defined herein shall have the meanings set forth in Section 7.

This Agreement clarifies certain rights of (i) the Sponsor, (ii) any persons or entities providing management, advisory, consulting or other services at the direction or request of the Sponsor or any Sponsor Affiliate, to or for the benefit of the Company or any successors or direct or indirect subsidiaries of the Company (collectively, the “ Toys Companies ”), (iii) any investment fund formed or managed by the Sponsor or any Sponsor Affiliate or for which the Sponsor or any Sponsor Affiliate serves as an investment adviser (a “ Fund ”); (iv) any direct or indirect general partner, managing member and/or controlling shareholder of any Fund; (v) any persons designated by the Sponsor, any Sponsor Affiliate or any Fund, to serve as a director, officer, board observer, partner, trustee, fiduciary, manager, employee, consultant or advisor, or functional or foreign equivalent of the foregoing, to any of the Toys Companies (collectively, the “ Sponsor Designees ”); and (vi) any direct or indirect partners (including general partners), shareholders, members (including managing members), affiliates, controlling persons, subsidiaries, directors, officers, fiduciaries, managers, employees and agents of each of the foregoing (those persons and entities identified in (i), (ii), (iii), (iv), (v) and (iv) are herein collectively the “ Indemnitees, ” and each is individually an “ Indemnitee ”), whether such right exists pursuant to any Organizational Document, Advisory Agreement or any other agreement or document.

It is the intent of the parties that (i) the Toys Companies are and shall be the indemnitors of first resort with respect to any matters for which advancement and indemnification are provided by

the Toys Companies to or on behalf of the Indemnitees, whether for claims and liabilities arising prior to or after the date of this Agreement and whether such claims or liabilities arise out of any act, statement or omission occurring prior to or after the date of this Agreement, (ii) that the Toys Companies shall provide advancement and/or indemnification to each Indemnitee on a primary basis; and (iii) that any Indemnitee may be expected to seek advancement and/or indemnification from any other potential source of advancement or indemnification (including without limitation from any other Indemnitee) only if, and to the extent, that the Toys Companies are legally and/or financially unable to pay advancement and/or indemnification, as the case may be, to or on behalf of such Indemnitee.

Accordingly, in consideration of the mutual promises and agreements herein contained, and other good and valuable consideration – including, without limitation, the Sponsor’s agreement to provide management, advisory, consulting or other services to the Toys Companies and each Sponsor Designee’s agreement to serve as a director, officer, board observer, partner, trustee, fiduciary, manager, employee, consultant, or advisor of any of the Toys Companies – the receipt and sufficiency of which is hereby acknowledged, all parties intending to be legally bound hereby, the parties hereby agree as follows:

Except as, and to the extent, specifically provided herein, any and all rights to advancement and/or indemnification to which each Indemnitee has ever been, is or may in the future be entitled from the Toys Companies shall remain unchanged by this Agreement.

Each of the Toys Companies hereby agrees and acknowledges that (i) it is the indemnitor of first resort; (ii) its obligations to each Indemnitee are primary, and any obligations of the Sponsor, any Sponsor Affiliate or any Fund or other Indemnitee to provide advancement or indemnification for any damages, judgments, liabilities, assessments, fines, penalties, amounts paid in settlement, fees and costs (including attorneys fees and costs) or other losses (herein “ Losses ”) incurred by Indemnitee and for which one or more of the Toys Companies have agreed to, or are otherwise obligated to, indemnify Indemnitee (whether under any Organizational Document, Advisory Agreement or any other agreement or document) are secondary, and (iii) if the Sponsor, any Sponsor Affiliate or any Fund or other Indemnitee is obligated to pay, or pays or causes to be paid for any reason, any Losses which any of the Toys Companies is otherwise obligated (whether under any Organizational Document, Advisory Agreement or other document or agreement) to pay (as advancement or indemnification) to or on behalf of Indemnitee, then (A) such Sponsor, Sponsor Affiliate, Fund or other Indemnitee, as the case may be, shall be fully subrogated to and otherwise succeed to all rights of Indemnitee with respect to such payment; and (B) each of the Toys Companies shall jointly and severally reimburse, indemnify and hold harmless the Sponsor, Sponsor Affiliate, Fund or other

Indemnitee, as the case may be, for all such payments actually made by such entity or person on behalf of or for the benefit of Indemnitee.

Each of the Toys Companies shall use its reasonable best efforts to purchase and maintain (or be covered under) a policy or policies of insurance with reputable insurance companies with A.M. Best ratings of “A” or better, providing each Indemnitee with coverage for any liability asserted against, and incurred by, Indemnitee or on Indemnitee’s behalf by reason of the fact that Indemnitee is or was or has agreed to serve as a director, officer, employee or agent of any of the Toys Companies. Such insurance p