10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended January 31, 2015 Commission file number 1-11609

TOYS “R” US, INC.

(Exact name of registrant as specified in its charter)

Delaware	22-3260693
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)
One Geoffrey Way Wayne, New Jersey	07470
(Address of principal executive offices)	(Zip code)

(973) 617-3500

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) or 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ¨    No  x

Indicate by check mark whether the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.    Yes  x    No  ¨

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ¨    No  ¨

(Note: As a voluntary filer not subject to the filing requirements of Section 13(a) or 15(d) of the Exchange Act, the registrant has filed all reports pursuant to Section 13(a) or 15(d) of the Exchange Act during the preceding 12 months as if the registrant were subject to such filing requirements.)

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    x

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one)

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	x  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  ¨    No  x

As of March 2, 2015, there were 49,201,899 outstanding shares of common stock, $0.001 par value per share, of Toys “R” Us, Inc., none of which were publicly traded.

DOCUMENTS INCORPORATED BY REFERENCE

None

Forward-Looking Statements

This Annual Report on Form 10-K, the other reports and documents that we have filed or may in the future file with the Securities and Exchange Commission and other publicly released materials and statements, both oral and written, that we have made or may make in the future, may contain “forward looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such disclosures are intended to be covered by the safe harbors created thereby. These forward looking statements reflect our current views with respect to, among other things, our operations and financial performance. All statements herein or therein that are not historical facts, including statements about our beliefs or expectations, are forward-looking statements. We generally identify these statements by words or phrases, such as “anticipate,” “estimate,” “plan,” “project,” “expect,” “believe,” “intend,” “foresee,” “forecast,” “will,” “may,” “outlook” or the negative version of these words or other similar words or phrases. These statements discuss, among other things, our strategy, store openings, integration and remodeling, the development, implementation and integration of our Internet business, future financial or operational performance, projected sales for certain periods, comparable store net sales from one period to another, cost savings, results of store closings and restructurings, outcome or impact of pending or threatened litigation, domestic or international developments, amount and allocation of future capital expenditures, growth initiatives, inventory levels, cost of goods, selection and type of merchandise, marketing positions, implementation of safety standards, future financings, estimates regarding future effective tax rates, and other goals and targets and statements of the assumptions underlying or relating to any such statements.

These statements are subject to risks, uncertainties and other factors, including, among others, the seasonality of our business, competition in the retail industry, changes in our product distribution mix and distribution channels, general economic factors in the United States and other countries in which we conduct our business, consumer spending patterns, birth rates, our ability to implement our strategy including implementing initiatives for season, our ability to recognize cost savings, marketing strategies, the availability of adequate financing, access to trade credit, changes in consumer preferences, changes in employment legislation, our dependence on key vendors for our merchandise, political and other developments associated with our international operations, costs of goods that we sell, labor costs, transportation costs, domestic and international events affecting the delivery of toys and other products to our stores, product safety issues including product recalls, the existence of adverse litigation, changes in laws that impact our business, our substantial level of indebtedness and related debt-service obligations, restrictions imposed by covenants in our debt agreements and other risks, uncertainties and factors set forth under Item 1A entitled “RISK FACTORS” of this Annual Report on Form 10-K and in our other reports and documents filed with the Securities and Exchange Commission. In addition, we typically earn a disproportionate part of our annual operating earnings in the fourth quarter as a result of seasonal buying patterns and these buying patterns are difficult to forecast with certainty. These factors should not be construed as exhaustive, and should be read in conjunction with the other cautionary statements that are included in this report. We believe that all forward-looking statements are based on reasonable assumptions when made; however, we caution that it is impossible to predict actual results or outcomes or the effects of risks, uncertainties or other factors on anticipated results or outcomes and that, accordingly, one should not place undue reliance on these statements. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to update these statements in light of subsequent events or developments unless required by the Securities and Exchange Commission’s rules and regulations. Actual results and outcomes may differ materially from anticipated results or outcomes discussed in any forward-looking statement.

INDEX

		PAGE
PART I.
Item 1.	Business	1
Item 1A.	Risk Factors	11
Item 1B.	Unresolved Staff Comments	21
Item 2.	Properties	21
Item 3.	Legal Proceedings	22
Item 4.	Mine Safety Disclosures	22
PART II.
Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	23
Item 6.	Selected Financial Data	23
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	48
Item 8.	Financial Statements and Supplementary Data	50
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	113
Item 9A.	Controls and Procedures	113
Item 9B.	Other Information	116
PART III.
Item 10.	Directors, Executive Officers and Corporate Governance	116
Item 11.	Executive Compensation	119
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	149
Item 13.	Certain Relationships and Related Transactions and Director Independence	150
Item 14.	Principal Accounting Fees and Services	153
PART IV.
Item 15.	Exhibits and Financial Statement Schedules	154
SIGNATURES		155
INDEX TO EXHIBITS		157

PART I

ITEM 1. BUSINESS

As used herein, the “Company,” “we,” “us,” or “our” means Toys “R” Us, Inc., and its consolidated subsidiaries, except as expressly indicated or unless the context otherwise requires. Our fiscal year ends on the Saturday nearest to January 31 of each calendar year. This Annual Report on Form 10-K focuses on our last three fiscal years ended as follows: fiscal 2014 ended January 31, 2015; fiscal 2013 ended February 1, 2014; and fiscal 2012 ended February 2, 2013. With the exception of fiscal 2012, which included 53 weeks, all other fiscal years presented include 52 weeks. References to 2014, 2013 and 2012 are to our fiscal years unless otherwise specified.

Overview

We are the leading global specialty retailer of toys and baby products as measured by Net sales. Toys “R” Us, Inc. is recognized as the toy and baby authority. We sell a variety of products in the baby, core toy, entertainment, learning and seasonal categories through our retail locations and the Internet. Our brand names are highly recognized in North America, Europe and Asia, and our expertise in the toy and baby retail space, our broad range of product offerings, our substantial scale and geographic footprint and our strong vendor relationships account for our market-leading position and distinguish us from the competition.

As of January 31, 2015, we operated 1,602 stores and licensed an additional 212 stores. These stores are located in 37 countries and jurisdictions around the world under the Toys “R” Us, Babies “R” Us and FAO Schwarz banners. In addition, we operate Toys “R” Us Express stores (“Express stores”), smaller format stores primarily open on a short-term basis during the holiday season. During the fiscal 2014 holiday season, we operated 265 Express stores, of which 115 were still open as of January 31, 2015. Of the 115 Express stores that remained open, 66 have been included in our overall store count as they each have a cumulative lease term of at least two years. We also own and operate websites including Toysrus.com, Babiesrus.com, eToys.com, FAO.com and toys.com, as well as other Internet sites we operate in our international markets. For fiscal 2014, we generated Net sales of $12,361 million, Net loss attributable to Toys “R” Us, Inc. of $292 million and Adjusted EBITDA of $642 million. For the definition of Adjusted EBITDA, an explanation of why we present it and a description of the limitations of this non-GAAP measure, as well as a reconciliation to Net loss attributable to Toys “R” Us, Inc., see Item 6 entitled “SELECTED FINANCIAL DATA” of this Annual Report on Form 10-K.

History

Our Company was founded in Washington D.C. in 1948 when Charles Lazarus opened a baby furniture store, Children’s Bargain Town. The Toys “R” Us name made its debut in 1957. In 1978, we completed an initial public offering of our common stock. When Charles Lazarus retired as our Chief Executive Officer in 1994, we operated or licensed over 1,000 stores in 17 countries and jurisdictions. In 1996, we established the Babies “R” Us brand, further solidifying our reputation as a leading consumer destination for children and their families.

On July 21, 2005, we were acquired by an investment group led by entities advised by or affiliated with Bain Capital Partners, LLC, Kohlberg Kravis Roberts & Co. L.P., and Vornado Realty Trust. We refer to this collective ownership group as our “Sponsors.” Upon the completion of this acquisition, we became a private company.

Our Business

We believe we offer our customers the most comprehensive year-round selection of merchandise in the retail toy and baby categories through our “R” Us branded stores and through the Internet. On average, our domestic and international stores (other than Express stores) offer 12,000 and 7,500 items year-round, respectively. Express stores, due to their size, typically carry 2,500 items. We believe that our differentiated product assortment, private label and exclusively licensed product offerings and expert service enable us to command a reputation as the shopping destination for toys and baby products. We seek to differentiate ourselves from our competitors in several key areas, including product selection, product presentation, service, in-store experience and marketing. We are able to provide vendors with a year-round distribution outlet for the broadest assortment of their products. Over the past year, we have commenced the implementation of our strategic plan to improve and strengthen our Toys “R” Us - Domestic (“Domestic”) and Toys “R” Us - International (“International”) segments over the short-term, while implementing new initiatives which we believe will put the Company on track for profitable growth in the future. We also continue to seek opportunities to optimize our cost structure and enhance efficiencies throughout the organization.

Our customer promise is to provide the broadest selection of products to help kids and babies develop, learn, have fun and be safe; be the easiest place to research and find solutions throughout the journey of parenthood; be the best resource for children’s

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gift giving occasions; offer fair prices; deliver expert and unique service; and provide customers the ability to shop whenever, wherever and however they want.

Senior Management Team

In fiscal 2014, we strengthened our senior management team with a number of key hires at the senior management level across a broad range of disciplines, including finance, marketing and operations. These hires, along with existing management, provide us with a fresh perspective on the business and a wealth of relevant experience in leading key areas of our business strategy.

Omnichannel

We have well-developed omnichannel capabilities through which we integrate our e-commerce and brick-and-mortar businesses. The “Buy Online, Pick Up In Store” program, available within all stores in the United States, the United Kingdom, Canada and Germany, offers customers the ability to browse and shop from the comfort of their own homes, while giving them the flexibility to pick up their purchases in-store, usually within the same day. In addition, our “Ship to Store” program allows customers in the United States to purchase online items that may not be currently available in their local store, and have their order delivered to the local store of their choice, free of shipping charges. We also have “Pay In-Store,” which enables customers to shop online and pay for their items in any one of our stores across the United States.

The “Ship from Store” program leverages inventory from the majority of our U.S. stores to improve the speed with which customers receive their online orders, as well as provide an additional option to fulfill these orders. This feature is also available in several of our international countries. Our loyalty programs in the U.S., including the Babies “R” Us Registry, Geoffrey’s Birthday Club and Rewards “R” Us, all offer online functionality which we believe deepens our relationship with our customers and complements the in-store experience. In addition, we have maintained our competitive free shipping offer in the U.S. for purchases $49 and above, which we implemented at the end of fiscal 2013.

Internationally, we have an online presence in 19 countries, which includes Australia, Austria, Belgium, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, the Netherlands, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom. Additionally, we offer international shipping through a third party for select products ordered online to more than 60 countries across Asia, the Caribbean, Central America, Europe, North America and South America. This service allows customers to place orders domestically and have them delivered across the world, and more importantly, it allows us to expand the global reach of our brands to countries where we do not currently have any physical stores. For fiscal years 2014, 2013 and 2012, our consolidated e-commerce business generated net sales of $1,229 million, $1,151 million and $1,135 million, respectively.

International Store Portfolio Expansion

We believe that we have the potential to continue to grow the number of stores in our international store portfolio, particularly those in the emerging economies which are seeing overall GDP growth and rising incomes. In line with this strategy, in fiscal 2011 the Company acquired a 70% ownership interest in Toys (Labuan) Holding Limited (“Labuan”) from Li & Fung, which includes locations in Brunei, China, Hong Kong, Malaysia, Singapore, Taiwan and Thailand. In fiscal 2014, we increased stores operated in Labuan from 129 Toys “R” Us retail stores as of February 1, 2014 (90 which were acquired in fiscal 2011) to 159 stores as of January 31, 2015. In addition, in fiscal 2011 we expanded our operated stores to Poland and have 9 stores there as of January 31, 2015. Our licensed store base has continued to expand as we identify opportunities in markets where we do not already have a physical store presence. As a result, from February 1, 2014 to January 31, 2015, our International operated and licensed stores have increased by 26 and 27 locations, respectively.

Marketing and Customer Loyalty Programs

We believe that we have achieved our leading market position largely as a result of building highly recognized brand names, year-round breadth of product offerings, knowledgeable employees and strong loyalty programs. We use a variety of broad-based and targeted marketing and advertising strategies to reach consumers. These strategies include mass marketing programs such as e-mail marketing, national television and radio spots, direct mail, targeted magazine advertisements, catalogs/rotos and other inserts in national or local newspapers, targeted door-to-door distribution, direct mailings to loyalty program members and in-store marketing. In the current year, we transitioned a significant portion of our marketing spend to social and digital media channels in an effort to optimize our digital versus traditional media mix compared to prior years. Our most significant single piece of advertising in the U.S. is “The Great Big Christmas Book” promotional catalog release, which is distributed through direct mail, newspapers and in-stores in advance of the holiday selling season.

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The merchandising and marketing teams work closely to present the products in an engaging and innovative manner and we are focused on enhancing our in-store signage, which is carefully coordinated so that it is consistent with the current advertisements. We regularly change our banners and in-store promotions, which are advertised throughout the year, to attract consumers to visit the stores, to generate strong customer frequency and to increase average sales per customer. Our websites are used to support and supplement the promotion of products in “R” Us branded stores.

Domestically, we continue to use several programs that benefit customers during our holiday selling season. We offer a free, no minimum purchase layaway program early in the holiday selling season, which allows customers to take full advantage of the flexible payment terms provided by layaway. In addition, our “Price Match Guarantee” program matches competitors’ in-store and selected online retailer pricing on identical items.

In fiscal 2014, we re-launched our Rewards “R” Us program in the U.S., which currently has 19 million active members. As part of the re-launch, customers now earn $5 for every $125 spent and have 60 days to redeem the offer, with members of our Credit Card Program earning double the points for every $1 spent. Through this program we are able to effectively provide a variety of exclusive one-time and ongoing benefits, deals and promotions to our customers, and allow them to earn and redeem points in a more convenient fashion at our stores and online at Toysrus.com and Babiesrus.com. This includes Double Points days, Black Friday deals, Credit Card 10% Thursdays, Endless Earnings and Geoffrey’s Birthday Club membership. We believe this program results in an improved customer shopping experience and more frequent visits to our stores and online sites by our loyal customer base.

Our baby business targets the pre-natal to infant market which allows us to offer the broadest range of baby products and deliver a high level of customer service and product knowledge.  Our Babies “R” Us Registry in the U.S., which has been used by over 21 million registrants to-date, and our baby product assortment enables us to capture new customers during pregnancy, assisting our direct marketing and customer relationship initiatives, while helping customers prepare for the arrival of their newborn. Our comprehensive baby registry offered in our stores and on the Internet allows an expectant parent to list desired products and enables gift-givers to tailor purchases to the expectant parent’s specific needs and wishes. Because first-time parents tend to make multiple product purchases during a relatively short period of time, we seek to provide the expectant parent with a “one-stop shopping” venue for all baby product needs. We then become a resource for infant products such as baby formula, diapers and solid foods, as well as baby clothing and learning aids. We believe this opportunity to establish first contact with new parents enables us to develop long-lasting customer relationships with them as their children grow and they transition to becoming consumers of our products. We continue to build on these relationships as these children mature and eventually become parents themselves. Additionally, we believe that baby merchandise staples such as baby formula, diapers, infant clothing and gear provide us with a mitigant to the inherent seasonality in the toy business. Domestically, in fiscal 2014, we instituted an Endless Earnings tiered feature of our Babies “R” Us Registry, where an expectant parent receives 5% off the first $300 in purchases and 10% off every purchase thereafter with no limits, encouraging parents to continue to make purchases off the registry even after sharing it with family and friends.

Much like our Rewards “R” Us and Baby Registry programs in the U.S., we have millions of active members in similar loyalty programs around the world. Other programs include our Wish List, which allows parents and kids to create a tailored list of desired toys that gift-givers can utilize to make their purchases; Geoffrey’s Birthday Club, in which parents receive exciting offers and incentives to help prepare for their child’s birthday and kids receive special gifts and greetings from Geoffrey the Giraffe; and our Credit Card Program, which offers co-branded and private label credit cards in order for customers to finance purchases at our stores, online and at other businesses, and receive loyalty benefits, deals and promotions in exchange.

Customer Service

Compared with multi-line mass merchandisers, we believe we are able to provide more knowledgeable service to our customers through our highly trained sales force. We train our store associates to deepen their product knowledge and enhance their targeted selling skills in order to improve customer service in our stores. We are continually working to improve the allocation of products within our stores and reduce wait times at checkout counters.

This past year in the U.S., to further improve the customer experience and make it easier to shop with us, we reduced the time it takes for a customer to check-out in our stores. We also introduced new store navigation to all of our U.S. store locations, including new overhead aisle signage, welcome signage at store entrances, and way-finding signage at aisle entry points. New digital store-specific maps help customers pinpoint the location of the items they are looking for by using their smartphone to scan a Quick Response code (unique identifier) on a navigational sign at the entrance to our stores. Additionally, we introduced two new customer points of interest at the front of our toy stores designed to help customers easily find what they’re looking for--a “Here’s What’s Hot Shop” with the hottest toys and trending toys conveniently pulled together in one location and our “Gift Express” shop featuring grab-and-go gifts for $30 and under.

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For the added convenience of our customers, we offer a layaway program and provide a home delivery service. In addition to our baby registry, we offer a variety of helpful publications and innovative programs, classes and services for the expectant parent, including frequent in-store product demonstrations.

During the course of fiscal 2014, we invested a greater amount of our capital in our U.S. store maintenance as part of our “Clean and Bright” initiative, which included the re-lamping of 96 stores, while retrofitting 157 stores which had outdated lighting technology. Furthermore, under this same initiative, we also identified U.S. store locations for the following:

• removing overstocked inventory to improve the appearance of the store and our in-stock performance;

• upgrading the floor appearance through execution of a floor care plan;

• improving maintenance standards; and

• replacing cart corrals outside of the stores.

Inventory Management

In fiscal 2014, we implemented a product life cycle management process to reduce clearance margin risk by instituting greater discipline around product exit dates. Additionally, we are optimizing the frequency of outbound shipments to improve distribution center labor efficiency. We have improved forecasting accuracy in an effort to properly balance lower inventory levels with higher in-stocks position. These initiatives have resulted in an improved in-stock position as compared to prior year. We also continue to focus on increasing our private label penetration, which accounted for 14% of products sold as of January 31, 2015, and expanding our use of direct sourcing.

Cost Structure Management

During fiscal 2014, we identified critical areas for improvement, including:

• end-to-end process re-engineering across assortment, purchasing, forecasting, planning, marketing and logistics;

• store labor productivity;

• holiday selling season planning and marketing effectiveness; and

• omnichannel experience.

While some initiatives are underway, we are also working with outside consultants to look for more transformational ways to streamline processes, identify and eliminate unproductive tasks, and separate critical needs from those that are not as essential to running our operations. We expect to continue to benefit from such process improvements in the coming years.

Strategic Initiatives

We are continuously enhancing our product offerings by working with vendors to drive category leadership and differentiation, and adding private label and exclusive products to our mix, including unique and exceptional items sold through the FAO Schwarz brand.

In the current year, the Company and Claire’s, a leading specialty retailer of fashionable jewelry and accessories for young women, teens, tweens and kids, entered into a strategic global partnership to bring trendy, fashion-forward products to Toys “R” Us customers in select stores around the world. Following a successful pilot program in Europe, Claire’s-branded shops within Toys “R” Us stores were rolled out to 12 Toys “R” Us stores in the United States, 2 in Canada and 94 across Europe, including stores in the United Kingdom, Spain, France, Germany and Austria. Shoppers are able to choose from thousands of products found in Claire’s stand-alone stores, including a unique assortment of jewelry, headbands, hair and fashion accessories, jewelry holders, legwear, seasonal items and more.

Integrated Store Formats

We also provide an integrated shopping format by combining the Toys “R” Us and Babies “R” Us merchandise offerings under one roof creating a “one-stop shopping” experience for our customers. We call this format a side-by-side (“SBS”) store. SBS stores are a combination of Toys “R” Us stores and Babies “R” Us stores, and may be the result of a conversion or relocation and, in certain cases, may be accompanied by the closure of one or more existing stores. In addition, SBS stores may also be constructed in a new location and market. As of January 31, 2015, we operated 214 SBS stores in our Domestic segment and 198 SBS stores in our International segment.

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As of January 31, 2015, we operated 1,602 retail stores and licensed an additional 212 retail stores worldwide in the following formats:

Operated Stores

• 881 traditional toy stores, which typically range in size from 20,000 to 50,000 square feet and devote 5,000 square feet to boutique areas for baby products (including 97 Babies “R” Us Express (“BRU Express”) and Juvenile Expansion formats which devote an additional 4,000 square feet and 1,000 square feet, respectively, for baby products);

• 412 SBS stores, which typically range in size from 30,000 to 70,000 square feet and devote 20,000 to 40,000 square feet to traditional toy products and 10,000 to 30,000 square feet to baby products;

• 240 baby stores, which typically range in size from 30,000 to 45,000 square feet and devote 3,000 square feet to traditional toy products;

• 66 permanent Express stores, which typically range in size from 2,000 to 7,000 square feet, each with a cumulative lease term of at least two years; and

• 3 flagship store locations (the Toys “R” Us store in Times Square, the FAO Schwarz store on 5th Avenue and the Babies “R” Us store in Union Square – all in New York City), which range in size from 55,000 to 105,000 square feet.

Licensed Stores

• 212 “R” Us branded retail stores ranging in various sizes. Licensing fees did not have a material impact on our Net sales.

In addition to these stores, during the fiscal 2014 holiday selling season, we operated an additional 199 temporary Express stores globally in shopping malls, outlet malls and other shopping centers located in high traffic areas. These locations typically range in size from 2,000 to 7,000 square feet each, have a cumulative lease term of less than two years and are not included in our overall store count.

Our extensive experience in retail site selection has resulted in a portfolio of stores that includes attractive locations in many of our chosen markets. Markets for new stores and formats are selected on the basis of proximity to other “R” Us branded stores, demographic factors, population growth potential, competitive environment, availability of real estate and cost. Once a potential market is identified, we select a suitable location based upon several criteria, including size of the property, access to major commercial thoroughfares, proximity of other strong anchor stores, visibility and parking capacity.

Our Business Segments

Our business has two reportable segments: Domestic and International. See Note 11 to our Consolidated Financial Statements entitled “SEGMENTS” for our segments’ financial results. The following is a brief description of our segments:

• Domestic — Our Domestic segment sells a variety of products in the baby, core toy, entertainment, learning and seasonal categories through 872 stores that operate in 49 states in the United States, Puerto Rico and Guam and through the Internet. Domestic Net sales in fiscal 2014 were derived from 370 traditional toy stores (including 78 BRU Express and Juvenile Expansion formats), 225 baby stores, 214 SBS stores, 60 permanent Express stores (with cumulative lease terms of at least two years) and our three flagship stores in New York City. Additionally, we generated Net sales through our temporary Express store locations. Domestic Net sales were $7,524 million for fiscal 2014, which accounts for 61% of our consolidated Net sales.

• International — Our International segment sells a variety of products in the baby, core toy, entertainment, learning and seasonal categories through 730 operated and 212 licensed stores in 36 countries and jurisdictions and through the Internet. In addition to fees received from licensed stores, International Net sales in fiscal 2014 were derived from 511 traditional toy stores (including 19 BRU Express formats), 198 SBS stores, 15 baby stores and 6 permanent Express stores (with cumulative lease terms of at least two years). Additionally, we generated Net sales through our temporary Express store locations. Our operated stores are located in Australia, Austria, Brunei, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom. International Net sales were $4,837 million for fiscal 2014, which accounts for 39% of our consolidated Net sales.

Product Selection and Merchandise

Our product offerings are focused on serving the needs of parents, grandparents and other gift-givers interested in purchasing merchandise in our primary product categories:

• Baby — focused on serving newborns and children up to four years of age by offering a broad array of products, such as baby gear, infant care products, apparel, commodities, furniture, bedding and room décor; many of these items are available in toy and baby stores;

• Core Toy — boys and girls toys, such as action figures, dolls and doll accessories, role play toys and vehicles;

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• Entertainment — video game software, systems and accessories, tablet computers, electronics and other related products;

• Learning — educational electronics and developmental toys, such as our Imaginarium products in the United States and World of Imagination products at our International locations, construction toys, games, creative activities and pre-school merchandise which includes learning products, activities and toys; and

• Seasonal — toys and other products geared toward holidays (including Christmas, Hanukkah, Three Kings, Chinese New Year, Carnival, Easter, Children’s Day, Golden Week and Halloween) and summer activities, as well as bikes, sporting goods, play sets and other outdoor products.

We offer a wide selection of popular national toy and baby brands including many products that are exclusively offered at, or launched at, our stores. Over the past few years, we have worked with key resources to obtain exclusive products and expand our private label brands enabling us to earn higher margins and offer products that our customers will not find elsewhere. We offer a broad selection of private label merchandise under names such as BABIES “R” US, KOALA BABY, IMAGINARIUM, AVIGO, FAST LANE, YOU & ME, JUST LIKE HOME, FAO SCHWARZ, JOURNEY GIRLS, TRUE HEROES, TOTALLY ME! and DREAM DAZZLERS in our stores. We believe these private label brands provide a platform on which we can expand our product offerings in the future and will further differentiate our products and allow us to enhance profitability. We utilize our sourcing office in China to work with our vendors and differentiate our product offerings.

Safety Focus

We believe that we have put in place industry-leading product safety standards that meet or exceed United States federally mandated and/or global regulatory requirements in the countries in which we operate. In addition, through our dedicated safety website, safety boards in stores, e-mail communications and partnerships with noted safety experts and organizations, we provide resources that are used by parents, grandparents and childcare providers to ensure they have the most up-to-date information on product safety and recalls.

Corporate Philanthropy and Community Service

We are proud to have a long tradition at Toys “R” Us of supporting numerous children’s charities. The Toys “R” Us Children’s Fund Inc., a public charity, and the Company together have contributed millions of dollars to charities that keep children safe and help them in times of need. We actively support charities such as the Marine Toys For Tots Foundation, Operation Shower, Alex’s Lemonade Stand Foundation, Special Olympics and Save the Children, among others. Each year the Company also produces the Toys “R” Us Toy Guide for Differently-Abled Kids, a resource featuring specially selected toys that encourage play for children with physical, cognitive and developmental disabilities. We encourage our employees to become active in charitable endeavors by matching contributions they make to qualified charities of their choice, and through Volunteer Match, a program that helps them identify charities to assist in their communities. We also manage the Geoffrey Fund, Inc., a non-profit organization. The Geoffrey Fund’s sole purpose is to provide assistance to employees affected by natural and personal disasters and relies on donations from employees and funds from us to carry out our mission.

Market and Competition

We are the leading global specialty retailer of toys and baby products as measured by Net sales. As a specialty retailer, we focus primarily on the toys and baby products market, offering customers our depth and breadth of products throughout the year.

In the domestic market, we compete with mass merchandisers, such as Walmart, Target and Kmart; consumer electronics retailers, such as Best Buy and GameStop; Internet and catalog businesses, such as Amazon.com (“Amazon”); national and regional specialty, department and discount store chains; as well as local retailers in the geographic areas we serve. Our baby registry competes with baby registries of mass merchandisers, other specialty retail formats, such as buybuy BABY, and regional retailers. In the International toy and electronics markets, we compete with mass merchandisers, discounters and specialty retailers such as Argos, Auchan, Bic Camera, Carrefour, El Corte Ingles, King Jouet, Mothercare, Smyths, Walmart, and Yamada Denki. The domestic and international mass merchandisers and discounters aggressively price items in the traditional toy and electronic product categories with larger dedicated selling space during the holiday season in order to build traffic for other store departments.

We believe the principal competitive factors in the toy, including video game products, and baby markets are product variety, price, quality, availability, advertising and promotion, convenience or store location, shipping offers, safety and customer support and service. We believe we are able to effectively compete by providing a broader range of merchandise, maintaining in-stock positions, as well as convenient locations, knowledgeable customer service and competitive pricing.

Given our market leadership position, we have been able to develop partnerships with many of our vendors. We provide vendors with a year-round platform for their brand and let them use our stores to test their products. We use our New York City

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flagship stores (our Toys “R” Us Times Square store, our FAO Schwarz 5^th Avenue store and our Babies “R” Us Union Square store) as venues to introduce new products. In return, we obtain greater access to products in demand, support for advertising and marketing efforts, and exclusive access to merchandise.

Seasonality

Our global business is highly seasonal with sales and earnings highest in the fourth quarter due to the fourth quarter holiday selling season. During fiscals 2014, 2013 and 2012, 40%, 42% and 43%, respectively, of our total Net sales were generated in the fourth quarter. We typically incur net losses in each of the first three quarters of the year, with a substantial portion of our operating earnings generated in the fourth quarter, with the exception of the fourth quarter of fiscal 2013 which resulted in a net loss primarily due to a non-cash goodwill impairment of $378 million and a $51 million incremental write-down of excess and obsolete inventory. We seek to continuously improve our ability to manage the numerous demands of a highly seasonal business, from the areas of product sourcing and distribution, to the challenges of delivering high sales volumes and excellent customer service during peak business periods. For more than 65 years, we have developed substantial experience and expertise in managing the increased demand during the holiday season which we believe favorably differentiates us from our competition.

License Agreements

We have license agreements with unaffiliated third party operators located outside the United States. The agreements are largely structured with royalty income paid as a percentage of sales for the use of our trademarks, trade name and branding. Licensing fees for fiscals 2014, 2013 and 2012 were $17 million, $16 million and $16 million, respectively. While this business format remains a small piece of our overall International business operations, we continue to look for opportunities for market expansion. Our preferred approach is to open stores in our Company-operated format, but we may choose partnerships or licensed arrangements where we believe it is appropriate due to business climate and risks.

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Geographic Distribution of Domestic Stores

The following table sets forth the location of our Domestic stores as of January 31, 2015:

Location	Number of Stores
Alabama	9
Alaska	1
Arizona	16
Arkansas	5
California	112
Colorado	11
Connecticut	14
Delaware	3
Florida	56
Georgia	27
Hawaii	4
Idaho	2
Illinois	39
Indiana	17
Iowa	6
Kansas	6
Kentucky	9
Louisiana	9
Maine	3
Maryland	16
Massachusetts	23
Michigan	33
Minnesota	10
Mississippi	7
Missouri	18
Montana	1
Nebraska	3
Nevada	10
New Hampshire	7
New Jersey	41
New Mexico	3
New York	63
North Carolina	21
North Dakota	1
Ohio	37
Oklahoma	7
Oregon	10
Pennsylvania	44
Rhode Island	2
South Carolina	10
South Dakota	2
Tennessee	15
Texas	67
Utah	8
Vermont	1
Virginia	26
Washington	15
West Virginia	4
Wisconsin	12
Guam	1
Puerto Rico	5
Total (1)	872

(1) This includes 60 permanent Express stores that each have a cumulative lease term of at least two years and excludes the remaining 32 temporary Express store locations which remained open as of January 31, 2015. During the fiscal 2014 holiday selling season, we operated 227 Express stores domestically.

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Geographic Distribution of International Stores

The following table sets forth the location of our International operated stores as of January 31, 2015:

Location	Number of Stores Operated
Australia	33
Austria	15
Brunei	1
Canada	86
China	75
France	48
Germany	66
Hong Kong	15
Japan	165
Malaysia	31
Poland	9
Portugal	9
Singapore	7
Spain	50
Switzerland	10
Taiwan	20
Thailand	10
United Kingdom	80
Total (1)	730

(1) This includes 6 permanent Express stores that each have a cumulative lease term of at least two years and excludes the remaining 17 temporary Express store locations which remained open as of January 31, 2015. During the fiscal 2014 holiday selling season, we operated 38 Express stores internationally.

The following table sets forth the location of our International licensed stores as of January 31, 2015:

Location	Number of Stores Licensed
Bahrain	1
Denmark	16
Egypt	4
Finland	6
Iceland	3
Israel	24
Kuwait	2
Macau	2
Namibia	1
Norway	12
Oman	1
Philippines	23
Qatar	1
Saudi Arabia	14
South Africa	46
South Korea	32
Sweden	16
United Arab Emirates	8
Total	212

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Employees

As of January 31, 2015, we employed 66,000 full-time and part-time individuals worldwide, with 39,000 domestically and 27,000 internationally. These numbers do not include the individuals employed by licensees of our stores. Due to the seasonality of our business, we employed 108,000 full-time and part-time employees worldwide during the fiscal 2014 holiday season.

Distribution

We operate 18 distribution centers including 8 that support our Domestic operations and 10 that support our International operations (excluding licensed operations). These distribution centers employ warehouse management systems and material handling equipment that help to reduce overall inventory levels and distribution costs. We have agreements with third party logistics providers JB Hunt Transport, Inc. and Performance Team Freight Systems, Inc. to manage all services related to the delivery of inventory from our distribution centers to our U.S. stores. We believe the flexibility afforded by our warehouse/distribution system and the utilization of third party providers to distribute merchandise provides us with operating efficiencies and the ability to maintain a superior in-stock inventory position at our stores.

We continuously seek to improve our supply chain management, optimize our inventory assortment and upgrade our automated replenishment system to improve inventory turnover. In line with this strategy, in fiscal 2014, we created a service entity in Rotterdam, Netherlands referred to as the European Import Center (“EIC”) in order to improve supply chain management in the European markets in which we operate. The EIC manages a portion of the purchasing of inventory from third party vendors located in Asia on behalf of our wholly-owned subsidiaries within Europe.

We also have an agreement with Exel, Inc., a leading North American contract logistics provider, who provides additional warehousing and fulfillment services for our Internet operations in the United States. We utilize various third party providers who furnish similar services in our international markets.

Our Vendors

We procure the merchandise that we offer to our customers from a wide variety of domestic and international vendors. In fiscal 2014, we had 3,600 active vendor relationships. For fiscal 2014, our top 20 vendors worldwide, based on our purchase volume in USD, represented 44% of the total products we purchased.

Given our market leadership position, we have been able to develop partnerships with many of our vendors. We provide vendors with a year-round platform for their brand and let them use our stores to test their products. We use our New York City flagship stores (our Toys “R” Us Times Square store, our FAO Schwarz 5^th Avenue store and our Babies “R” Us Union Square store) as venues to introduce new products. In return, we obtain greater access to products in demand, support for advertising and marketing efforts, and exclusive access to merchandise.

Financial Information About Our Segments

Financial information about our segments and our operations in different geographical areas for the last three fiscal years is set forth in Note 11 to the Consolidated Financial Statements entitled “SEGMENTS.”

Trademarks and Licensing

“TOYS “R” US^®,” “BABIES “R” US^®,” “GEOFFREY^®,” “KOALA BABY^®,” “IMAGINARIUM^®,” “AVIGO^®,” “FAST LANE^®,” “YOU & ME^®,” “JOURNEY GIRLS^®,” “DREAM DAZZLERS^®,” the reverse “R” monogram logo and the Geoffrey character logo, as well as variations of our family of “R” Us marks, either have been registered, or have trademark applications pending, with the United States Patent and Trademark Office and with the trademark registries of many other countries. These trademarks are material to our business operations. We believe that our rights to these properties are adequately protected. In addition, we own the United States trademarks (along with certain trademark rights in other countries) associated with eToys.com and KB Toys. We also own the exclusive right and license to use the FAO SCHWARZ trademarks.

Available Information

Our investor relations website is Toysrusinc.com. On this website under “INVESTOR RELATIONS, SEC FILINGS,” we make available, free of charge, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K, as well as amendments to those reports as soon as reasonably practicable after we electronically file with the Securities and Exchange Commission (“SEC”).

We are not incorporating by reference in this Annual Report on Form 10-K any information from our websites.

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The public may read and copy any materials the Company files with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site, www.sec.gov, that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.

ITEM 1A. RISK FACTORS

Investors should carefully consider the risks described below together with all of the other information in this Annual Report on Form 10-K. The risks and uncertainties described below are not the only ones that we face. Additional risks and uncertainties not presently known to us, or that we currently believe to be less significant than the following risk factors, may also adversely affect our business and operations. If any of the following risks actually occur, our business, financial condition, cash flows or results of operations could be materially adversely affected.

Risks Relating to Our Business

Our business is highly seasonal, and our financial performance depends on the results of the fourth quarter of each fiscal year and, as a result, our operating results could be materially adversely affected if we achieve less than satisfactory sales prior to or during the holiday season.

Our business is highly seasonal. During fiscals 2014, 2013 and 2012, 40%, 42% and 43%, respectively, of our total Net sales were generated in the fourth quarter. We typically incur net losses in each of the first three quarters of the year, with a substantial portion of our operating earnings generated in the fourth quarter, with the exception of the fourth quarter of fiscal 2013 which resulted in a net loss primarily due to certain non-cash charges. As a result, we depend significantly upon the fourth quarter holiday selling season. If we achieve less than satisfactory sales, operating earnings or cash flows from operating activities during the fourth quarter, we may not be able to compensate sufficiently for the lower sales, operating earnings or cash flows from operating activities during the first three quarters of the fiscal year. Our results in any given period may be affected by dates on which important holidays fall and the shopping patterns relating to those holidays. Additionally, the concentrated nature of our seasonal sales means that our operating results could be materially adversely affected if we achieve less than satisfactory sales prior to or during the holiday season, including as a result of natural disasters and labor strikes, work stoppages, terrorist acts or disruptive global political events, prior to or during the holiday season, as described below.

Our industry is highly competitive and competitive conditions may materially adversely affect our revenues and overall profitability.

The retail industry is highly and increasingly competitive and our results of operations are sensitive to, and may be materially adversely affected by, competitive pricing, promotional pressures, competitor credit programs, additional competitor store openings, growth of e-commerce competitors and other factors. As a specialty retailer that primarily focuses on toys and baby products, we compete with discount and mass merchandisers, such as Walmart and Target, national and regional chains and department stores, as well as local retailers in the markets we serve. We also compete with national and local discount stores, consumer electronics retailers, supermarkets and warehouse clubs, as well as Internet and catalog businesses, such as Amazon. Competition is principally based on product variety, price, quality, availability, advertising and promotion, convenience or store location, safety and customer support and service. We believe that some of our competitors in the toy and baby products markets, as well as in the other markets in which we compete, have a larger market share than our market share. In addition, some of our competitors have greater financial resources, lower merchandise acquisition costs and lower operating expenses than we do.

Much of the merchandise we sell is also available from various retailers at competitive prices. Discount and mass merchandisers use aggressive pricing policies and enlarged toy-selling areas during the holiday season to increase sales and build traffic for other store departments. Our business is vulnerable to shifts in demand and pricing, as well as consumer preferences.

We are vulnerable to competitive pressures from e-commerce activity in the market, both as they impact our own e-commerce business and our stores. The Internet provides greater price transparency of our merchandise that is widely available to customers. Our “Price Match Guarantee” may lead to reduced margins as a result of intense price competition, especially during the holiday selling season. In addition, sales of video games have been impacted by a shift to sales in channels other than traditional retail stores, including direct online distribution to customers through download or cloud play, which eliminates the need for a retailer. Furthermore, competitors’ recent launches of subscription models for diapers, formula, and other commodities eliminate the need for customers to visit our stores or e-commerce websites. We believe that this e-commerce activity has adversely affected our sales and profitability, and any increase in the proportion of our customers’ purchases via the Internet could materially adversely affect our sales and profitability from physical stores.

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The baby registry market is highly competitive, based on convenience, quality and selection of merchandise offerings and functionality. Our baby registry primarily competes with the baby registries of mass merchandisers, Internet retailers and other specialty format and regional retailers. Some of our competitors have been aggressively advertising and marketing their baby registries through national television, magazine and Internet campaigns. These trends present consumers with more choices for their baby registry needs, and as a result, increase competition for our baby registry.

If we fail to compete successfully, we could face lower sales and may decide or be compelled to offer greater discounts to our customers, which could result in decreased profitability.

Our sales may be adversely affected by changes in economic factors and changes in consumer spending patterns.

Many economic and other factors outside our control, including consumer confidence, consumer spending levels, employment levels, consumer debt levels, individual income tax and sales tax rates, inflation and deflation, as well as the availability of consumer credit, affect consumer spending habits. A significant deterioration in the global financial markets and economic environment, recessions or an uncertain economic outlook adversely affects consumer spending habits and results in lower levels of economic activity. The domestic and international political situation, including the economic health of various political jurisdictions, also affects economic conditions and consumer confidence. In addition, changing economic and regulatory conditions and increasing consumer credit delinquencies may cause banks to re-evaluate their lending practices and terms which could have an adverse effect on our credit card program and consequently, an adverse effect on our sales. Any of these events and factors could cause consumers to curtail spending and could have a negative impact on our financial performance and position in future fiscal periods.

Our operations have significant liquidity and capital requirements and depend on the availability of adequate financing on reasonable terms. If our lenders are unable to fund borrowings under their credit commitments or we are unable to borrow, it could have a significant negative effect on our business.

We have significant liquidity and capital requirements. Among other things, the seasonality of our businesses requires us to purchase merchandise well in advance of the fourth quarter holiday selling season. We depend on our ability to generate cash flows from operating activities, as well as on borrowings under our revolving credit facilities and our credit lines, to finance the carrying costs of this inventory and to pay for capital expenditures and operating expenses. As of January 31, 2015, we had no outstanding borrowings under any of our revolving credit facilities or credit lines. As of January 31, 2015, we had unused availability under committed lines of credit of $1.1 billion. For fiscal 2014, peak borrowings under all of our revolving credit facilities and credit lines were $986 million, as we purchased merchandise for the fourth quarter holiday selling season. If our lenders are unable to fund borrowings under their credit commitments or we are unable to borrow, it could have a significant negative effect on our business. In addition, any adverse change to our credit ratings or our business could negatively impact our ability to refinance our debt on satisfactory terms and could have the effect of increasing our financing costs. While we believe we currently have adequate sources of funds to provide for our ongoing operations and capital requirements for at least the next 12 months, any inability on our part to have future access to financing, when needed, would have a negative effect on our business.

A loss of, or reduction in, trade credit from our vendors could reduce our liquidity, increase our working capital needs and/or limit our ability to purchase products.

Trade credit from our vendors is an important source of financing for the purchase of the inventory we sell in our stores. Accordingly, the loss of, or reduction in, trade credit could have a significant adverse impact on our inventory levels and operating cash flow and negatively impact our liquidity. Our vendors may seek credit insurance to protect against non-payment of amounts due to them. If credit insurance is not available to vendors at reasonable terms or at all, vendors may demand accelerated payment of amounts due to them or require advance payments or letters of credit before goods are shipped to us. Any adverse changes in our trade credit for these or other reasons could increase our costs of financing our inventory or negatively impact our ability to deliver products to our customers, which could in turn negatively affect our financial performance.

We may not retain or attract customers if we fail to successfully implement our strategic initiatives, which could result in lower sales and a failure to realize the benefit of the expenditures incurred for these initiatives.

We continue to implement a series of customer-oriented strategic programs designed to differentiate and strengthen our core merchandise content and service levels and to expand and enhance our merchandise offerings. As part of our omnichannel strategy to integrate our e-commerce and brick-and-mortar businesses, we aim to satisfy our customers’ evolving shopping preferences by utilizing fulfillment channels such as “In-Store Pick Up,” “Ship from Store” and “Ship to Store.” We seek to improve the effectiveness of our marketing and advertising programs for our “R” Us stores and e-commerce business. The success of these and other initiatives will depend on various factors, including the implementation of our strategy, the appeal of our store and website formats, our ability to offer new products to customers, our financial condition, our ability to respond to

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changing consumer preferences and competitive and economic conditions. We continuously endeavor to minimize our operating expenses, without adversely affecting the profitability of the business. If we fail to implement successfully some or all of our strategic initiatives, we may be unable to retain or attract customers, which could result in lower sales and a failure to realize the benefit of the expenditures incurred for these initiatives.

If we cannot increase profitability within existing stores or open new stores, our performance may be materially adversely affected.

Our performance is dependent on maintaining and increasing sales in existing stores and the ability to successfully open profitable new stores. Increases in sales in existing stores are dependent on factors such as competition, merchandise selection, store operations (including maintaining and remodeling these stores) and other factors discussed in these Risk Factors. Our ability to successfully open new stores and expand into additional market areas depends in part on the following factors, which are in part beyond our control:

• the availability of sufficient funds for the expansion;

• the availability of attractive store locations and the ability to accurately assess the demographic or retail environment and customer demand at a given location;

• the ability to negotiate favorable lease terms and obtain the necessary permits and zoning approvals;

• the absence of occupancy delays;

• the ability to construct, furnish and supply a store in a timely and cost effective manner;

• the ability to hire and train new personnel, especially store managers, in a cost effective manner; and

• general economic conditions.

Delays or failures in successfully opening new stores, or achieving lower than expected sales in existing or new stores, could materially adversely affect our profitability. In addition, we may not be able to anticipate all of the challenges imposed by the expansion of our operations and, as a result, may not meet our targets for opening new stores or relocating stores or expanding profitably.

Some of our new stores may be located in areas where we have little or no meaningful experience. Those markets may have different market conditions, consumer preferences and discretionary spending patterns than our existing markets, which may cause our new stores to be less successful than stores in our existing markets. Other new stores may be located in areas where we have existing stores. Although we have experience in these markets, increasing the number of locations may result in unanticipated over-saturation of markets and temporarily or permanently divert customers and sales from our existing stores, thereby adversely affecting our overall financial performance.

The success and expansion of our e-commerce business depends on our ability to provide quality service to our customers and if we are not able to provide such services, our operating results may be materially adversely affected.

Our Internet operations are subject to a number of risks and uncertainties which are in part beyond our control, including the following:

• failure of our Internet service providers to perform their services properly and in a timely and efficient manner;

• changes in consumer willingness to purchase goods via the Internet;

• increases in software filters that may inhibit our ability to market our products through e-mail messages to our customers and increases in consumer privacy concerns relating to the Internet;

• changes in applicable federal and state regulation, such as the Federal Trade Commission Act, the Children’s Online Privacy Act, the Fair Credit Reporting Act and the Gramm-Leach-Bliley Act and similar types of international laws;

• breaches of Internet security;

• failures in our Internet infrastructure or the failure of systems or third parties, such as telephone or electric power service, resulting in website downtime or other problems;

• failure by us to process online customer orders properly and on time, which may negatively impact future online and in-store purchases by such customers;

• failure by our service provider to provide warehousing and fulfillment services, which may negatively impact future online and in-store purchases by customers; and

• failure to keep up with changes in technology.

As technology continues to advance, customers are increasingly using a variety of devices, such as computers, tablets and smartphones to shop online with us and our competitors. We continue to enhance our customers’ shopping experience on each of these devices as well as incorporate social media as another means of communicating with our customers. If we fail to provide attractive, user-friendly online shopping platforms or fail to continually meet the evolving expectations of customers with developments in online merchandising technology and competitor offerings, we could be at a competitive disadvantage and our business and results of operations may be materially adversely affected.

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Moreover, if we are not able to provide satisfactory service to our Internet customers, our future operating results may be materially adversely affected. We are also vulnerable to the special competitive pressures from the growing e-commerce activity in our market, as they impact our own e-commerce business.

Our sales may be adversely affected if we fail to respond to changes in consumer preferences in a timely manner.

Our financial performance depends on our ability to identify, originate and define product trends, as well as to anticipate, gauge and react to changing consumer preferences in a timely manner. Our products must appeal to a broad range of consumers whose preferences cannot be predicted with certainty and are subject to change. Our business fluctuates according to changes in consumer preferences dictated in part by fashion trends, perceived value and season. These fluctuations affect the merchandise in stock since purchase orders are written well in advance of the holiday season and, at times, before fashion trends and high-demand brands are evidenced by consumer purchases. If we overestimate the market for our products, we may be faced with significant excess inventories, which could result in increased expenses and reduced margins associated with having to liquidate obsolete inventory at lower prices or write it off. For example, in fiscal 2013, we recorded an incremental write-down of $51 million of excess and obsolete inventory. Conversely, if we underestimate the market for our products, we will miss opportunities for increased sales and profits, which would place us at a competitive disadvantage.

Sales of video games and video game systems may be adversely affected by changing trends in the interactive entertainment industry including the rise in popularity of browser, mobile, tablet and social games distributed through alternative channels.

Sales of video games and video game systems, which have accounted for 6%, 7% and 7% of our annual Net sales for fiscals 2014, 2013 and 2012, respectively, have been impacted by trends in the interactive entertainment industry. Video games are now played on a wide variety of products, including mobile phones, tablets, social networking websites and other devices. The popularity of such non-traditional gaming has increased greatly and this popularity is expected to continue to grow. Browser, mobile, tablet and social gaming is accessed through hardware other than the consoles and traditional hand-held video game devices we sell and its games are available through websites or proprietary app stores via direct online distribution at a fraction of the cost of console games. While we continue to develop and implement various strategies to incorporate these new trends into our offerings, including selling third party tablets and other devices, we can provide no assurances that these strategies will be successful or contribute to profitability. Similarly, a continued rise in the popularity of mobile and tablet gaming could negatively impact sales and profitability of traditional toys.

The decrease of birth rates in countries where we operate could negatively affect our business.

Most of our end-customers are newborns and children and, as a result, our revenues are dependent on the birth rates in countries where we operate. In recent years, many countries have experienced a drop in birth rates as their population ages, and education and income levels increase. A continued and significant decline in the number of newborns and children in these countries could have a material adverse effect on our operating results.

We depend on key vendors to supply the merchandise that we sell to our customers and our vendors’ failure to supply quality merchandise in a timely manner may damage our reputation and brands and harm our business.

Our performance depends, in part, on our ability to purchase our merchandise in sufficient quantities at competitive prices. We purchase our merchandise from numerous international and domestic manufacturers and importers. We have no contractual assurances of continued supply, pricing or access to new products, and any vendor could change the terms under which they sell to us or discontinue selling to us at any time. We may not be able to purchase desired merchandise in sufficient quantities on terms acceptable to us in the future. Better than expected sales demand may also lead to customer backorders and lower in-stock positions of our merchandise.

In fiscal 2014, we had 3,600 active vendor relationships through which we procure the merchandise that we offer to our customers. For fiscal 2014, our top 20 vendors worldwide, based on our purchase volume in USD, represented 44% of the total products we purchased. An inability to purchase suitable merchandise on acceptable terms or the loss of one or more key vendors could have a negative effect on our business and operating results and could cause us to miss products that we feel are important to our assortment. We may not be able to develop relationships with new vendors, and products from alternative sources, if any, may be of a lesser quality and/or more expensive than those from existing vendors.

In addition, our vendors are subject to various risks, including raw material costs, inflation, labor disputes, union organizing activities, financial liquidity, product merchantability, inclement weather, natural disasters and general economic and political conditions that could limit our vendors’ ability to provide us with quality merchandise on a timely basis and at prices and payment terms that are commercially acceptable. For these or other reasons, one or more of our vendors might not adhere to our quality control standards, and we might not identify the deficiency before merchandise ships to our stores or customers. In addition, our vendors may have difficulty adjusting to our changing demands and growing business. Our vendors’ failure to manufacture or import quality merchandise in a timely and effective manner could damage our reputation and brands, and

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could lead to an increase in customer litigation against us and an increase in our routine and non-routine litigation costs. Further, any merchandise that does not meet our quality standards could become subject to a recall, which could damage our brand reputation and harm our business.

If our vendors fail to provide promotional support consistent with past levels, our sales, earnings and cash flow could be materially adversely affected.

Our vendors typically provide us with promotional support for the sale of their products in our stores and on our websites. We also receive allowances for volume-related purchases. As part of this support, we receive allowances, payments and credits from the vendors which reduce our cost of goods sold, support the promotion and merchandising of the products we sell and drive sales at our stores and on our websites. We cannot provide assurance that vendors will continue to provide this support consistent with past levels. If our vendors fail to do so, our sales, earnings and cash flow could be materially adversely affected.

If current store locations become unattractive, and attractive new locations are not available for a reasonable price, we may be adversely affected.

The success of any store depends in substantial part on its location. There can be no assurance that current locations will continue to be attractive as demographic patterns change. Neighborhood or economic conditions where stores are located could decline in the future, potentially resulting in reduced sales in these locations. If we cannot obtain desirable locations at reasonable prices, our ability to implement our strategy will be adversely affected.

We have substantial obligations under long-term leases that could materially adversely affect our financial condition and prevent us from fulfilling our obligations.

As of January 31, 2015, we leased 1,292 of our properties from third-parties pursuant to long-term space and ground leases. Total rent expense, net of sublease income, was $601 million, $609 million and $628 million for fiscals 2014, 2013 and 2012, respectively, and is expected to be approximately $546 million for fiscal 2015. Many of our leases provide for scheduled increases in rent. The substantial obligations under our leases could further exacerbate the risks described below under “Our substantial indebtedness could adversely affect our ability to raise additional capital to fund our operations or refinance our maturing debt, limit our ability to react to changes in the economy or our industries, expose us to interest rate risk to the extent of our variable rate debt and prevent us from meeting our obligations under our various debt instruments.”

If we are unable to renew or replace our current store leases or if we are unable to enter into leases for additional stores on favorable terms, or if one or more of our current leases are terminated prior to expiration of their stated term and we cannot find suitable alternate locations, our growth and profitability could be negatively impacted.

We currently have ground leasehold interests in 15% and long-term space leasehold interests in 63% of our domestic and international store locations. Most of our current leases provide for our unilateral option to renew for several additional periods at specific rental rates. Our ability to re-negotiate favorable terms on an expiring lease or to negotiate favorable terms for a suitable alternate location or for additional store locations could depend on conditions in the real estate market, competition for desirable properties and our relationships with current and prospective landlords or may depend on other factors that are not within our control. Any or all of these factors and conditions could negatively impact our growth and profitability.

Our business, financial condition and results of operations are subject to risks arising from the international scope of our operations which could negatively impact our financial condition and results of operations.

We conduct a significant portion of our business outside the United States. For fiscals 2014, 2013 and 2012, 39%, 39% and 40% of our Net sales, respectively, were generated outside the United States. In addition, as of January 31, 2015 and February 1, 2014, 33% and 35% of our long-lived assets, respectively, were located outside of the United States. Weakened global economic conditions, particularly the weakened and unstable environment in parts of Europe, could continue to affect us through lower sales as a result of reduced demand and the effects of foreign currency translation. All of our foreign operations are subject to risks inherent in conducting business abroad, including the challenges of different economic conditions in each of the countries, possible nationalization or expropriation, price and currency exchange controls, fluctuations in the relative values of currencies as described below, limited protection of intellectual property in certain jurisdictions, political instability and restrictive governmental actions.

The products we sell are sourced from a variety of international suppliers, with China being a significant source. Additionally, a growing portion of our stores are located in China and as a consequence, our financial results are expected to become increasingly affected by our results in China, and our business is increasingly exposed to risks there. Political or financial instability, trade restrictions, labor unrest, transport capacity and costs, port security or other events that could slow port activities and affect foreign trade are beyond our control and could disrupt our supply of merchandise and/or materially adversely affect our results of operations. In addition, changes in the costs of procuring raw materials used in our merchandise

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or the costs related to our supply chain, including labor, fuel, tariffs, and currency exchange rates could have a material adverse effect on gross margin, expenses and results of operations.

In addition, any significant or prolonged deterioration in US - China relations could adversely affect our China business. Certain risks and uncertainties of doing business in China are solely within the control of the Chinese government, and Chinese law regulates the scope of our foreign investments and business conducted within China. There are also uncertainties regarding the interpretation and application of laws and regulations and the enforceability of intellectual property and contract rights in China.

Our business is subject to fluctuations in foreign currency exchange rates and such fluctuations may have a material adverse effect on our business, financial condition and results of operations.

Exchange rate fluctuations may affect the translated value of our earnings and cash flow associated with our international operations, as well as the translation of net asset or liability positions that are denominated in foreign currencies. In countries outside of the United States where we operate stores, we generate revenues and incur operating expenses and selling, general and administrative expenses denominated in local currencies. In many countries where we do not operate stores, our licensees pay royalties in USD. However, as the royalties are calculated based on local currency sales, our revenues are still impacted by fluctuations in exchange rates. In fiscal years 2014, 2013 and 2012, 39%, 39% and 40% of our Net sales, respectively, were completed in a currency other than the USD, the majority of which were denominated in yen, Euros, Canadian dollars and pounds. In fiscal 2014, our reported operating earnings would have decreased or increased $23 million if all foreign currencies uniformly weakened or strengthened by an incremental 10% relative to the USD.

We enter into foreign exchange agreements from time to time with financial institutions to reduce our exposure to fluctuations in currency exchange rates referred to as hedging activities. However, these hedging activities may not eliminate foreign currency risk entirely and involve costs and risks of their own. Although we hedge some exposures to changes in foreign currency exchange rates arising in the ordinary course of business, foreign currency fluctuations may have a material adverse effect on our business, financial condition and results of operations.

Because of our extensive international operations, we could be adversely affected by violations of the United States Foreign Corrupt Practices Act and similar worldwide anti-bribery laws.

The United States Foreign Corrupt Practices Act and similar worldwide anti-bribery laws generally prohibit companies and their intermediaries from making improper payments to non-U.S. officials for the purpose of obtaining or retaining business. Our policies mandate compliance with these anti-bribery laws. We cannot provide assurance that our internal control policies and procedures always will protect us from reckless or criminal acts committed by our employees or agents. Violations of these laws, or allegations of such violations, could disrupt our business, damage our reputation and result in a material adverse effect on our financial condition, results of operations and cash flows.

International events could delay or prevent the delivery of products to our stores, which could negatively affect our sales and profitability.

A significant portion of products we sell are manufactured outside of the United States, primarily in Asia. As a result, any event causing a disruption of imports, including labor strikes, work stoppages, boycotts, safety issues on materials, the imposition of trade restrictions in the form of tariffs, embargoes or export controls, “anti-dumping” duties, port security or other events that could slow port activities, could increase the cost and reduce the supply of products available to us. In addition, port-labor issues, rail congestion and trucking shortages can have an impact on all direct importers. Although we attempt to anticipate and manage such situations, both our sales and profitability could be materially adversely impacted by any such developments in the future.

Our results may be materially adversely affected by fluctuations in raw material and energy costs.

Our results may be affected by the prices of the components and raw materials used in the manufacture of our toys and baby products. These prices may fluctuate based on a number of factors beyond our control, including: oil prices, changes in supply and demand, general economic conditions, labor costs, competition, import duties, tariffs, currency exchange rates and government regulation. In addition, energy costs have fluctuated dramatically in the past. These fluctuations may result in an increase in our transportation costs for distribution, utility costs for our retail stores and overall costs to purchase products from our vendors.

We may not be able to adjust the prices of our products, especially in the short-term, to recover these cost increases in raw materials and energy. A continual rise in raw material and energy costs could adversely affect consumer spending and demand for our products and increase our operating costs, both of which could have a material adverse effect on our financial condition and results of operations.

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A significant disruption to our distribution network or to the timely receipt of inventory could adversely impact sales or increase our transportation costs, which would decrease our profits.

We rely on our ability to replenish depleted inventory in our stores through deliveries to our distribution centers from vendors and then from our distribution centers or direct ship vendors to our stores by various means of transportation, including shipments by sea, rail, air and truck. We rely on various third-party vendors to manage services related to the delivery of inventory from distribution centers to our stores. Unexpected delays in deliveries or increases in transportation costs (including from increased fuel costs) could significantly decrease our ability to generate sales and earn profits. In addition, labor shortages or labor disagreements in the transportation industry or long-term disruptions to the national and international transportation infrastructure that lead to delays or interruptions of deliveries could negatively affect our business.

Product safety issues, including product recalls, could harm our reputation, divert resources, reduce sales and increase costs.

The products we sell in our stores are subject to regulation by the Federal Consumer Product Safety Commission and similar state and international regulatory authorities. As a result, such products have been and could be in the future subject to recalls and other remedial actions. Product safety concerns may require us to voluntarily remove selected products from our stores. Such recalls and voluntary removal of products can result in, among other things, lost sales, diverted resources, potential harm to our reputation and increased customer service costs, which could have a material adverse effect on our business, financial condition and results of operations.

Our business exposes us to personal injury and product liability claims which could result in adverse publicity and harm to our brands and our results of operations.

We are from time to time subject to claims due to the injury of an individual in our stores or on our property. In addition, we have in the past been subject to product liability claims for the products that we sell. Subject to certain exceptions, our purchase orders generally require the manufacturer to indemnify us against any product liability claims; however, if the manufacturer does not have insurance or becomes insolvent, there is a risk we would not be indemnified. Any personal injury or product liability claim made against us, whether or not it has merit, could be time consuming and costly to defend, resulting in adverse publicity, or damage to our reputation, and have an adverse effect on our results of operations.

Adverse litigation judgments or settlements resulting from legal proceedings in which we may be involved could expose us to monetary damages or limit our ability to operate our business.

We are involved in private actions, investigations and various other legal proceedings by employees, suppliers, competitors, government agencies or others. The results of such litigation, investigations and other legal proceedings are inherently unpredictable. Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time and divert significant resources. If any of these legal proceedings were to be determined adversely to us, we could be exposed to monetary damages or limits on our ability to operate our business, which could have a material adverse effect on our business, financial condition and results of operations.

Healthcare reform legislation could have an adverse impact on our business, financial condition and results of operations.

The enacted healthcare reform legislation under the Patient Protection and Affordable Care Act and Health Care and Education Reconciliation Act of 2010 will potentially impact our healthcare cost structure and may, over time, increase our employee healthcare related expenses. Provisions of this law have become and will become effective in 2015 and at various dates over the next several years and many of the regulations and guidance for the law still have not been implemented. We continue to evaluate the potential additional impact the healthcare reform legislation will have on our business as regulations and guidance are communicated.  Due to the breadth and complexity of this law, the lack of regulations and guidance for implementation and the phased-in nature of new requirements, we cannot predict with certainty the future effect of this law on our results.  Because it may increase the costs of providing medical insurance to our employees, the new healthcare legislation may adversely affect our results of operations, financial condition and cash flow.

We are subject to certain regulatory and legal requirements. If we fail to comply with regulatory or legal requirements, our business and results of operations may be materially adversely affected.

We are subject to numerous regulatory and legal requirements. Our policies, procedures and internal controls are designed to comply with all applicable laws and regulations, including those imposed by the Federal Trade Commission, the Sarbanes-Oxley Act of 2002 and the SEC. In addition, our business activities require us to comply with complex regulatory and legal issues on a local, national and worldwide basis (including, in some cases, more stringent local labor laws or regulations). Future legislative and regulatory actions relating to credit cards could also have an adverse impact on our credit card program and our sales. Additionally, we may be subject to new disclosure and reporting requirements, established under existing or new state or federal laws. Failure to comply with such laws and regulations could adversely affect our operations, involve

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significant expense and divert management’s attention and resources from other matters, which in turn could materially harm our business and results of operations.

Our business operations could be disrupted if our information technology systems fail to perform adequately or we are unable to protect the integrity and security of our customers’ information.

We depend largely upon our information technology systems in the conduct of all aspects of our operations. If our information technology systems fail to perform as anticipated, we could experience difficulties in virtually any area of our operations, including but not limited to replenishing inventories or in delivering our products to store locations in response to consumer demands. Any of these or other systems-related problems could, in turn, materially adversely affect our sales and profitability.

Other sophisticated retailers have recently suffered serious security breaches. A compromise of our security systems (or a design flaw in our system environment) could result in unauthorized access to certain personal information about our employees or customers (including credit card and gift registry information) which could adversely affect our reputation with our customers and others, as well as our operations, and could result in litigation against us or the imposition of penalties. In addition, a security breach could require that we expend significant additional resources related to our information security systems. Such risks may be difficult to insure against or insurance may be costly.

Natural disasters, inclement weather, pandemic outbreaks, terrorist acts or disruptive global political events could cause permanent or temporary distribution center or store closures, impair our ability to purchase, receive or replenish inventory, or decrease customer traffic, all of which could result in lost sales and otherwise materially adversely affect our financial performance.

The occurrence of one or more natural disasters, such as hurricanes, fires, floods, earthquakes, tornadoes and volcano eruptions, or inclement weather such as frequent or unusually heavy snow, ice or rain storms, or extended periods of unseasonable temperatures, or the occurrence of pandemic outbreaks, labor strikes, work stoppages, terrorist acts or disruptive global political events, such as civil unrest in countries in which we operate stores or our suppliers are located, or similar disruptions could materially adversely affect our operations and financial performance. To the extent these events impact one or more of our key vendors or result in the closure of one or more of our distribution centers or a significant number of stores, our operations and financial performance could be materially adversely affected through an inability to make deliveries to our stores and through lost sales. In addition, these events could result in increases in fuel (or other energy) prices or a fuel shortage, delays in opening new stores, the temporary lack of an adequate work force in a market, the temporary or long-term disruption in the supply of products from some local and overseas vendors, the temporary disruption in the transport of goods from overseas, delay in the delivery of goods to our distribution centers or stores, the temporary reduction in the availability of products in our stores and disruption to our information systems. These events also can have indirect consequences such as increases in the costs of insurance if they result in significant loss of property or other insurable damage.

Our results of operations could suffer if we lose key management or are unable to attract and retain experienced senior management for our business.

Our future success depends to a significant degree on the skills, experience and efforts of our senior management team. The loss of services of any of these individuals, or the inability to attract and retain qualified individuals for key management positions, could harm our business and financial performance.

We may experience fluctuations in our tax obligations and effective tax rate, which could materially adversely affect our results of operations.

We are subject to taxes in the United States and numerous international jurisdictions. We record tax expense based on current tax payments and our estimates of future tax payments, which include reserves for estimates of probable settlements of international and domestic tax audits. At any one time, many tax years are subject to audit by various taxing jurisdictions. The results of these audits and negotiations with taxing authorities may affect the ultimate settlement of these issues. As a result, we expect that throughout the year there could be ongoing variability in our quarterly tax rates as taxable events occur and exposures are re-evaluated. Further, our effective tax rate in a given financial statement period may be materially impacted by changes in tax laws, changes in the mix and level of earnings by taxing jurisdiction, changes to existing accounting rules or regulations, or by changes to our ownership or capital structures. Fluctuations in our tax obligations and effective tax rate could materially adversely affect our results of operations.

Changes to accounting rules or regulations may materially adversely affect our results of operations.

Changes to existing accounting rules or regulations may impact our future results of operations. New accounting rules or regulations and varying interpretations of existing accounting rules or regulations have occurred and may occur in the future. Future changes to accounting rules or regulations may materially adversely affect our reported results of operations and financial position.

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Our total assets include a substantial amount of property and equipment. Changes to estimates or projections related to such assets, or operating results that are lower than our current estimates at certain store locations, may cause us to incur impairment charges that could materially adversely affect our results of operations.

Our total assets include a substantial amount of property and equipment and have historically included a substantial goodwill balance prior to impairments recorded in fiscal 2013. We make certain estimates and projections in connection with impairment analyses for these assets, in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 360, “Property, Plant and Equipment” (“ASC 360”), and ASC Topic 350, “Intangibles—Goodwill and Other” (“ASC 350”). We review the carrying value of these assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable in accordance with ASC 360 or ASC 350. We will record an impairment loss when the carrying value of the underlying asset, asset group or reporting unit exceeds its fair value. These calculations require us to make a number of estimates and projections of future results. During fiscal 2013, we recorded impairment losses of $44 million on property and equipment and $378 million on goodwill associated with our Toys-Domestic and Toys-Japan reporting units. Refer to “CRITICAL ACCOUNTING POLICIES” within Item 7 entitled “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” for further details. If these estimates or projections change, we may be required to record additional impairment charges on certain of these assets. If these impairment charges are significant, our results of operations could be materially adversely affected.

We may from time to time pursue acquisitions, which could have an adverse impact on our business, as could the integration of the businesses following acquisition.

We may from time to time acquire complementary companies or businesses. Acquisitions may result in unanticipated costs, delays or other operational or financial problems related to integrating the acquired company and business with our Company, which may result in the diversion of our capital and our management’s attention from other business issues and opportunities. We may not be able to successfully integrate operations that we acquire, including their personnel, technology, financial systems, distribution and general business operations and procedures. We cannot provide assurance that any acquisition we make will be successful and our operating results may be adversely impacted by the integration of a new business and its financial results.

The Sponsors control us and may have conflicts of interest with us.

Investment funds or groups advised by or affiliated with the Sponsors currently control us through their ownership of 98%of our voting common stock. As a result, the Sponsors have control over our decisions to enter into any corporate transaction and have the ability to prevent any transaction that requires the approval of stockholders. In addition, the Sponsors may have an interest in pursuing dispositions, acquisitions, financings or other transactions that, in their judgment, could enhance their equity investments, even though such transactions might involve risks to us as a company.

The Sponsors may direct us to make significant changes to our business operations and strategy, including with respect to, among other things, store openings and closings, new product and service offerings, sales of real estate and other assets, employee headcount levels and initiatives to reduce costs and expenses. We cannot provide assurance that our future business operations will remain broadly in line with our existing operations or that significant real estate and other assets will not be sold.

The Sponsors are also in the business of making investments for their own accounts in companies, and may from time to time acquire and hold interests in businesses that compete directly or indirectly with us. One or more of the Sponsors may also pursue acquisition opportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us. So long as investment funds associated with or designated by the Sponsors continue to indirectly own a significant amount of the outstanding shares of our common stock, the Sponsors will continue to be able to strongly influence or effectively control our decisions.

Risks Related to Our Substantial Indebtedness

Our substantial indebtedness could adversely affect our ability to raise additional capital to fund our operations or refinance our maturing debt, limit our ability to react to changes in the economy or our industry, expose us to interest rate risk to the extent of our variable rate debt and prevent us from meeting our obligations under our various debt instruments.

We are, and we expect to continue to be, highly leveraged. As of January 31, 2015, our total indebtedness was $4.8 billion, of which $2.7 billion was secured indebtedness. Our substantial indebtedness could have significant consequences, including, among others, the following:

• increasing our vulnerability to general economic and industry conditions;

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• requiring a substantial portion of cash flows from operating activities to be dedicated to the payment of principal and interest on our indebtedness, and as a result, reducing our ability to use our cash flows to fund our operations and capital expenditures, capitalize on future business opportunities, expand our business and execute our strategy;

• increasing the difficulty for us to make scheduled payments on our outstanding debt and other obligations, as our business may not be able to generate sufficient cash flows from operating activities to meet our debt service obligations;

• exposing us to the risk of increased interest expense due to changes in borrowing spreads and short-term interest rates;

• causing us to make non-strategic divestitures;

• limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements and general, corporate or other purposes; and

• limiting our ability to adjust to changing market conditions and reacting to competitive pressure, placing us at a competitive disadvantage compared to our competitors who are less leveraged.

Despite our current level of indebtedness, we may still be able to incur substantially more debt. This could further exacerbate the risks to our financial condition described above.

We may be able to incur additional indebtedness in the future, including under our current outstanding credit facilities. Although our indentures, credit agreements and documents governing our other indebtedness contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and the additional indebtedness incurred in compliance with these restrictions could be substantial. These restrictions also will not prevent us from incurring obligations that do not constitute indebtedness. If new indebtedness is added to our current debt levels, the related risks that we now face could intensify.

If our cash flows and capital resources are insufficient to fund our debt service obligations or we are unable to refinance our indebtedness, we may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.

Our ability to make scheduled payments on or to refinance our debt obligations depends on our financial condition and operating performance, which are subject to prevailing global economic and market conditions and to certain financial, business and other factors beyond our control. Even if we were able to refinance or obtain additional financing, the costs of new indebtedness could be substantially higher than the costs of our existing indebtedness.

If our cash flows and capital resources are insufficient to fund our debt service obligations or we are unable to refinance our indebtedness, we could face substantial liquidity problems, and we may be forced to reduce or delay investments and capital expenditures, or to sell assets, seek additional capital or restructure our indebtedness. These alternative measures may not be successful and may not permit us to meet our debt obligations. If we were unable to repay amounts when due, the lenders could proceed against the collateral granted to them to secure that indebtedness.

Our debt agreements contain covenants that limit our flexibility in operating our business.

Toys “R” Us, Inc. is a holding company and conducts its operations through its subsidiaries, certain of which have incurred their own indebtedness. As specified in certain of our subsidiaries’ debt agreements, there are restrictions on our ability to obtain funds from our subsidiaries through dividends, loans or advances. The agreements governing our indebtedness contain various covenants that limit our ability to engage in specified types of transactions, and may materially adversely affect our ability to operate our business. Among other things, these covenants limit our ability to:

• incur certain additional indebtedness;

• transfer money between Toys “R” Us, Inc. and our various subsidiaries;

• pay dividends on, repurchase or make distributions with respect to our or our subsidiaries’ capital stock or make other restricted payments;

• issue stock of subsidiaries;

• make certain investments, loans or advances;

• transfer and sell certain assets;

• create or permit liens on assets;

• consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;

• enter into certain transactions with our affiliates; and

• amend certain documents.

A breach of any of these covenants could result in default under one or more of our debt agreements, which could prompt the lenders to declare all amounts outstanding under one or more of our debt agreements to be immediately due and payable and terminate all commitments to extend further credit. If we were unable to repay those amounts, the lenders could proceed against the collateral granted to them to secure that indebtedness. If the lenders under the debt agreements accelerate the

20

repayment of borrowings, we cannot ensure that we will have sufficient assets and funds to repay the borrowings under our debt agreements.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

The following summarizes our worldwide operating stores and distribution centers as of January 31, 2015 (excluding licensed operations in our International segment):

	Owned	Ground Leased(1)	Leased (2)	Total	Total Gross Square Feet  (3) (In millions)
Stores:
Domestic	277	214	381	872	36
International	78	26	626	730	21
	355	240	1,007	1,602	57
Distribution Centers:
Domestic	7	—	1	8	7
International	5	—	5	10	4
	12	—	6	18	11
Total Operating Stores and Distribution Centers	367	240	1,013	1,620	68

(1) Owned buildings on leased land.

(2) This includes 60 and 6 permanent Express stores within our Domestic and International segments, respectively, that each have a cumulative lease term of at least two years and excludes the remaining 32 and 17 temporary Express store locations within our Domestic and International segments, respectively, which remained open as of January 31, 2015. During the fiscal 2014 holiday selling season, we operated 227 Domestic and 38 International Express stores.

(3) Represents total square footage occupied, excluding any space dedicated to catwalks, parking lots and decks.

See also the sections of Item 1 entitled “Geographic Distribution of Domestic Stores” and “Geographic Distribution of International Stores” of this Annual Report on Form 10-K.

As described above, a significant part of our properties are ground leased (i.e. properties where we own the building but we do not retain fee ownership in the underlying land) or space leased (i.e. we lease a store from a property owner). We lease substantially all of our properties from unrelated third parties, pursuant to leases that vary as to their terms, rental provisions and expiration dates. Substantially all of our leases are considered triple-net leases, which require us to pay all costs and expenses arising in connection with the ownership, operation, leasing, use, maintenance and repair of these properties. These costs include real estate taxes and assessments, utility charges, license and permit fees and insurance premiums, among other things. Virtually all of our leases include options that allow us to renew or extend the lease term beyond the initial lease period, subject to terms and conditions. In addition, some of our leases include early termination options, which we may exercise under specified conditions, including, upon damage, destruction or condemnation of a specified percentage of the value or land area of the property. A portion of our leased stores have contingent rentals, where the lease payments depend on factors that are not measurable at the inception of the lease, such as future sales volume. Contingent rent expense was $10 million, $10 million and $12 million for fiscals 2014, 2013 and 2012, respectively.

We own our headquarters, comprising 585,000 square feet of space, in Wayne, New Jersey.

As of January 31, 2015, we maintained 82 former stores that are no longer part of our operations. Approximately half of these surplus facilities are owned and the remaining locations are leased. We have tenants in approximately two-thirds of these facilities, and we continue to market those facilities without tenants for disposition or leasing opportunities. The net costs associated with these facilities are reflected in our Consolidated Financial Statements, but the number of surplus facilities is not included above.

Portions of our debt are secured by direct and indirect interests in certain of our properties. See Note 2 to the Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

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ITEM 3. LEGAL PROCEEDINGS

We are, and in the future may be, involved in various other lawsuits, claims and proceedings incident to the ordinary course of business. The results of litigation are inherently unpredictable. Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time and result in diversion of significant resources. We are not able to estimate an aggregate amount or range of reasonably possible losses for those legal matters for which losses are not probable and estimable, primarily for the following reasons: (i) many of the relevant legal proceedings are in preliminary stages, and until such proceedings develop further, there is often uncertainty regarding the relevant facts and circumstances at issue and potential liability; and (ii) many of these proceedings involve matters of which the outcomes are inherently difficult to predict. However, based upon our historical experience with similar matters, we do not expect that any such additional losses would be material to our consolidated financial position, results of operations or cash flows.

ITEM 4. MINE SAFETY DISCLOSURES

None.

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PART II

ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our shares of common stock, $0.001 par value (“Common Stock”) are privately held by our Sponsors, our officers, certain employees and a private investor and there is no established public trading market for our Common Stock. As of March 1, 2014, there were approximately 400 holders of our Common Stock. During fiscals 2014, 2013 and 2012, no dividends were paid out to shareholders. See Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for a discussion of our debt agreements which restrict our ability to pay dividends and obtain funds from certain of our subsidiaries through dividends, loans or advances.

ITEM 6. SELECTED FINANCIAL DATA

	Fiscal Years Ended (1)
(In millions, except number of stores)	January 31, 2015			February 1, 2014			February 2, 2013		January 28, 2012		January 29, 2011
Statement of Operations Data:
Net sales	$	12,361		$	12,543		$	13,543	$	13,909	$	13,864
Net (loss) earnings (2)	(288		)	(1,036		)	39		151		167
Net (loss) earnings attributable to Toys “R” Us, Inc. (2)	(292		)	(1,039		)	38		149		168
Balance Sheet Data (end of period):
Working capital	$	355		$	704		$	1,171	$	708	$	534
Property and equipment, net	3,335			3,638			3,891		4,052		4,061
Total assets	7,115			7,549			8,921		8,842		8,832
Total debt (3)	4,788			5,019			5,343		5,170		5,288
Total (deficit) equity	(1,095		)	(656		)	485		503		343
Other Financial and Operating Data:
Number of stores - Domestic (at period end)	872			873			875		876		868
Number of stores - International - Operated (at period end) (4)	730			704			665		626		524
Total operated stores (at period end) (4)	1,602			1,577			1,540		1,502		1,392
Number of stores - International - Licensed (at period end) (4)	212			185			163		151		220
Adjusted EBITDA (5)	$	642		$	583		$	1,019	$	1,054	$	1,118

(1) Our fiscal year ends on the Saturday nearest to January 31 of each calendar year. With the exception of fiscal 2012, which included 53 weeks, all other fiscal years presented include 52 weeks.

(2) Refer to the Adjusted EBITDA table within this section for certain income and expense items that management believes make it more difficult to assess the Company’s actual operating performance.

(3) Includes current portion of long-term debt and short-term borrowings. See Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

(4) As a result of the Labuan acquisition, on October 31, 2011, 90 of our licensed stores became part of our operated locations upon acquisition. As of January 31, 2015, February 1, 2014 and February 2, 2013, International operated stores included 159, 129 and 100 Labuan stores, respectively. See Note 17 to our Consolidated Financial Statements entitled “ACQUISITIONS” for further details.

(5) Adjusted EBITDA is defined as EBITDA (earnings (loss) before net interest income (expense), income tax expense (benefit), depreciation and amortization), as further adjusted to exclude the effects of certain income and expense items that management believes make it more difficult to assess the Company’s actual operating performance including certain items which are generally non-recurring. We have excluded the impact of such items from internal performance assessments. We believe that excluding items such as Sponsors’ management and advisory fees, goodwill and asset impairment charges, restructuring charges, impact of litigation, noncontrolling interest, net gains on sales of properties and the other charges specified below, helps investors compare our operating performance with our results in prior periods. We believe it is appropriate to exclude these items as they are not related to ongoing operating performance and, therefore, limit comparability between periods and between us and similar companies.

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We believe Adjusted EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. Investors in the Company regularly request Adjusted EBITDA as a supplemental analytical measure to, and in conjunction with, the Company’s financial data prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). We understand that investors use Adjusted EBITDA, among other things, to assess our period-to-period operating performance and to gain insight into the manner in which management analyzes operating performance.

In addition, we believe that Adjusted EBITDA is useful in evaluating our operating performance compared to that of other companies in our industry because the calculation of EBITDA and Adjusted EBITDA generally eliminates the effects of financing and income taxes and the accounting effects of capital spending and acquisitions, which items may vary for different companies for reasons unrelated to overall operating performance. We use the non-GAAP financial measures for planning and forecasting and measuring results against the forecast and in certain cases we use similar measures for bonus targets for certain of our employees. Using several measures to evaluate the business allows us and investors to assess our relative performance against our competitors.

Although we believe that Adjusted EBITDA can make an evaluation of our operating performance more consistent because it removes items that do not reflect our core operations, other companies, even in the same industry, may define Adjusted EBITDA differently than we do. As a result, it may be difficult to use Adjusted EBITDA or similarly named non-GAAP measures that other companies may use to compare the performance of those companies to our performance. The Company does not, and investors should not, place undue reliance on EBITDA or Adjusted EBITDA as measures of operating performance.

Reconciliation of Net (loss) earnings attributable to Toys “R” Us, Inc. to EBITDA and Adjusted EBITDA is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013			January 28, 2012			January 29, 2011
Net (loss) earnings attributable to Toys “R” Us, Inc.	$	(292	)	$	(1,039	)	$	38		$	149		$	168
Add:
Income tax expense (benefit)	32			169			53			(1		)	(35		)
Interest expense, net	447			517			464			432			514
Depreciation and amortization	377			388			407			403			388
EBITDA	564			35			962			983			1,035
Adjustments:
Compensation expense (a)	22			3			2			1			6
Sponsors’ management and advisory fees (b)	18			22			21			20			20
Severance (c)	17			13			3			7			4
Impairment of long-lived assets (d)	13			44			11			6			11
Certain accounting transaction costs (e)	13			1			6			6			—
Obsolete inventory clearance (f)	9			51			—			—			—
Net earnings (loss) attributable to noncontrolling interest (g)	4			3			1			2			(1		)
Store closure costs (c)	4			2			7			5			5
Property losses, net of insurance recoveries (h)	(9		)	—			8			11			—
Litigation (i)	(8		)	23			1			8			23
Net gains on sales of properties (j)	(5		)	(8		)	(4		)	(3		)	(10		)
Goodwill impairment (k)	—			378			—			—			—
Prior period adjustments (l)	—			16			—			—			16
Restructuring (m)	—			—			2			3			3
Transfer tax (benefit) expense (n)	—			—			(1		)	—			6
Acquisition costs (o)	—			—			—			4			—
Loss on liquidation of TRU (HK) Limited (p)	—			—			—			1			—
Adjusted EBITDA	$	642		$	583		$	1,019		$	1,054		$	1,118

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(a) Represents the incremental compensation expense related to certain one-time awards and modifications (net of forfeitures of certain officers’ awards), the fair market value remeasurement of existing liability awards and the repurchase of awards by the Company upon termination. Commencing in fiscal 2014, we have revised our definition of Adjusted EBITDA to include the impact of forfeitures of certain officers’ awards and have therefore revised our prior periods’ Adjusted EBITDA.

(b) Represents fees expensed to the Sponsors in accordance with the advisory agreement. In fiscal 2014, the advisory agreement was amended in order to reduce the advisory fees to $17 million, plus out-of-pocket expenses, for fiscal 2014 and each year thereafter. See Note 16 to our Consolidated Financial Statements entitled “RELATED PARTY TRANSACTIONS” for further details.

(c) Represents severance and store closure costs, net of lease surrender payments. Commencing in fiscal 2014, we have revised our definition of Adjusted EBITDA to include non-officers’ severance and lease surrender payments. We have therefore revised our prior periods’ Adjusted EBITDA.

(d) Asset impairments primarily due to the identification of underperforming stores and the relocation of certain stores. See Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” and Note 4 to our Consolidated Financial Statements entitled “FAIR VALUE MEASUREMENTS” for further details.

(e) Fiscal 2014 primarily represents the unrealized loss on foreign exchange related to the re-measurement of the portion of the tranche of loans in an aggregate principal amount of $280 million due fiscal 2019 (the “Tranche A-1 Loan”) attributed to Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee (“Toys-Canada”), an indirect wholly-owned subsidiary, and other transaction costs. See Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

(f) Represents the incremental expense related to the write-down of excess and obsolete inventory. Commencing in fiscal 2014, we have revised our definition of Adjusted EBITDA to include third party fees associated with our clearance efforts.

(g) Represents noncontrolling interests in Labuan for fiscal 2011 through fiscal 2014, and Toys – Japan for fiscal 2010.

(h) Represents property losses, the write-off of damaged assets and repairs from a hurricane that hit the east coast of the United States, store fires in Australia, and an earthquake and resulting tsunami that hit the Northeast coast of Japan, net of insurance claims recognized.

(i) Represents certain litigation expenses and settlements recorded for legal matters. See Note 14 to our Consolidated Financial Statements entitled “LITIGATION AND LEGAL PROCEEDINGS” for further details.

(j) Represents the sale of properties. See Note 5 to our Consolidated Financial Statements entitled “PROPERTY AND EQUIPMENT” for further details.

(k) Represents the impairment of goodwill associated with our Toys-Domestic and Toys-Japan reporting units. Refer to “CRITICAL ACCOUNTING POLICIES” within Item 7 entitled “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” for further details.

(l) Represents a non-cash cumulative correction of prior period accrued vacation accounting in fiscal 2013, partially offset by the non-cash cumulative correction of accounting for dotcom prior period sales. The adjustment in fiscal 2010 represents a non-cash cumulative correction of prior period straight-line lease accounting.

(m) Restructuring and other charges consist primarily of costs incurred from the Company’s 2003 and 2005 restructuring initiatives. The additional charges are primarily due to changes in management’s estimates for events such as lease terminations, assignments and sublease income adjustments.

(n) Represents state and city property transfer taxes recognized in fiscal 2010 related to the merger transaction in fiscal 2005, a portion of which were settled in fiscal 2012.

(o) Represents costs incurred in conjunction with the acquisition of 70% ownership interest in Labuan from Li & Fung. See Note 17 to our Consolidated Financial Statements entitled “ACQUISITIONS” for further details.

(p) In fiscal 2011, in conjunction with the completion of the liquidation of TRU (HK) Limited, our wholly-owned subsidiary, we recognized a $1 million loss.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help facilitate an understanding of our historical results of operations during the periods presented and our financial condition. This MD&A should be read in conjunction with our Consolidated Financial Statements and the accompanying

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notes, and contains forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements” and Item 1A entitled “RISK FACTORS” of this Annual Report on Form 10-K. Our MD&A includes the following sections:

EXECUTIVE OVERVIEW provides an overview of our business.

RESULTS OF OPERATIONS provides an analysis of our financial performance and of our consolidated and segment results of operations for fiscal 2014 compared to fiscal 2013 and fiscal 2013 compared to fiscal 2012. With the exception of fiscal 2012, which included 53 weeks, all other fiscal years presented include 52 weeks.

LIQUIDITY AND CAPITAL RESOURCES provides an overview of our financing, capital expenditures, cash flows and contractual obligations.

CRITICAL ACCOUNTING POLICIES provides a discussion of our accounting policies that require critical judgment, assumptions and estimates.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS provides a brief description of significant accounting standards which were adopted during fiscal 2014. This section also refers to Note 18 to our Consolidated Financial Statements entitled “RECENT ACCOUNTING PRONOUNCEMENTS” for accounting standards which we have not yet been required to implement and may be applicable to our future operations.

EXECUTIVE OVERVIEW

Our Business

We are the leading global specialty retailer of toys and baby products as measured by Net sales. Toys “R” Us, Inc. is recognized as the toy and baby authority. We sell a variety of products in the baby, core toy, entertainment, learning and seasonal categories through our retail locations and the Internet. Our brand names are highly recognized in North America, Europe and Asia, and our expertise in the toy and baby retail space, our broad range of product offerings, our substantial scale and geographic footprint and our strong vendor relationships account for our market-leading position and distinguish us from the competition.

As of January 31, 2015, we operated 1,602 stores and licensed an additional 212 stores. These stores are located in 37 countries and jurisdictions around the world under the Toys “R” Us, Babies “R” Us and FAO Schwarz banners. In addition, we operate Express stores, smaller format stores primarily open on a short-term basis during the holiday season. We also provide an integrated shopping format by combining the Toys “R” Us and Babies “R” Us merchandise offerings under one roof creating a “one-stop shopping” experience for our customers. We call this format a SBS store. SBS stores are a combination of Toys “R” Us stores and Babies “R” Us stores, and may be the result of a conversion or relocation and, in certain cases, may be accompanied by the closure of one or more existing stores. In addition, SBS stores may also be constructed in a new location and market. Below is a summary of our operated and licensed stores under the following formats:

Operated Stores

• 881 traditional toy stores, which typically range in size from 20,000 to 50,000 square feet and devote 5,000 square feet to boutique areas for baby products (including 97 BRU Express and Juvenile Expansion formats which devote an additional 4,000 square feet and 1,000 square feet, respectively, for baby products);

• 412 SBS stores, which typically range in size from 30,000 to 70,000 square feet and devote 20,000 to 40,000 square feet to traditional toy products and 10,000 to 30,000 square feet to baby products;

• 240 baby stores, which typically range in size from 30,000 to 45,000 square feet and devote 3,000 square feet to traditional toy products;

• 66 permanent Express stores, which typically range in size from 2,000 to 7,000 square feet, each with a cumulative lease term of at least two years; and

• 3 flagship store locations (the Toys “R” Us store in Times Square, the FAO Schwarz store on 5^th Avenue and the Babies “R” Us store in Union Square – all in New York City), which range in size from 55,000 to 105,000 square feet.

Licensed Stores

• 212 “R” Us branded retail stores ranging in various sizes. Licensing fees did not have a material impact on our Net sales.

In addition to these stores, during the fiscal 2014 holiday selling season, we operated an additional 199 temporary Express stores globally in shopping malls, outlet malls and other shopping centers located in high traffic areas. These locations typically range in size from 2,000 to 7,000 square feet each, have a cumulative lease term of less than two years and are not included in our overall store count.

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We also own and operate websites including Toysrus.com, Babiesrus.com, eToys.com, FAO.com and toys.com, as well as other Internet sites we operate in our international markets. Internationally, we have an online presence in 19 countries, which includes Australia, Austria, Belgium, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, the Netherlands, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom. For fiscal years 2014, 2013 and 2012, our consolidated e-commerce business generated net sales of $1,229 million, $1,151 million and $1,135 million, respectively.

We believe we offer our customers the most comprehensive year-round selection of merchandise in the retail toy and baby categories through our “R” Us branded stores and through the Internet. On average, our domestic and international stores (other than Express stores) offer 12,000 and 7,500 items year-round, respectively. Express stores, due to their size, typically carry 2,500 items. We believe that our differentiated product assortment, private label and exclusively licensed product offerings and expert service enable us to command a reputation as the shopping destination for toys and baby products. We seek to differentiate ourselves from our competitors in several key areas, including product selection, product presentation, service, in-store experience and marketing. We are able to provide vendors with a year-round distribution outlet for the broadest assortment of their products. Over the past year, we have commenced the implementation of our strategic plan to improve and strengthen our Domestic and International segments over the short-term, while implementing new initiatives which we believe will put the Company on track for profitable growth in the future. We also continue to seek opportunities to optimize our cost structure and enhance efficiencies throughout the organization.

Our customer promise is to provide the broadest selection of products to help kids and babies develop, learn, have fun and be safe; be the easiest place to research and find solutions throughout the journey of parenthood; be the best resource for children’s gift giving occasions; offer fair prices; deliver expert and unique service; and provide customers the ability to shop whenever, wherever and however they want.

For fiscal 2014, we generated Net sales of $12,361 million, Net loss attributable to Toys “R” Us, Inc. of $292 million and Adjusted EBITDA of $642 million. For the definition of Adjusted EBITDA, an explanation of why we present it and a description of the limitations of this non-GAAP measure, as well as a reconciliation to Net loss attributable to Toys “R” Us, Inc., see Item 6 entitled “SELECTED FINANCIAL DATA” of this Annual Report on Form 10-K.

Our Business Segments

Our business has two reportable segments: Domestic and International. See Note 11 to our Consolidated Financial Statements entitled “SEGMENTS” for our segments’ financial results. The following is a brief description of our segments:

• Domestic — Our Domestic segment sells a variety of products in the baby, core toy, entertainment, learning and seasonal categories through 872 stores that operate in 49 states in the United States, Puerto Rico and Guam and through the Internet. Domestic Net sales in fiscal 2014 were derived from 370 traditional toy stores (including 78 BRU Express and Juvenile Expansion formats), 225 baby stores, 214 SBS stores, 60 permanent Express stores (with cumulative lease terms of at least two years) and our three flagship stores in New York City. Additionally, we generated Net sales through our temporary Express store locations. Domestic Net sales were $7,524 million for fiscal 2014, which accounts for 61% of our consolidated Net sales.

• International —Our International segment sells a variety of products in the baby, core toy, entertainment, learning and seasonal categories through 730 operated and 212 licensed stores in 36 countries and jurisdictions and through the Internet. In addition to fees received from licensed stores, International Net sales in fiscal 2014 were derived from 511 traditional toy stores (including 19 BRU Express formats), 198 SBS stores, 15 baby stores and 6 permanent Express stores (with cumulative lease terms of at least two years). Additionally, we generated Net sales through our temporary Express store locations. Our operated stores are located in Australia, Austria, Brunei, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom. International Net sales were $4,837 million for fiscal 2014, which accounts for 39% of our consolidated Net sales.

In order to properly judge our business performance, it is necessary to be aware of the challenges and risks we face. Refer to the “Forward-Looking Statements” and Item 1A entitled “RISK FACTORS” of this Annual Report on Form 10-K for further details. The risks and uncertainties described are not the only ones that we face. Additional risks and uncertainties not presently known to us, or that we currently believe to be less significant, may also adversely affect our business and operations. If any of the risks actually occur, our business, financial condition, cash flows or results of operations could be materially adversely affected.

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RESULTS OF OPERATIONS

Financial Performance

As discussed in more detail in this MD&A, the following financial data represents an overview of our financial performance for fiscals 2014, 2013 and 2012:

	Fiscal Years Ended
($ In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Net sales	$	12,361		$	12,543		$	13,543
Gross margin	4,430			4,389			4,951
Gross margin as a percentage of Net sales	35.8		%	35.0		%	36.6		%
Selling, general and administrative expenses	$	3,915		$	4,010		$	4,041
Selling, general and administrative expenses as a percentage of Net sales	31.7		%	32.0		%	29.8		%
Net (loss) earnings attributable to Toys “R” Us, Inc.	$	(292	)	$	(1,039	)	$	38
Non-GAAP Financial Measure:
Adjusted EBITDA (1)	$	642		$	583		$	1,019

(1) For an explanation of Adjusted EBITDA as a measure of the Company’s operating performance and a reconciliation to Net (loss) earnings attributable to Toys “R” Us, Inc., see Item 6 entitled “SELECTED FINANCIAL DATA” of this Annual Report on Form 10-K.

Net sales decreased by $182 million in fiscal 2014 compared to fiscal 2013. Foreign currency translation decreased Net sales by $243 million. Excluding the impact of foreign currency translation, the increase in Net sales was primarily due to an increase in net sales from new locations within our International segment and an increase in our International comparable store net sales, partially offset by a decrease in our Domestic comparable store net sales.

Gross margin, as a percentage of Net sales, increased by 0.8 percentage points in fiscal 2014 compared to fiscal 2013 primarily as a result of overall margin improvements across all categories in our Domestic segment, mainly attributable to promotional efficiencies and an inventory write-down of $51 million recorded within our Domestic segment in fiscal 2013. Foreign currency translation decreased Gross margin by $83 million.

Selling, general and administrative expenses (“SG&A”) decreased by $95 million in fiscal 2014 compared to fiscal 2013. Foreign currency translation decreased SG&A by $57 million. Excluding the impact of foreign currency translation, the decrease in SG&A was due to a decline in advertising and promotional expenses, lower store payroll expense, favorable legal and property insurance claim settlements, a decrease in litigation expense related to the prior year adverse liability judgment and a reduction in general liability insurance reserves. These decreases were partially offset by increases in annual bonus and occupancy costs.

Net loss attributable to Toys “R” Us, Inc. decreased by $747 million in fiscal 2014 compared to fiscal 2013. The decrease was primarily due to goodwill impairment charges in fiscal 2013, decreases in Income tax expense, SG&A and Interest expense and an increase in Gross margin.

Comparable Store Net Sales

In computing comparable store net sales, we include stores that have been open for at least 56 weeks (1 year and 4 weeks) from their “soft” opening date. A soft opening is typically two weeks prior to the grand opening. Permanent Express stores that have been open for at least 56 weeks from their “soft” opening date are also included in our comparable store net sales computation.

Comparable stores include the following:

• stores that have been remodeled (including conversions) while remaining open;

• stores that have been relocated and/or expanded to new buildings within the same trade area, in which the new store opens at about the same time as the old store closes;

• stores that have expanded within their current locations; and

• sales from our Internet businesses.

By measuring the year-over-year sales of merchandise in the stores that have been open for a full comparable 56 weeks or more and on-line, we can better gauge how the core store base and e-commerce businesses are performing since comparable store net sales excludes the impact of store openings and closings.

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Various factors affect comparable store net sales, including the number of and timing of stores we open, close, convert, relocate or expand, the number of transactions, the average transaction amount, the general retail sales environment, current local and global economic conditions, consumer preferences and buying trends, changes in sales mix among distribution channels, our ability to efficiently source and distribute products, changes in our merchandise mix, competition, the timing of the release of new merchandise and our promotional events, the success of marketing programs and the cannibalization of existing store net sales by new stores. Among other things, weather conditions can affect comparable store net sales because inclement weather may discourage travel or require temporary store closures, thereby reducing customer traffic. These factors have caused our comparable store net sales to fluctuate significantly in the past on a monthly, quarterly and annual basis and, as a result, we expect that comparable store net sales will continue to fluctuate in the future.

The following table discloses the change in our comparable store net sales for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
	January 31,  2015 (1)		February 1,  2014 (1)			February 2,  2013 (1)(2)
Domestic	(1.0	)%	(5.2	)%	(3)	(3.5	)%	(3)
International	1.8	%	(3.3	)%		(5.0	)%
Toys “R” Us - Consolidated	0.0	%	(4.4	)%		(4.1	)%

(1) Our reporting period for fiscals 2014 and 2013 includes 52 weeks compared to 53 weeks for fiscal 2012. Therefore, comparable store net sales for fiscal 2012 has been adjusted by one week as compared to Net sales.

(2) For fiscal 2012, international comparable store net sales includes sales from stores acquired in the Labuan acquisition 56 weeks from their acquisition in fiscal 2011.

(3) Excludes the effect of an immaterial out of period adjustment. Previously reported Domestic comparable store net sales were(5.0)%for fiscal 2013. Fiscal 2012 remains unchanged.

Percentage of Net Sales by Product Category

	Fiscal Years Ended
Domestic:	January 31, 2015		February 1, 2014		February 2, 2013
Baby	38.0	%	37.7	%	37.9	%
Core Toy	17.4	%	16.2	%	16.0	%
Entertainment	10.2	%	11.3	%	11.7	%
Learning	22.7	%	22.8	%	22.4	%
Seasonal	11.2	%	11.3	%	11.3	%
Other (1)	0.5	%	0.7	%	0.7	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues.

	Fiscal Years Ended
International:	January 31, 2015		February 1, 2014		February 2, 2013
Baby	20.2	%	20.4	%	21.6	%
Core Toy	23.5	%	22.7	%	21.9	%
Entertainment	8.5	%	10.0	%	11.4	%
Learning	31.1	%	30.8	%	29.2	%
Seasonal	15.9	%	15.3	%	15.2	%
Other (1)	0.8	%	0.8	%	0.7	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues, including licensing fees from unaffiliated third parties.

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From time to time, we may make revisions to our prior period Net sales by product category to conform to the current period allocation. These revisions did not have a significant impact to our prior year disclosure.

Store Count by Segment

		Fiscal 2014
	February 1, 2014	Opened	Closed (5)		Conversions			Relocations			January 31, 2015
Domestic:
Standalone stores (1)(3)	659	33	(34	)	—			—			658
Side-by-side stores	214	—	—		—			—			214
Total Domestic	873	33	(34	)	—			—			872
International:
Standalone stores (2)(3)	518	48	(33	)	(1	)		—			532
Side-by-side stores	186	11	—		1			—			198
Total International	704	59	(33	)	—			—			730
Total Operated (3)(4)	1,577	92	(67	)	—			—			1,602
		Fiscal 2013
	February 2, 2013	Opened	Closed (5)		Conversions			Relocations			February 1, 2014
Domestic:
Standalone stores (1)(3)	671	9	(10	)	(2	)		(9	)		659
Side-by-side stores	204	2	—		1			7			214
Total Domestic	875	11	(10	)	(1	)	(6)	(2	)	(7)	873
International:
Standalone stores (2)(3)	495	53	(28	)	(2	)		—			518
Side-by-side stores	170	15	(1	)	2			—			186
Total International	665	68	(29	)	—			—			704
Total Operated (3)(4)	1,540	79	(39	)	(1	)		(2	)		1,577

(1) Store count as of January 31, 2015 includes 294 Toys “R” Us (“TRU”) stores, 226 Babies “R” Us (“BRU”) stores, 214 SBS stores, 58 Juvenile Expansions, 20 BRU Express stores and 60 permanent Express stores (with cumulative lease terms of at least two years). Store count as of February 1, 2014 included 305 TRU stores, 233 BRU stores, 214 SBS stores, 59 Juvenile Expansions, 20 BRU Express stores and 42 permanent Express stores. Store count as of February 2, 2013 included 312 TRU stores, 240 BRU stores, 204 SBS stores, 62 Juvenile Expansions, 21 BRU Express stores and 36 permanent Express stores.

(2) Store count as of January 31, 2015 includes 492 TRU stores, 198 SBS stores, 19 BRU Express stores, 15 BRU stores and 6 permanent Express stores. Store count as of February 1, 2014 included 467 TRU stores, 186 SBS stores, 18 BRU Express stores, 15 BRU stores and 18 permanent Express stores. Store count as of February 2, 2013 included 442 TRU stores, 170 SBS stores, 17 BRU Express stores, 13 BRU stores and 23 permanent Express stores (with cumulative lease terms of at least two years). The net increase in store count from prior year is predominantly due to 30 stores in China and Southeast Asia.

(3) There were 32 Domestic and 17 International Express stores open as of January 31, 2015, 47 Domestic and 13 International Express stores open as of February 1, 2014 and 48 Domestic and 18 International Express stores open as of February 2, 2013. These stores were not included in our overall store count within our Domestic and International segments and are considered temporary as they have a cumulative lease term of less than two years.

(4) Excluded from our overall store count are 212, 185 and 163 International licensed stores as of January 31, 2015, February 1, 2014 and February 2, 2013, respectively. The net increase in store count from prior year is predominantly due to 12 stores in South Africa, 6 stores in the Philippines and 4 stores in South Korea.

(5) Excludes stores closed as a result of conversions and relocations.

(6) The one conversion in fiscal 2013 was accompanied by multiple store closings.

(7) Of the seven relocations in fiscal 2013, two were accompanied by multiple store closings.

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Fiscal 2014 Compared to Fiscal 2013

Net Loss Attributable to Toys “R” Us, Inc.

(In millions)	Fiscal 2014			Fiscal 2013			Change
Toys “R” Us - Consolidated	$	(292	)	$	(1,039	)	$	747

Net loss attributable to Toys “R” Us, Inc. decreased by $747 million to $292 million in fiscal 2014, compared $1,039 million in fiscal 2013. The decrease in Net loss attributable to Toys “R” Us, Inc. was primarily due to $378 million of goodwill impairment charges in fiscal 2013 associated with our Toys-Domestic and Toys-Japan reporting units and a decrease in Income tax expense of $137 million. Additionally contributing to the decrease in Net loss attributable to Toys “R” Us, Inc. was a decrease in SG&A of $95 million, a decline in Interest expense of $73 million and an increase in Gross margin of $41 million.

Net Sales

										Percentage of Net sales
($ In millions)	Fiscal 2014		Fiscal 2013		$ Change			% Change		Fiscal 2014		Fiscal 2013
Domestic	$	7,524	$	7,638	$	(114	)	(1.5	)%	60.9	%	60.9	%
International	4,837		4,905		(68		)	(1.4	)%	39.1	%	39.1	%
Toys “R” Us - Consolidated	$	12,361	$	12,543	$	(182	)	(1.5	)%	100.0	%	100.0	%

Net sales decreased by $182 million or 1.5%, to $12,361 million in fiscal 2014, compared to $12,543 million in fiscal 2013. The impact of foreign currency translation decreased Net sales in fiscal 2014 by $243 million.

Excluding the impact of foreign currency translation, the increase in Net sales for fiscal 2014 was primarily due to an increase in net sales from new locations within our International segment. Additionally contributing to the increase in Net sales was an increase in our International comparable store net sales primarily driven by an increase in the number of transactions. Partially offsetting the increase in Net sales was a decrease in Domestic comparable store net sales primarily driven by a decline in the number of transactions.

Domestic

Net sales for the Domestic segment decreased by $114 million or 1.5%, to $7,524 million in fiscal 2014, compared to $7,638 million in fiscal 2013. The decrease in Net sales was primarily a result of a decrease in comparable store net sales of 1.0%.

The decrease in comparable store net sales resulted primarily from decreases in our entertainment, learning and seasonal categories. The decrease in our entertainment category was primarily due to decreased sales of video game software, portable electronics and video game systems. The decrease in our learning category was primarily due to decreased sales of educational electronics and creative activity products, partially offset by increased sales of construction toys. The decrease in our seasonal category was primarily due to decreased sales of outdoor products. Partially offsetting these decreases was an increase in our core toy category primarily as a result of increased sales of girls’ role play products and accessories.

International

Net sales for the International segment decreased by $68 million or 1.4%, to $4,837 million in fiscal 2014, compared to $4,905 million in fiscal 2013. Excluding a $243 milliondecrease in Net sales due to foreign currency translation, International Net sales increased primarily as a result of an increase in net sales from new locations and an increase in comparable store net sales of 1.8%.

The increase in comparable store net sales resulted primarily from increases in our core toy, seasonal and learning categories. The increase in our core toy category was primarily due to increased sales of action figures. The increase in our seasonal category was primarily due to increased sales of outdoor products. The increase in our learning category was primarily due to increased sales of construction toys, partially offset by decreased sales of educational electronics. Partially offsetting these increases was a decrease in our entertainment category primarily as a result of decreased sales of video game software and systems.

Cost of Sales and Gross Margin

We record the costs associated with operating our distribution networks as a part of SG&A, including those costs that primarily relate to transporting merchandise from distribution centers to stores. Therefore, our consolidated Gross margin may not be comparable to the gross margins of other retailers that include similar costs in their cost of sales.

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The following are reflected in “Cost of sales”:

• the cost of merchandise acquired from vendors;

• freight in;

• provision for excess and obsolete inventory;

• shipping costs to consumers;

• provision for inventory shortages; and

• credits and allowances from our merchandise vendors.

Gross Margin

								Percentage of Net sales
($ In millions)	Fiscal 2014		Fiscal 2013		$ Change			Fiscal 2014		Fiscal 2013		Change
Domestic	$	2,563	$	2,489	$	74		34.1	%	32.6	%	1.5	%
International	1,867		1,900		(33		)	38.6	%	38.7	%	(0.1	)%
Toys “R” Us - Consolidated	$	4,430	$	4,389	$	41		35.8	%	35.0	%	0.8	%

Gross margin increased by $41 million to $4,430 million in fiscal 2014, compared to $4,389 million in fiscal 2013. Foreign currency translation decreased Gross margin by $83 million.

Gross margin, as a percentage of Net sales, increased by 0.8 percentage points in fiscal 2014 compared to fiscal 2013. The increase in Gross margin, as a percentage of Net sales, was primarily the result of overall margin improvements across all categories in our Domestic segment, mainly attributable to promotional efficiencies (reduction in the depth and breadth of promotions). Additionally contributing to the increase in Gross margin was an inventory write-down of $51 million recorded within our Domestic segment in fiscal 2013.

Domestic

Gross margin increased by $74 million to $2,563 million in fiscal 2014, compared to $2,489 million in fiscal 2013. Gross margin, as a percentage of Net sales, increased by 1.5 percentage points in fiscal 2014 compared to fiscal 2013.

The increase in Gross margin, as a percentage of Net sales, resulted primarily from overall margin improvements predominantly in our entertainment, baby product and core toy categories due to promotional efficiencies (reduction in the depth and breadth of promotions). Additionally contributing to the increase in Gross margin was an inventory write-down of $51 million recorded in fiscal 2013.

International

Gross margin decreased by $33 million to $1,867 million in fiscal 2014, compared to $1,900 million in fiscal 2013. Foreign currency translation decreased Gross margin by $83 million. Gross margin, as a percentage of Net sales, remained relatively consistent in fiscal 2014 compared to fiscal 2013.

Selling, General and Administrative Expenses

The following table presents expenses as a percentage of consolidated SG&A:

	Fiscal 2014		Fiscal 2013
Payroll and related benefits (1)	44.7	%	43.1	%
Occupancy costs (2)	30.0	%	29.5	%
Advertising and promotional expenses	9.7	%	10.8	%
Professional fees	3.4	%	3.4	%
Transaction fees (3)	3.1	%	3.3	%
Other (4)	9.1	%	9.9	%
Total	100	%	100	%

(1) Excluding the increase of the annual bonus, total expense dollars for payroll and related benefits expense dollars declined in fiscal 2014 as compared to the prior year.

(2) Fiscal 2014 includes property insurance claim settlements noted below.

(3) Primarily consists of credit card fees, which includes the fiscal 2014 Visa and MasterCard settlement.

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(4) Includes costs related to transporting merchandise from distribution centers to stores, store related supplies and signage, website hosting and other corporate-related expenses.

								Percentage of Net sales
($ In millions)	Fiscal 2014		Fiscal 2013		$ Change			Fiscal 2014		Fiscal 2013		Change
Toys “R” Us - Consolidated	$	3,915	$	4,010	$	(95	)	31.7	%	32.0	%	(0.3	)%

SG&A decreased by $95 million to $3,915 million in fiscal 2014, compared to $4,010 million in fiscal 2013. Foreign currency translation decreased SG&A by $57 million. As a percentage of Net sales, SG&A decreased by 0.3 percentage points.

Excluding the impact of foreign currency translation, SG&A decreased by $38 million, reflecting: a $48 million decline in advertising and promotional expenses; $26 million of lower store payroll expense; favorable legal and property insurance claim settlements of $21 million; a $20 million decrease in litigation expense related to the prior year adverse liability judgment; and a reduction of $9 million in general liability insurance reserves; offset in part by a $63 million increase in annual bonus, a $21 million increase in occupancy costs predominantly related to new stores within our International segment and the aggregate of $2 million in other insignificant items.

Refer to Note 14 to our Consolidated Financial Statements entitled “LITIGATION AND LEGAL PROCEEDINGS” for further details on the legal proceedings mentioned above.

Depreciation and Amortization

(In millions)	Fiscal 2014		Fiscal 2013		Change
Toys “R” Us - Consolidated	$	377	$	388	$	(11	)

Depreciation and amortization decreased by $11 million to $377 million in fiscal 2014, compared to $388 million in fiscal 2013. Foreign currency translation decreased Depreciation and amortization by $5 million. Excluding the impact of foreign currency translation, the decrease in Depreciation and amortization was primarily due to fully depreciated assets, which included the impact of fiscal 2013 impairments of $44 million. Partially offsetting the decrease was accelerated depreciation of certain assets, which we committed to dispose of prior to the end of their useful lives.

Goodwill Impairment

(In millions)	Fiscal 2014		Fiscal 2013		Change
Toys “R” Us - Consolidated	$	—	$	378	$	(378	)

We had no Goodwill impairment for fiscal 2014. The amount recorded in fiscal 2013 was comprised of $361 million related to our Toys-Domestic reporting unit and $17 million related to our Toys-Japan reporting unit.

Refer to the “CRITICAL ACCOUNTING POLICIES” section below and Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

Other Income, Net

Other income, net includes the following:

• credit card program income;

• gift card breakage income;

• foreign exchange gains and losses;

• impairment of long-lived assets;

• net gains on sales of properties; and

• other operating income and expenses.

(In millions)	Fiscal 2014		Fiscal 2013		Change
Toys “R” Us - Consolidated	$	53	$	37	$	16

Other income, net increased by $16 million to $53 million in fiscal 2014, compared to $37 million in fiscal 2013. The increase was primarily due to a $31 million decrease in impairment of long-lived assets, partially offset by a $15 million increase in unrealized loss on foreign exchange related to the re-measurement of the Tranche A-1 Loan attributed to Toys-Canada.

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Refer to Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

Interest Expense

(In millions)	Fiscal 2014		Fiscal 2013		Change
Toys “R” Us - Consolidated	$	451	$	524	$	(73	)

Interest expense decreased by $73 million to $451 million in fiscal 2014, compared to $524 million in fiscal 2013. The decrease in Interest expense was primarily due to $77 million of incremental interest expense associated with the prior year repayment of the $950 million 10.750% senior unsecured notes due fiscal 2017 (the “Propco I Notes”), composed of a redemption premium of $51 million, and the write-off of unamortized original issue discount and deferred debt issuance costs. Additionally contributing to the decrease was $23 million in savings associated with refinancing the Propco I Notes to a $985 million senior unsecured term loan facility due fiscal 2019 (the “Propco I Term Loan Facility”) at a lower rate of interest. Partially offsetting the decrease in Interest expense was the current year extinguishment of the Secured term loan facility and the 7.375% senior secured notes due fiscal 2016, and portions of the Incremental secured term loan facility and Second incremental secured term loan facility, resulting in $35 million of incremental expense, composed of the write-off of portions of unamortized deferred debt issuance costs and original issue discount, and a redemption premium of $6 million on the 7.375% senior secured notes due fiscal 2016.

As a result of the third quarter of fiscal 2014 refinancing of a portion of the secured term loan facilities and the 7.375% senior secured notes due fiscal 2016 with the Secured Term B-4 Loan, as defined below, and the Tranche A-1 Loan, we expect that our annual Interest expense will increase primarily due to a higher rate of interest on the new financing.

Interest Income

(In millions)	Fiscal 2014		Fiscal 2013		Change
Toys “R” Us - Consolidated	$	4	$	7	$	(3	)

Interest income decreased by $3 million to $4 million in fiscal 2014, compared to $7 million in fiscal 2013. The decrease was primarily due to the April 2013 maturity of our Vanwall Finance Plc (“Vanwall”) debt security holdings.

Income Tax Expense

($ In millions)	Fiscal 2014			Fiscal 2013			Change
Toys “R” Us - Consolidated	$	32		$	169		$	(137	)
Consolidated effective tax rate	(12.5		)%	(19.5		)%	7.0		%

The net decrease in income tax expense of $137 million in fiscal 2014 compared to fiscal 2013 was principally due to the fact that in fiscal 2014 we recorded a valuation allowance on deferred tax assets associated with the fiscal 2014 loss in the U.S. and certain foreign jurisdictions, whereas in fiscal 2013 we recorded a valuation allowance in the U.S. and certain foreign jurisdictions on both the fiscal 2013 loss, as well as the opening deferred tax balances in these jurisdictions.

Our income tax expense in fiscal 2014 was unfavorably impacted by certain non-routine, discrete items, including a valuation allowance for U.S. Federal and state jurisdictions, as well as in certain foreign jurisdictions. We have evaluated the available positive and negative evidence and have concluded that, for some of our deferred tax assets, it is more likely than not that these assets will not be realized in the foreseeable future. A valuation allowance is a non-cash charge, which does not eliminate the tax loss carryforwards and other deferred tax assets. It reflects a reduction in the benefit we expect is more likely than not to be realized from these items. Favorably impacting the fiscal 2014 income tax expense is a benefit associated with the reduction of uncertain tax benefits.

Our income tax expense in fiscal 2013 was unfavorably impacted by certain non-routine, discrete items, including an increase to our valuation allowance for U.S. Federal and state as well as certain foreign tax jurisdictions. We evaluated the available positive and negative evidence and concluded that, for some of our deferred tax assets, it is more likely than not that these assets will not be realized in the foreseeable future. The increase to our valuation allowance for U.S. Federal, state and foreign taxes was predominantly due to the fact that, as of the end of fiscal 2013, we incurred a pre-tax cumulative loss over the past three fiscal years. As a result, we established a valuation allowance to reduce these deferred tax assets for the amount we believed will not be realized. Also contributing to the fiscal 2013 tax expense were adjustments to deferred taxes resulting from changes to statutory tax rates in various jurisdictions.

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In the next 12 months, we may conclude that it is more likely than not that we will realize a benefit for deferred tax assets in certain foreign jurisdictions. We estimate that this may result in the valuation allowance being reduced by up to $33 million.

Refer to Note 10 to the Consolidated Financial Statements entitled “INCOME TAXES” for further details.

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Fiscal 2013 Compared to Fiscal 2012

Net (Loss) Earnings Attributable to Toys “R” Us, Inc.

(In millions)	Fiscal 2013			Fiscal 2012		Change
Toys “R” Us - Consolidated	$	(1,039	)	$	38	$	(1,077	)

Net loss attributable to Toys “R” Us, Inc. was $1,039 million in fiscal 2013, compared to Net earnings attributable to Toys “R” Us, Inc. of $38 million in fiscal 2012, a change of $1,077 million. The Net loss attributable to Toys “R” Us, Inc. was primarily due to a decrease in Gross margin dollars of $562 million, a $378 million goodwill impairment associated with our Toys- Domestic and Toys-Japan reporting units and an increase in Income tax expense of $116 million principally due to an increase in expense for non-routine, discrete items, partially offset by a benefit associated with the decrease in pre-tax earnings.

Net Sales

										Percentage of Net sales
($ In millions)	Fiscal 2013		Fiscal 2012		$ Change			% Change		Fiscal 2013		Fiscal 2012
Domestic	$	7,638	$	8,149	$	(511	)	(6.3	)%	60.9	%	60.2	%
International	4,905		5,394		(489		)	(9.1	)%	39.1	%	39.8	%
Toys “R” Us - Consolidated	$	12,543	$	13,543	$	(1,000	)	(7.4	)%	100.0	%	100.0	%

Net sales decreased by $1.0 billion or 7.4%, to $12,543 million in fiscal 2013, compared to $13,543 million in fiscal 2012. The impact of foreign currency translation decreased Net sales in fiscal 2013 by $329 million. Our reporting period for fiscal 2013 included 52 weeks compared to 53 weeks for fiscal 2012, which included an additional week of net sales of $152 million.

Excluding the impact of foreign currency translation, the decrease in Net sales for fiscal 2013 was primarily due to a decrease in comparable store net sales. The decrease in comparable store net sales was primarily driven by a decrease in the number of transactions and lower average transaction amounts. Partially offsetting the decline in Net sales was an increase in net sales from new locations within our International segment.

Domestic

Net sales for the Domestic segment decreased by $511 million or 6.3%, to $7,638 million in fiscal 2013, compared to $8,149 million in fiscal 2012. The decrease in Net sales was primarily a result of a decrease in comparable store net sales of 5.2%. Our reporting period for fiscal 2013 included 52 weeks compared to 53 weeks for fiscal 2012, which included an additional week of net sales of $95 million.

The decrease in comparable store net sales resulted primarily from decreases in our baby, entertainment and learning categories. The decrease in our baby category was predominantly due to decreased sales of infant care products. The decrease in our entertainment category was primarily due to decreased sales of video game software. The decrease in our learning category was primarily due to decreased sales of educational electronics and construction toys.

International

Net sales for the International segment decreased by $489 million or 9.1%, to $4,905 million in fiscal 2013, compared to $5,394 million in fiscal 2012. Excluding a $329 million decrease in Net sales due to foreign currency translation, International Net sales decreased primarily due to a decrease in comparable store net sales of 3.3%. Partially offsetting this decrease was an increase in net sales from new locations. Our reporting period for fiscal 2013 included 52 weeks compared to 53 weeks for fiscal 2012, which included an additional week of net sales of $57 million.

The decrease in comparable store net sales resulted primarily from decreases in our entertainment and baby categories. The decrease in our entertainment category was primarily due to decreased sales of video game systems and software. The decrease in our baby category was primarily due to decreased sales of baby gear and apparel.

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Gross Margin

								Percentage of Net sales
($ In millions)	Fiscal 2013		Fiscal 2012		$ Change			Fiscal 2013		Fiscal 2012		Change
Domestic	$	2,489	$	2,885	$	(396	)	32.6	%	35.4	%	(2.8	)%
International	1,900		2,066		(166		)	38.7	%	38.3	%	0.4	%
Toys “R” Us - Consolidated	$	4,389	$	4,951	$	(562	)	35.0	%	36.6	%	(1.6	)%

Gross margin decreased by $562 million to $4,389 million in fiscal 2013, compared to $4,951 million in fiscal 2012. Foreign currency translation decreased Gross margin by $110 million.

Gross margin, as a percentage of Net sales, decreased by 1.6 percentage points in fiscal 2013 compared to fiscal 2012. Gross margin, as a percentage of Net sales, was primarily impacted by margin rate declines across all Domestic categories due in part to our competitive pricing strategy and to our inventory clearance efforts, as well as an inventory write-down recorded within our Domestic segment. Partially offsetting these decreases was an increase in vendor allowances recorded within our International segment and improvements in sales mix away from lower margin products within our Domestic and International segments, predominantly in our entertainment category.

Domestic

Gross margin decreased by $396 million to $2,489 million in fiscal 2013, compared to $2,885 million in fiscal 2012. Gross margin, as a percentage of Net sales, decreased by 2.8 percentage points in fiscal 2013 compared to fiscal 2012.

The decrease in Gross margin, as a percentage of Net sales, resulted primarily from margin rate declines across all categories due in part to our competitive pricing strategy and to our inventory clearance efforts, as well as an inventory write-down of excess and obsolete inventory. Partially offsetting these decreases were improvements in sales mix away from lower margin products, predominantly in our entertainment category.

International

Gross margin decreased by $166 million to $1,900 million in fiscal 2013, compared to $2,066 million in fiscal 2012. Foreign currency translation decreased Gross margin by $110 million. Gross margin, as a percentage of Net sales, increased by 0.4 percentage points in fiscal 2013 compared to fiscal 2012.

The increase in Gross margin, as a percentage of Net sales, resulted primarily from an increase in vendor allowances due to sales mix compared to the same period last year. Additionally contributing to the increase in Gross margin, as a percentage of Net sales, were improvements in sales mix away from lower margin products, predominantly in our entertainment category.

Selling, General and Administrative Expenses

								Percentage of Net sales
($ In millions)	Fiscal 2013		Fiscal 2012		$ Change			Fiscal 2013		Fiscal 2012		Change
Toys “R” Us - Consolidated	$	4,010	$	4,041	$	(31	)	32.0	%	29.8	%	2.2	%

SG&A decreased by $31 million to $4,010 million in fiscal 2013, compared to $4,041 million in fiscal 2012. Foreign currency translation decreased SG&A by $98 million. As a percentage of Net sales, SG&A increased by 2.2 percentage points.

Excluding the impact of foreign currency translation, the increase in SG&A was primarily due to a $24 million increase in occupancy costs, predominantly as a result of new stores and store improvements, and a $20 million increase in litigation expense related to the judgment in the Aleo case. Additionally contributing to the increase in SG&A was an increase in payroll expenses predominantly related to an additional $17 million of accrued vacation expense resulting from a prior period correction.

Depreciation and Amortization

(In millions)	Fiscal 2013		Fiscal 2012		Change
Toys “R” Us - Consolidated	$	388	$	407	$	(19	)

Depreciation and amortization decreased by $19 million to $388 million in fiscal 2013, compared to $407 million in fiscal 2012. Foreign currency translation decreased Depreciation and amortization by $8 million. Excluding the impact of foreign

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currency translation, the decrease in Depreciation and amortization was primarily due to assets that were fully depreciated in fiscal 2013.

Goodwill Impairment

(In millions)	Fiscal 2013		Fiscal 2012		Change
Toys “R” Us - Consolidated	$	378	$	—	$	378

Goodwill impairment was $378 million in fiscal 2013. The amount recorded in fiscal 2013 was comprised of $361 million related to our Toys-Domestic reporting unit and $17 million related to our Toys-Japan reporting unit.

Other Income, Net

(In millions)	Fiscal 2013		Fiscal 2012		Change
Toys “R” Us - Consolidated	$	37	$	53	$	(16	)

Other income, net decreased by $16 million to $37 million in fiscal 2013, compared to $53 million in fiscal 2012. The decrease was primarily due to a $33 million increase in impairment of long-lived assets, partially offset by an $11 million increase in credit card program income and a $4 million increase in net gains on sales of properties.

Interest Expense

(In millions)	Fiscal 2013		Fiscal 2012		Change
Toys “R” Us - Consolidated	$	524	$	480	$	44

Interest expense increased by $44 million to $524 million in fiscal 2013, compared to $480 million in fiscal 2012. The increase was primarily due to $77 million of incremental expense associated with the fiscal 2013 repayment of the Propco I Notes, composed of a redemption premium of $51 million, and the write-off of unamortized original issue discount and deferred debt issuance costs. Partially offsetting the increase was $19 million in savings associated with refinancing the Propco I Notes to the Propco I Term Loan Facility at a lower rate of interest, as well as the prior year repayment of the $400 million 7.875% senior notes due fiscal 2013, which included a make-whole premium of $18 million.

Interest Income

(In millions)	Fiscal 2013		Fiscal 2012		Change
Toys “R” Us - Consolidated	$	7	$	16	$	(9	)

Interest income decreased by $9 million to $7 million in fiscal 2013, compared to $16 million in fiscal 2012. The decrease was primarily due to the April 2013 maturity of our Vanwall debt security holdings.

Income Tax Expense

($ In millions)	Fiscal 2013			Fiscal 2012			Change
Toys “R” Us - Consolidated	$	169		$	53		$	116
Consolidated effective tax rate	(19.5		)%	57.6		%	(77.1		)%

The net increase in income tax expense of $116 million in fiscal 2013 compared to fiscal 2012 was principally due to an increase in expense for non-routine, discrete items, partially offset by a benefit associated with the decrease in pre-tax earnings (multiplied by the statutory tax rate).

Our income tax expense in fiscal 2013 was unfavorably impacted by certain non-routine, discrete items, including an increase to our valuation allowance for federal and state as well as certain foreign tax jurisdictions. We have evaluated the available positive and negative evidence and have concluded that, for some of our deferred tax assets, it is more likely than not that these assets will not be realized in the foreseeable future. The increase to our valuation allowance for Federal, state and foreign taxes was predominantly due to the fact that, as of the end of fiscal 2013, we have incurred a pre-tax cumulative loss (after adjustments required for tax purposes) over the past three fiscal years. As a result, we have established a valuation allowance to reduce these deferred tax assets for the amount we believe will not be realized. A valuation allowance is a non-cash charge, which does not eliminate the tax loss carry forwards and other deferred tax assets. It reflects a reduction in the benefit we

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expect is more likely than not to be realized from these items. Also contributing to an increase in the fiscal 2013 tax expense are adjustments to deferred taxes resulting from changes to statutory tax rates in various jurisdictions.

Our income tax expense in fiscal 2012 was unfavorably impacted by certain non-routine, discrete items, including an increase to our valuation allowance for certain state tax jurisdictions. The determination by the Company to increase our valuation allowance was predominantly due to the fact that, as of the end of fiscal 2012, in certain state tax jurisdictions we have incurred a pre-tax cumulative loss (after adjustments required for tax purposes) over the past three fiscal years. Also contributing to an increase in the fiscal 2012 tax expense are adjustments to deferred taxes resulting from changes to statutory tax rates in various jurisdictions. These expense items were partially offset by tax benefits related to the resolution of ongoing tax examinations in various jurisdictions.

LIQUIDITY AND CAPITAL RESOURCES

Overview

As of January 31, 2015, we were in compliance with all of the covenants related to our outstanding debt. On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for its $1.85 billion secured revolving credit facility (“ABL Facility”) in order to extend the maturity date of the facility and amend certain other provisions. The ABL Facility as amended will continue to provide for $1.85 billion of revolving commitments. At January 31, 2015, under the ABL Facility, we had no outstanding borrowings, a total of $99 million of outstanding letters of credit and excess availability of $973 million. We are also subject to a minimum excess availability covenant of $125 million, with remaining availability of $848 million in excess of the covenant.

Our European and Australian asset-based revolving credit facility as amended (the “European ABL Facility”) provides for a five-year £138 million ($208 million at January 31, 2015) asset-based senior secured revolving credit facility which will expire on March 8, 2016. At January 31, 2015, we had no outstanding borrowings, with $86 million of remaining availability under the European ABL Facility.

Toys “R” Us - Japan, Ltd. (“Toys-Japan”) currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit (“Tranche 1” and “Tranche 2”). Tranche 1 is available in amounts of up to ¥13.0 billion ($111 million at January 31, 2015), expiring on June 30, 2015. At January 31, 2015, we had no outstanding borrowings under Tranche 1, with $111 million of remaining borrowing availability.

On July 15, 2014, Toys-Japan entered into an agreement with a syndicate of financial institutions to refinance Tranche 2. As a result, Tranche 2 is available in amounts of up to ¥3.5 billion ($30 million at January 31, 2015), expiring on June 30, 2016. At January 31, 2015, we had no outstanding borrowings under Tranche 2, with $30 million of remaining availability.

On July 15, 2014, Toys-Japan amended its uncommitted line of credit resulting in total availability of ¥1.5 billion ($13 million at January 31, 2015), which will renew August 1 of each year unless otherwise canceled. As of January 31, 2015, we had no outstanding borrowings under the uncommitted line of credit.

On September 17, 2014, Toys-Japan entered into an uncommitted line of credit with a financial institution that is part of our Tranche 1 syndicate. The uncommitted line of credit of ¥0.5 billion ($4 million at January 31, 2015) matures on August 31, 2015. As the agreement states that the borrowings associated with this line of credit plus the borrowings associated with this financial institution’s portion of Tranche 1 borrowings cannot exceed its already committed credit of ¥1.5 billion, this new uncommitted line of credit does not result in incremental availability. As of January 31, 2015, we had no outstanding borrowings under the uncommitted line of credit.

Labuan has several uncommitted unsecured lines of credit with various financial institutions with total availability of HK$275 million ($35 million at January 31, 2015). As of January 31, 2015, we had no borrowings and $3 million of bank guarantees issued under these facilities. The remaining availability under these facilities was $32 million.

We are dependent on the borrowings provided by the lenders to support our working capital needs, capital expenditures and to service debt. As of January 31, 2015, we have funds available to finance our operations under our ABL Facility through March 2019, subject to an earlier springing maturity, our European ABL Facility through March 2016 and our Toys-Japan unsecured credit lines with a tranche maturing June 2015 and a tranche maturing June 2016. In addition, Labuan and Toys-Japan have uncommitted lines of credit due on demand. If our cash flow and capital resources do not provide the necessary liquidity, it could have a significant negative effect on our results of operations.

In general, our primary uses of cash are providing for working capital purposes (which principally represents the purchase of inventory), servicing debt, remodeling existing stores, financing construction of new stores and paying expenses, such as payroll costs and rental expense, to operate our stores. Our working capital needs follow a seasonal pattern, peaking in the

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third quarter of the year when inventory is purchased for the fourth quarter holiday selling season. For fiscal 2014, peak borrowings under our revolving credit facilities and credit lines amounted to $986 million, with remaining availability of $910 million in excess of the ABL Facility covenant.

Our largest source of operating cash flows is cash collections from our customers. We have been able to meet our cash needs principally by using cash on hand, cash flows from operations and borrowings under our revolving credit facilities and credit lines. Although we believe that cash generated from operations, along with our existing cash, revolving credit facilities and credit lines will be sufficient to fund our expected cash flow requirements and planned capital expenditures for at least the next 12 months, any world-wide financial market disruption could have a negative impact on our ability to refinance our maturing debt and available resources in the future.

Capital Expenditures

A component of our long-term strategy is our capital expenditure program. Our capital expenditures are primarily for financing construction of new stores and maintaining existing stores, as well as improving and enhancing our e-commerce and other information technology and logistics systems. Capital expenditures are funded primarily through cash provided by operating activities, as well as available cash.

The following table presents our capital expenditures for each of the past three fiscal years:

(In millions)	Fiscal 2014		Fiscal 2013		Fiscal 2012
Information technology	$	79	$	58	$	57
Maintenance (1)	58		28		39
New stores (2)	32		73		68
Distribution centers	31		16		21
Conversion projects (3)	2		15		62
Other store-related projects (4)	5		48		39
Total capital expenditures	$	207	$	238	$	286

(1) Includes maintenance for existing stores, including expenditures related to the “Clean and Bright” initiative carried out in fiscal 2014.

(2) Includes single format stores (including Express stores) as well as SBS relocations.

(3) Primarily includes SBS conversions as well as other juvenile integration remodels.

(4) Includes store updates and projects other than conversions.

Cash Flows

(In millions)	Fiscal 2014			Fiscal 2013			Fiscal 2012
Net cash provided by operating activities	$	476		$	144		$	537
Net cash used in investing activities	(193		)	(205		)	(267		)
Net cash (used in) provided by financing activities	(191		)	(388		)	147
Effect of exchange rate changes on Cash and cash equivalents	(38		)	(25		)	—
Net increase (decrease) during period in Cash and cash equivalents	$	54		$	(474	)	$	417

Cash Flows Provided by Operating Activities

Net cash provided by operating activities for fiscal 2014 was $476 million, an increase of $332 million compared to fiscal 2013. The increase in Net cash provided by operating activities was primarily due to improved operating performance and a decrease in vendor payments due to timing.

Net cash provided by operating activities for fiscal 2013 was $144 million, a decrease of $393 million compared to fiscal 2012. The decrease in Net cash provided by operating activities was principally the result of a fiscal 2013 Net loss due to a decline in Net sales. The decrease was partially offset by the timing of vendor payments.

Cash Flows Used in Investing Activities

Net cash used in investing activities for fiscal 2014 was $193 million, a decrease of $12 million compared to fiscal 2013. The decrease in Net cash used in investing activities was due to a $31 million reduction in capital expenditures, a change of $29

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million in restricted cash primarily resulting from the prior year incremental amount required to be held in conjunction with the terms of the UK Propco Facility Agreement and a prior year purchase of $20 million in debt securities of Debussy DTC Plc (“Debussy”). Refer to Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details. The decrease in Net cash used in investing activities was partially offset by a prior year repayment of $52 million for the Vanwall debt securities held by us and a $17 million decrease in proceeds received from sales of fixed assets compared to prior year.

Net cash used in investing activities for fiscal 2013 was $205 million, a decrease of $62 million compared to fiscal 2012. The decrease in Net cash used in investing activities was due to fiscal 2013 proceeds of $52 million from the repayment of the Vanwall debt securities held by us, a $48 million reduction in capital expenditures, $15 million in fiscal 2012 payments related to the Labuan acquisition, and a $15 million increase in proceeds received from sales of fixed assets. The decrease in Net cash used in investing activities was partially offset by a $48 million increase in restricted cash in conjunction with the terms of the UK Propco Facility Agreement and the fiscal 2013 purchase of $20 million in debt securities of Debussy.

Cash Flows (Used in) Provided by Financing Activities

Net cash used in financing activities was $191 million for fiscal 2014, a decrease of $197 million compared to fiscal 2013. The decrease in net cash used in financing activities was primarily due to a $178 million decrease in net debt repayments compared to the prior year.

Net cash used in financing activities was $388 million for fiscal 2013, compared to net cash provided by financing activities of $147 million for fiscal 2012. The net cash used in financing activities was primarily due to a $509 million decrease in net debt borrowings compared to fiscal 2012, as well as an increase of $22 million in capitalized debt issuance costs primarily in conjunction with our UK Propco Facility Agreement and Propco I Term Loan Facility in fiscal 2013.

Debt

Our credit facilities, loan agreements and indentures contain customary covenants that, among other things restrict our ability to incur certain additional indebtedness, pay dividends, make restricted payments or certain investments, create or permit liens on assets, sell assets, engage in mergers or consolidations, and place restrictions on the ability of certain of our subsidiaries to provide funds to us through dividends, loans or advances. We conduct our operations through our subsidiaries, most of which are subject to restrictions on their ability to provide funds to us. The amount of total net assets that were subject to these restrictions was $582 million as of January 31, 2015.

Certain of our agreements also contain various and customary events of default with respect to the indebtedness, including, without limitation, the failure to pay interest or principal when the same is due under the agreements, cross default provisions, the failure of representations and warranties contained in the agreements to be true and certain insolvency events. If an event of default occurs and is continuing under these agreements, the principal amounts outstanding thereunder, together with all accrued and unpaid interest and other amounts owed thereunder, may be declared immediately due and payable by the lenders. Were such an event to occur, we would be forced to seek new financing that may not be on as favorable terms as our current facilities or be available at all. As of January 31, 2015, we had total indebtedness of $4.8 billion, of which $2.7 billion was secured indebtedness. Our ability to refinance our indebtedness on favorable terms, or at all, is directly affected by global economic and financial conditions and other economic factors that may be outside our control. In addition, our ability to incur secured indebtedness (which may enable us to achieve better pricing than the incurrence of unsecured indebtedness) depends in part on the covenants in our credit facilities and indentures and the value of our assets, which depends, in turn, on the strength of our cash flows, results of operations, economic and market conditions and other factors. We are currently in compliance with our covenants relating to our debt. Refer to Note 2 to the Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details regarding our debt and any of the transactions described below.

During fiscal 2014, the following events occurred with respect to our debt structure:

• On October 24, 2014, Toys-Delaware amended the credit agreement for its secured term loan facilities to provide for, among other things, a new tranche of term loans in an aggregate principal amount of $1,026 million due fiscal 2020 (the “Secured Term B-4 Loan”). Additionally, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the ABL Facility to provide for, among other things, the Tranche A-1 Loan due fiscal 2019 in an aggregate principal amount of $280 million. The Secured Term B-4 Loan and the Tranche A-1 Loan, together with other sources and funds available to Toys-Delaware, were used to (i) refinance in full the Secured term loan facility due fiscal 2016, (ii) extend $380 million of the term loans due fiscal 2018 under the Incremental secured term loan facility and the Second incremental secured term loan facility into the Secured Term B-4 Loan and (iii) redeem all of

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the 7.375% senior secured notes due fiscal 2016, plus accrued interest, premiums and fees. The Tranche A-1 Loan has a springing maturity date if the Toys-Delaware term loans due fiscal 2018 are not repaid 30 days prior to maturity.

• On July 15, 2014, Toys-Japan entered into an agreement with a syndicate of financial institutions to refinance Tranche 2. As a result, Tranche 2 is available in amounts of up to ¥3.5 billion, expiring on June 30, 2016.

• On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for the ABL Facility in order to extend the maturity date of the facility and amend certain other provisions. The ABL Facility as amended will continue to provide for $1.85 billion of revolving commitments, and permits Toys-Delaware to request an increase in commitments by up to $1.15 billion, subject to certain conditions, including obtaining new or increased commitments from new or existing lenders. The ABL Facility has a final maturity date of March 21, 2019, with a springing maturity date if the Toys-Delaware term loans due fiscal 2018 are not repaid 30 days prior to maturity.

We and our subsidiaries, as well as the Sponsors or their affiliates, may from time to time acquire debt or debt securities issued by us or our subsidiaries in open market transactions, tender offers, exchange offers, privately negotiated transactions or otherwise. Any such transactions, and the amounts involved, will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors. The amounts involved may be material. Refer to Note 16 to the Consolidated Financial Statements entitled “RELATED PARTY TRANSACTIONS.”

Contractual Obligations

Our contractual obligations consist mainly of payments for operating leases related to real estate used in the operation of our business, Long-term debt and related interest and product purchase obligations. The following table summarizes our contractual obligations as of January 31, 2015, except as noted below:

	Payments Due By Period
(In millions)	Fiscal 2015		Fiscals 2016 & 2017		Fiscals 2018 & 2019		Fiscals 2020 and thereafter		Total
Operating leases (1)	$	561	$	887	$	605	$	1,055	$	3,108
Less: sub-leases to third parties	15		23		17		24		79
Net operating lease obligations	546		864		588		1,031		3,029
Capital leases and financing obligations (2)	31		51		44		96		222
Short-term borrowings and long-term debt (3)	155		1,236		1,837		1,396		4,624
Interest payments (2)(4)(5)	377		739		425		40		1,581
Purchase obligations (6)	1,257		—		—		—		1,257
Other (7)	141		127		40		34		342
Total contractual obligations (8)(9)	$	2,507	$	3,017	$	2,934	$	2,597	$	11,055

(1) Excluded from the minimum rental commitments displayed above are $1.7 billion related to options to extend ground lease terms that are reasonably assured of being exercised, the balance of which is predominantly related to fiscals 2020 and thereafter.

(2) Included in capital leases and financing obligations displayed above is $20 million of interest.

(3) Excludes finance obligations associated with capital projects and capital lease obligations, which are included in “Capital leases and financing obligations.”

(4) In an effort to manage interest rate exposure, we periodically enter into interest rate swaps and interest rate caps. Interest payments presented are net of interest rate swaps or caps.

(5) Interest payments for our ABL Facility, European ABL Facility and our Toys-Japan unsecured credit lines were estimated based on the average borrowings under each of the facilities in fiscal 2014.

(6) Purchase obligations consist primarily of open purchase orders for merchandise as well as an agreement to purchase fixed or minimum quantities of goods that are not included in our Consolidated Balance Sheet as of January 31, 2015.

(7) Includes service contract obligations, risk management liabilities, pension obligations, and other contractual commitments.

(8) The above table does not reflect liabilities for uncertain tax positions of $27 million, which are included in other non- current liabilities. The amount and timing of payments with respect to these items are subject to a number of uncertainties such that we are unable to make sufficiently reliable estimates of the timing and amount of future payments.

(9) The above table does not reflect the potential acquisition of Li & Fung’s 30% interest in Labuan. The terms of the agreement provide us with the future option to acquire Li & Fung’s 30% interest in the business and also provides Li

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& Fung the option to require us to buy their 30% interest in the business beginning on October 31, 2015. See Note 17 to our Consolidated Financial Statements entitled “ACQUISITIONS” for further details.

Obligations under our operating leases and capital leases in the above table do not include real estate taxes, maintenance and insurance, or contingent rent. The following table presents these amounts which were recorded in SG&A in our Consolidated Statements of Operations for fiscals 2014, 2013 and 2012:

(In millions)	Fiscal 2014		Fiscal 2013		Fiscal 2012
Real estate taxes	$	82	$	81	$	79
Maintenance and insurance	74		71		70
Contingent rent	10		10		12
Total	$	166	$	162	$	161

Off-balance Sheet Arrangements

We have an off-balance sheet arrangement as a result of the March 25, 2013 UK Propco Facility Agreement between UK Propco and Debussy. Debussy is a special purpose entity established with the limited purpose of making loans and issuing £263 million of multiple classes of commercial mortgage backed fixed rate notes (the “Debussy Notes”) to third party investors and the Company. We purchased £13 million principal amount of the various classes of the Debussy Notes, which are included in Other assets within the Consolidated Balance Sheets, classified as held-to-maturity and reported at amortized cost. The proceeds from the Debussy Notes were used to fund the new loan under the UK Propco Facility Agreement.

In accordance with ASC Topic 810, “Consolidation,” we identified Debussy as a VIE because Debussy, by design, has insufficient equity investment at risk and its equity investment holders at risk lack the ability through voting or similar rights, to direct the activities that most significantly impact Debussy’s economic performance.  Additionally, we evaluated our variable interests in Debussy and third party investors’ involvement and concluded that we are not the primary beneficiary and therefore should not consolidate Debussy as we do not hold the power to direct the activities that most significantly impact Debussy’s economic performance.

Effects of Inflation

Our results of operations and financial condition are presented based on historical cost. While it is difficult to accurately measure the impact of inflation due to the imprecise nature of the estimates required, we believe the effects of inflation, if any, on our results of operations and financial condition have been immaterial.

CRITICAL ACCOUNTING POLICIES

Our Consolidated Financial Statements have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the related disclosures of contingent assets and liabilities as of the date of the Consolidated Financial Statements and during the applicable periods. We base these estimates on historical experience and on other factors that we believe are reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions and could have a material impact on our Consolidated Financial Statements.

We believe the following are our most critical accounting policies that include significant judgments and estimates used in the preparation of our Consolidated Financial Statements. We consider an accounting policy to be critical if it requires assumptions to be made that were uncertain at the time they were made, and if changes in these assumptions could have a material impact on our consolidated financial condition or results of operations.

Merchandise Inventories

We value our merchandise inventories at the lower of cost or market, as determined by the weighted average cost method. Cost of sales under the weighted average cost method represents the weighted average cost of the individual items sold. Cost of sales under the weighted average cost method is also affected by adjustments to reflect current market conditions, merchandise allowances from vendors, expected inventory shortages and estimated losses from obsolete and slow-moving inventory.

Merchandise inventories and related reserves are reviewed on an interim basis and adjusted, as appropriate, to reflect management’s current estimates. These estimates are derived using available data, our historical experience, estimated inventory turnover and current purchase forecasts. Various types of negotiated allowances received from our vendors are generally treated as adjustments to the purchase price of our merchandise inventories. We adjust our estimates for vendor

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allowances and our provision for expected inventory shortage to actual amounts at the completion of our physical inventory counts and finalization of all vendor allowance agreements. In addition, we perform an inventory-aging analysis for identifying obsolete and slow-moving inventory. We establish a reserve to reduce the cost of our inventory to its estimated net realizable value based on certain loss indicators which include aged inventory and excess supply on hand, as well as specific identification methods. In fiscal 2013, we wrote down an incremental $51 million of excess and obsolete inventory as a result of specific identification.

Our estimates may be impacted by changes in certain underlying assumptions and may not be indicative of future activity. For example, factors such as slower inventory turnover due to changes in competitors’ tactics, consumer preferences, consumer spending and inclement weather could cause excess inventory requiring greater than estimated markdowns to entice consumer purchases. Such factors could also cause sales shortfalls resulting in reduced purchases from vendors and an associated reduction in vendor allowances. Our reserve for merchandise inventories was $54 million and $109 million as of January 31, 2015 and February 1, 2014, respectively. The reserve as of February 1, 2014 included an incremental write down of $51 million of excess and obsolete inventory as a result of specific identification. Based on our inventory aging analysis for identifying obsolete and slow-moving inventory, a 10% change in our reserve, excluding the impact of our specific item reserves, would have impacted pre-tax earnings by $4 million for fiscal 2014.

Long-lived Asset Impairment

We evaluate the carrying value of all long-lived assets, such as property and equipment, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable, in accordance with ASC 360. Events or circumstances that might warrant an impairment review include, among other things, material declines in operational performance, other than temporary significant adverse market conditions and significant changes or planned changes in our use of assets, including store relocation, store closure and property sales. When evaluating operating stores for impairment, our asset group is at an individual store level, as that is the lowest level for which cash flows are identifiable. Cash flows for individual operating stores include an allocation of applicable overhead. We will record an impairment loss when the carrying value of the underlying asset group exceeds its estimated fair value.

In determining whether long-lived assets are recoverable, our estimate of undiscounted future cash flows over the estimated life or lease term of a store is based upon our experience, historical operations of the store, an estimate of future store profitability and economic conditions. The future estimates of store profitability require estimating such factors as sales growth, inflation and the overall economic conditions. Since we forecast our future undiscounted cash flows for up to 25 years, our estimates are subject to variability as future results can be difficult to predict. If a long-lived asset is found to be non-recoverable, we record an impairment charge equal to the difference between the asset’s carrying value and fair value. We estimate the fair value of the asset using a valuation method such as discounted cash flow or a relative, market-based approach.

In fiscal 2014, 2013 and 2012, we recorded $13 million, $44 million and $11 million, respectively, of impairment charges related to non-recoverable long-lived assets. These impairments were primarily due to the identification of underperforming stores, the relocation of certain stores, property sales, and a decrease in real estate market values.

Goodwill Impairment

In fiscal 2013, the Company decided to change its annual goodwill impairment testing date from the first day of the fourth quarter (or the first day of the tenth fiscal month) to the last day of the eleventh fiscal month of each fiscal year, which is shortly after the holiday season. The change is preferable as it aligns the timing of the annual impairment test with the timing of the Company’s annual strategic planning process, which will now encompass actual holiday season results, given the later testing date. Goodwill is evaluated for impairment annually as of the last day of the eleventh fiscal month or whenever we identify certain events or circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or circumstances that might warrant an interim evaluation include, among other things, a significant adverse change in legal factors or in the business climate, an adverse action or assessment by a regulator, unanticipated competition, loss of key personnel and a more-likely-than-not expectation that a reporting unit or a significant portion of a reporting unit will be sold or otherwise disposed of.

In preparing a qualitative analysis for each of our reporting units, we assess events and circumstances that may impact the fair value and the carrying amount of each reporting unit. The identification of relevant events and circumstances and how these may impact a reporting unit’s fair value or carrying amount involve significant judgments and assumptions. For each reporting unit, we compare its current carrying value as of the testing date to its most recent fair value. Based upon the differential noted, we may decide to perform the first step of the quantitative impairment test or to continue with the qualitative assessment by analyzing whether changes in the business and/or operating environment have occurred since the most recent fair value obtained that may impact this relationship. This assessment includes, but is not limited to, the identification of macroeconomic conditions, industry and market considerations that currently impact the reporting unit’s operating environment, as well as cost

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factors, overall financial performance including actual and projected operating results, and peer group share price trends. We examine the positive and negative influences of each relevant factor on the reporting unit’s fair value and qualitatively assess the impact that such factors (when considered both individually and in the aggregate) would have on a reporting unit’s fair value since the last full valuation was performed. If, after assessing the totality of events or circumstances, we determine that the potential impact of the positive and negative factors do not indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we will conclude that goodwill is not impaired and performance of the two-step quantitative impairment test is not required.

For the two-step quantitative goodwill impairment test, we compare the current carrying value of the reporting unit to its current fair value to determine whether there is an indication of impairment. First, we determine the current fair value of the reporting unit by blending results from the market and income approaches. These valuation approaches consider a number of factors that include, but are not limited to, expected future cash flows, growth rates, discount rates, and comparable multiples from publicly-traded companies in our industry, and require us to make certain assumptions and estimates regarding industry economic factors and future profitability of our business. It is our policy to conduct impairment testing (both from a qualitative and quantitative perspective) based on our most current business plans, projected future revenues and cash flows, which reflect changes we anticipate in the economy and the industry. The cash flows are based on five-year financial forecasts developed internally by management and are discounted to a present value using discount rates that properly account for the risk and nature of the respective reporting unit’s cash flows and the rates of return market participants would require to invest their capital in our reporting unit. The outcome of the market and income approaches are heavily dependent upon the aforementioned projections. If the carrying value exceeds the fair value, we would then calculate the implied fair value of our reporting unit’s goodwill as compared to its carrying value to determine the appropriate impairment charge, if any. To calculate the implied fair value of goodwill the Company would allocate the reporting unit’s fair value to all of the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical scenario that faithfully represents an acquisition of the reporting unit in a business combination. If the implied fair value of the reporting unit’s goodwill is less than its carrying value, the difference is recorded as an impairment charge, not to exceed the balance of goodwill.

As a result of our fourth quarter fiscal 2013 test, we recorded full impairments of the Toys-Domestic and Toys-Japan reporting unit’s goodwill balances of $361 million and $17 million, respectively, which were recorded in our Consolidated Statement of Operations for the fiscal year ended February 1, 2014. These impairment charges were a result of significant declines in the projected financial performance of the Toys-Domestic and Toys-Japan reporting units compared to the projections used in goodwill impairment tests of prior years. The decrease in financial projections was primarily due to the fiscal 2013 decline in operating results, due in large part to the holiday season.

For the fourth quarter fiscal 2014 goodwill impairment test, the Company opted to bypass the optional qualitative assessment in favor of updating the valuation and proceeding directly to the quantitative analysis of our Toys-China and Southeast Asia reporting unit (included in our International segment). Goodwill was tested for impairment using the two-step quantitative impairment test described above. Upon completion of step one of the quantitative impairment test, it was determined that the goodwill associated with our Toys-China and Southeast Asia reporting unit of $64 million as of January 31, 2015, was not impaired. The estimated fair value of our Toys-China and Southeast Asia reporting unit substantially exceeded its carrying value as of the date of testing. Refer to Note 1 to our Consolidated Financial Statements entitled, “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

Self-Insured Liabilities

We self-insure a substantial portion of our workers’ compensation, general liability, auto liability, property, medical, prescription drug and dental insurance risks, in addition to maintaining third party insurance coverage. We estimate our provisions for losses related to self-insured risks using actuarial techniques and estimates for incurred but not reported claims. We record the liability for workers’ compensation on a discounted basis. We also maintain insurance coverage to limit the exposure related to certain risks. The assumptions underlying the ultimate costs of existing claim losses can vary, which can affect the liability recorded for such claims.

Although we feel our reserves are adequate to cover our estimated liabilities, changes in the underlying assumptions and future economic conditions could have a considerable effect upon future claim costs, which could have a material impact on our Consolidated Financial Statements. Our reserve for self-insurance was $99 million and $102 million as of January 31, 2015 and February 1, 2014, respectively. A 10% change in the value of our self-insured liabilities would have impacted pre-tax earnings by $10 million for the fiscal year ended January 31, 2015.

Revenue Recognition

We recognize revenue in accordance with ASC Topic 605, “Revenue Recognition.” Revenue related to merchandise sales, which is 99.6% of total revenues, is generally recognized for retail sales at the point of sale in the store and when the customer

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receives the merchandise purchased from our websites. Discounts provided to customers are accounted for as a reduction of sales. We record a reserve for estimated product returns in each reporting period based on historical return experience and changes in customer demand. Actual returns may differ from historical product return patterns, which could impact our financial results in future periods.

Income Taxes

We account for income taxes in accordance with ASC Topic 740, “Income Taxes” (“ASC 740”). Our provision for income taxes and effective tax rates are calculated by legal entity and jurisdiction and are based on a number of factors, including our level of pre-tax earnings, income tax planning strategies, differences between tax laws and accounting rules, statutory tax rates and credits, uncertain tax positions, and valuation allowances. We use significant judgment and estimates in evaluating our tax positions. Our effective tax rate in a given financial statement period may be materially impacted by changes in the mix and level of earnings by taxing jurisdiction.

Tax law and accounting rules often differ as to the timing and treatment of certain items of income and expense. As a result, the tax rate reflected in our tax return (our current or cash tax rate) is different from the tax rate reflected in our Consolidated Financial Statements. Some of the differences are permanent, while other differences are temporary as they will reverse over time. We record deferred tax assets and liabilities for any temporary differences between the assets and liabilities in our Consolidated Financial Statements and their respective tax bases. We establish valuation allowances when we believe it is more likely than not that our deferred tax assets will not be realized. In assessing the need for a valuation allowance, management weighs the available positive and negative evidence, including limitations on the use of tax loss and other carryforwards due to changes in ownership, historic information, projections of future sources of taxable income, including future reversals of taxable temporary differences and future taxable income exclusive of reversing temporary differences and carryforwards, and tax planning strategies. For example, we would establish a valuation allowance for the tax benefit associated with a tax loss carry forward in a tax jurisdiction if we did not expect to generate sufficient taxable income of the appropriate character to utilize the tax loss carry forward prior to its expiration. Changes in future taxable income, tax liabilities and our tax planning strategies may impact our effective tax rate, valuation allowances and the associated carrying value of our deferred tax assets and liabilities.

At any one time our tax returns for numerous tax years are subject to examination by U.S. Federal, state and foreign taxing jurisdictions. ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attributes for income tax positions taken or expected to be taken on a tax return. Under ASC 740, the impact of an uncertain tax position taken or expected to be taken on an income tax return must be recognized in the financial statements at the largest amount that is more-likely-than-not to be sustained. An uncertain income tax position will not be recognized in the financial statements unless it is more-likely-than-not to be sustained. We adjust these tax liabilities, as well as the related interest and penalties, based on the latest facts and circumstances, including recently enacted tax law changes, published rulings, court cases, and outcomes of tax audits. While we do not expect material changes, it is possible that our actual tax liability will differ from our established tax liabilities for unrecognized tax benefits, and our effective tax rate may be materially impacted. While it is often difficult to predict the final outcome of, the timing of, or the tax treatment of any particular tax position or deduction, we believe that our tax balances reflect the more-likely-than-not outcome of known tax contingencies. We report tax-related interest and penalties as a component of Income tax expense (benefit).

Stock-Based Compensation

The fair value of the common stock shares utilized in valuing stock-based payment awards was determined by the Executive Committee of the Board based on management’s recommendations. We engage an independent valuation specialist to assist management and the Executive Committee of the Board in determining the fair value of our common stock for these purposes. Management and the Executive Committee of the Board rely on the valuations provided by the independent valuation specialist as well as their review of the Company’s historical financial results, business milestones, financial forecast and business outlook as of each award date. The same Company data is reviewed by management, on a periodic basis, to monitor the performance metrics associated with certain stock-based payment awards as the achievement of established thresholds directly impact the amount of target shares ultimately earned.

The fair value of common stock shares is based on total enterprise value ranges and the total equity value ranges estimated on a non-marketable and minority basis utilizing both the income approach and the market approach guidelines. A range of the two methods was utilized to determine the fair value of the shares. The income approach is a valuation technique that provides an estimation of the fair value of a business based upon the cash flows that it can be expected to generate over time. The market approach is a valuation technique that provides an estimation of fair value based on market prices of publicly traded companies and the relationship to financial results. When warranted, a Black-Scholes option-based model may be utilized in addition to the market and income approaches in order to estimate the fair value of our shares.

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The income approach utilized begins with an estimation of the annual cash flows that a business is expected to generate over a discrete projection period. The estimated cash flows for each of the years in the period are then converted to their present value equivalent using a discount rate considered appropriate given the risk of achieving the projected cash flows. The present value of the estimated cash flows are then added to the present value equivalent of the terminal value of the business at the end of the projection period to arrive at an estimate of fair value. Such an approach necessarily relies on estimations of future cash flows that are inherently uncertain, as well as a determination of an appropriate discount rate in order to derive present value equivalents of both the projected cash flows and the terminal value of the business at the end of the period. The use of different estimations of future cash flows or a different discount rate could result in a different indication of fair value.

The market approach utilizes in part a comparison to publicly traded companies deemed to be in similar lines of business. Such companies were then analyzed to determine which were most comparable based on various factors, including industry similarity, financial risk, company size, geographic diversification, growth opportunities, similarity of reaction to macroeconomic factors, profitability, financial data availability and active trading volume. Six companies were included as comparable companies in the market comparable approach. Alternate determinations of which publicly traded entities constituted comparable companies could result in a different indication of fair value.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

In November 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-17, “Business Combinations (Topic 805): Pushdown Accounting” (“ASU 2014-17”). ASU 2014-17 provides an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. The acquired entity may elect the option to apply pushdown accounting in the reporting period in which the change-in-control event occurs. If pushdown accounting is not applied in the reporting period in which the change-in-control event occurs, an acquired entity will have the option to elect to apply pushdown accounting in a subsequent reporting period as a change in accounting principle in accordance with ASC Topic 250, “Accounting Changes and Error Corrections”. If pushdown accounting is applied to an individual change-in-control event, that election is irrevocable. ASU 2014-17 also requires an acquired entity that elects the option to apply pushdown accounting in its separate financial statements to disclose information in the current reporting period that enables users of financial statements to evaluate the effect of pushdown accounting. The Company has adopted the amendments in ASU 2014-17, effective November 18, 2014, as the amendments in the update are effective upon issuance. The adoption did not have an impact on our Consolidated Financial Statements.

In April 2014, the FASB issued ASU No. 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” (“ASU 2014-08”). ASU 2014-08 limits the requirement to report discontinued operations to disposals of components of an entity that represent strategic shifts that have (or will have) a major effect on an entity’s operations and financial results. The amendments also require expanded disclosures concerning discontinued operations, disclosures of certain financial results attributable to a disposal of a significant component of an entity that does not qualify for discontinued operations reporting and expanded disclosures for long-lived assets classified as held for sale or disposed of. Early adoption is permitted, but only for disposals (or assets classified as held for sale) that have not been reported in financial statements previously issued or available for issuance. The Company early adopted the amendments in ASU 2014-08, effective February 2, 2014. The adoption did not have a material impact on our Consolidated Financial Statements.

In July 2013, the FASB issued ASU No. 2013-11, “Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” (“ASU 2013-11”). ASU 2013-11 addresses the diversity in practice regarding financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance requires an unrecognized tax benefit, or a portion of, to be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. To the extent the deferred tax asset is not available at the reporting date to settle any additional income taxes that would result from the disallowance of a tax position; the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with the deferred tax asset. The Company has been using the method prescribed by ASU 2013-11 since the fiscal year ended February 3, 2007. Therefore, the issuance of ASU 2013-11 did not have an impact on our Consolidated Financial Statements.

In April 2013, the FASB issued ASU No. 2013-07, “Presentation of Financial Statements (Topic 205): Liquidation Basis of Accounting” (“ASU 2013-07”). ASU 2013-07 clarifies when an entity should apply the liquidation basis of accounting and provides principles for the measurement of associated assets and liabilities, as well as required disclosures. The Company adopted the amendments in ASU 2013-07, effective February 2, 2014. The adoption did not have an impact on our Consolidated Financial Statements.

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In March 2013, the FASB issued ASU No. 2013-05, “Foreign Currency Matters (Topic 830): Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity” (“ASU 2013-05”). ASU 2013-05 provides clarification regarding whether Subtopic 810-10, Consolidation - Overall, or Subtopic 830-30, Foreign Currency Matters - Translation of Financial Statements, applies to the release of cumulative translation adjustments into net income when a reporting entity either sells a part or all of its investment in a foreign entity or ceases to have a controlling financial interest in a subsidiary or group of assets that constitute a business within a foreign entity. The Company adopted the amendments in ASU 2013-05, effective February 2, 2014. The adoption did not have an impact on our Consolidated Financial Statements.

In February 2013, the FASB issued ASU No. 2013-04, “Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date” (“ASU 2013-04”). ASU 2013-04 provides guidance for the recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this ASU is fixed at the reporting date. The guidance requires an entity to measure those obligations as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors as well as any additional amount the reporting entity expects to pay on behalf of its co-obligors. ASU 2013-04 also requires an entity to disclose the nature and amount of those obligations. The Company adopted the amendments in ASU 2013-04, effective February 2, 2014. Other than additional disclosures regarding obligations resulting from joint and several liability arrangements disclosed above, the adoption did not have an impact on our Consolidated Financial Statements.

Refer to Note 18 to our Consolidated Financial Statements entitled “RECENT ACCOUNTING PRONOUNCEMENTS” for a discussion of accounting standards which we have not yet been required to implement and our assessment of their impact to our Consolidated Financial Statements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk from potential changes in interest rates and foreign currency exchange rates. We regularly evaluate our exposure to these risks and take measures to mitigate these risks on our consolidated financial results. We enter into derivative financial instruments to economically manage our market risks related to interest rate and foreign currency exchange. We do not participate in speculative derivative trading. The analysis below presents our sensitivity to selected hypothetical, instantaneous changes in market interest rates and foreign currency exchange rates as of January 31, 2015.

Foreign Exchange Exposure

Our foreign currency exposure is primarily concentrated in the United Kingdom, Continental Europe, Asia, Canada and Australia. We face currency translation exposures related to translating the results of our worldwide operations into USD because of exchange rate fluctuations during the reporting period.

We face foreign currency exchange transaction exposures related to short-term, cross-currency intercompany loans and merchandise purchases:

• We enter into short-term, cross-currency intercompany loans with our foreign subsidiaries. The majority of this exposure is economically hedged through the use of foreign currency exchange forward contracts. Our exposure to foreign currency risk related to exchange forward contracts on our short-term, cross-currency intercompany loans has not materially changed from fiscal 2013 to fiscal 2014. As a result, a 10% change in foreign currency exchange rates against the USD would not have a material impact on our pre-tax earnings related to our short-term, cross-currency intercompany loans that were outstanding as of year-end.

• In addition, our foreign subsidiaries make USD denominated merchandise purchases through the normal course of business. From time to time, we enter into foreign exchange forward contracts under our merchandise import program. As of January 31, 2015, we did not have any outstanding foreign exchange forward contracts under our merchandise import programs.

The above sensitivity analysis on our foreign currency exchange transaction exposures related to our short-term, cross-currency intercompany loans assumes our mix of foreign currency-denominated debt instruments and derivatives and all other variables will remain constant in future periods. These assumptions are made in order to facilitate the analysis and are not necessarily indicative of our future intentions.

Changes in foreign exchange rates affect interest expense recorded in relation to our foreign currency-denominated derivative instruments and debt instruments. For the fiscal years ended January 31, 2015 and February 1, 2014, we estimate that a 10% hypothetical change in foreign exchange rates would impact our pre-tax earnings due to the effect of foreign currency translation on interest expense related to our foreign currency-denominated derivative instruments and debt instruments by $5 million and $6 million, respectively.

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Interest Rate Exposure

We have a variety of fixed and variable rate debt instruments and are exposed to market risks resulting from interest rate fluctuations. In an effort to manage interest rate exposures, we periodically enter into interest rate swaps and interest rate caps. A change in interest rates on variable rate debt impacts our pre-tax earnings, whereas a change in interest rates on fixed rate debt impacts the fair value of debt. As of January 31, 2015, a portion of our interest rate contracts are designated for hedge accounting as cash flow hedges. For designated cash flow hedges, the effective portion of the changes in the fair value of derivatives are recorded in Accumulated other comprehensive (loss) income and subsequently recorded in the Consolidated Statements of Operations at the time the hedged item affects earnings.

The following table illustrates the estimated sensitivity of a 1% change in interest rates to our future pre-tax earnings on our derivative instruments and variable rate debt instruments at January 31, 2015:

(In millions)	Impact of 1% Increase			Impact of 1% Decrease
Interest rate swaps/caps	$	—		$	—
Variable rate debt	(5		)	—
Total pre-tax income exposure to interest rate risk	$	(5	)	$	—

The above sensitivity analysis assumes our mix of financial instruments and all other variables will remain constant in future periods. These assumptions are made in order to facilitate the analysis and are not necessarily indicative of our future intentions. As of February 1, 2014, we estimated that a 1% hypothetical increase or decrease in interest rates could potentially have caused either a $7 million decrease or a $5 million increase on our pre-tax earnings, respectively. Refer to our Consolidated Financial Statements for further discussion in Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES.” At this time, we do not anticipate material changes to our interest rate risk exposure or to our risk management policies. We believe that we could mitigate potential losses on pre-tax earnings through our risk management objectives, if material changes occur in future periods.

49

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

	PAGE
Report of Independent Registered Public Accounting Firm	51
Consolidated Statements of Operations	52
Consolidated Statements of Comprehensive Loss	53
Consolidated Balance Sheets	54
Consolidated Statements of Cash Flows	55
Consolidated Statements of Stockholders’ (Deficit) Equity	56
Notes to the Consolidated Financial Statements	57
Quarterly Results of Operations (Unaudited)	105
Schedule I — Parent Company Condensed Financial Statements and Notes to Condensed Financial Statements	106

50

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Toys “R” Us, Inc.:

We have audited the accompanying consolidated balance sheets of Toys “R” Us, Inc. and subsidiaries (the "Company") as of January 31, 2015 and February 1, 2014, and the related consolidated statements of operations, comprehensive loss, stockholders' (deficit) equity, and cash flows for each of the three fiscal years in the period ended January 31, 2015. Our audits also included the financial statement schedule listed in the Index at Item 15. These financial statements and financial statement schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on the financial statements and financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Toys “R” Us, Inc. and subsidiaries as of January 31, 2015 and February 1, 2014, and the results of their operations and their cash flows for each of the three fiscal years in the period ended January 31, 2015, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company's internal control over financial reporting as of January 31, 2015, based on the criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 26, 2015 expressed an unqualified opinion on the Company's internal control over financial reporting.

/s/ Deloitte & Touche LLP

New York, New York

March 26, 2015

51

Toys “R” Us, Inc. and Subsidiaries

Consolidated Statements of Operations

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Net sales	$	12,361		$	12,543		$	13,543
Cost of sales	7,931			8,154			8,592
Gross margin	4,430			4,389			4,951
Selling, general and administrative expenses	3,915			4,010			4,041
Depreciation and amortization	377			388			407
Goodwill impairment	—			378			—
Other income, net	(53		)	(37		)	(53		)
Total operating expenses	4,239			4,739			4,395
Operating earnings (loss)	191			(350		)	556
Interest expense	(451		)	(524		)	(480		)
Interest income	4			7			16
(Loss) earnings before income taxes	(256		)	(867		)	92
Income tax expense	32			169			53
Net (loss) earnings	(288		)	(1,036		)	39
Less: Net earnings attributable to noncontrolling interest	4			3			1
Net (loss) earnings attributable to Toys “R” Us, Inc.	$	(292	)	$	(1,039	)	$	38

See Notes to the Consolidated Financial Statements.

52

Toys “R” Us, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Loss

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Net (loss) earnings	$	(288	)	$	(1,036	)	$	39
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustments	(128		)	(82		)	(46		)
Unrealized gain on hedged transactions	1			1			—
Unrecognized actuarial losses	(33		)	—			(1		)
Total other comprehensive loss, net of tax	(160		)	(81		)	(47		)
Comprehensive loss, net of tax	(448		)	(1,117		)	(8		)
Less: Comprehensive income attributable to noncontrolling interest	4			3			1
Comprehensive loss attributable to Toys “R” Us, Inc.	$	(452	)	$	(1,120	)	$	(9	)

See Notes to the Consolidated Financial Statements.

53

Toys “R” Us, Inc. and Subsidiaries

Consolidated Balance Sheets

(In millions - except share amounts)	January 31, 2015			February 1, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	698		$	644
Accounts and other receivables	225			249
Merchandise inventories	2,064			2,171
Current deferred tax assets	45			31
Prepaid expenses and other current assets	122			125
Total current assets	3,154			3,220
Property and equipment, net	3,335			3,638
Goodwill	64			64
Deferred tax assets	133			152
Restricted cash	53			53
Other assets	376			422
Total Assets	$	7,115		$	7,549
LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accounts payable	$	1,571		$	1,488
Accrued expenses and other current liabilities	1,032			920
Income taxes payable	20			19
Current portion of long-term debt	176			89
Total current liabilities	2,799			2,516
Long-term debt	4,612			4,918
Deferred tax liabilities	112			96
Deferred rent liabilities	347			362
Other non-current liabilities	255			235
Temporary Equity	85			78
Stockholders’ Deficit:
Common stock (par value $0.001 and $0.001; shares authorized 55,000,000 and 55,000,000; shares outstanding 49,195,396 and 49,047,844 at January 31, 2015 and February 1, 2014, respectively)	—			—
Treasury stock	(5		)	(9		)
Additional paid-in capital	68			49
Accumulated deficit	(914		)	(612		)
Accumulated other comprehensive loss	(244		)	(84		)
Total Stockholders’ Deficit	(1,095		)	(656		)
Total Liabilities, Temporary Equity and Stockholders’ Deficit	$	7,115		$	7,549

See Notes to the Consolidated Financial Statements.

54

Toys “R” Us, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Cash Flows from Operating Activities:
Net (loss) earnings	$	(288	)	$	(1,036	)	$	39
Adjustments to reconcile Net (loss) earnings to Net cash provided by operating activities:
Depreciation and amortization	377			388			407
Amortization and write-off of debt issuance costs and debt discount (1)	59			73			44
Net gains on sales of properties	(5		)	(8		)	(4		)
Deferred income taxes	(1		)	133			36
Non-cash portion of asset impairments and other charges	20			49			22
Goodwill impairment	—			378			—
Proceeds from settlement of derivatives	9			—			—
Unrealized losses (gains) on foreign exchange	15			(1		)	—
Other	23			16			(2		)
Changes in operating assets and liabilities:
Accounts and other receivables	(6		)	(1		)	(9		)
Merchandise inventories	(16		)	13			(32		)
Prepaid expenses and other operating assets	14			21			13
Accounts payable, Accrued expenses and other liabilities	283			160			(4		)
Income taxes payable and receivable	(8		)	(41		)	27
Net cash provided by operating activities	476			144			537
Cash Flows from Investing Activities:
Capital expenditures	(207		)	(238		)	(286		)
(Increase) decrease in restricted cash	(5		)	(34		)	14
Proceeds from sales of fixed assets	18			35			20
Property insurance recovery	2			—			—
Acquisitions	(1		)	—			(15		)
Purchases of debt securities	—			(20		)	—
Proceeds from redemption of debt securities	—			52			—
Net cash used in investing activities	(193		)	(205		)	(267		)
Cash Flows from Financing Activities:
Long-term debt borrowings	2,866			3,159			1,972
Long-term debt repayments	(3,010		)	(3,491		)	(1,802		)
Short-term debt borrowings, net	(12		)	(2		)	5
Capitalized debt issuance costs	(35		)	(47		)	(25		)
Other	—			(7		)	(3		)
Net cash (used in) provided by financing activities	(191		)	(388		)	147
Effect of exchange rate changes on Cash and cash equivalents	(38		)	(25		)	—
Cash and cash equivalents:
Net increase (decrease) during period	54			(474		)	417
Cash and cash equivalents at beginning of period	644			1,118			701
Cash and cash equivalents at end of period	$	698		$	644		$	1,118
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	380		$	458		$	432
Net income tax payments (refunds)	$	43		$	71		$	(4	)
Non-Cash Operating Information:
Purchases of property and equipment included in Accounts payable and Accrued expenses and other current liabilities	$	42		$	24		$	26

(1) Includes amortization and write-off of debt discount, which was previously presented within Other, of $22 million and $8 million for fiscals 2013 and 2012, respectively.

See Notes to the Consolidated Financial Statements.

55

Toys “R” Us, Inc. and Subsidiaries

Consolidated Statements of Stockholders’ (Deficit) Equity

	Toys “R” Us, Inc. Stockholders
	Common Stock				Additional Paid-in Capital			Total   (Accumulated  Deficit) Retained Earnings			Accumulated Other Comprehensive (Loss) Income			Total Stockholders’ (Deficit) Equity
(In millions)	Issued Shares	Treasury Amount
Balance, January 28, 2012	49	$	(2	)	$	35		$	426		$	44		$	503
Net earnings attributable to Toys “R” Us, Inc.	—	—			—			38			—			38
Total other comprehensive loss, net of tax	—	—			—			—			(47		)	(47		)
Restricted stock forfeitures	—	(1		)	1			—			—			—
Stock compensation expense	—	—			14			—			—			14
Repurchase of common stock	—	(24		)	—			—			—			(24		)
Issuance of common stock	—	23			(5		)	—			—			18
Stock award reclassification	—	—			2			—			—			2
Adjustment of noncontrolling interest to redemption value	—	—			—			(19		)	—			(19		)
Balance, February 2, 2013	49	$	(4	)	$	47		$	445		$	(3	)	$	485
Net loss attributable to Toys “R” Us, Inc.	—	$	—		$	—		$	(1,039	)	$	—		$	(1,039	)
Total other comprehensive loss, net of tax	—	—			—			—			(81		)	(81		)
Restricted stock forfeitures	—	(2		)	2			—			—			—
Stock compensation expense	—	—			15			—			—			15
Repurchase of common stock	—	(38		)	—			—			—			(38		)
Issuance of common stock	—	35			(7		)	—			—			28
Redemption value of redeemable shares to temporary equity	—	—			(8		)	—			—			(8		)
Adjustment of noncontrolling interest to redemption value	—	—			—			(18		)	—			(18		)
Balance, February 1, 2014	49	$	(9	)	$	49		$	(612	)	$	(84	)	$	(656	)
Net loss attributable to Toys “R” Us, Inc.	—	$	—		$	—		$	(292	)	$	—		$	(292	)
Total other comprehensive loss, net of tax	—	—			—			—			(160		)	(160		)
Issuance of restricted stock	—	4			(4		)	—			—			—
Stock compensation expense	—	—			15			—			—			15
Value of formerly redeemable shares from temporary equity	—	—			8			—			—			8
Adjustment of noncontrolling interest to redemption value	—	—			—			(10		)				(10		)
Balance, January 31, 2015	49	$	(5	)	$	68		$	(914	)	$	(244	)	$	(1,095	)

See Notes to the Consolidated Financial Statements.

56

Toys “R” Us, Inc. and Subsidiaries

Notes to the Consolidated Financial Statements

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

As used herein, the “Company,” “we,” “us,” or “our” means Toys “R” Us, Inc., and its consolidated subsidiaries, except as expressly indicated or unless the context otherwise requires. We sell a variety of products in the baby, core toy, entertainment, learning and seasonal categories through our retail locations and the Internet. As of January 31, 2015, we operated 1,602 stores and licensed an additional 212 stores. These stores are located in 37 countries and jurisdictions around the world under the Toys “R” Us, Babies “R” Us and FAO Schwarz banners. In addition, we operate Toys “R” Us Express stores (“Express stores”), smaller format stores primarily open on a short-term basis during the holiday season. We also own and operate websites including Toysrus.com, Babiesrus.com, eToys.com, FAO.com and toys.com, as well as other Internet sites we operate in our international markets.

Our Company was founded in Washingtonfcred D.C. in 1948 when Charles Lazarus opened a baby furniture store, Children’s Bargain Town. The Toys “R” Us name made its debut in 1957. In 1978, we completed an initial public offering of our common stock. When Charles Lazarus retired as our Chief Executive Officer (“CEO”) in 1994, we operated or licensed over 1,000 stores in 17 countries and jurisdictions. In 1996, we established the Babies “R” Us brand, further solidifying our reputation as a leading consumer destination for children and their families.

On July 21, 2005, we were acquired through a $6.6 billion merger (the “Merger”) by an investment group led by entities advised by or affiliated with Bain Capital Partners, LLC, Kohlberg Kravis Roberts & Co. L.P. and Vornado Realty Trust (collectively, the “Sponsors”). Upon the completion of this acquisition, we became a private company.

Fiscal Year

Our fiscal year ends on the Saturday nearest to January 31 of each calendar year. Unless otherwise stated, references to years in this report relate to the fiscal years below:

Fiscal Year	Number of Weeks	Ended
2014	52	January 31, 2015
2013	52	February 1, 2014
2012	53	February 2, 2013

Basis of Presentation

The accompanying consolidated financial statements as of January 31, 2015 and February 1, 2014 and for each of the three year periods ended January 31, 2015, February 1, 2014 and February 2, 2013, have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).

Principles of Consolidation

The Consolidated Financial Statements include the accounts of the Company. We eliminate all inter-company balances and transactions.

Variable Interest Entities

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, “Consolidation” (“ASC 810”), requires the consolidation of entities that are controlled by a company through interests other than voting interests. We evaluate our lending vehicles, including our commercial mortgage-backed securities, structured loans and any joint venture interests to determine whether we are the primary beneficiary of a variable interest entity (“VIE”). The primary beneficiary will have a controlling financial interest in a VIE if it has (1) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance and (2) the obligation to absorb losses of the entity that could potentially be significant to the VIE or the right to receive benefits from the entity that could potentially be significant to the VIE.

On March 25, 2013, our indirect wholly-owned subsidiary, Toys “R” Us Properties (UK) Limited (“UK Propco”) entered into a facility agreement (the “UK Propco Facility Agreement”) with Debussy DTC Plc (“Debussy”), pursuant to which Debussy made loans (collectively, the “UK Propco Loan”) to UK Propco on March 28, 2013 in the aggregate principal amount of £263 million. Debussy is a special purpose entity established with the limited purpose of making loans and issuing the £263 million

57

of multiple classes of commercial mortgage backed fixed rate notes (the “Debussy Notes”) to third party investors and the Company. Refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

In accordance with ASC 810, we identified Debussy as a VIE because Debussy, by design, has insufficient equity investment at risk and its equity investment holders at risk lack the ability, through voting or similar rights, to direct the activities that most significantly impact Debussy’s economic performance.  Additionally, we evaluated our variable interests in Debussy and third party investors’ involvement in Debussy and concluded that the Company is not the primary beneficiary and therefore should not consolidate Debussy as we do not hold the power to direct the activities that most significantly impact Debussy’s economic performance. The Company has not identified any subsequent changes to Debussy’s governing documents or contractual arrangements that would change the characteristics or adequacy of the entity’s equity investment at risk in accordance with ASC 810.

Use of Estimates

The preparation of our Consolidated Financial Statements requires us to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and the related disclosures of contingent assets and liabilities as of the date of the Consolidated Financial Statements and during the applicable periods. We base these estimates on historical experience and other factors that we believe are reasonable under the circumstances. Actual results may differ materially from these estimates and such differences could have a material impact on our Consolidated Financial Statements.

Cash and Cash Equivalents

We consider our highly liquid investments with original maturities of three months or less at acquisition to be cash equivalents. These investments primarily consist of money market funds, bank deposits, term deposits or certificates of deposit. Cash equivalents are stated at cost, which approximates fair value. Book cash overdrafts are reclassified to accounts payable.

Restricted Cash

Restricted cash represents collateral and other cash that is restricted from withdrawal. As of January 31, 2015 and February 1, 2014, we had restricted cash of $53 million, respectively.

Accounts and Other Receivables

Accounts and other receivables consist primarily of receivables from vendors and consumer credit card and debit card transactions.

Merchandise Inventories

We value our merchandise inventories at the lower of cost or market, as determined by the weighted average cost method. Cost of sales represents the weighted average cost of the individual items sold and is affected by adjustments to reflect current market conditions, merchandise allowances from vendors, estimated inventory shortages and estimated losses from obsolete and slow-moving inventory.

Property and Equipment, Net

We record property and equipment at cost. Property and leasehold improvements represent capital improvements made to our owned and leased properties. We record depreciation and amortization using the straight-line method over the shorter of the estimated useful lives of the assets or the terms of the respective leases, if applicable.

We capitalize interest for new store construction-in-progress in accordance with ASC Topic 835, “Interest.” Capitalized interest amounts are immaterial.

Asset Retirement Obligations

We account for asset retirement obligations (“ARO”) in accordance with ASC Topic 410, “Asset Retirement and Environmental Obligations,” which requires us to recognize a liability for the fair value of obligations to retire tangible long-lived assets when there is a legal obligation to incur such costs. As a result of certain leasehold improvements we have undertaken in our stores, we may be obligated to restore the retail space to its original configuration as per the terms of the lease. We recognize a liability for ARO, capitalize asset retirement costs and amortize these costs over the life of the assets. As of January 31, 2015 and February 1, 2014, we had $63 million and $66 million, respectively, recorded for ARO.

58

Goodwill

At January 31, 2015 and February 1, 2014 our Toys-China and Southeast Asia reporting unit (included in our International segment) had $64 million of Goodwill, respectively. As a result of our fourth quarter fiscal 2013 goodwill impairment test, we recorded full impairments of the Toys-Domestic and Toys-Japan reporting unit’s goodwill balances of $361 million and $17 million, respectively, which were recorded in our Consolidated Statement of Operations for the fiscal year ended February 1, 2014. These impairment charges were a result of significant declines in the projected financial performance of the Toys-Domestic and Toys-Japan reporting units compared to the projections used in goodwill impairment tests of prior years. The decrease in financial projections was primarily due to the fiscal 2013 decline in operating results, due in large part to the holiday selling season. Refer to below and “CRITICAL ACCOUNTING POLICIES” within Item 7 entitled “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” for further details regarding the fiscal 2014 annual impairment tests.

In fiscal 2013, the Company decided to change its annual goodwill impairment testing date from the first day of the fourth quarter (or the first day of the tenth fiscal month) to the last day of the eleventh fiscal month of each fiscal year, which is shortly after the holiday season. The change is preferable as it aligns the timing of the annual impairment test with the timing of the Company’s annual strategic planning process, which now encompasses actual holiday selling season results, given the later testing date. Goodwill is evaluated for impairment annually as of the last day of the eleventh fiscal month or whenever we identify certain events or circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount, in accordance with the provisions of ASC Topic 350, “Intangibles - Goodwill and Other” (“ASC 350”). Events or circumstances that might warrant an interim evaluation include, among other things, a significant adverse change in legal factors or in the business climate, an adverse action or assessment by a regulator, unanticipated competition, loss of key personnel and a more-likely-than-not expectation that a reporting unit or a significant portion of a reporting unit will be sold or otherwise disposed of. ASC 350 provides an entity with the option to first assess qualitative factors for each reporting unit to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount prior to performing the two-step quantitative impairment test. The optional qualitative assessment can be performed at the discretion of management for any or all of the reporting units in any given period. For the fourth quarter of fiscal 2014, the Company opted to bypass the optional qualitative assessment in favor of updating the valuation and proceeding directly to the quantitative analysis for our Toys-China and Southeast Asia reporting unit.

For the step-one quantitative goodwill impairment test, we compared the current carrying value of the reporting unit to its current fair value to determine whether there is an indication of impairment. First, we determined the current fair value of the reporting unit by blending results from the market multiples approach and the income approach. These valuation approaches consider a number of factors that include, but are not limited to, expected future cash flows, growth rates, discount rates, and comparable multiples from publicly-traded companies in our industry, and require us to make certain assumptions and estimates regarding industry economic factors and future profitability of our business. It is our policy to conduct impairment testing (both from a qualitative and quantitative perspective) based on our most current business plans, projected future revenues and cash flows, which reflect changes we anticipate in the economy and the industry. The cash flows are based on five-year financial forecasts developed internally by management and are discounted to a present value using discount rates that properly account for the risk and nature of the respective reporting unit’s cash flows and the rates of return market participants would require to invest their capital in our reporting unit. The outcome of the market multiples and income approaches are heavily dependent upon the aforementioned projections. Upon completion of step one of the quantitative impairment test, it was determined that the goodwill associated with our Toys-China and Southeast Asia reporting unit was not impaired. The estimated fair value of our Toys-China and Southeast Asia reporting unit substantially exceeded its carrying value as of the date of testing.

Debt Issuance Costs

We defer debt issuance costs, which are classified as non-current Other assets, and amortize the costs into Interest expense over the term of the related debt facility. Unamortized amounts at January 31, 2015 and February 1, 2014 were $139 million and $127 million, respectively. Deferred financing fees amortized to Interest expense for fiscals 2014, 2013 and 2012 were $48 million, $51 million and $36 million, respectively, which is inclusive of accelerated amortization due to certain debt repayments and refinancings prior to maturity.

Acquisition of Debt Securities

There were no acquisitions of debt securities during fiscal 2014 and fiscal 2012. During fiscal 2013, we acquired £13 million ($20 million at March 28, 2013) principal amount of the various classes of Debussy Notes. These debt securities are included in Other assets within the Consolidated Balance Sheet, classified as held-to-maturity debt and reported at amortized cost. Refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

59

Insurance Risks

We self-insure a substantial portion of our workers’ compensation, general liability, auto liability, property, medical, prescription drug and dental insurance risks, in addition to maintaining third party insurance coverage. Provisions for losses related to self-insured risks are based upon actuarial techniques and estimates for incurred but not reported claims. We record the liability for workers’ compensation on a discounted basis. We also maintain insurance coverage above retention amounts of $15 million for employment practices liability, $8 million for catastrophic events, $5 million for property, $5 million for general liability, $4 million for auto liability and a minimum of $1 million for workers’ compensation to limit the exposure related to such risks. The assumptions underlying the ultimate costs of existing claim losses are subject to a high degree of unpredictability, which can affect the liability recorded for such claims. As of January 31, 2015 and February 1, 2014, we had $99 million and $102 million, respectively, of reserves for self-insurance risk which have been included in Accrued expenses and other current liabilities and Other non-current liabilities in our Consolidated Balance Sheets.

Commitments and Contingencies

We are subject to various claims and contingencies related to lawsuits and commitments under contractual and other commercial obligations. We recognize liabilities for contingencies and commitments when a loss is probable and estimable. For additional information on our commitments and contingencies, refer to Note 15 entitled “COMMITMENTS AND CONTINGENCIES.”

Leases

We lease store locations, distribution centers, equipment and land used in our operations. Our lease store locations consist of locations which have buildings that are owned by us and land which is controlled through a ground lease with third parties (“Ground Lease Locations”) and locations that are controlled through straight leases for land and building which we lease from third parties (“Straight Lease Locations”). We account for our leases under the provisions of ASC Topic 840, “Leases” (“ASC 840”), which require that leases be evaluated and classified as operating or capital leases for financial reporting purposes. Assets held under capital lease are included in Property and equipment, net. As of January 31, 2015 and February 1, 2014, accumulated depreciation related to capital leases for property and equipment was $41 million, respectively.

We record operating leases on a straight-line basis over the lease term, which includes renewal options only if those options are specified in the lease agreement and if failure to exercise the renewal option imposes a significant economic penalty on us. For Ground Lease Locations, we include renewal options in the lease term through the estimated useful life of the owned building located on the property as failure to renew a ground lease during the estimated useful life of the building would result in forgoing an economic benefit given our significant capital investment at the inception of the lease to construct a new building. For Straight Lease Locations, we do not include renewal options in the lease term as the failure to renew a straight lease does not typically result in a significant economic penalty for us, and therefore renewal cannot be reasonably assured at the inception of the lease. Renewal options are exercised at our sole discretion. The expected lease term is used to determine whether a lease is capital or operating and is used to calculate straight-line rent expense. Additionally, the useful life of buildings and leasehold improvements are limited by the expected lease term. Refer to Note 9 entitled “LEASES” for further details.

Substantially all of our leases include options that allow us to renew or extend the lease term beyond the initial lease period, subject to terms and conditions agreed upon at the inception of the lease. Such terms and conditions include rental rates agreed upon at the inception of the lease that could represent below or above market rental rates later in the life of the lease, depending upon market conditions at the time of such renewal or extension. In addition, many leases include early termination options, which can be exercised under specified conditions, including upon damage, destruction or condemnation of a specified percentage of the value or land area of the property.

Deferred Rent

We recognize fixed minimum rent expense on non-cancelable leases on a straight-line basis over the term of each individual lease starting at the date of possession, including the build-out period, and record the difference between the recognized rental expense and amounts payable under the leases as a deferred rent liability or asset. Deferred rent liabilities in our Consolidated Balance Sheets totaled $359 million and $374 million at January 31, 2015 and February 1, 2014, respectively, of which $12 million was included in Accrued expenses and other current liabilities for each period, respectively. Landlord incentives and abatements are recorded in Deferred rent liabilities and amortized over the term of the lease.

Financial Instruments

We enter into foreign exchange forward contracts to minimize the risk associated with currency fluctuations relating to our foreign subsidiaries. We also enter into derivative financial arrangements such as interest rate swaps and interest rate caps to hedge interest rate risk associated with our long-term debt. We account for derivative financial instruments in accordance with ASC Topic 815, “Derivatives and Hedging” (“ASC 815”) and record all derivatives as either assets or liabilities on the

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Consolidated Balance Sheets measured at estimated fair value and recognize the changes in fair value as unrealized gains and losses. The recognition of these gains and losses depends on our intended use of the derivatives and resulting designation. We record the changes in fair value of derivative instruments, which do not qualify and therefore are not designated for hedge accounting, in our Consolidated Statements of Operations. If we determine that we do qualify for hedge accounting treatment, the following is a summary of the impact on our Consolidated Financial Statements:

• For designated cash flow hedges, the effective portion of the changes in the fair value of derivatives is recorded in Accumulated other comprehensive (loss) income and subsequently recorded in Interest expense in the Consolidated Statements of Operations at the time the hedged item affects earnings.

• For designated cash flow hedges, the ineffective portion of a hedged derivative instrument’s change in fair value is immediately recognized in Interest expense in the Consolidated Statements of Operations.

• For designated fair value hedges, the change in the fair value of the derivative as well as the offsetting change in fair value of the hedged item attributable to the hedged risk are recorded in Interest expense in the Consolidated Statements of Operations.

Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for more information related to our accounting for derivative financial instruments. We did not have significant credit risk related to our financial instruments at January 31, 2015 and February 1, 2014.

Revenue Recognition

We generally recognize sales, net of customer coupons and other sales incentives, at the time the customer takes possession of merchandise, either at the point of sale in our stores or at the time the customer receives shipment of products purchased from our websites. We recognize the sale from layaway transactions when our customer satisfies all payment obligations and takes possession of the merchandise. Sales are recorded net of sales, use and value added taxes.

Other revenues of $43 million, $56 million and $72 million for fiscals 2014, 2013 and 2012, respectively, are included in Net sales. Other revenues consist of warranty income, licensing fees and non-core product related revenue.

We have license agreements with unaffiliated third party operators located outside the United States. The agreements are largely structured with royalty income paid as a percentage of sales for the use of our trademarks, trade name and branding. Licensing fees for fiscals 2014, 2013 and 2012 were $17 million, $16 million and $16 million, respectively.

Reserve for Sales Returns

We establish reserves for sales returns for estimated product returns by our customers based on historical return experience, changes in customer demand, known returns we have not received, and other assumptions. The balance of our reserve for sales returns was $10 million at January 31, 2015 and February 1, 2014, respectively.

Cost of Sales and Selling, General & Administrative Expenses

The following table illustrates what is reflected in each expense category:

“Cost of sales”

“SG&A”

•        the cost of merchandise acquired from vendors; •        freight in; •        provision for excess and obsolete inventory; •        shipping costs to customers; •        provision for inventory shortages; and •        credits and allowances from our merchandise vendors.

•        store payroll and related payroll benefits; •        rent and other store operating expenses; •        advertising and promotional expenses; •        costs associated with operating our distribution          network, including costs related to transporting          merchandise from distribution centers to stores; •        restructuring charges; and •        other corporate-related expenses.

Credits and Allowances Received from Vendors

We receive credits and allowances that are related to formal agreements negotiated with our vendors. These credits and allowances are predominantly for product markdowns, cooperative advertising, promotions and volume related purchases. We generally treat credits and allowances, including cooperative advertising allowances, as a reduction of product cost in accordance with the provisions of ASC Topic 605, “Revenue Recognition” (“ASC 605”) since such funds are not a reimbursement of specific, incremental, identifiable SG&A costs incurred by us in selling the vendors’ products.

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Advertising Costs

Gross advertising costs are recognized in SG&A at the point of first broadcast or distribution and were $379 million, $433 million and $449 million in fiscals 2014, 2013 and 2012, respectively.

Pre-Opening Costs

The cost of start-up activities, including organization costs, related to new store openings are expensed as incurred.

Costs of Computer Software

We capitalize certain costs associated with computer software developed or obtained for internal use in accordance with the provisions of ASC 350. We capitalize those costs from the acquisition of external materials and services associated with developing or obtaining internal use computer software. We capitalize certain payroll costs for employees that are directly associated with internal use computer software projects once specific criteria of ASC 350 are met. We expense those costs that are associated with preliminary stage activities, training, maintenance, and all other post-implementation stage activities as they are incurred. We amortize all costs capitalized in connection with internal use computer software projects on a straight-line basis over a useful life of five years, beginning when the software is ready for its intended use. We amortized computer software costs of $34 million, $31 million and $27 million for fiscals 2014, 2013 and 2012, respectively.

Other Income, Net

Other income, net includes the following:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Credit card program income	$	36		$	33		$	22
Gift card breakage income	27			24			21
Net gains on sales of properties	5			8			4
Impairment of long-lived assets	(13		)	(44		)	(11		)
Foreign currency translation	(19		)	(1		)	(3		)
Other (1)	17			17			20
Total	$	53		$	37		$	53

(1) Includes advertising income from our websites, fixed asset write-offs and other miscellaneous income and expense charges.

Credit Card Program

We operate under a Credit Card Program agreement (the “Agreement”) with a third-party credit lender Synchrony Financial (formerly GE Retail Bank) to offer co-branded and private label credit cards to our customers. The credit lender provides financing for our customers to purchase merchandise at our stores for all cardholders and other businesses for co-branded cardholders. We received an up-front incentive payment in fiscal 2012 for entering into the seven year Agreement with Synchrony Financial, which was deferred and is being amortized ratably over the life of the Agreement. In addition, we receive bounty fees for credit card activations and royalties on the co-branded and private label credit cards. Bounty fees and royalties are recognized when earned and realizable. During fiscals 2014, 2013 and 2012, we recognized credit card program income of $36 million, $33 million and $22 million, respectively.

Gift Card Breakage

We sell gift cards to customers in our retail stores, through our websites and through third parties and, in certain cases, provide gift cards for returned merchandise and in connection with promotions. We recognize income from gift card sales when the customer redeems the gift card, as well as an estimated amount of unredeemed liabilities (“breakage”). Gift card breakage is recognized proportionately, utilizing management estimates and assumptions based on actual redemptions, the estimated useful life of the gift card and an estimated breakage rate of unredeemed liabilities. Our estimated gift card breakage represents the remaining unused portion of the gift card liability for which the likelihood of redemption is remote and for which we have determined that we do not have a legal obligation to remit the value to the relevant jurisdictions. Income related to customer gift card redemption is included in Net sales, whereas income related to gift card breakage is recorded in Other income, net in our Consolidated Financial Statements. We recognize breakage income and derecognize the gift card liability for unredeemed gift cards in proportion to actual redemptions of gift cards. We recognized $27 million, $24 million and $21 million of gift card breakage income in fiscals 2014, 2013 and 2012, respectively.

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Net Gains on Sales of Properties

Net gains on sales of properties were $5 million, $8 million and $4 million for fiscals 2014, 2013 and 2012, respectively. Refer to Note 5 entitled “PROPERTY AND EQUIPMENT” for further information.

Impairment of Long-Lived Assets and Costs Associated with Exit Activities

We evaluate the carrying value of all long-lived assets, which include property, equipment and finite-lived intangibles, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable, in accordance with ASC Topic 360, “Property, Plant and Equipment.” Events or circumstances that might warrant an impairment review include, among other things, material declines in operational performance, significant adverse market conditions and significant changes or planned changes in our use of assets, including store relocation, store closure and property sales. If a long-lived asset is found to be non-recoverable, we record an impairment charge equal to the difference between the asset’s carrying value and fair value. This evaluation requires management to make judgments relating to future cash flows, growth rates, and economic and market conditions. These evaluations are based on determining the fair value of an asset using a valuation method such as discounted cash flow or a relative, market-based approach.

During fiscals 2014, 2013 and 2012, we recorded total impairment losses of $13 million, $44 million and $11 million, respectively. Impairment losses are recorded in Other income, net within our Consolidated Statements of Operations. These impairments were primarily due to the identification of underperforming stores and the relocation of certain stores.

For any store closing where a lease obligation still exists, we record the estimated future liability associated with the rental obligation less any estimated sublease income on the date the store is closed in accordance with ASC Topic 420, “Exit or Disposal Cost Obligations.”

Foreign Currency Translation

Unrealized and realized gains and losses resulting from foreign currency transactions related to operations are included in Other income, net. In fiscal 2014, we recorded foreign currency losses of $19 million, which included an unrealized loss on foreign exchange of $15 million related to the re-measurement of the new tranche of loans in an aggregate principal amount of $280 million due fiscal 2019 (the “Tranche A-1 Loan”) attributed to Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee (“Toys-Canada”), an indirect wholly-owned subsidiary. For fiscals 2013 and 2012, we recorded foreign exchange losses of $1 million and $3 million, respectively. Refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details regarding the Tranche A-1 Loan.

Foreign Currency Translation - Foreign Subsidiaries

The functional currencies of our foreign subsidiaries are as follows:

• Australian dollar for our subsidiary in Australia;

• British pound sterling for our subsidiary in the United Kingdom;

• Brunei dollar for our subsidiary in Brunei;

• Canadian dollar for our subsidiary in Canada;

• Chinese yuan for our subsidiary in China;

• Euro for our subsidiaries in Austria, France, Germany, Spain and Portugal;

• Hong Kong dollar for our subsidiaries in Hong Kong;

• Japanese yen for our subsidiary in Japan;

• Malaysian ringgit for our subsidiary in Malaysia;

• Polish zloty for our subsidiary in Poland;

• Singapore dollar for our subsidiary in Singapore;

• Swiss franc for our subsidiary in Switzerland;

• Taiwan dollar for our subsidiary in Taiwan; and

• Thailand baht for our subsidiary in Thailand.

Assets and liabilities are translated into USD using the current exchange rates in effect at the balance sheet date, while revenues and expenses are translated using the average exchange rates during the applicable reporting period. The resulting translation adjustments are recorded in Accumulated other comprehensive (loss) income within the Consolidated Statements of Stockholders’ (Deficit) Equity.

Foreign Currency Translation - Short-Term Intercompany Loans

Foreign currency transactions related to short-term, cross-currency intercompany loans amounted to gains of $9 million, $1 million and $2 million for fiscals 2014, 2013 and 2012, respectively. Such amounts were included in Interest expense.

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We economically hedge the majority of these short-term, cross-currency intercompany loans with foreign currency forward contracts. These derivative contracts were not designated as hedges and are recorded on our Consolidated Balance Sheets at fair value with a gain or loss recorded on the Consolidated Statements of Operations in Interest expense. For fiscal years 2014, 2013 and 2012, we recorded losses of $9 million, $1 million and $2 million, respectively. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

Income Taxes

We account for income taxes in accordance with ASC Topic 740, “Income Taxes” (“ASC 740”). Our provision for income taxes and effective tax rates are calculated by legal entity and jurisdiction and are based on a number of factors, including our level of pre-tax earnings, income tax planning strategies, differences between tax laws and accounting rules, statutory tax rates and credits, uncertain tax positions and valuation allowances. We use significant judgment and estimates in evaluating our tax positions. Our effective tax rate in a given financial statement period may be materially impacted by changes in the mix and level of earnings by taxing jurisdiction.

Under ASC 740, deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the Consolidated Financial Statements. Valuation allowances are established when, in management’s judgment, it is more likely than not that our deferred tax assets will not be realized. In assessing the need for a valuation allowance, management weighs the available positive and negative evidence, including limitations on the use of tax loss and other carryforwards due to changes in ownership, historic information, projections of future sources of taxable income, including future reversals of taxable temporary differences and future taxable income exclusive of reversing temporary differences and carryforwards and tax planning strategies.

At any one time, our tax returns for numerous tax years are subject to examination by U.S. Federal, state and foreign taxing jurisdictions. ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attributes for income tax positions taken or expected to be taken on a tax return. Under ASC 740, the impact of an uncertain tax position taken or expected to be taken on an income tax return must be recognized in the financial statements at the largest amount that is more-likely-than-not to be sustained. An uncertain income tax position will not be recognized in the financial statements unless it is more-likely-than-not to be sustained. We adjust these tax liabilities, as well as the related interest and penalties, based on the latest facts and circumstances, including recently enacted tax law changes, published rulings, court cases and outcomes of tax audits. While we do not expect material changes, it is possible that our actual tax liability will differ from our established tax liabilities for unrecognized tax benefits, and our effective tax rate may be materially impacted. While it is often difficult to predict the final outcome of, the timing of or the tax treatment of any particular tax position or deduction, we believe that our tax balances reflect the more-likely-than-not outcome of known tax contingencies. We report tax-related interest and penalties as a component of Income tax expense.

At January 31, 2015 and February 1, 2014, we reported unrecognized tax benefits in Accrued expenses and other current liabilities and Other non-current liabilities in our Consolidated Balance Sheets. These tax liabilities do not include a portion of our unrecognized tax benefits, which have been recorded as either a reduction of Deferred tax assets related to tax loss carryforwards or a reduction of taxes receivable. For further information, refer to Note 10 entitled “INCOME TAXES.”

Temporary Equity

On October 31, 2011, in connection with the acquisition of a 70% ownership interest in Toys (Labuan) Holding Limited (“Labuan”), the Company recognized Noncontrolling interest in the amount of $24 million which was measured at fair value at the acquisition date. Refer to Note 17 entitled “ACQUISITIONS” for further details. In accordance with the terms of the agreement, the Noncontrolling interest is redeemable for cash or common stock of the Company at the option of the holder. As such, the Noncontrolling interest has been recorded in Temporary Equity in our Consolidated Balance Sheets at its redemption value.

In addition, as a result of modifications made to our stock-based compensation plans during fiscal 2013, certain equity awards were redeemable for cash at the option of the holder and redemption was probable. As of January 31, 2015, these awards have all vested and redemption is no longer probable. Therefore, in accordance with ASC Topic 718, “Compensation – Stock Compensation” (“ASC 718”) and ASC Topic 480, “Distinguishing Liabilities from Equity” (“ASC 480”), the shares were initially recorded as Temporary Equity in fiscal 2013 in our Consolidated Balance Sheet at their redemption value and were subsequently reclassified to Additional paid-in capital in fiscal 2014. Refer to Note 7 entitled “STOCK-BASED COMPENSATION” for further details.

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The reconciliation of the changes in Temporary Equity is as follows:

(In millions)
Balance, January 28, 2012	$	29
Net earnings attributable to noncontrolling interest	1
Adjustment of noncontrolling interest to redemption value	19
Balance, February 2, 2013	49
Net earnings attributable to noncontrolling interest	3
Adjustment of noncontrolling interest to redemption value	18
Redemption value of redeemable shares	8
Balance, February 1, 2014	78
Net earnings attributable to noncontrolling interest	4
Adjustment of noncontrolling interest to redemption value	10
Value of formerly redeemable shares to equity	(8		)
Capital contribution	1
Balance, January 31, 2015	$	85

Stock-Based Compensation

Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service period. We have applied ASC 718 to new awards and to awards modified, repurchased or canceled since January 29, 2006. For further information, refer to Note 7 entitled “STOCK-BASED COMPENSATION.”

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NOTE 2 — SHORT-TERM BORROWINGS AND LONG-TERM DEBT

A summary of the Company’s consolidated Short-term borrowings and Long-term debt as well as the effective interest rates on our outstanding variable rate debt as of January 31, 2015 and February 1, 2014 is outlined in the table below:

(In millions)	January 31, 2015		February 1, 2014
Short-term borrowings
Labuan uncommitted lines of credit	$	—	$	12
Long-term debt
Spanish real estate credit facility, due fiscal 2015 (EURIBOR+6.00%)	34		71
Toys-Japan unsecured credit lines, expire fiscals 2015-2016 (1)	—		5
European and Australian asset-based revolving credit facility, expires fiscal 2016	—		—
Secured term loan facility, due fiscal 2016 (LIBOR+4.50%) (2)(3)	—		646
7.375% senior secured notes, due fiscal 2016 (2)(3)	—		357
10.375% senior notes, due fiscal 2017 (4)	448		447
8.500% senior secured notes, due fiscal 2017 (5)	721		719
French real estate credit facility, due fiscal 2018 (EURIBOR+4.50%)	53		64
Incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (2)(3)	133		372
Second incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (2)(3)	67		210
7.375% senior notes, due fiscal 2018 (4)	402		403
$1.85 billion secured revolving credit facility, expires fiscal 2019 (2)(3)(6)	—		—
Senior unsecured term loan facility, due fiscal 2019 (LIBOR+5.00%) (7)	965		973
Tranche A-1 loan facility, due fiscal 2019 (LIBOR+7.25%) (2)(3)	272		—
Secured term B-4 loan facility, due fiscal 2020 (LIBOR+8.75%) (2)(3)	1,010		—
UK real estate credit facility, due fiscal 2020 (6.85%)	396		433
Toys-Japan 1.85%-2.45% loans, due fiscals 2015-2021	63		91
8.750% debentures, due fiscal 2021 (8)	22		22
Finance obligations associated with capital projects	189		174
Capital lease obligations	13		20
	4,788		5,007
Less: current portion	176		89
Total Long-term debt (9)	$	4,612	$	4,918

(1) Toys “R” Us - Japan, Ltd. (“Toys-Japan”) currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit (“Tranche 1” due fiscal 2015 and “Tranche 2” due fiscal 2016). On July 15, 2014, Toys-Japan entered into an agreement to refinance Tranche 2 of its committed lines of credit.

(2) Represents obligations of Toys “R” Us - Delaware, Inc. (“Toys-Delaware”).

(3) On October 24, 2014, Toys-Delaware amended the credit agreement for its secured term loan facilities (the “Secured Term Loan Credit Agreement”) to provide for, among other things, a new tranche of term loans in an aggregate principal amount of $1,026 million due fiscal 2020 (the “Secured Term B-4 Loan”). Additionally, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the $1.85 billion secured revolving credit facility (“ABL Facility”) to provide for, among other things, a new tranche of loans in an aggregate principal amount of $280 million due fiscal 2019. The Secured Term B-4 Loan and the Tranche A-1 Loan, together with other sources and funds available to Toys-Delaware, were used to (i) refinance in full the Secured term loan facility due fiscal 2016, (ii) extend $380 million of the term loans due fiscal 2018 under the Incremental secured term loan facility and the Second incremental secured term loan facility into the Secured Term B-4 Loan and (iii) redeem all of the 7.375% senior secured notes due fiscal 2016 (“Toys-Delaware Secured Notes”), plus accrued interest, premiums and fees. The Secured Term B-4 Loan is guaranteed by Wayne Real Estate Parent Company, LLC, a wholly-owned subsidiary of the Company and an indirect parent of Toys “R” Us Property Company I, LLC.

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(4) Represents obligations of Toys “R” Us, Inc. (the “Parent Company”) legal entity. For further details on Parent Company information, refer to Schedule I — Parent Company Condensed Financial Statements and Notes to the Condensed Financial Statements.

(5) Represents obligations of Toys “R” Us Property Company II, LLC (“TRU Propco II”).

(6) On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for the ABL Facility in order to extend the maturity date of the facility and amend certain other provisions.

(7) Represents obligations of Toys “R” Us Property Company I, LLC and its subsidiaries (“TRU Propco I”).

(8) Represents obligations of the Parent Company and Toys-Delaware.

(9) We maintain derivative instruments on certain of our long-term debt, which impact our effective interest rates. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

As of January 31, 2015, we had total indebtedness of $4.8 billion, of which $2.7 billion was secured indebtedness. Toys “R” Us, Inc. is a holding company and conducts its operations through its subsidiaries, certain of which have incurred their own indebtedness. Our credit facilities, loan agreements and indentures contain customary covenants that, among other things restrict our ability to:

• incur certain additional indebtedness;

• transfer money between the Parent Company and our various subsidiaries;

• pay dividends on, repurchase or make distributions with respect to our or our subsidiaries’ capital stock or make other restricted payments;

• issue stock of subsidiaries;

• make certain investments, loans or advances;

• transfer and sell certain assets;

• create or permit liens on assets;

• consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;

• enter into certain transactions with our affiliates; and

• amend certain documents.

The amount of total net assets that were subject to such restrictions was $582 million as of January 31, 2015. Our agreements also contain various and customary events of default with respect to the indebtedness, including, without limitation, the failure to pay interest or principal when the same is due under the agreements, cross default and cross acceleration provisions, the failure of representations and warranties contained in the agreements to be true and certain insolvency events. If an event of default occurs and is continuing, the principal amounts outstanding thereunder, together with all accrued and unpaid interest and other amounts owed thereunder, may be declared immediately due and payable by the lenders.

We are dependent on the borrowings provided by the lenders to support our working capital needs, capital expenditures and to service debt. As of January 31, 2015, we have funds available to finance our operations under our ABL Facility through March 2019, subject to an earlier springing maturity, our European and Australian asset-based revolving credit facility (“European ABL Facility”) through March 2016 and our Toys-Japan unsecured credit lines with a tranche maturing June 2015 and a tranche maturing June 2016. In addition, Labuan and Toys-Japan have uncommitted lines of credit due on demand.

The annual maturities of our Long-term debt, including current portion, at January 31, 2015 are as follows:

(In millions)	Annual Maturities
2015	$	176
2016	34
2017	1,207
2018	658
2019	1,180
2020 and subsequent	1,571
Total	$	4,826

Labuan uncommitted lines of credit, due on demand ($0 million at January 31, 2015)

Labuan has several uncommitted unsecured lines of credit with various financial institutions with total availability of HK$275 million ($35 million at January 31, 2015). As of January 31, 2015, we had no borrowings and $3 million of bank guarantees

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issued under these facilities. The remaining availability under these facilities was $32 million. The average interest rate on the drawn borrowings was 2.36% as of February 1, 2014.

Toys-Japan unsecured credit lines, expire fiscals 2015-2016 ($0 million at January 31, 2015)

Toys-Japan currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit. Tranche 1 is available in amounts up to ¥13.0 billion ($111 million at January 31, 2015), expiring on June 30, 2015, and bears an interest rate of Tokyo Interbank Offered Rate (“TIBOR”) plus 0.80% per annum. At January 31, 2015, we had no outstanding borrowings under Tranche 1, with $111 million of remaining borrowing availability. Deferred debt issuance costs for this agreement were less than $1 million and $1 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

On July 15, 2014, Toys-Japan entered into an agreement with a syndicate of financial institutions to refinance Tranche 2. As a result, Tranche 2 is available in amounts up to ¥3.5 billion ($30 million at January 31, 2015), expiring on June 30, 2016, and bears an interest rate of TIBOR plus 0.80% per annum. At January 31, 2015, we had no outstanding borrowings under Tranche 2, with $30 million of remaining availability. Deferred debt issuance costs for this agreement were less than $1 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

These agreements contain covenants that require, among other things, Toys-Japan to maintain a certain level of net assets and a provision that requires Toys-Japan to not incur two consecutive years of ordinary loss in accordance with accounting principles generally accepted in Japan (“JGAAP”), as defined in the credit agreement. The agreement also restricts Toys-Japan from paying dividends or making loans to affiliates without lender consent.

Additionally on July 15, 2014, Toys-Japan amended its uncommitted line of credit resulting in total availability of ¥1.5 billion ($13 million at January 31, 2015), which will renew August 1 of each year unless otherwise canceled. The uncommitted line of credit bears an interest rate of TIBOR plus 0.50%. As of January 31, 2015, we had no outstanding borrowings under the uncommitted line of credit.

On September 17, 2014, Toys-Japan entered into an uncommitted line of credit with a financial institution that is part of our Tranche 1 syndicate. The uncommitted line of credit of ¥0.5 billion ($4 million at January 31, 2015) bears an interest rate of the short-term prime rate plus 1.00%, as defined in the agreement, and matures on August 31, 2015. As the agreement states that the borrowings associated with this line of credit plus the borrowings associated with this financial institution’s portion of Tranche 1 borrowings cannot exceed its already committed credit of ¥1.5 billion, this uncommitted line of credit does not result in incremental availability. As of January 31, 2015, we had no outstanding borrowings under the uncommitted line of credit.

European and Australian asset-based revolving credit facility, expires fiscal 2016 ($0 million at January 31, 2015)

The European ABL Facility, as amended, provides for a five-year £138 million ($208 million at January 31, 2015) asset-based senior secured revolving credit facility which will expire on March 8, 2016. Loans under the European ABL Facility bear interest at a rate of LIBOR or Euro Interbank Offered Rate (“EURIBOR”) plus a margin of 2.25%, 2.50% or 2.75% depending on historical excess availability. In addition, a commitment fee accrues on any unused portion of the commitments at a rate per annum of 0.375% or 0.50% based on usage. At January 31, 2015, we had no outstanding borrowings, with $86 million of remaining availability under the European ABL Facility. Deferred debt issuance costs for this credit facility were $2 million and $4 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Borrowings under the European ABL Facility are subject to, among other things, the terms of a borrowing base derived from the value of eligible inventory and/or eligible credit card receivables of certain of Toys “R” Us Europe, LLC’s (“Toys Europe”) and Toys “R” Us Australia Holdings, LLC’s (“Toys Australia”) subsidiaries organized in Australia, England and France. The terms of the European ABL Facility include a customary cash dominion trigger requiring the cash of certain of Toys Europe’s and Toys Australia’s subsidiaries to be applied to pay down outstanding loans if availability falls below certain thresholds. The European ABL Facility also contains a springing fixed charge coverage ratio of 1.00 to 1.00 based on earnings before interest, taxes, depreciation and amortization (“EBITDA”) (as defined in the agreement governing the European ABL Facility) and fixed charges of Toys Europe, Toys Australia and their subsidiaries. Borrowings under the European ABL Facility are guaranteed by Toys Europe, Toys Australia and certain of their material subsidiaries, with certain customary local law limitations and to the extent such guarantees do not result in adverse tax consequences. Borrowings are secured by substantially all of the assets of Toys Europe, Toys Australia and the UK and Australian obligors, as well as by share pledges over the shares of certain other material subsidiaries and pledges over certain of their assets (including bank accounts and certain receivables). The European ABL Facility contains covenants that, among other things, restrict the ability of Toys Europe and Toys Australia and their respective subsidiaries to incur certain additional indebtedness, create or permit liens on assets, repurchase or pay dividends or

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make certain other restricted payments on capital stock, make acquisitions or investments or engage in mergers or consolidations.

$1.85 billion secured revolving credit facility, expires fiscal 2019 ($0 million at January 31, 2015)

On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for the ABL Facility in order to extend the maturity date of the facility and amend certain other provisions. The ABL Facility as amended will continue to provide for $1.85 billion of revolving commitments, and permits Toys-Delaware to request an increase in commitments by up to $1.15 billion, subject to certain conditions, including obtaining new or increased commitments from new or existing lenders. The ABL Facility has a final maturity date of March 21, 2019, with a springing maturity date if the Toys-Delaware term loans due fiscal 2018 are not repaid 30 days prior to maturity. The ABL Facility as amended bears a tiered floating interest rate of London Interbank Offered Rate (“LIBOR”) plus a margin of between 1.50% and 1.75% depending on usage (or, at the election of the borrower, a tiered floating interest rate based on the agent’s prime rate plus a margin of between 0.50% and 0.75% depending on usage). A commitment fee is payable on the undrawn portion of the ABL Facility in an amount equal to 0.25% per annum of the average daily balance of unused commitments during each calendar quarter. In connection with the amended and restated credit agreement, we incurred transaction fees of $31 million, which are capitalized as deferred debt issuance costs, amortized over the term of the agreement and included in Other assets on our Consolidated Balance Sheet. Prior to the amended ABL Facility, unamortized debt issuance costs were $17 million, of which $1 million was expensed, and the remaining amount will be amortized over the term of the amended and restated credit agreement.

At January 31, 2015, under our ABL Facility, we had no outstanding borrowings, a total of $99 million of outstanding letters of credit and excess availability of $973 million. We are also subject to a minimum excess availability covenant of $125 million, with remaining availability of $848 million in excess of the covenant at January 31, 2015. Deferred debt issuance costs for this credit facility were $38 million and $19 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The ABL facility is available for general corporate purposes and the issuance of letters of credit. Borrowings under this credit facility are secured by tangible and intangible assets of Toys-Delaware and certain of its subsidiaries, subject to specific exclusions stated in the credit agreement. The credit agreement contains covenants that, among other things, restrict Toys-Delaware’s ability to incur certain additional indebtedness, create or permit liens on assets, engage in mergers or consolidations, make investments, loans or advances, sell or transfer assets, pay dividends or distributions, repurchase capital stock or make other restricted payments, repay or prepay certain debt, engage in transactions with affiliates, amend material documents and change fiscal year. The ABL Facility, as amended pursuant to the amended and restated credit agreement, requires Toys-Delaware to maintain excess availability at all times of no less than $125 million and to sweep cash toward prepayment of the loans if excess availability falls below $150 million for any three days in a 30-day period (or if certain specified defaults are continuing or if excess availability falls below $130 million at any time). Availability is determined pursuant to a borrowing base, consisting of specified percentages of eligible inventory and eligible credit card receivables and certain real estate less any applicable availability reserves.

On October 24, 2014, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the ABL Facility and the Intercreditor Agreement (as defined below) in connection with the issuance of the Secured Term B-4 Loan and Tranche A-1 Loan. Refer to the Tranche A-1 loan facility below for further details on the amendment to the credit agreement for the ABL Facility. The Intercreditor amendment amended the Amended and Restated Intercreditor Agreement, dated as of August 24, 2010 (the “Intercreditor Agreement”), to provide for, among other things, modifications to the priority among the lenders under the Secured Term B-4 Loan and the Tranche A-1 Loan with respect to the Canadian Pledge Collateral (as defined in the Intercreditor Agreement).

€30 million Spanish real estate credit facility, due fiscal 2015 ($34 million at January 31, 2015)

On January 29, 2013, Toys “R” Us Iberia Real Estate S.L.U. (“TRU Iberia Real Estate”) entered into a three year senior secured term loan facility agreement (the “Spain Propco Facility Agreement”) for an aggregate principal amount of €75 million. TRU Iberia Real Estate owns freehold and leasehold interests in properties in various retail markets throughout Spain. Under an operating company/property company structure, TRU Iberia Real Estate leases these properties on a triple-net basis to Toys “R” Us Iberia, SA (“Spain Opco”). Substantially all of TRU Iberia Real Estate’s revenues and cash flows are derived from payments from Spain Opco under a series of uniform lease agreements. The loan is secured by 26 properties located in Spain. The Spain Propco Facility Agreement will mature on January 29, 2016 and bears interest equal to EURIBOR plus 6.00%. We have entered into an interest rate cap as required under the Spain Propco Facility Agreement capping EURIBOR at 2.00% per annum. TRU Iberia Real Estate is required to repay the principal of the loan in installments equal to €22.5 million, €22.5 million and €30 million in the first, second and third years of the loan, respectively. As such, we have repaid the first and second installments of €22.5 million during fiscals 2013 and 2014, respectively, and the third installment of €30 million ($34 million at January 31, 2015) has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of

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January 31, 2015. Deferred debt issuance costs for this credit facility were $3 million and $5 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Our Parent Company has provided the lenders with a deficiency guarantee with respect to certain losses the lenders may suffer in certain circumstances. The Spain Propco Facility Agreement contains covenants that, among other things, restrict the ability of TRU Iberia Real Estate to incur additional indebtedness, pay dividends or make other distributions, make restricted payments or certain investments, create or permit liens on assets, sell assets or engage in mergers or consolidations. The agreement also contains financial covenants including a loan to value covenant, an interest coverage ratio covenant and an EBITDA (as defined in the Spain Propco Facility Agreement) to rent covenant related to Spain Opco.

10.375% senior notes, due fiscal 2017 ($448 million at January 31, 2015)

On August 1, 2012, we completed the offering of $450 million aggregate principal amount of 10.375% senior notes, which will mature on August 15, 2017 (the “2017 Notes”). The 2017 Notes were issued at a discount of $4 million, which resulted in proceeds of $446 million. The 2017 Notes are solely the obligation of the Parent Company and are not guaranteed by Toys-Delaware or any of our other subsidiaries. Investment funds or accounts advised by or affiliated with Kohlberg Kravis Roberts & Co. L.P. (collectively, “KKR”) owned an aggregate of $9 million of the 2017 Notes as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for these notes were $8 million and $10 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The indenture governing the 2017 Notes contain covenants, including, among other things, covenants that restrict the ability of the Company and its restricted subsidiaries to incur additional indebtedness, pay dividends or make other distributions, make investments and other restricted payments, create liens, sell assets, incur restrictions on the ability of a subsidiary to pay dividends or make other payments, enter into certain transactions with affiliates and consolidate, merge, sell or otherwise dispose of all or substantially all of their assets. These covenants are subject to a number of important qualifications and exceptions and will not be applicable to any of our subsidiaries that are designated as “unrestricted subsidiaries.” As of January 31, 2015, TRU Asia, LLC, our majority owned subsidiary operating in Asia (other than Japan), is an unrestricted subsidiary.

Certain covenants will be suspended at any time the 2017 Notes are rated “investment grade.” As of January 31, 2015, the 2017 Notes are not “investment grade.” In addition, the indenture contains customary terms and covenants, including certain events of default after which the 2017 Notes may be due and payable immediately.

The 2017 Notes may be redeemed, in whole or in part, at any time prior to February 15, 2015 at a price equal to 100% of the aggregate principal amount of the 2017 Notes plus a “make-whole” premium, plus accrued and unpaid interest to the date of redemption. The 2017 Notes will be redeemable, in whole or in part, at any time on or after February 15, 2015 at the specified redemption prices, plus accrued and unpaid interest, if any, to the redemption date. In addition, we may redeem up to 40% of the 2017 Notes before February 15, 2015 with the net cash proceeds from certain equity offerings. Following specified kinds of changes of control, we will be required to make an offer to repurchase all of the 2017 Notes at a purchase price of 101% of their principal amount, plus accrued and unpaid interest, if any, to the repurchase date. Interest on the 2017 Notes is payable in cash semi-annually in arrears on February 15 and August 15 of each year.

8.500% senior secured notes, due fiscal 2017 ($721 million at January 31, 2015)

On November 20, 2009, TRU Propco II, an indirect wholly-owned subsidiary, completed the offering of $725 million aggregate principal amount of senior secured 8.500% notes, which will mature on December 1, 2017 (the “Propco II Notes”). TRU Propco II owns fee and ground leasehold interests in properties in various retail markets throughout the United States. Under an operating company/property company structure, TRU Propco II leases these properties on a triple-net basis to Toys-Delaware. Substantially all of TRU Propco II’s revenues and cash flows are derived from payments from Toys-Delaware under the master lease agreement between TRU Propco II as landlord and Toys-Delaware as tenant (the “TRU Propco II Master Lease”). The rent under the TRU Propco II Master Lease will increase by 10% every five years during its 20-year term. The Propco II Notes were issued at a discount of $10 million which resulted in proceeds of $715 million. The Propco II Notes are solely the obligation of TRU Propco II and are not guaranteed by the Parent Company or Toys-Delaware or any of our other subsidiaries. The Propco II Notes are secured by the first priority security interests in all of the existing and future real estate properties of TRU Propco II and its interest in the TRU Propco II Master Lease. Those real estate properties and interests in the TRU Propco II Master Lease are not available to satisfy or secure the obligations of the Company or its affiliates, other than the obligations of TRU Propco II under the Propco II Notes. KKR owned an aggregate of $5 million of the Propco II Notes as of February 1, 2014. Deferred debt issuance costs for these notes were $10 million and $14 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

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The indenture governing the Propco II Notes contains covenants that, among other things, restrict the ability of TRU Propco II to incur additional indebtedness, sell assets, enter into affiliate transactions, pay dividends or make other distributions, make other restricted payments and investments, or create liens.  The indenture governing the Propco II Notes also contains covenants that limit the ability of the Parent Company to cause or permit Toys-Delaware to incur indebtedness, pay dividends, make distributions or make other restricted payments and investments. These covenants are subject to a number of important qualifications and limitations. The Propco II Notes are redeemable, in whole or in part, at specified redemption prices, plus accrued and unpaid interest, if any. Following specified kinds of changes of control with respect to the Parent Company, Toys-Delaware or TRU Propco II, TRU Propco II will be required to offer to purchase the Propco II Notes at a purchase price in cash equal to 101% of their principal amount, plus accrued and unpaid interest, if any to, but not including, the purchase date. Interest on the Propco II Notes is payable in cash semi-annually in arrears on June 1 and December 1 of each year.

€47 million French real estate credit facility, due fiscal 2018 ($53 million at January 31, 2015)

On February 27, 2013, Toys “R” Us France Real Estate SAS (“TRU France Real Estate”) entered into a five year senior secured term loan facility agreement (the “France Propco Facility Agreement”) for an aggregate principal amount of €48 million. TRU France Real Estate owns freehold and leasehold interests in properties in various retail markets throughout France. Under an operating company/property company structure, TRU France Real Estate leases these properties on a triple-net basis to Toys “R” Us SARL (“France Opco”). Substantially all of TRU France Real Estate’s revenues and cash flows are derived from payments from France Opco under a series of amended lease agreements. The loan is secured by nine properties located in France. The France Propco Facility Agreement will mature on February 27, 2018 and bears interest equal to EURIBOR plus 4.50%. We have entered into an interest rate cap as required under the France Propco Facility Agreement capping EURIBOR at 2.50% per annum. Additionally, TRU France Real Estate is required to make principal payments equal to 1.25% per year of the original loan amount. As such, $1 million has been classified as Current portion of long-term debt on our Consolidated Balance Sheets as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for this credit facility were $2 million and $4 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The France Propco Facility Agreement contains covenants that, among other things, restrict the ability of TRU France Real Estate to incur additional indebtedness, pay dividends or make other distributions, make restricted payments or certain investments, create or permit liens on assets, sell assets or engage in mergers or consolidations. The agreement also contains financial covenants including a loan to value covenant and an interest coverage ratio covenant relating to France Propco.

7.375% senior notes, due fiscal 2018 ($402 million at January 31, 2015)

On September 22, 2003, the Parent Company issued $400 million in notes bearing interest at a coupon rate of 7.375%, which will mature on October 15, 2018. The notes were issued at a discount of $2 million which resulted in proceeds of $398 million. Simultaneously with the sale of the notes, we entered into interest rate swap agreements. We subsequently terminated the swaps and received a payment of $10 million which is being amortized over the remaining term of the notes. Interest is payable semi-annually on April 15 and October 15 of each year. These notes carry a limitation on creating liens on domestic real property or improvements or the stock or indebtedness of domestic subsidiaries (subject to certain exceptions) that exceed the greater of 10% of the consolidated net tangible assets or 15% of the consolidated capitalization. The covenants also restrict sale and leaseback transactions (subject to certain exceptions) unless net proceeds are at least equal to the sum of all costs incurred in connection with the acquisition of the principal property and a lien would be permitted on such principal property. Deferred debt issuance costs for these notes were $1 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Senior unsecured term loan facility, due fiscal 2019 ($965 million at January 31, 2015)

On August 21, 2013, TRU Propco I entered into the Propco I Term Loan Facility for an aggregate principal amount of $985 million. The Propco I Term Loan Facility was issued at a discount of $10 million, which resulted in proceeds of $975 million. The proceeds, together with other funds available to TRU Propco I, were used to redeem in full TRU Propco I’s $950 million senior unsecured 10.750% notes due fiscal 2017 (the “Propco I Notes”), plus accrued interest, premiums and expenses, and to pay fees and expenses relating to the Propco I Term Loan Facility. As a result of the repayment of the Propco I Notes, we expensed $77 million composed of a redemption premium of $51 million, and the write-off of unamortized original issue discount and deferred debt issuance costs during fiscal 2013. KKR owned an aggregate of $17 million of the Propco I Term Loan Facility as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for this loan were $23 million and $27 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

TRU Propco I owns fee and leasehold interests in properties in the United States, which it leases on a long-term basis to Toys-Delaware, pursuant to a master lease agreement.

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The Propco I Term Loan Facility matures on August 21, 2019 and bears interest equal to, at the option of TRU Propco I, (i) LIBOR plus a margin of 5.00% per annum or (ii) the Base Rate (defined as the highest of (x) the Federal Funds Rate plus 0.50%, (y) the rate of interest in effect for such day as publicly announced from time to time by the Administrative Agent as its “prime rate,” and (z) one-month LIBOR plus 1.00%) plus a margin of 4.00% per annum, each of (i) and (ii)(z) subject to a LIBOR floor of 1.00%. The Propco I Term Loan Facility currently bears interest equal to LIBOR plus a margin of 5.00% per annum. The Propco I Term Loan Facility is guaranteed by all of TRU Propco I’s subsidiaries (the “Guarantors”). The Propco I Term Loan Facility is solely the obligation of TRU Propco I and the Guarantors and is not guaranteed by the Parent Company or Toys-Delaware.

The Propco I Term Loan Facility is required to be repaid in equal quarterly installments commencing January 31, 2014 in aggregate annual amounts equal to 1.00% of the original principal amount, with the balance payable on the final maturity date. The Propco I Term Loan Facility also requires TRU Propco I to prepay outstanding term loans with 25% of TRU Propco I’s annual excess cash flow (as defined in the Propco I Term Loan Facility), commencing with the fiscal year ending January 31, 2015, subject to the right of the lenders to decline such prepayment (the “Declined Proceeds”). Additionally, the Propco I Term Loan Facility requires TRU Propco I to prepay outstanding term loans at specified times, subject to certain exceptions and reinvestment rights, in connection with certain asset sales in an amount generally equal to 65% of the appraised value (as defined in the Propco I Term Loan Facility) of the real property disposed of in such sale. As such, an aggregate amount of $57 million has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Propco I may optionally prepay the outstanding principal balance of the loan at any time.

The Propco I Term Loan Facility contains certain affirmative and negative covenants, including, among other things, covenants that, subject to certain exceptions, restrict the ability of TRU Propco I and its subsidiaries to incur certain additional indebtedness, make distributions, create or permit liens on assets, sell or otherwise dispose of assets, or engage in mergers or consolidations. The exceptions include the right of TRU Propco I to make distributions from 75% of excess cash flow plus certain other amounts, including Declined Proceeds, subject to the satisfaction of certain conditions, including satisfaction of a fixed charge ratio (as defined in the Propco I Term Loan Facility) of at least 2.0 to1.0 for 50% of such distributions. If an event of default under the Propco I Term Loan Facility shall occur and be continuing, the principal amount of loans outstanding thereunder, together with all accrued and unpaid interest and other amounts owed thereunder, may be declared immediately due and payable.

Tranche A-1 loan facility, due fiscal 2019 ($272 million at January 31, 2015)

On October 24, 2014, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the ABL Facility to provide for, among other things, the Tranche A-1 Loan in an aggregate principal amount of $280 million. Toys-Canada borrowed $125 million principal amount of the Tranche A-1 Loan, which is subject to foreign exchange re-measurement. The Tranche A-1 Loan was issued at a discount of $8 million, which resulted in the receipt of gross proceeds of $272 million. In conjunction with the Tranche A-1 Loan, we capitalized $8 million of transaction fees as deferred debt issuance costs, which are being amortized over the term of the facility. Deferred debt issuance costs for this loan were $7 million as of January 31, 2015 and have been included in Other assets on our Consolidated Balance Sheet.

The Tranche A-1 Loan will mature on October 24, 2019, subject to a springing maturity in 2018 if the remaining Incremental secured term loan and Second incremental secured term loan have not been refinanced, extended or otherwise replaced or repaid prior to such time. The Tranche A-1 Loan will bear interest equal to, at the option of Toys-Delaware or Toys-Canada, as applicable, (i) LIBOR plus a margin of 7.25% per annum (subject to a LIBOR floor of 1.00%) or (ii) the Prime Rate (defined as the highest of (x) the rate of interest in effect for such day as publicly announced from time to time by the ABL Agent as its “prime rate”, (y) the Federal Funds Rate plus 0.50%, and (z) one-month LIBOR plus 1.00%), plus a margin of 6.25% per annum. The Tranche A-1 Loan currently bears interest equal to LIBOR plus a margin of 7.25% per annum (subject to a LIBOR floor of 1.00%).

Certain prepayments of the Tranche A-1 Loan which lower the All-in Yield (as defined in the credit agreement for the ABL Facility) of the Tranche A-1 Loan on or prior to the one-year anniversary of the refinancing closing date will be subject to a prepayment premium of 1.00% of the principal amount that is repriced or refinanced (subject to certain exceptions).

The Tranche A-1 Loan is guaranteed by Toys-Delaware’s subsidiaries (other than certain excluded subsidiaries) that guarantee the existing loans and commitments under the credit agreement for the ABL Facility. The Tranche A-1 Loan is secured by the same collateral that secures the existing loans and commitments under the credit agreement for the ABL Facility.

The Tranche A-1 Loan is subject to a borrowing base consisting of specified percentages of eligible inventory, eligible credit card receivables and certain Canadian real estate which does not reduce the availability under the borrowing base for the ABL Facility (provided that the Tranche A-1 Loan borrowing base includes (i) $125 million of the required availability amount for

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the ABL Facility and (ii) an availability reserve with respect to the borrowing base for the ABL Facility if the amount of outstanding Tranche A-1 Loan otherwise exceeds the borrowing base with respect to the Tranche A-1 Loan).

Secured Term Loan Credit Agreement

Incremental secured term loan, due fiscal 2018 ($133 million at January 31, 2015)

Second incremental secured term loan, due fiscal 2018 ($67 million at January 31, 2015)

Secured term B-4 loan facility, due fiscal 2020 ($1,010 million at January 31, 2015)

On October 24, 2014, Toys-Delaware amended the Secured Term Loan Credit Agreement to provide for, among other things, the Secured Term B-4 Loan tranche in an aggregate principal amount of $1,026 million. The Secured Term B-4 Loan was issued at a discount of $19 million.  In conjunction with the Secured Term B-4 Loan, we capitalized $27 million of transaction fees as deferred debt issuance costs which are being amortized over the term of the facility.  KKR owned an aggregate of $96 million of the Secured Term B-4 Loan as of January 31, 2015. Deferred debt issuance costs for this loan were $26 million as of January 31, 2015 and have been included in Other assets on our Consolidated Balance Sheet.

The Secured Term B-4 Loan and the Tranche A-1 Loan, together with other sources and funds available to Toys-Delaware, were used to (i) refinance in full the Secured term loan facility due fiscal 2016, (ii) extend $380 million of the term loans due fiscal 2018 under the Incremental secured term loan facility and the Second incremental secured term loan facility into the Secured Term B-4 Loan and (iii) redeem all of the Toys-Delaware Secured Notes at a redemption price of 101.844% of the principal amount thereof, plus accrued and unpaid interest to the redemption date.  As a result of the refinancing, we expensed $35 million, composed of the write-off of unamortized deferred debt issuance costs and original issue discount related to the extinguishment of the Secured term loan facility, and a portion of the Incremental secured term loan facility and the Second incremental secured term loan facility and the Toys-Delaware Secured Notes, as well as a redemption premium of $6 million on the Toys-Delaware Secured Notes.

The Secured Term B-4 Loan will mature on April 24, 2020 and bear interest equal to, at the option of Toys-Delaware, (i) LIBOR plus a margin of 8.75% per annum (subject to a LIBOR floor of 1.00%) or (ii) the Base Rate (defined as the highest of (x) the Federal Funds Rate plus 0.50%, (y) the rate of interest in effect for such day as publicly announced from time to time by the Term Agent as its “prime rate” and (z) one-month LIBOR plus 1.00%) plus a margin of 7.75% per annum (subject to a Base Rate floor of 2.00%). The Secured Term B-4 Loan currently bears interest equal to LIBOR plus a margin of 8.75% per annum (subject to a LIBOR floor of 1.00%).

The Secured Term B-4 Loan is required to be repaid in equal quarterly installments commencing February 28, 2015 in aggregate annual amounts equal to 1.00% of the original principal amount, with the balance payable on the final maturity date. As such, $10 million has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Voluntary prepayments and certain mandatory prepayments of the Secured Term B-4 Loan will be subject to a prepayment premium of (i) prior to the one and one-half year anniversary of the refinancing closing date, a “make-whole” price as set forth in the Secured Term Loan Credit Agreement, (ii) after the one and one-half year anniversary of the refinancing closing date, but prior to the two and one-half year anniversary of the refinancing closing date, 2.00% of the principal amount prepaid and (iii) after the two and one-half year anniversary of the refinancing closing date, but prior to the three and one-half year anniversary of the refinancing closing date, 1.00% of the principal amount prepaid.

On May 25, 2011, Toys-Delaware and certain of its subsidiaries entered into a Joinder Agreement (the “Joinder Agreement”) to the Secured Term Loan Credit Agreement. The Joinder Agreement added a tranche of term loans in an aggregate principal amount of $400 million due fiscal 2018 (“Incremental Secured Term Loan”). The Incremental Secured Term Loan was issued at a discount of $4 million which resulted in proceeds of $396 million. On October 24, 2014, Toys-Delaware refinanced $237 million of the Incremental Secured Term Loan outstanding in conjunction with the issuance of the Secured Term B-4 Loan described above. The Incremental Secured Term Loan will mature on May 25, 2018, and bears interest at LIBOR (with a floor of 1.50%) plus 3.75%, which is subject to a step down of 0.25% based on total leverage.

KKR owned an aggregate of $12 million and $50 million of the Incremental Secured Term Loan as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for this loan were $1 million and $4 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Pursuant to the terms of the Joinder Agreement, Toys-Delaware is required to make quarterly principal payments equal to 0.25% ($4 million per year) of the original principal amount of the Incremental Secured Term Loan. As such, this amount has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Toys-Delaware may optionally prepay the outstanding principal balance of the Incremental Secured Term Loan at any time.

On April 10, 2012, Toys-Delaware and certain of its subsidiaries entered into a Second Joinder Agreement (the “Second Joinder Agreement”) to the Secured Term Loan Credit Agreement. The Second Joinder Agreement added a tranche of term loans in an

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aggregate principal amount of $225 million due fiscal 2018 (“Second Incremental Secured Term Loan”). The Second Incremental Secured Term Loan was issued at a discount of $5 million, which resulted in proceeds of $220 million. On October 24, 2014, Toys-Delaware refinanced $143 million of the Second Incremental Secured Term Loan outstanding in conjunction with the issuance of the Secured Term B-4 Loan described above. The Second Incremental Secured Term Loan will mature on May 25, 2018, and bears interest at LIBOR (with a floor of 1.50%) plus 3.75%, subject to a 0.25% step-down based on our total leverage ratio.

KKR owned an aggregate of $2 million and $9 million of the Second Incremental Secured Term Loan as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for this loan was $1 million and $3 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Toys-Delaware is required to make quarterly principal payments equal to 0.25% ($2 million per year) of the original principal amount of the Second Incremental Secured Term Loan. As such, this amount has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Toys-Delaware may optionally prepay the outstanding principal balance of the Second Incremental Secured Term Loan at any time.

The Secured Term Loan Credit Agreement contains customary covenants applicable to Toys-Delaware and certain of its subsidiaries, including, among other things, covenants that restrict the ability of Toys-Delaware and certain of its subsidiaries to incur certain additional indebtedness, create or permit liens on assets, or engage in mergers or consolidations, pay dividends, repurchase capital stock, make other restricted payments, make loans or advances, engage in transactions with affiliates, or amend material documents. These covenants are subject to certain exceptions, including among other things to allow for certain other additional debt incurrences including unsecured, later-maturing debt subject to a fixed charge coverage test and the provision of a cumulative credit exception allowing for Toys-Delaware and certain of its subsidiaries to make investments, pay dividends and make certain other restricted payments subject to Toys-Delaware meeting a fixed charge coverage test. If an event of default under the Secured Term Loan Credit Agreement occurs and is continuing, the principal amount outstanding, together with all accrued and unpaid interest and other amounts owed may be declared by the lenders or become immediately due and payable. Toys-Delaware may optionally prepay the outstanding principal balance of the loans at any time.

The Secured Term Loan Credit Agreement contains a provision that requires us to repay a specified percentage of excess cash flow generated in the previous fiscal year, as defined in the agreement. Cash flow generated for the fiscal year ended February 1, 2014 did not result in a required repayment under this provision during fiscal 2014. The October 24, 2014 amendment to the agreement waived the excess cash flow provision that would have applied to fiscal 2014. Further, the loans under the Secured Term Loan Credit Agreement are guaranteed by certain of Toys-Delaware subsidiaries and the borrowings thereunder are secured by the trademarks and certain other intellectual property of Geoffrey, LLC, Toys-Delaware’s wholly owned subsidiary, and the assets securing the ABL Facility including inventory, accounts receivable, equipment and certain other personal property owned or acquired by Toys-Delaware and certain of its subsidiaries.

In addition, the Secured Term B-4 Loan is guaranteed by Wayne Real Estate Parent Company, LLC (the “Additional Guarantor”) pursuant to an unsecured guarantee (the “Unsecured Guarantee”) for the benefit of the lenders of the Secured Term B-4 Loan. The Additional Guarantor is a wholly-owned subsidiary of the Company and is an indirect parent of TRU Propco I which, along with its wholly-owned subsidiaries, leases its properties to Toys-Delaware pursuant to a master lease agreement. Additionally, Toys-Delaware has agreed to provide, in the future, for the benefit of the lenders of the Secured Term B-4 Loan, a first priority security interest in certain specified real property, subject to certain exceptions.

The Unsecured Guarantee contains certain provisions triggering mandatory prepayments by Toys-Delaware of the Secured Term B-4 Loan, including, among other things, in connection with the incurrence of certain additional indebtedness and the making of certain restricted payments, in each case, by the Additional Guarantor and its subsidiaries, subject to certain exceptions, including exceptions for indebtedness and restricted payments permitted under the current Propco I Term Loan Facility. The Unsecured Guarantee also contains certain covenants applicable to the Additional Guarantor and its subsidiaries, including, among other things, limitations on the sale or disposition of assets and the conduct of business, subject to certain exceptions. In addition, if the Additional Guarantor fails to comply with certain covenants in the Unsecured Guarantee, additional interest of 2.00% per annum with respect to the aggregate outstanding principal amount of Secured Term B-4 Loan will be payable by Toys-Delaware.

£263 million UK real estate credit facility, due fiscal 2020 ($396 million at January 31, 2015)

On March 25, 2013, UK Propco entered into the UK Propco Facility Agreement with Debussy, pursuant to which Debussy made the UK Propco Loan to UK Propco on March 28, 2013 in the aggregate principal amount of £263 million. UK Propco owns freehold and leasehold interests in properties in various retail markets throughout the United Kingdom. Under an operating company/property company structure, UK Propco leases these properties on a triple-net basis to Toys “R” Us Limited (“UK Opco”). Substantially all of UK Propco’s revenues and cash flows are derived from payments from UK Opco under a

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series of amended lease agreements. The UK Propco Loan is secured by, among other things, 31 owned and leased properties held by UK Propco, certain cash reserve accounts which are classified as Restricted cash on the Consolidated Balance Sheets and the stock of UK Propco. The UK Propco Loan bears interest on a weighted average basis of 6.85% per annum plus mandatory costs and matures on July 7, 2020.

The UK Propco Facility Agreement contains covenants that restrict the ability of UK Propco to incur certain additional indebtedness, make restricted payments or certain investments, create or permit liens on assets, dispose of properties, acquire further property, vary or terminate the lease agreements referred to above, conclude further leases or engage in mergers or consolidations. If an event of default, including an event resulting from the failure to comply with a rent to interest coverage ratio applicable to UK Propco, under the UK Propco Loan occurs and is continuing, the principal amount outstanding, together with all accrued and unpaid interest and other amounts owed may be declared immediately due and payable by the lenders. The loans are subject to mandatory prepayments in certain cases, including from the proceeds of certain permitted property disposals, and UK Propco may optionally prepay the loans at any time, provided that prior to July 7, 2015 and subject to certain exceptions, the loans may only be prepaid in full. Any prepayment prior to July 7, 2015, subject to certain exceptions, shall be subject to a “make whole” premium. Any prepayment occurring during the first, second and third year after July 7, 2015 are subject to a prepayment fee equal to 3%, 2% and 1%, respectively, of the amount of the loan prepaid.

Debussy is a special purpose entity established with the limited purpose of making loans and issuing £263 million of the Debussy Notes to third party investors and the Company. On July 24, 2013, Debussy completed the securitization of the UK Propco Loan, the notes of which are now publicly traded on the Irish Stock Exchange. In connection with the securitization, UK Propco entered into an amendment and restatement agreement relating to the UK Propco Facility Agreement.  The Company owns and holds £13 million ($20 million as of January 31, 2015) principal amount of the various classes of the Debussy Notes, which are included in Other assets within the Consolidated Balance Sheet, classified as held-to-maturity and reported at amortized cost. For further details regarding the consolidation of Debussy, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.” Deferred debt issuance costs for this credit facility were $16 million and $21 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Toys-Japan bank loans (1.85% to 2.45%), due fiscals 2015-2021 ($63 million at January 31, 2015)

Toys-Japan had four bank loans with various financial institutions totaling $63 million at January 31, 2015. On January 17, 2011, Toys-Japan entered into a bank loan with a syndicate financial institution for ¥11.5 billion. The loan will mature on January 29, 2016 and bears an interest rate of TIBOR plus 1.50% per annum. In conjunction with the loan, we entered into an interest rate swap, converting the variable rate of interest to a fixed rate of 2.45%. The swap has been designated as a cash flow hedge. Toys-Japan is required to make principal payments of ¥1.6 billion annually in January of each year, with the remaining principal and interest due upon maturity. The outstanding balance of this loan was ¥4.9 billion or $42 million, which has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. On February 28, 2011, Toys-Japan entered into a bank loan with a financial institution for ¥1.0 billion. The loan will mature on February 25, 2016 and bears an interest rate of 1.85% per annum. Toys-Japan is required to make semi-annual principal payments of ¥115 million ($1 million at January 31, 2015). As of January 31, 2015, the outstanding balance of this loan was ¥310 million or $3 million. On October 31, 2014, Toys-Japan entered into a bank loan with a financial institution for ¥0.5 billion. The loan will mature on October 25, 2019 and bears an interest rate of 1.85% per annum. Toys-Japan is required to make semi-annual principal payments of ¥50 million (less than $1 million at January 31, 2015). As of January 31, 2015, the outstanding balance of this loan was ¥0.5 billion or $4 million. On February 28, 2013, Toys-Japan entered into a bank loan with a financial institution for ¥2.0 billion. The loan will mature on February 26, 2021 and bears an interest rate of 2.18% per annum. Toys-Japan is required to make semi-annual principal payments of ¥125 million ($1 million at January 31, 2015). As of January 31, 2015, the outstanding balance of this loan was ¥1.6 billion or $14 million. For these loans, the semi-annual principal payments due within one year totaling $5 million are classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Deferred debt issuance costs for these loans were less than $1 million and $1 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets. In addition, during fiscal 2014, two of the previously outstanding loans matured.

These agreements contain covenants that require, among other things, Toys-Japan to maintain a certain level of net assets and profitability during the agreement terms, including provisions that require Toys-Japan to not incur two consecutive years of ordinary loss in accordance with JGAAP, as defined in the credit agreement. The agreement also restricts Toys-Japan from paying dividends or making loans to affiliates without lender consent.

8.750% debentures, due fiscal 2021 ($22 million at January 31, 2015)

On August 29, 1991, the Parent Company issued $200 million in debentures bearing interest at a coupon rate of 8.750% (the “Debentures”), maturing on September 1, 2021. Interest is payable semi-annually on March 1 and September 1 of each year.

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On November 2, 2006, Toys-Delaware commenced a cash tender offer for any and all of the outstanding Debentures (the “Tender Offer”) and a related consent solicitation to effect certain amendments to the indenture, eliminating all of the restrictive covenants and certain events of default in the indenture. On November 30, 2006, the Tender Offer expired, and on December 1, 2006, Toys-Delaware consummated the Tender Offer of $178 million or 89% of the outstanding Debentures in the Tender Offer using borrowings under an unsecured credit facility to purchase the tendered Debentures. Deferred debt issuance costs for these Debentures were nominal as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

NOTE 3 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We are exposed to market risk from potential changes in interest rates and foreign currency exchange rates. We regularly evaluate our exposure and enter into derivative financial instruments to economically manage these risks. We record all derivatives as either assets or liabilities on the Consolidated Balance Sheets measured at estimated fair value and we do not offset assets and liabilities with the same counterparty. We recognize the changes in fair value as unrealized gains and losses. The recognition of these gains or losses depends on our intended use of the derivatives and the resulting designation. In certain defined conditions, we may designate a derivative as a hedge for a particular exposure.

Interest Rate Contracts

We and our subsidiaries have a variety of fixed and variable rate debt instruments and are exposed to market risks resulting from interest rate fluctuations. We enter into interest rate swaps and/or caps to reduce our exposure to variability in expected future cash outflows and changes in the fair value of certain Long-term debt, attributable to the changes in LIBOR, EURIBOR and TIBOR. Some of our interest rate contracts contain credit-risk related contingent features and are subject to master netting arrangements. As of January 31, 2015, our interest rate contracts have various maturity dates through February 2018. A portion of our interest rate swaps and caps as of January 31, 2015 are designated as cash flow hedges in accordance with ASC 815.

The hedge accounting for a designated cash flow hedge requires that the effective portion be recorded to Accumulated other comprehensive (loss) income; the ineffective portion of a cash flow hedge is recorded to Interest expense. We evaluate the effectiveness of our cash flow hedging relationships on an ongoing basis. For our derivatives that are designated as cash flow hedges, no material ineffectiveness was recorded for fiscals 2014, 2013 and 2012, respectively. Reclassifications from Accumulated other comprehensive (loss) income to Interest expense primarily relate to realized Interest expense on interest rate swaps and caps and the amortization of gains (losses) recorded on previously terminated or de-designated swaps and caps. We expect to reclassify a net loss of $1 million in fiscal 2015 to Interest expense from Accumulated other comprehensive (loss) income.

The hedge accounting for a designated fair value hedge requires that the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk be recognized in Interest expense. We evaluate the effectiveness of our fair value hedging relationship on an ongoing basis and recalculate the change in the fair value of the derivative and the underlying hedged item separately. During fiscal 2014, the $350 million notional amount interest rate swap that we designated as a fair value hedge failed to meet the effectiveness assessment thresholds required to qualify for hedge accounting. Accordingly, subsequent changes in the fair value of the derivative were recorded in Interest expense. We recorded net gains of less than $1 million in earnings related to ineffectiveness for fiscal 2013 and we recorded a net gain of $5 million in earnings related to ineffectiveness for fiscal 2012. In conjunction with the dedesignation of the fair value hedge, commencing in the second quarter of fiscal 2014, we no longer adjusted the hedged debt for changes in fair value attributable to changes in the benchmark interest rate. We were amortizing to maturity the residual basis adjustment to the hedged debt from the application of hedge accounting to Interest expense. In the third quarter of fiscal 2014, we extinguished the previously hedged debt and recognized a $4 million gain in Interest expense. On November 26, 2014, we terminated the associated $350 million notional amount interest rate swap which was originally scheduled to expire in September 2016. As a result, we received cash proceeds of $10 million, which included $1 million of accrued interest receivable.

Certain of our agreements with credit-risk related contingent features contain cross-default provisions which provide that we could be declared in default on our derivative obligations if we default on certain specified indebtedness. As of January 31, 2015 and February 1, 2014, there were no derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 31, 2015 and February 1, 2014, we were not required to post collateral for any of these derivatives.

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The following table presents our outstanding interest rate contracts as of January 31, 2015 and February 1, 2014:

			January 31, 2015	February 1, 2014
(In millions)	Effective Date	Maturity Date	Notional Amount	Notional Amount
Interest Rate Swaps
3 Month USD LIBOR Fixed to Float Interest Rate Swap (1)	September 2010	September 2016	—	350
6 Month JPY TIBOR Float to Fixed Interest Rate Swap (2)	January 2011	January 2016	42	65
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (2)	January 2011	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap	January 2011	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap (3)	January 2012	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap	January 2012	April 2015	500	500
3 Month EURIBOR Interest Rate Cap (2)	January 2013	January 2016	34	71
3 Month EURIBOR Interest Rate Cap (2)	February 2013	February 2018	53	64
1 Month USD LIBOR Interest Rate Cap	January 2014	April 2015	311	311

(1) On November 26, 2014, we terminated this interest rate swap. As a result, we received cash proceeds of $10 million, which included $1 million of accrued interest receivable as described above.

(2) As of January 31, 2015, these derivatives were designated for hedge accounting.

(3) The Company de-designated a portion of this interest rate cap in fiscal 2010. As of January 31, 2015 and February 1, 2014, 40% of the $500 million interest rate cap is designated as a cash flow hedge.

Foreign Exchange Contracts

We enter into foreign currency forward contracts to economically hedge the USD merchandise purchases of our foreign subsidiaries and our short-term, cross-currency intercompany loans with and between our foreign subsidiaries. We enter into these contracts in order to reduce our exposure to the variability in expected cash outflows attributable to changes in foreign currency rates. These derivative contracts are not designated as hedges and are recorded on our Consolidated Balance Sheets at fair value with a gain or loss recorded on the Consolidated Statements of Operations in Interest expense.

Our foreign exchange contracts typically mature within 12 months. Some of these contracts contain credit-risk related contingent features and are subject to master netting arrangements. Some of these agreements contain provisions which provide that we could be declared in default on our derivative obligations if we default on certain specified indebtedness. At January 31, 2015 and February 1, 2014, derivative liabilities related to agreements that contain credit-risk related contingent features had a fair value of $2 million and less than $1 million, respectively. We are not required to post collateral for these contracts.

The following table presents our outstanding foreign exchange contracts as of January 31, 2015 and February 1, 2014:

			January 31, 2015		February 1, 2014
(In millions)	Effective Date	Maturity Date	Notional  Amount		Notional  Amount
Foreign-Exchange Forwards
Short-term cross-currency intercompany loans	Varies	Varies	$	98	$	104
Merchandise purchases	Varies	Varies	—		—

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The following table sets forth the net impact of the effective portion of derivatives designated as cash flow hedges on Accumulated other comprehensive (loss) income on our Consolidated Statements of Stockholders’ (Deficit) Equity for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Derivatives designated as cash flow hedges:
Beginning balance	$	(1	)	$	(2	)	$	(2	)
Change in fair value recognized in Accumulated other comprehensive (loss) income - Interest Rate Contracts	—			—			—
Reclassifications from Accumulated other comprehensive (loss) income - Interest Rate Contracts	1			1			—
	1			1			—
Ending balance	$	—		$	(1	)	$	(2	)

The following table sets forth the impact of derivatives on Interest expense on our Consolidated Statements of Operations for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Derivatives not designated for hedge accounting:
(Loss) gain on the change in fair value - Interest Rate Contracts	$	(2	)	$	—		$	7
Loss on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	(9		)	(1		)	(2		)
Gain (loss) on the change in fair value - Merchandise Purchases Program Foreign Exchange Contracts	9			2			(1		)
	(2		)	1			4
Derivatives designated as cash flow hedges:
Loss reclassified from Accumulated other comprehensive (loss) income (effective portion) - Interest Rate Contracts	—			—			(1		)
Gain amortized from terminated cash flow hedges - Interest Rate Contracts	—			—			1
Amortization of hedged caps	(2		)	(1		)	—
	(2		)	(1		)	—
Derivative designated as a fair value hedge:
Amortization of swap basis adjustment - Interest Rate Contract	—			(1		)	(1		)
Loss on the change in fair value - Interest Rate Contract	(2		)	(5		)	—
Gain recognized in Interest expense on hedged item	2			5			5
	—			(1		)	4
Total Interest expense	$	(4	)	$	(1	)	$	8

(1) Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

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The following table contains the notional amounts and related fair values of our derivatives included within our Consolidated Balance Sheets as of January 31, 2015 and February 1, 2014:

	January 31, 2015					February 1, 2014
(In millions)	Notional Amount		Fair Value Assets/ (Liabilities)			Notional Amount		Fair Value Assets/ (Liabilities)
Interest Rate Contracts designated as cash flow hedges:
Prepaid expenses and other current assets (1)	$	734	$	—		$	—	$	—
Other assets	53		—			835		—
Accrued expenses and other current liabilities (1)	42		—			—		—
Other non-current liabilities	—		—			65		(1		)
Interest Rate Contract designated as a fair value hedge:
Other assets	—		—			350		13
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets (1)	1,611		—			—		—
Other assets	—		—			1,611		—
Foreign Currency Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	8		—			26		—
Accrued expenses and other current liabilities	$	90	$	(2	)	$	78	$	—
Total derivative contracts outstanding:
Prepaid expenses and other current assets	$	2,353	$	—		$	26	$	—
Other assets	53		—			2,796		13
Total derivative assets (2)	$	2,406	$	—		$	2,822	$	13
Accrued expenses and other current liabilities	$	132	$	(2	)	$	78	$	—
Other non-current liabilities	—		—			65		(1		)
Total derivative liabilities (2)	$	132	$	(2	)	$	143	$	(1	)

(1) Amounts as of January 31, 2015 includes reclassifications of contracts scheduled to mature within the next 12 months, which were previously included within Other assets or Other non-current liabilities as of February 1, 2014.

(2) Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the fair value of our derivative instruments classified within the fair value hierarchy.

Offsetting of Derivatives

We present our derivatives at gross fair values in the Consolidated Balance Sheets. However, some of our interest rate and foreign exchange contracts are subject to master netting arrangements which allow net settlements under certain conditions. As of January 31, 2015 and February 1, 2014, the aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets were nominal, respectively, and the aggregate gross fair value of derivative assets which could be net settled against our derivative liabilities were nominal, respectively. As of January 31, 2015 and February 1, 2014, none of the master netting arrangements involved collateral.

NOTE 4 — FAIR VALUE MEASUREMENTS

To determine the fair value of our assets and liabilities, we utilize the established fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Derivative Financial Instruments

Currently, we use derivative financial arrangements to manage a variety of risk exposures, including interest rate risk associated with our Long-term debt and foreign currency risk relating to cross-currency intercompany lending and merchandise purchases. The valuation of our foreign currency contracts is determined using market-based foreign exchange rates, which are classified as Level 2 inputs.

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The valuation of our interest rate contracts is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves, foreign exchange rates and implied volatilities. We evaluate the inputs used to value our derivatives at the end of each reporting period.

For our interest rate contracts, we primarily use Level 2 inputs mentioned above to arrive at fair value. Additionally, for interest rate contracts we also incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements taking into account the impact of any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees. We measure the credit risk of our derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. The portfolio-level adjustments are then allocated each period to the individual assets or liabilities within the portfolio.

The credit valuation adjustments are calculated by determining the total expected exposure of the derivatives (which incorporates both the current and potential future exposure) and then applying each counterparty’s credit spread to the applicable exposure. The total expected exposure of a derivative is derived using market-observable inputs, such as yield curves and volatilities. The inputs utilized for our own credit spread are based on implied spreads from our debt, which are considered unobservable inputs. These credit valuation adjustments fall within Level 3 of the fair value hierarchy and include estimates of current credit spreads to evaluate the likelihood of default. For counterparties with publicly available credit information, the credit spreads over LIBOR used in the calculations represent implied credit default swap spreads obtained from a third party credit data provider. Generally, significant increases (decreases) in our own credit spread in isolation would result in significantly lower (higher) fair value measurement for these derivatives. Based on the mixed input valuation, we classify these derivatives based on the lowest level in the fair value hierarchy that is significant to the overall fair value of the instrument.

Any transfer into or out of a level of the fair value hierarchy is recognized based on the value of the instruments at the end of the reporting period.

The table below presents our assets and liabilities measured at fair value on a recurring basis as of January 31, 2015 and February 1, 2014, aggregated by level in the fair value hierarchy within which those measurements fall.

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Liabilities
Derivative financial instruments:
Interest rate contracts	$	—	$	—	$	—	$	—
Foreign exchange contracts	—		2		—		2
Total liabilities	$	—	$	2	$	—	$	2

Fiscal 2013

(In millions)	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets
Derivative financial instruments:
Interest rate contracts	$	—	$	13	$	—	$	13
Foreign exchange contracts	—		—		—		—
Total assets	$	—	$	13	$	—	$	13
Liabilities
Derivative financial instruments:
Interest rate contracts	$	—	$	1	$	—	$	1
Foreign exchange contracts	—		—		—		—
Total liabilities	$	—	$	1	$	—	$	1

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For the fiscal years ended January 31, 2015 and February 1, 2014, we had no derivative financial instruments within Level 3 of the fair value hierarchy.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Certain of our assets and liabilities are measured at fair value on a nonrecurring basis. We evaluate the carrying value of all long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The fair value measurements related to long-lived assets held and used classified as Level 3 were determined using a discounted cash flow valuation method or a relative, market-based approach based on purchase offers or appraisals we have received from third parties. The inputs we use to calculate discounted cash flows include the projected cash flows for the asset group (generally by store location) and, when significant, a risk-adjusted rate of return we estimate would be used by a market participant in valuing the assets. The projected cash flows are based on the Company’s sales, gross margin and expense forecasts for each asset group, taking into consideration historical cash flows, as well as anticipated costs and/or proceeds from disposal. For our market-based valuations, we use purchase offers we receive from third parties, predominantly for our properties, which are classified as Level 3 because they are not received in an organized market or observable to market participants. Alternatively, when management commits to sell properties and no third party offers exist, we use asset appraisals conducted by external specialists with experience in real estate valuations. These require a significant amount of judgment regarding appropriate comparable properties and their assessment of current market conditions.

For the fiscal years ended January 31, 2015 and February 1, 2014, we had no impairments to long-lived assets held for sale. There have been no changes in valuation technique or related inputs for long-lived assets for the fiscal years ended January 31, 2015 and February 1, 2014. During fiscal 2014, management determined that fair values based on offers received should be reclassified to Level 3. The impact of this change on the prior period was deemed immaterial.

Goodwill is evaluated for impairment annually or whenever we identify certain events or circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The fair value measurements related to goodwill are classified as Level 3 and were determined by blending results from the market multiples approach and the income approach. These valuation approaches consider a number of factors that include, but are not limited to, expected future cash flows, growth rates, discount rates, and comparable multiples from publicly-traded companies in our industry, and require us to make certain assumptions and estimates regarding industry economic factors and future profitability of our business. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details on the valuation technique and related inputs for goodwill. For the fiscal year ended January 31, 2015, we had no goodwill impairment. There have been no changes in valuation technique or related inputs for goodwill for the fiscal years ended January 31, 2015 and February 1, 2014.

The table below presents our long-lived assets and goodwill evaluated for impairment and measured at fair value on a nonrecurring basis for the fiscal years ended January 31, 2015 and February 1, 2014, aggregated by level in the fair value hierarchy within which those measurements fall. Because these assets are not measured at fair value on a recurring basis, certain carrying amounts and fair value measurements presented in the table may reflect values at earlier measurement dates and may no longer represent their fair values at January 31, 2015 and February 1, 2014. As of January 31, 2015 and February 1, 2014, we did not have any long-lived assets or goodwill classified as Level 1 or Level 2 within the fair value hierarchy, respectively.

Fiscal 2014

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3)		Impairment Losses (1)
Long-lived assets held and used	$	20	$	7	$	13
Total	$	20	$	7	$	13

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Fiscal 2013

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3) (2)		Impairment Losses (1)
Long-lived assets held and used	$	68	$	24	$	44
Goodwill (3)	445		64		378
Total	$	513	$	88	$	422

(1) Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

(2) Includes fair values based on offers received of $11 million as of February 1, 2014 which were previously classified as Level 2 and should have been Level 3.

(3) Includes foreign currency translation of $3 million.

Other Financial Instruments

The fair values of our Long-term debt including current portion are estimated using quoted market prices for the same or similar issues and other pertinent information available to management as of the end of the respective periods. The fair values of debt instruments classified as Level 1 are based on quoted prices in reasonably active markets and Level 2 instruments are valued using market prices we obtain from external third parties. Debt instruments classified as Level 3 are not publicly traded, and therefore we are unable to obtain quoted market prices, and are generally valued using estimated spreads, a present value calculation or a cash flow analysis, as appropriate. There have been no significant changes in valuation technique or related inputs for Long-term debt for the fiscal years ended January 31, 2015 and February 1, 2014. The table below presents the carrying values and fair values of our Long-term debt including current portion as of January 31, 2015 and February 1, 2014, aggregated by level in the fair value hierarchy within which those measurements fall.

	Long-term Debt
(In millions)	Carrying Value		Fair Value		Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
January 31, 2015	$	4,788	$	4,416	$	1,346	$	2,315	$	755
February 1, 2014	5,007		4,541		1,411		2,303		827

Other financial instruments that are not measured at fair value on our Consolidated Balance Sheets include cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and short-term borrowings. Due to the short-term nature of these assets and liabilities, their carrying amounts approximate fair value.

NOTE 5 — PROPERTY AND EQUIPMENT

The following detail of property and equipment includes estimated useful lives which are generally used to depreciate the assets on a straight-line basis:

($ In millions)	Useful life (in years)	January 31, 2015		February 1, 2014
Land		$	695	$	733
Buildings	45-50	1,967		2,059
Furniture and equipment	3-20	1,639		1,733
Property and leasehold improvements	5-25	2,500		2,594
Costs of computer software	5	210		212
Construction in progress		32		20
Leased equipment under capital lease	3-5	51		57
		7,094		7,408
Less: accumulated depreciation and amortization		3,759		3,770
Total		$	3,335	$	3,638

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Net gains on sales of properties

During fiscals 2014, 2013 and 2012, we sold certain properties and assets for proceeds of $18 million, $35 million and $20 million, respectively, resulting in net gains of $5 million, $8 million and $4 million, respectively, which were recorded in Other income, net on our Consolidated Statements of Operations.

NOTE 6 — ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

A summary of our Accounts payable, Accrued expenses and other current liabilities as of January 31, 2015 and February 1, 2014 is outlined in the table below:

(In millions)	January 31, 2015		February 1, 2014
Merchandise accounts payable (1)	$	1,373	$	1,269
Non-merchandise accounts payable (2)	198		219
Accounts payable	$	1,571	$	1,488
Gift card and certificate liability	$	205	$	199
Accrued bonus	110		26
Sales and use tax and value added tax payable	84		75
Accrued interest	55		58
Accrued property taxes	52		55
Accrued sponsor transaction fees (3)	47		15
Accrued vacation	44		43
Accrued payroll	42		48
Other (4)	393		401
Accrued expenses and other current liabilities	$	1,032	$	920

(1) Includes $36 million and $51 million of book overdraft cash as of January 31, 2015 and February 1, 2014, respectively.

(2) Includes $84 million and $107 million of book overdraft cash as of January 31, 2015 and February 1, 2014, respectively.

(3) Includes fees payable to the Sponsors as a result of certain financing transactions. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

(4) Includes, among other items, employee benefits, accrued lease liabilities, current deferred tax liabilities and other accruals. No individual amount included exceeds 5% of Total current liabilities.

NOTE 7 — STOCK-BASED COMPENSATION

Management Equity Plan

On July 21, 2005, we adopted the Toys “R” Us, Inc. 2005 Management Equity Plan (the “Management Equity Plan”). Under the Management Equity Plan, outstanding awards during fiscal 2014 included service-based options and restricted stock to officers and other key employees of the Company and its subsidiaries. In connection with Amendment No. 2 to the 2010 Incentive Plan (“Amendment No. 2”) effective September 2014, the Company made the determination to no longer issue any awards under the Management Equity Plan.

The service-based options generally follow a graded vesting schedule of 40% on the second anniversary of the award with the remaining portion vesting in equal annual installments over the subsequent three years, subject to the participant’s continued employment with the Company, and vest automatically upon a change of control of the Company. All options generally expire on the tenth anniversary of the date of the grant, unless the terms are amended pursuant to the Management Equity Plan.

In November 2013, the Company extended the expiration dates of certain outstanding option awards under the Management Equity Plan, which were originally scheduled to expire in fiscals 2015 and 2016, to August 6, 2017. We accounted for the modification in accordance with ASC 718. Management concluded that the modification resulted in incremental compensation costs of $1 million, which were recorded in SG&A in fiscal 2013.

Under the Management Equity Plan, each participant’s restricted shares or shares issued or issuable pursuant to stock options will be subject to repurchase rights by the Company in the event of a termination of employment due to death or disability and under specific circumstances upon retirement. In connection with the 2014 Option Exchange described below, the exercise of

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any put rights on any shares held by the participants who elected to participate will be subject to the prior approval of the Board. The Company has no plans to open a transaction window for participants to put the shares to the Company in the foreseeable future.

2010 Incentive Plan

In fiscal 2010, we adopted the Toys “R” Us, Inc. 2010 Incentive Plan (the “2010 Incentive Plan”). The 2010 Incentive Plan provides that the total number of shares of our common stock that may be issued is 3,750,000 and the maximum number of such shares of common stock for which incentive stock options may be granted is 500,000. In connection with Amendment No. 2, the number of shares available for issuance under the 2010 Incentive Plan were increased by the number of shares available for issuance under the Management Equity Plan as of July 17, 2014 and any shares that after July 17, 2014 would have otherwise been available for issuance thereunder. The Board of Directors of the Company has discretion over the amount of shares available for future issuances of stock awards.

All outstanding options issued under the 2010 Incentive Plan and Management Equity Plan are scheduled to expire at dates ranging from August 6, 2017 to October 10, 2024. We expect to satisfy future option exercises by issuing shares held in treasury or authorized but unissued new shares.

Stock options

In fiscals 2014, 2013 and 2012, we granted options under the 2010 Incentive Plan. The options were granted at an exercise price equal to grant date fair market value. Options granted in fiscal 2014, except for the options granted under the 2014 Option Exchange described below, generally follow a graded vesting schedule of four equal annual installments commencing on the first anniversary of the awards. Additionally, certain options issued in fiscal 2014 will be subject to performance and time vesting and will only be deemed fully vested when they have both time vested and performance vested. Options granted in fiscals 2013 and 2012 generally follow a graded vesting schedule of 50% on the second anniversary of the awards with the remaining portion vesting in equal annual installments over the subsequent two years, subject to the participant’s continued employment with us, and will vest automatically upon a change of control of the Company. Options generally expire ten years from the date of the grant, however, the options issued in connection with the 2014 Option Exchange will expire the later of five years after the final vesting date of the New Options or the original expiration date of the respective Old Options.

Restricted Stock

Additionally, in connection with the services they provide as the Company’s Board of Directors, certain members of our Board of Directors were granted restricted stock units in fiscal 2014, which were valued at a fair market value on the grant date of $8.00 per share. These restricted stock units granted to certain members of our Board of Directors cliff vest 100% on the first anniversary of the grant date. In fiscals 2013 and 2012, concurrent with the grant of the options, additional awards were granted under the 2010 Incentive Plan consisting of service-based restricted stock and restricted stock units, which were valued at a fair market value on the date of grant of $30.00 per share and $44.00 per share in fiscals 2013 and 2012, respectively. The restricted stock units issued in fiscal 2013 for certain officers follow the same graded vesting schedule as the options granted in the same year, while the restricted stock units for other officers cliff vest 100% on the second anniversary of the award, subject to the participant’s continued employment with the Company, and will vest automatically upon a change in control of the Company. The service-based restricted stock and restricted stock units for fiscal 2012 follow the same graded vesting schedule as the options granted in the same year.

In fiscal 2012, certain officers were awarded performance-based restricted stock and restricted stock units valued at a fair market value on the date of the grant of $44.00. The performance-based awards cliff vest 100% on the third anniversary of the awards if the performance criteria have been met. The performance metrics are based 50% on our consolidated Adjusted Compensation EBITDA performance results and 50% on our total return on invested capital (ROIC) results, each over a three year period.

Option Exchanges

In November 2013, certain participants under the 2010 Incentive Plan were offered an opportunity to exchange certain of their outstanding stock options (“2013 Old Options”) and all outstanding performance shares or units for a grant of one new stock option (“2013 New Options”) for every two 2013 Old Options canceled, which 2013 New Options have an exercise price of $22.00. On December 23, 2013, the Company closed its offer with a total of 919,599 and 104,240 2013 Old Options and performance shares or units canceled, respectively, and a total of 459,805 2013 New Options issued under the 2010 Incentive Plan. The 2013 New Options follow a vesting schedule of 50% on the second anniversary of the awards with the remaining portion vesting in equal annual installments over the subsequent two years (subject to the earlier expiration in accordance with the 2013 New Option award agreement), subject to the participant’s continued employment with the Company, and will vest

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automatically upon a change of control of the Company. We accounted for the modification in accordance with ASC 718. Management has concluded that the modification had a nominal impact on compensation costs.

In September 2014, certain participants were offered an opportunity to exchange their outstanding stock options that were granted prior to fiscal 2014 (“Old Options”) under the Management Equity Plan or the 2010 Incentive Plan for new stock options granted under the 2010 Incentive Plan (“New Options”) on a one-for-one basis (the “2014 Option Exchange”). On October 10, 2014, the Company closed its offer with a total of 1,566,307 Old Options canceled and an equal amount of New Options issued under the 2010 Incentive Plan. The New Options have an exercise price of $8.00 and vest as follows: (i) New Options granted in exchange for Old Options originally granted during the period commencing on January 1, 2005 and ending on December 31, 2012 vest 50% on the award exchange date and 25% on each of the first and second anniversaries of the award exchange date and (ii) New Options granted in exchange for Old Options originally granted in fiscal 2013 vest in equal annual installments over the subsequent four years from the award exchange date. We accounted for the modification in accordance with ASC 718. Management concluded that the modification resulted in incremental compensation costs of $2 million in fiscal 2014, which were recorded in SG&A.

One-time awards

In connection with the appointment of Antonio Urcelay as CEO announced on October 16, 2013, the Company entered into an employment agreement which provided a one-time award of restricted stock units under the 2010 Incentive Plan, which had a grant date of November 5, 2013. The one-time award had a grant date fair value of $8 million, or $22.00 per share, 50% of which vested on October 16, 2014 and the remainder of which was scheduled to vest in equal installments at the end of each fiscal quarter commencing January 31, 2015, with the last portion scheduled to vest on October 31, 2015, subject to continued employment through the applicable vesting dates.

In October 2014, Mr. Urcelay exchanged the one-time restricted stock unit award described above for new options under the 2010 Incentive Plan. Pursuant to the terms of the amendment to Mr. Urcelay’s employment agreement, Mr. Urcelay forfeited certain of his outstanding restricted stock units in exchange for new options (the “Urcelay Options”). Fifty percent and 12.5% of the Urcelay Options vested on October 31, 2014, and January 31, 2015, respectively and 12.5% will vest on each of April 30, 2015, July 31, 2015 and October 31, 2015, subject to Mr. Urcelay’s continued employment on each such date. The Urcelay Options have the same exercise price per share as the New Options. We accounted for the modification in accordance with ASC 718. Management has concluded that the modification did not result in incremental compensation costs.

On November 5, 2013 the Company entered into an employment agreement with Harry J. Mullany III to serve as President, Toys “R” Us, US. The employment agreement provided a one-time award of stock options and restricted stock units under the 2010 Incentive Plan with grant date fair values of $5 million and $2 million, respectively, each at $22.00 per share.  Fifty percent of the options were scheduled to vest in four equal annual installments beginning on the first anniversary of the grant date. The remaining option awards were subject to time and performance vesting and would have only been deemed fully vested when the performance obligations pursuant to Mr. Mullany’s employment agreement were satisfied. The restricted stock units were scheduled to vest in four equal annual installments beginning on the first anniversary of the grant date. Additionally, Mr. Mullany purchased 22,728 shares of stock at a price of $22.00 per share.

In October 2014, the Company and Mr. Mullany entered into an option exchange pursuant to which Mr. Mullany exchanged his outstanding time-based and performance-based options described above for equal amounts of new time-based and performance-based options. The new time-based options have the same terms and exercise price per share as the New Options issued as part of the 2014 Option Exchange. Mr. Mullany’s new performance-based options, will be subject to time and performance vesting and will only be deemed fully vested when the performance criteria is satisfied. Additionally, Mr. Mullany forfeited certain of his outstanding restricted stock units in exchange for new time-based options (the “Mullany Options”). The Mullany Options have the same exercise price per share as the New Options and will vest in four equal annual installments commencing on November 5, 2014. We accounted for the modification in accordance with ASC 718. Management has concluded that the modification had a nominal impact on compensation costs.

In June 2014, the Company entered into an employment agreement with Michael J. Short to serve as Chief Financial Officer. The employment agreement provided (i) a one-time award of stock options under the 2010 Incentive Plan, which had a grant date of October 10, 2014 and will vest infour equal annual installments beginning on the first anniversary of the grant date and (ii) a one-time award of additional options, fifty percent of which will vest in four equal annual installments beginning on the first anniversary of the grant date and the remaining fifty percent of which are subject to time and performance vesting and will only be deemed fully vested when the performance obligations pursuant to Mr. Short’s employment agreement are satisfied. These one-time awards have a grant date fair value of $1 million, at $8.00 per share.

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Award Acceleration

In September 2014, the Company accelerated the vesting of certain restricted share units and restricted share awards issued under the 2010 Incentive Plan (the “Award Acceleration”). This acceleration provided that these unvested restricted shares for eligible participants became immediately vested as of September 8, 2014. We accounted for the modification of these awards in accordance with ASC 718. Management concluded that the acceleration resulted in incremental compensation costs of $1 million in fiscal 2014, which were included in SG&A.

In addition, the Company has no plans to open a transaction window for participants to put the shares to the Company in the foreseeable future, and therefore, the put right for these awards has effectively been eliminated. In accordance with ASC 718 and ASC 480, the shares have been reclassified from temporary equity to permanent equity as redemption of these equity awards is no longer considered probable or redeemable at the option of the holder.

Additional Amendments

Effective March 2012, participants in the Management Equity Plan are bound by the terms and conditions of Amendment No. 4 to the Management Equity Plan (“Amendment No. 4”). This amendment provided for, among other things, a longer exercise period, expiring no later than the original term of the option, and the right to a cashless exercise of options held by a participant who was terminated without cause after four or more years of continuous service. Option holders under the 2010 Incentive Plan had the same rights to a longer exercise period and a cashless exercise right in the event such participant’s employment was terminated without cause (or the participant resigns for good reason) after four or more years of continuous service and in certain cases of retirement, as further described in the form of option award agreement. We accounted for the modification of awards impacted by the terms of Amendment No. 4 in accordance with ASC 718. Management concluded that the modification had a nominal impact on compensation costs. In connection with the 2014 Option Exchange, the New Options will be subject to repurchase rights by the Company following a termination of employment and any cashless exercises will be subject to prior approval of the Board.

Effective May 2012, we adopted Amendment No. 5 (“Amendment No. 5”) to the Management Equity Plan. Amendment No. 5 allowed any plan participant, as long as he or she remains employed by the Company or its affiliates, the right to put up to 25%, calculated as provided in Amendment No. 5, of his or her Original Investment Shares, the number of shares that would be equal to the value of their original investment to us, during permitted transaction windows, until the occurrence of an initial public offering of the Company. The purchase price per share payable by us in connection with any such put rights would be the fair market value as of a date determined by our Board of Directors that would be the anticipated closing date of the repurchase. We accounted for the modification of awards impacted by the terms of Amendment No. 5 in accordance with ASC 718. As these awards allowed the plan participant the right to put a portion of their rollover options, we were required to account for them as liability-classified awards. These liability awards were remeasured at their fair market value as of each reporting period through the date of settlement. Management concluded that the modification resulted in incremental compensation costs of $2 million, which was recorded in SG&A in fiscal 2012. In connection with the 2014 Option Exchange, all shares issued under the Management Equity Plan will be subject to repurchase rights by the Company following a termination of employment and the exercise of any put rights on the shares will be subject to the prior approval of the Board. The Company has no plans to open a transaction window for participants to put the shares to the Company in the foreseeable future.

Effective March 2013, we adopted Amendment No. 6 (“Amendment No. 6”) to the Management Equity Plan which provides that any participant in the Management Equity Plan, who is a former employee of the Company or its affiliates as of March 1, 2013 or who continues to be employed by the Company or its affiliates, has the right to put to the Company (i) in 2013, up to 50% of his or her Original Investment Shares held at March 1, 2013 and (ii) in 2014, any or all of the participant’s then remaining Original Investment Shares, in each case, during permitted transaction windows, until the occurrence of an initial public offering of the Company. In each case, the purchase price per share payable by the Company in connection with any such put rights would be the fair market value determined as of a date determined by the Board of Directors that would be the anticipated closing date of the repurchase. Additionally effective in March 2013, certain participants under the 2010 Incentive Plan were granted the right to put to the Company any or all of the restricted stock that becomes vested as well as any net shares acquired upon vesting of restricted stock units beginning 6 months after the applicable vesting date of these awards. We accounted for the modification of these awards impacted under the Management Equity Plan and 2010 Incentive Plan in accordance with ASC 718 and ASC 480, and determined that the impacted awards retained equity classification. However, as these equity awards were redeemable for cash at the option of the holder and redemption was probable, the shares were recorded in temporary equity at their redemption value and the redemption amount was adjusted to fair market value as of each reporting period through the date of settlement. Management concluded that the modifications did not have an impact to compensation costs.

Commencing September 2014, concurrent with the Award Acceleration, the Company informed participants that it no longer has plans to open a transaction window for participants to put the shares to the Company in the foreseeable future, and therefore, the put right for these awards described above has effectively been eliminated. The shares previously recorded in

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temporary equity as a result of the adoption of Amendment No. 6 have been reclassified from temporary equity to permanent equity as redemption of these equity awards is no longer considered probable or redeemable at the option of the holder.

Valuation Assumptions

The fair value of each option award modified or granted under the 2010 Incentive Plan and Management Equity Plan is estimated on the date of modification or grant using a lattice option-pricing model that uses the assumptions noted in the following table, along with the associated weighted-average fair values. We use historical data to estimate pre-vesting option forfeitures. To the extent actual results of forfeitures differ from the estimates, such amounts will be recorded as an adjustment in the period the estimates are revised. The expected volatilities are based on a combination of implied and historical volatilities of a peer group of companies, as the Company is a non-publicly traded company. The risk-free rate is based on the United States Treasury yield curve in effect at the time of grant for periods corresponding with the expected life of the options. The expected term represents the median time until exercise and is based on contractual terms of the awards, expectations of employee exercise behavior and expectations of liquidity for the underlying shares. The expected dividend yield is based on an assumption that no dividends are expected to be approved in the near future. The following are the weighted-average assumptions used:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014	February 2, 2013
Volatility	45.0	%	40.0%-45.0%	50.0	%
Risk-free interest rate	1.4%-2.4%		2.0%-2.7%	1.8	%
Expected term	4.0-5.5 years		3.8-5.2 years	5.1 years
Dividend Yield	—		—	—
Weighted-average grant-date fair value per option:	$2.55		$9.67	$20.27

For fiscals 2014 and 2013, the range of assumptions presented includes the assumptions used for the modified option awards as well as the grants issued under the 2010 Incentive Plan.

Options

A summary of option activity under the 2010 Incentive Plan and Management Equity Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price
Outstanding at beginning of fiscal year	2,661,025		$	29.40	3,483,283		$	36.02	3,895,776		$	32.73
Granted	3,901,217		8.00		1,587,057		25.25		640,756		44.00
Exercised	—		—		(1,057,773	)	26.37		(735,576	)	21.61
Forfeited/Canceled	(2,639,871	)	29.23		(1,351,542	)	43.97		(317,673	)	45.13
Outstanding at end of fiscal year	3,922,371		$	8.23	2,661,025		$	29.40	3,483,283		$	36.02

	Options	Weighted-average Exercise Price		Weighted-average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Options vested or expected to vest at January 31, 2015	3,883,928	$	8.17	8.5	$	—
Options exercisable at January 31, 2015	—	$	—	—	$	—

There were no options exercised in fiscal 2014. The aggregate intrinsic value of options exercised, which includes options exercised on a net settlement basis, was $4 million and $16 million in fiscals 2013 and 2012, respectively. The total fair value of options vested was $2 million, $19 million and $23 million in fiscals 2014, 2013 and 2012, respectively. We received no proceeds from the exercise of options in fiscal 2013, and less than $1 million in fiscal 2012. We did not cash settle share-based liability awards in fiscal 2014. We paid a nominal amount and $2 million in fiscals 2013 and 2012, respectively, to cash settle share-based liability awards. We did not repurchase shares in fiscal 2014. We paid $8 million and less than $3 million in fiscals 2013 and 2012, respectively, to repurchase shares. We did not recognize any tax benefits as a result of options exercised in fiscal 2013 and recognized tax benefits of $6 million for options exercised in fiscal 2012.

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As of January 31, 2015, there was $10 million of total unrecognized compensation cost related to option share-based compensation arrangements granted under the 2010 Incentive Plan and Management Equity Plan. This cost is expected to be recognized over a weighted-average period of 2.6 years.

Restricted Shares and Units

A summary of nonvested restricted share activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Shares		Weighted-average Grant-date Fair Value		Shares		Weighted-average Grant-date Fair Value		Shares		Weighted-average Grant-date Fair Value
Nonvested shares at beginning of fiscal year	39,182		$	60.00	91,632		$	60.00	105,714		$	60.00
Granted	—		—		—		—		—		—
Shares vested	(35,472	)	60.00		(45,192	)	60.00		—		—
Forfeited/Canceled	(3,710	)	60.00		(7,258	)	60.00		(14,082	)	60.00
Nonvested shares at end of fiscal year	—		$	—	39,182		$	60.00	91,632		$	60.00

A summary of outstanding restricted stock unit activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value
Outstanding units at beginning of fiscal year	945,878		$	29.05	215,849		$	46.04	30,804		$	60.00
Granted	50,000		8.00		791,165		25.40		199,428		44.00
Units converted	(156,079	)	45.20		(20,694	)	51.93		(2,001	)	49.49
Forfeited/Canceled	(549,799	)	30.49		(40,442	)	36.66		(12,382	)	47.34
Outstanding units at end of fiscal year	290,000		$	14.01	945,878		$	29.05	215,849		$	46.04

As of January 31, 2015, there was $1 million of total unrecognized compensation cost related to restricted share-based compensation arrangements under the 2010 Incentive Plan. This cost is expected to be recognized over a weighted-average period of 1.1 years.

The fair value of restricted shares vested and restricted stock units converted was $9 million and $4 million for fiscals 2014 and 2013, respectively, and we did not recognize any tax benefits as a result of the vesting and conversion. The fair value of restricted shares vested and restricted stock units converted, and the tax benefits recognized as a result of the vesting and conversion, were nominal for fiscal 2012.

Performance-Based Shares and Units

A summary of performance-based stock unit activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value
Outstanding units at beginning of fiscal year	39,370		$	45.34	175,104		$	46.24	25,863		$	60.00
Granted	—		—		—		—		160,187		44.00
Units converted	—		—		(1,677	)	50.36		—		—
Forfeited/Canceled	(9,761	)	49.42		(134,057	)	46.45		(10,946	)	45.95
Outstanding units at end of fiscal year	29,609		$	44.00	39,370		$	45.34	175,104		$	46.24

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As of January 31, 2015, we did not have outstanding performance-based share awards as the performance-based share awards granted on May 26, 2011 were canceled as of the third anniversary date of the award due to the inability to meet the performance criteria for vesting.

The amount of stock-based compensation expense recognized in SG&A and the tax benefit recognized in Income tax expense in fiscals 2014, 2013 and 2012 was as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
SG&A	$	15	$	15	$	16
Total recognized tax benefit	—		—		6

NOTE 8 — ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

Total other comprehensive loss, net of tax is included in the Consolidated Statements of Comprehensive Loss and Consolidated Statements of Stockholders’ (Deficit) Equity. Accumulated other comprehensive (loss) income is reflected in the Consolidated Balance Sheets and Consolidated Statements of Stockholders’ (Deficit) Equity, as follows:

(In millions)	Foreign currency translation adjustments, net of tax			Unrealized gain (loss) on hedged transactions, net of tax			Unrecognized actuarial losses, net of tax			Accumulated other comprehensive (loss) income
Balance, January 28, 2012	$	54		$	(2	)	$	(8	)	$	44
Current period change	(46		)	—			(1		)	(47		)
Balance, February 2, 2013	8			(2		)	(9		)	(3		)
Current period change	(82		)	1			—			(81		)
Balance, February 1, 2014	(74		)	(1		)	(9		)	(84		)
Current period change	(128		)	1			(33		)	(160		)
Balance, January 31, 2015	$	(202	)	$	—		$	(42	)	$	(244	)

NOTE 9 — LEASES

We lease a majority of the real estate and certain equipment used in our operations. Most real estate leases require us to pay real estate taxes and other expenses and some leases require additional payments based on percentages of sales.

Minimum rental commitments under non-cancelable operating leases, capital leases and lease financing obligations as of January 31, 2015 are as follows:

	Operating Leases (1)						Capital Leases and Financing Obligations (2)
(In millions)	Gross Minimum Rentals		Sublease Income		Net Minimum Rentals		Lease Obligation
2015	$	561	$	15	$	546	$	31
2016	488		13		475		27
2017	399		10		389		24
2018	333		9		324		24
2019	272		8		264		20
2020 and subsequent	1,055		24		1,031		96
Total	$	3,108	$	79	$	3,029	$	222

(1) Excluded from the minimum rental commitments displayed above are $1.7 billion related to options to extend ground lease terms that are reasonably assured of being exercised, the balance of which is predominantly related to fiscals 2020 and thereafter.

(2) Included in Capital Leases and Financing Obligations displayed above is $20 million of interest.

Total rent expense, net of sublease income, was $601 million, $609 million and $628 million in fiscals 2014, 2013 and 2012, respectively. Sublease income was $18 million, $19 million and $19 million in fiscals 2014, 2013 and 2012, respectively. We

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remain directly and primarily liable for lease payments to third party landlords for locations where we have subleased all or a portion of the locations to third parties. Rental payments received from our sub-lessees offset the lease payments we make to third party landlords. To the extent that sub-lessees fail to make sublease rental payments, our total net rent expense to the third party landlords would increase in direct proportion.

We record operating leases on a straight-line basis over the lease term, which includes renewal options only if those options are specified in the lease agreement and if failure to exercise the renewal option imposes a significant economic penalty on us. For Ground Lease Locations, we include renewal options in the lease term through the estimated useful life of the owned building located on the property as failure to renew a ground lease during the estimated useful life of the building would result in forgoing an economic benefit given our significant capital investment at the inception of the lease to construct a new building. For Straight Lease Locations, we do not include renewal options in the lease term as the failure to renew a straight lease does not typically result in a significant economic penalty for us, and therefore renewal cannot be reasonably assured at the inception of the lease. Substantially all of our leases include options that allow us to renew or extend the lease term beyond the initial lease period, subject to terms and conditions agreed upon at the inception of the lease. Such terms and conditions include rental rates agreed upon at the inception of the lease that could represent below or above market rental rates later in the life of the lease, depending upon market conditions at the time of such renewal or extension. In addition, many leases include early termination options, which can be exercised under specified conditions, including, upon damage, destruction or condemnation of a specified percentage of the value or land area of the property.

The difference between the recognized rental expense and amounts payable under the leases is recorded as deferred rent liability. Deferred rent liabilities in our Consolidated Balance Sheets totaled $359 million and $374 million at January 31, 2015 and February 1, 2014, respectively, of which $12 million was included in Accrued expenses and other current liabilities for each respective period.

Lease payments that depend on factors that are not measurable at the inception of the lease, such as future sales volume, are contingent rentals and are excluded from minimum lease payments. We include contingent rentals in the determination of total rental expense when it is probable that the expense has been incurred and the amount is reasonably estimable. Contingent rent expense was $10 million, $10 million and $12 million for fiscals 2014, 2013 and 2012, respectively. Future payments for maintenance, insurance and taxes to which we are obligated are excluded from minimum lease payments. Tenant allowances received upon entering into certain store leases are deferred and recognized on a straight-line basis as a reduction to rent expense over the lease term.

We have been and may be involved in the construction of leased stores which includes non-standard tenant improvements. As a result of this involvement, we were deemed the “owner” for accounting purposes and were required to capitalize the construction costs on our Consolidated Balance Sheets. Upon completion of these projects, we performed an analysis pursuant to ASC 840 and determined that we were unable to derecognize the assets capitalized during construction. Therefore, in conjunction with these leases, we recorded financing obligations equal to the cash proceeds and fair market value of the assets received. As of January 31, 2015 and February 1, 2014, the carrying amounts of our financing obligations, which approximates fair value, were $189 million and $174 million, respectively. The rental payments to the landlord are recognized as a reduction of the financing obligation and interest expense. We also continue to recognize rent expense on the ground leases for the land on which these assets were constructed.

NOTE 10 — INCOME TAXES

(Loss) earnings before income taxes are as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
U.S.	$	(263	)	$	(851	)	$	(18	)
Foreign	7			(16		)	110
(Loss) earnings before income taxes	$	(256	)	$	(867	)	$	92

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Income tax expense (benefit) is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Current:
U.S. Federal	$	(13	)	$	(7	)	$	(28	)
Foreign	46			46			45
State	—			(3		)	—
Total current income tax expense (benefit)	$	33		$	36		$	17
Deferred:
U.S. Federal	$	1		$	42		$	(9	)
Foreign	(2		)	72			11
State	—			19			34
Total deferred income tax expense (benefit)	$	(1	)	$	133		$	36
Total income tax expense (benefit)	$	32		$	169		$	53

Included within Total income tax expense (benefit) is a benefit of less than $1 million, benefit of less than $1 million, and expense of $1 million related to interest and penalties in fiscals 2014, 2013 and 2012, respectively. The interest and penalties relate to tax payments and refunds for prior period tax filings made or to be made, as well as amounts associated with increases and decreases to unrecognized tax benefits.

We have not provided deferred taxes on $1 million of accumulated earnings of certain foreign subsidiaries as it is management’s intention to reinvest those earnings indefinitely. The estimated unrecognized deferred income tax liabilities on these earnings, net of associated foreign tax credits and other offsets, is zero.

The effective tax rate reconciliations are as follows:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014		February 2, 2013
U.S. Federal statutory tax rate	35.0	%	35.0	%	35.0	%
State taxes, net of U.S. Federal benefit	—	%	(1.2	)%	23.9	%
Foreign operations (1)	(13.5	)%	(12.3	)%	3.7	%
U.S. Federal valuation allowance	(36.6	)%	(27.9	)%	0.8	%
Unrecognized tax benefits (2)	3.0	%	—	%	(3.6	)%
Goodwill impairment (3)	—	%	(13.4	)%	—	%
Other	(0.4	)%	0.3	%	(2.2	)%
Effective tax rate	(12.5	)%	(19.5	)%	57.6	%

(1) Foreign operations include the net impact of: differences between local statutory rates and the U.S. Federal statutory rate; the impact of changes to foreign valuation allowances; the net cost of foreign unrecognized tax benefits; the cost of repatriating foreign earnings, net of foreign tax credits; changes to our assertion regarding the permanent reinvestment of foreign earnings related to certain foreign entities; permanent items related to foreign operations; as well as changes in the tax status of foreign entities.

(2) Unrecognized tax benefits include benefits related to the resolution of issues in connection with resolving tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations. See “Unrecognized Tax Benefits” in this footnote.

(3) Goodwill impairment represents the U.S. Federal tax cost associated with the amount of Goodwill that was impaired for which we did not have tax basis, and therefore for which we could not take a tax benefit.

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The tax effects of temporary differences that give rise to deferred tax assets and liabilities are:

(In millions)	January 31, 2015			February 1, 2014
Deferred tax assets:
U.S. Federal tax loss and other carryforwards	$	385		$	398
State tax loss and other carryforwards	84			75
Foreign tax loss and other carryforwards	169			197
Straight line rent	127			137
Inventory	52			75
Insurance loss reserve	35			36
Restructuring charges	7			10
Other	158			119
Gross deferred tax assets before valuation allowance	1,017			1,047
Valuation allowance	(621		)	(511		)
Total deferred tax assets	$	396		$	536
Deferred tax liabilities:
Fixed assets (1)	$	(67	)	$	(131	)
Undistributed earnings of foreign subsidiaries	(222		)	(291		)
Foreign currency translation	(24		)	(26		)
Other	(21		)	(14		)
Total deferred tax liabilities	$	(334	)	$	(462	)
Net deferred tax assets	$	62		$	74

The deferred tax assets and liabilities above are reflected in the Consolidated Balance Sheets as follows:

(In millions)	January 31, 2015			February 1, 2014
Current deferred tax assets	$	45		$	31
Current deferred tax liabilities (2)	(4		)	(13		)
Non-current deferred tax assets	133			152
Non-current deferred tax liabilities	(112		)	(96		)
	$	62		$	74

(1) Includes deferred impact of finance obligations associated with capital projects.

(2) The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities in the Consolidated Balance Sheets.

Our gross deferred tax assets above include an offset of $7 million and $8 million of unrecognized tax benefits related to tax loss carryforwards as of January 31, 2015 and February 1, 2014, respectively.

Carryforwards

In addition to the unused portion of losses and credits reported on tax returns, our carryforwards also include interest deductions that are being carried forward due to thin-capitalization and other tax limitations, as well as credits that will be realized in connection with the undistributed earnings of foreign subsidiaries on which we have provided taxes.

Of our $385 million of U.S. Federal tax loss and other carryforwards, less than $1 million will expire during the next 5 years, $143 million will expire during the next 6 to 20 years and $241 million may be carried forward indefinitely. Of our $84 million of state tax loss and other carryforwards, $4 million will expire during the next 5 years, $68 million will expire during the next 6 to 20 years and $12 million may be carried forward indefinitely. Of our $169 million of foreign tax loss and other carryforwards, $4 million will expire during the next 5 years, $3 million will expire during the next 6 to 20 years and $162 million may be carried forward indefinitely.

On July 21, 2005, the Company was acquired by the Sponsors. U.S. Federal and certain state and foreign taxing jurisdictions impose limitations on the amount of tax losses, credits and other carryforwards that can be used to offset current income and

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tax within any given year when there has been an ownership change. We have evaluated the impact of these limitations and have established a valuation allowance to reduce some of these deferred tax assets to the amount expected to be realized.

Valuation Allowance

We have evaluated the available positive and negative evidence and have concluded that, for some of our deferred tax assets, it is more likely than not that these assets will not be realized in the foreseeable future. As a result, we have established a valuation allowance to reduce these deferred tax assets for the amount we believe will not be realized. The increase to our valuation allowance for U.S. Federal and state jurisdictions, as well as in certain foreign jurisdictions, was predominantly due to the fact that, as of the end of fiscal 2014, we have incurred a pre-tax cumulative loss over the past three fiscal years. During fiscal 2014, our valuation allowance increased by $110 million. This includes a$99 million increase for U.S. Federal tax, a $15 million increase for state tax and a $4 million decrease for foreign tax.

Of our total valuation allowance of $621 million, there is $6 million related to the foreign valuation allowance which, if a benefit is subsequently recognized, will result in a reduction of another asset.

Unrecognized Tax Benefits

A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits (excluding interest and penalties) is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Beginning balance	$	37		$	32		$	42
Additions for tax positions of the current year	4			4			5
Additions for tax positions of prior years	5			6			3
Reductions for tax positions of prior years (1)	(11		)	(1		)	(12		)
Settlements	—			—			(5		)
Currency translation adjustment	(4		)	—			—
Lapse of statute of limitations	(1		)	(4		)	(1		)
Ending balance	$	30		$	37		$	32

(1) Reductions for tax positions of prior years include amounts related to the resolution of issues in connection with resolving tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations.

At January 31, 2015, $23 million of the $30 million of unrecognized tax benefits would affect our effective tax rate, if recognized, and the remaining $7 million would affect our deferred tax accounts. In addition, we had $4 million and less than $1 million of accrued interest and penalties, respectively, at January 31, 2015. We had $5 million and less than $1 million of accrued interest and penalties, respectively, at February 1, 2014, and $4 million and less than $1 million of accrued interest and penalties, respectively, at February 2, 2013.

The Company and its subsidiaries are subject to taxation in the United States and various foreign jurisdictions. Of the major jurisdictions, we are subject to examination in: the United States for U.S. Federal purposes for fiscal 2010 and forward and for state purposes for fiscal 2010 and forward; Australia for fiscal 2009 and forward; Canada for fiscal 2007 and forward; France for fiscal 2011 and forward; Germany for fiscal 2009 and forward; Japan for fiscal 2008 and forward; Spain for fiscal 2008 and forward; and the UK for fiscal 2009 and forward. While it is often difficult to predict whether we will prevail, we believe that our tax liabilities for unrecognized tax benefits reflect the more likely than not outcome of known tax contingencies.

We believe that it is reasonably possible that the total amount of unrecognized tax benefits of $35 million (inclusive of tax, interest and penalties) will not change during the next twelve months due to ongoing tax examinations and applicable statutes of limitations.

NOTE 11 — SEGMENTS

We generate sales, operating earnings and cash flows by retailing numerous product offerings worldwide. We operate all of the “R” Us branded retail stores in the United States, Puerto Rico and Guam and 77% of the 942 “R” Us branded retail stores internationally (excluding temporary Express store locations). The balance of the “R” Us branded retail stores internationally are operated by licensees. Licensing fees did not have a material impact on our Net sales and accounted for $17 million, $16 million and $16 million for fiscals 2014, 2013 and 2012, respectively. We also own and operate websites including

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Toysrus.com, Babiesrus.com, eToys.com, FAO.com and toys.com, as well as other Internet sites we operate in our international markets.

Our business has two reportable segments: Toys “R” Us – Domestic (“Domestic”) and Toys “R” Us – International (“International”). The following is a brief description of our segments:

• Domestic — Our Domestic segment sells a variety of products in the baby, core toy, entertainment, learning and seasonal categories through 872 stores that operate in 49 states in the United States, Puerto Rico and Guam and through the Internet. Domestic Net sales in fiscal 2014 were derived from traditional toy stores (including Babies “R” Us Express (“BRU Express”) and Juvenile Expansion formats), baby stores, side-by-side (“SBS”) stores, permanent Express stores (with cumulative lease terms of at least two years) and our flagship stores in New York City. Additionally, we generated Net sales through our temporary Express store locations.

• International — Our International segment sells a variety of products in the baby, core toy, entertainment, learning and seasonal categories through 730 operated and 212 licensed stores in 36 countries and jurisdictions and through the Internet. In addition to fees received from licensed stores, International Net sales in fiscal 2014 were derived from traditional toy stores (including BRU Express formats), SBS stores, baby stores and permanent Express stores (with cumulative lease terms of at least two years). Additionally, we generated Net sales through our temporary Express store locations. Our operated stores are located in Australia, Austria, Brunei, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom.

The Chief Operating Decision Maker evaluates segment performance primarily based on Net sales and segment Operating earnings (loss). Segment Operating earnings (loss) excludes corporate related charges and income. All intercompany transactions between the segments have been eliminated. Income tax information by segment has not been included as taxes are calculated at a company-wide level and are not allocated to each segment. Revenues from external customers are derived primarily from merchandise sales and we do not generate material sales from any single customer.

The following tables show our percentage of Net sales by product category:

	Fiscal Years Ended
Domestic:	January 31, 2015		February 1, 2014		February 2, 2013
Baby	38.0	%	37.7	%	37.9	%
Core Toy	17.4	%	16.2	%	16.0	%
Entertainment	10.2	%	11.3	%	11.7	%
Learning	22.7	%	22.8	%	22.4	%
Seasonal	11.2	%	11.3	%	11.3	%
Other (1)	0.5	%	0.7	%	0.7	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues.

	Fiscal Years Ended
International:	January 31, 2015		February 1, 2014		February 2, 2013
Baby	20.2	%	20.4	%	21.6	%
Core Toy	23.5	%	22.7	%	21.9	%
Entertainment	8.5	%	10.0	%	11.4	%
Learning	31.1	%	30.8	%	29.2	%
Seasonal	15.9	%	15.3	%	15.2	%
Other (1)	0.8	%	0.8	%	0.7	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues, including licensing fees from unaffiliated third parties.

From time to time, we may make revisions to our prior period Net sales by product category to conform to the current period allocation. These revisions did not have a significant impact to our prior year disclosure.

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A summary of financial results by reportable segment is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Net sales
Domestic	$	7,524		$	7,638		$	8,149
International	4,837			4,905			5,394
Total Net sales	$	12,361		$	12,543		$	13,543
Operating earnings (loss)
Domestic (1) (2)	$	332		$	(197	)	$	571
International (1)	229			203			309
Corporate and other	(370		)	(356		)	(324		)
Operating earnings (loss)	191			(350		)	556
Interest expense	(451		)	(524		)	(480		)
Interest income	4			7			16
(Loss) earnings before income taxes	$	(256	)	$	(867	)	$	92

(1) Fiscal 2013 includes full impairments of the Toys-Domestic and Toys-Japan reporting unit’s goodwill balances of $361 million and $17 million, respectively. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

(2) Includes incremental expense related to the write-down of excess and obsolete inventory of $51 million for fiscal 2013.

Certain corporate and other items are reported separately in our disclosure of segment Operating earnings (loss). In addition to the income items described above, charges include corporate office expenses and shared service center expenses, as well as certain other centrally managed expenses, which are not fully allocated to our reportable segments. The significant categories of expenses include salaries, benefits and related expenses, professional fees, corporate facility depreciation and amortization and insurance. Salaries, benefits and related expenses include salaries, bonus, payroll taxes and health insurance expenses for corporate office employees. Professional fees include costs related to internal control compliance, financial statement audits, legal, information technology and other consulting fees, which are engaged and managed through the corporate office. Depreciation and amortization includes depreciation of leasehold improvements for properties occupied by corporate office employees. Corporate insurance expense includes the cost of fire, liability and automobile premiums.

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
Depreciation and amortization
Domestic	$	210	$	216	$	225
International	116		123		136
Corporate	51		49		46
Total Depreciation and amortization	$	377	$	388	$	407
Capital expenditures
Domestic	$	67	$	113	$	148
International	83		86		95
Corporate	57		39		43
Total Capital expenditures	$	207	$	238	$	286

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(In millions)	January 31, 2015		February 1, 2014
Merchandise inventories
Domestic	$	1,353	$	1,375
International	711		796
Total Merchandise inventories	$	2,064	$	2,171
Total Assets
Domestic	$	3,633	$	3,812
International	2,122		2,442
Corporate and other (1)	1,360		1,295
Total Assets	$	7,115	$	7,549

(1) Includes cash and cash equivalents, deferred tax assets and other corporate assets.

Our Net sales, inclusive of each country’s respective Internet operations, and long-lived assets by country or region are as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
Net sales
United States (1)	$	7,524	$	7,638	$	8,149
Europe (2)	1,405		1,447		1,439
Japan	1,308		1,374		1,795
Canada	834		883		928
UK	710		680		735
China and Southeast Asia	333		277		233
Australia	230		228		248
Other (3)	17		16		16
Total Net sales	$	12,361	$	12,543	$	13,543

(1) Includes our wholly-owned operations in Puerto Rico and Guam.

(2) Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

(3) Represents licensing fees from unaffiliated third parties.

(In millions)	January 31, 2015		February 1, 2014
Long-lived assets
United States (1)	$	2,372	$	2,521
Europe (2)	352		417
Japan	306		383
UK	281		312
Canada	180		212
China and Southeast Asia	41		32
Australia	14		16
Total Long-lived assets	$	3,546	$	3,893

(1) Includes our wholly-owned operations in Puerto Rico and Guam.

(2) Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

NOTE 12 — DEFINED BENEFIT PENSION PLANS

We sponsor defined benefit pension plans covering certain international employees in the UK, Japan, Germany and Austria, with such benefits accounted for on an accrual basis using actuarial assumptions. For our pension plans, we use a measurement date matching the end of our fiscal years.

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The following tables provide information regarding our pension plans:

Obligation and Funded Status at End of Fiscal Year:

(In millions)	January 31, 2015			February 1, 2014
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	137		$	128
Service cost	5			5
Interest cost	5			5
Employee contributions	—			1
Benefits paid	(6		)	(2		)
Actuarial loss (gain)	52			(1		)
Foreign currency impact	(19		)	1
Projected benefit obligation at end of year	$	174		$	137

(In millions)	January 31, 2015			February 1, 2014
Change in fair value of plan assets:
Fair value of plan assets at beginning of year	$	118		$	105
Actual return on plan assets	17			5
Employer contributions	7			7
Employee contributions	—			1
Benefits paid	(6		)	(2		)
Foreign currency impact	(13		)	2
Fair value of plan assets at end of year	$	123		$	118

(In millions)	January 31, 2015			February 1, 2014
Reconciliation of funded status to total amount recognized:
Funded status	$	(51	)	$	(19	)
Amounts recognized in Consolidated Balance Sheets:
Other non-current liabilities	$	(51	)	$	(19	)
Amounts recognized in Accumulated other comprehensive loss:
Unrecognized actuarial losses, net of tax	$	42		$	9

Of the $42 million of unrecognized actuarial losses, net of tax in Accumulated other comprehensive loss as of January 31, 2015, $2 million is expected to be amortized into net periodic benefit cost in fiscal 2015.

Information for Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets:

(In millions)	January 31, 2015		February 1, 2014
Projected benefit obligation	$	174	$	137
Accumulated benefit obligation	150		118
Fair value of plan assets	123		118

Components of Net Periodic Benefit Cost During Each Fiscal Year:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Service cost	$	5		$	5		$	5
Interest cost	5			5			5
Expected return on plan assets	(5		)	(5		)	(4		)
Net periodic benefit cost	$	5		$	5		$	6

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Contributions

For fiscal 2015, we expect to contribute $6 million to our pension plans.

Estimated Future Payments

Pension benefit payments, including amounts to be paid from our assets, and reflecting expected future service, as appropriate, are expected to be paid as follows:

(In millions)	Pension Benefits
2015	$	2
2016	2
2017	2
2018	2
2019	2
2020 through 2024	9

Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs at Fiscal Year End:

	January 31, 2015		February 1, 2014		February 2, 2013
Discount rate	3.7	%	4.1	%	4.0	%
Expected rate of return on plan assets	4.5	%	4.9	%	4.6	%
Rate of compensation increase	2.6	%	2.7	%	2.8	%

Weighted-average Assumptions Used to Determine Benefit Obligations at Fiscal Year End:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014
Discount rate	2.7	%	3.9	%
Rate of compensation increase	2.6	%	2.6	%

Determination of Discount Rate

The discount rate used to determine benefit obligations for our pension plans has been developed based on the AA corporate bond yield curve.

Determination of Expected Return on Assets

The expected return on assets is the rate of return expected to be achieved on pension fund assets in the long term, net of investment expenses. More than 90% of the plan assets relate to the UK and Japan pension plans. The UK and Japan pension plans expected return on assets assumption for fiscal 2015 has been determined by considering the return on the actual asset classes held as of the measurement date and our expectations of future rates of return on each asset class. For the UK and Japan pension plans, we determine the expected rate of return by utilizing the current return available on stocks, and government and corporate bonds and applying suitable risk premiums that consider historical market returns and current market expectations. The estimate of the expected rate of return is based on a long term view and considers the impact of economic conditions in the evaluation of historical market returns.

Plan Assets

Investment policies and strategies

Our overall investment policy and strategic management of the plan assets are the responsibility of the trustees (acting based on advice as they deem appropriate) and are driven by investment objectives as set out below. The remaining elements of our investment policy are part of the day-to-day management of the assets, which is delegated to a professional investment manager. The trustees of our defined benefit pension plans are guided by an overall objective of achieving, over the long-term, a return on the investments, which is consistent with the long-term assumptions made by the actuaries in determining funding of the plans.

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The investment returns that the trustees expect to achieve are those that are broadly in line with or above the returns of the respective market indices and performance targets against which the investment manager is benchmarked. Over the longer term, the trustees expect to achieve an investment return in excess of the consumer price index.

Weighted-average asset allocation by asset category

The primary investment goal for our plans’ assets is to maximize total asset returns while ensuring the plans’ assets are available to fund the plans’ liabilities as they become due. A change in the overall investment strategy could significantly impact the expected rate of return on plan assets.

The following represents our pension plan target asset allocations for fiscal 2015, as well as the actual asset allocations as of January 31, 2015 and February 1, 2014:

	2015 Target Allocation		January 31, 2015		February 1, 2014
Equity securities	28.3	%	28.3	%	27.7	%
Debt securities	58.3	%	58.3	%	56.6	%
Insurance contracts	7.3	%	7.3	%	8.3	%
Cash and cash equivalents	6.1	%	6.1	%	7.4	%
Total	100	%	100	%	100	%

Risk management

In managing the Company’s plan assets, our investment managers evaluate and manage risk associated with funded status risk, interest rate risk, market risk, counterparty risk, liquidity risk and operational risk. Cash flow management and asset class diversification are central to our risk management strategy and are critical to the overall investment strategy of our pension plan assets.

Fair value of plan assets

The following tables present our plan assets by fair value hierarchy in accordance with ASC Topic 820, “Fair Value Measurements and Disclosures” as of January 31, 2015 and February 1, 2014. The fair value hierarchy is comprised of three levels based on the reliability of inputs used to determine fair value. Level 1 refers to fair values determined based on quoted prices in active markets for identical assets. Level 2 refers to fair values estimated using significant other observable inputs, while Level 3 includes fair values estimated using significant unobservable inputs. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement of the instrument. There have been no changes in valuation technique or related inputs for the fiscal years ended January 31, 2015 and February 1, 2014.

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Equity Securities: (1)
Domestic	$	—	$	11	$	11
International	—		24		24
Fixed Income: (2)
Domestic	—		4		4
International	—		68		68
Insurance Contracts (3)	—		9		9
Cash and cash equivalents (4)	7		—		7
Total	$	7	$	116	$	123

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Fiscal 2013

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Equity Securities: (1)
Domestic	$	—	$	12	$	12
International	—		21		21
Fixed Income: (2)
Domestic	—		2		2
International	—		64		64
Insurance Contracts (3)	—		10		10
Cash and cash equivalents (4)	9		—		9
Total	$	9	$	109	$	118

(1) Domestic and international equity securities categorized as Level 2 are valued using the Net Asset Value (“NAV”) per fund share, which is derived from quoted prices in active markets of the underlying securities.

(2) Domestic and international fixed-income securities categorized as Level 2 are valued using the NAV per fund share, which is derived using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported trades.

(3) Insurance contracts contain a minimum guaranteed return and are categorized as Level 2 as the fair value of the assets is equal to the total amount of all individual technical reserves plus the non allocated employer’s financing fund reserves at the valuation date. The individual technical and financing fund reserves are equal to the accumulated paid contributions taking into account the insurance ratification and any allocated profit sharing return.

(4) Cash and cash equivalents include highly liquid investments with original maturities of three months or less at acquisition. Due to the short-term nature of these investments, their carrying amounts approximate fair value. Therefore, we have determined that our cash and cash equivalents in their entirety are classified as Level 1 within the fair value hierarchy.

NOTE 13 — OTHER EMPLOYEE RETIREMENT AND COMPENSATION BENEFITS

We offer other employee retirement and compensation benefits for eligible employees. The Supplemental Executive Retirement Plan (“SERP”) provides supplemental retirement benefits to certain executive officers in excess of the limitations that are imposed by Section 401(a)(17) of the Internal Revenue Code of 1986, as amended, on contributions to our TRU Partnership Employees’ Savings and Profit Sharing Plan (the “Savings Plan”). Participants are generally 100% vested in their SERP accounts after completing 5 years of employment with the Company. During fiscal 2014 we recorded SERP expenses of less than $1 million. During fiscals 2013 and 2012, we recorded SERP expenses of $1 million and less than $1 million, respectively. As of January 31, 2015 and February 1, 2014, the SERP liability was $2 million and $3 million, respectively.

Included in our Savings Plan, we have a 401(k) salary deferral feature, company-matching contributions and a profit sharing component for eligible U.S.-based employees. Under the terms of the Savings Plan, annual employer profit sharing contributions are made at the discretion of the Board of Directors, subject to certain limitations. The Savings Plan may be terminated at our discretion. Employee eligibility for participation in the 401(k) savings account portion of the Savings Plan requires 12 months of service and completion of 1,000 hours. In addition, the Company makes a matching contribution in an amount equal to 100% of the first 4%, of the participant’s contribution. We also have various defined contribution and other foreign government sponsored retirement plans for foreign employees, which are managed by each respective foreign location. Expenses related to the Savings Plan, other foreign defined contribution plans and other foreign government sponsored retirement plans were $24 million in fiscals 2014 and 2013, respectively, and $25 million in fiscal 2012. The Board of Directors did not elect to contribute to the profit sharing portion of the Savings Plan in fiscals 2014, 2013 and 2012.

NOTE 14 — LITIGATION AND LEGAL PROCEEDINGS

In October 2012, the Massachusetts Supreme Judicial Court granted the Company’s request for direct appellate review of a judgment in the amount of $20 million, including $18 million in punitive damages, that was entered against the Company in a wrongful death products liability case entitled Aleo v. SLB Toys USA, Inc., et al. (Superior Court of Massachusetts, Essex County, No. 2008-02149-A) (the “Judgment”). Oral argument concerning this appeal was held on May 6, 2013. On September 13, 2013, the Massachusetts Supreme Judicial Court issued its decision affirming the Judgment. During fiscal 2013, we

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accrued an additional $20 million related to this matter which was recorded in SG&A. In October 2013, the Company paid $25 million to satisfy the Judgment.

In May 2013, we opted out of the settlement of a class action lawsuit against Visa and MasterCard alleging violations of antitrust laws.  In January 2014, we, along with several other companies, filed a separate lawsuit against Visa and MasterCard entitled Progressive Casualty Insurance Co. et al. v. Visa, Inc., et al. (United States District Court for the Eastern District of New York, No. 14-00276).  A settlement was reached in December 2014, and we received a payment of $12 million in January 2015 which was recorded in SG&A.

In addition to the litigation discussed above, we are, and in the future may be, involved in various other lawsuits, claims and proceedings incident to the ordinary course of business. The results of litigation are inherently unpredictable. Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time and result in diversion of significant resources. We are not able to estimate an aggregate amount or range of reasonably possible losses for those legal matters for which losses are not probable and estimable, primarily for the following reasons: (i) many of the relevant legal proceedings are in preliminary stages, and until such proceedings develop further, there is often uncertainty regarding the relevant facts and circumstances at issue and potential liability; and (ii) many of these proceedings involve matters of which the outcomes are inherently difficult to predict. However, based upon our historical experience with similar matters, we do not expect that any such additional losses would be material to our consolidated financial position, results of operations or cash flows.

NOTE 15 — COMMITMENTS AND CONTINGENCIES

We are subject to various claims and contingencies related to lawsuits as well as commitments under contractual and other commercial obligations. We recognize liabilities for contingencies and commitments when a loss is probable and estimable. Refer to Note 10 entitled “INCOME TAXES” for liabilities associated with uncertain tax positions. Refer to Note 9 entitled “LEASES” for minimum rental commitments under non-cancelable operating leases having a term of more than one year as of January 31, 2015.

As of January 31, 2015, we remain contingently liable for amounts due or amounts that may become due under certain real estate lease agreements that have been assigned to third parties. In the event of default by the assignees, we could be liable for payment obligations associated with these leases which have future lease related payments (not discounted to present value) of$63 million through September 2032. The impact of these obligations is not material to our Consolidated Financial Statements.

NOTE 16 — RELATED PARTY TRANSACTIONS

The Sponsors provide management and advisory services to us pursuant to an advisory agreement executed at the closing of the merger transaction effective as of July 21, 2005 and amended June 10, 2008, February 1, 2009 and August 29, 2014 (“Advisory Agreement”). The initial term of the Advisory Agreement is ten years. After ten years, it extends annually for one year unless we or the Sponsors provide notice of termination to the other. Prior to an amendment in August 2014, described below, the management and advisory fees paid to the Sponsors (the “Advisory Fees”) increased 5% per year during the ten-year term of the agreement with the exception of fiscal 2009.

In August 2014, the Advisory Agreement was amended in order to reduce the Advisory Fees to $17 million for fiscal year 2014 and each year thereafter.  If in the future we successfully complete an initial public offering (“IPO”), the Sponsors may elect to receive from the proceeds of such IPO, an amount equal to the aggregate difference between: (x) the Advisory Fees that we would have paid in fiscal year 2014 and each fiscal year thereafter had such amounts not been fixed and (y) the Advisory Fees that were actually paid by us for fiscal year 2014 and each fiscal year thereafter. We recorded Advisory Fees of $17 million, $22 million and $21 million for fiscals 2014, 2013 and 2012, respectively. During fiscals 2014, 2013 and 2012, we also paid the Sponsors fees of less than $1 million, respectively, for out-of-pocket expenses.

Additionally, the Advisory Agreement provides that affiliates of the Sponsors will be entitled to receive a fee equal to 1% of the aggregate transaction value in connection with certain financing, acquisition, disposition and change of control transactions (“Transaction Fees”). The Advisory Agreement includes customary exculpation and indemnification provisions in favor of the Sponsors and their affiliates. In the event that the Advisory Agreement is terminated by the Sponsors or us, the Sponsors will receive all unpaid Advisory Fees, all unpaid Transaction Fees and expenses due under the Advisory Agreement with respect to periods prior to the termination date plus the net present value of the Advisory Fees that would have been payable for the remainder of the applicable term of the Advisory Agreement. Transaction fees are capitalized as deferred debt issuance costs and are amortized over the term of the related debt agreement and included in Other assets on our Consolidated Balance Sheet.

In connection with the amendment and restatement of the ABL Facility on March 21, 2014, we incurred Transaction Fees of $19 million pursuant to the terms of the Advisory Agreement.

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In connection with entering into the Secured Term B-4 Loan and Tranche A-1 Loan on October 24, 2014, we incurred Transaction Fees of $13 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $96 million of the Secured Term B-4 Loan as of January 31, 2015.

In connection with the Propco I Term Loan Facility entered into on August 21, 2013, we incurred Transactions Fees of $10 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $17 million of the Propco I Term Loan Facility as of January 31, 2015 and February 1, 2014, respectively.

In connection with the UK Propco Facility Agreement entered into on March 25, 2013, we incurred Transactions Fees of $4 million pursuant to the terms of the Advisory Agreement.

In connection with the France Propco Facility Agreement entered into on February 27, 2013, we incurred Transactions Fees of $1 million pursuant to the terms of the Advisory Agreement.

In connection with the Spain Propco Facility Agreement entered into on January 29, 2013, we incurred Transaction Fees of $1 million pursuant to the terms of the Advisory Agreement.

In connection with the offering of the 2017 Notes on August 1, 2012, we incurred Transaction Fees of $4 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $9 million of the 2017 Notes as of January 31, 2015 and February 1, 2014, respectively.

In connection with the Second Incremental Secured Term Loan entered into on April 10, 2012, we incurred Transaction Fees of $2 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $2 million and $9 million of the Second Incremental Secured Term Loan as of January 31, 2015 and February 1, 2014, respectively.

KKR owned an aggregate of $12 million and $50 million of the Incremental Secured Term Loan as of January 31, 2015 and February 1, 2014, respectively. In addition, KKR owned an aggregate of $9 million of the Toys-Delaware Secured Notes as of February 1, 2014, $70 million of the Secured Term Loan Facility as of February 1, 2014, and $5 million of the Propco II Notes as of February 1, 2014. For further details, see Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

From time to time, we and our subsidiaries, as well as the Sponsors or their affiliates, may acquire debt or debt securities issued by us or our subsidiaries in open market transactions, tender offers, exchange offers, privately negotiated transactions or otherwise. During fiscals 2014, 2013 and 2012, affiliates of Vornado Realty Trust (“Vornado”) and KKR held debt and debt securities issued by the Company and its subsidiaries. The interest amounts paid on such debt and debt securities held by related parties were $10 million in fiscals 2014 and 2013, respectively. In fiscal 2012, the interest amounts paid on such debt and debt securities held by related parties were $8 million.

Additionally, under lease agreements with affiliates of Vornado, we paid an aggregate amount of $8 million in fiscals 2014 and 2013, respectively, and $10 million in fiscal 2012 with respect to 0.7%, 0.8% and 0.9%, respectively, of our operated stores, which include Express stores. Of the aggregate amount paid in fiscals 2014, 2013 and 2012, $2 million, respectively, was allocable to joint-venture parties not otherwise affiliated with Vornado.

Each of the Sponsors, either directly or through affiliates, has ownership interests in a broad range of companies (“Portfolio Companies”) with whom we may from time to time enter into commercial transactions in the ordinary course of business, primarily for the purchase of goods and services. We believe that none of our transactions or arrangements with Portfolio Companies are significant enough to be considered material to the Sponsors or to our business.

NOTE 17 — ACQUISITIONS

On October 31, 2011, the Company acquired a 70% ownership interest in Labuan from Li & Fung for a purchase price of $79 million (including a $10 million hold back) plus $8 million of contingent consideration. The terms of the agreement provide us with the future option to acquire Li & Fung’s 30% interest in the business and also provide Li & Fung the option to require us to buy their 30% interest in the business at the end of three years from the acquisition date. During fiscal 2014, we amended the terms of the agreement with Li & Fung to extend the future call option and put option to commence four years from the acquisition date.

The Company paid $1 million and $5 million of contingent consideration related to the Labuan acquisition during fiscal 2014 and 2012, respectively. The Company did not make any payments during fiscal 2013. In accordance with the purchase agreement, the remaining $2 million of contingent consideration is expected to be paid out during fiscal 2015 based on the financial performance of Labuan and is included within Accrued expenses and other current liabilities in our Consolidated Balance Sheet as of January 31, 2015.

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In addition, during fiscal 2012, in accordance with the purchase agreement, the Company paid $10 million of the purchase price related to the Labuan acquisition to Li & Fung as it was determined that the business had been appropriately delivered in the agreed upon financial condition.

As a result of the acquisition, the Company recognized Noncontrolling interest in the amount of $24 million which was measured at fair value at the acquisition date. In accordance with the terms of the agreement, the Noncontrolling interest is redeemable for cash or common stock of the Company at the option of the holder. As such, the Noncontrolling interest has been recorded in Temporary equity. See Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for a reconciliation of the change in Noncontrolling interest to redemption value as of January 31, 2015 and February 1, 2014.

NOTE 18 — RECENT ACCOUNTING PRONOUNCEMENTS

In February 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis” (“ASU 2015-02”). ASU 2015-02 is intended to improve targeted areas of consolidation guidance for reporting organizations that are required to evaluate whether they should consolidate certain legal entities. This ASU simplifies consolidation accounting by reducing the number of consolidation models and improves current GAAP by (1) placing more emphasis on risk of loss when determining a controlling financial interest; (2) reducing the frequency of the application of related-party guidance when determining a controlling financial interest in a VIE; and (3) changing consolidation conclusions for public and private companies in several industries that typically make use of limited partnerships or VIEs. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. Entities can transition to the standard either retrospectively or as a cumulative effect adjustment as of the date of adoption. The adoption of ASU 2015-02 is not expected to have an impact on our Consolidated Financial Statements.

In January 2015, the FASB issued ASU No. 2015-01, “Income Statement - Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items” (“ASU 2015-01”). ASU 2015-01 eliminates from U.S. GAAP the concept of extraordinary items. Under the previous practice, an entity was required to separately classify, present, and disclose extraordinary events and transactions. The FASB issued this ASU as part of its initiative to reduce complexity in accounting standards. This ASU will also align more closely U.S. GAAP income statement presentation guidance with IAS 1, “Presentation of Financial Statements,” which prohibits the presentation and disclosure of extraordinary items. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. A reporting entity may either apply the amendments prospectively or retrospectively to all prior periods presented in the financial statements. The adoption of ASU 2015-01 is not expected to have an impact on our Consolidated Financial Statements.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). ASU 2014-15 is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Other than the additional disclosures regarding the Company’s ability to continue as a going concern, the adoption of ASU 2014-15 is not expected to have an impact on our Consolidated Financial Statements.

In June 2014, the FASB issued ASU No. 2014-12, “Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period” (“ASU 2014-12”).  ASU 2014-12 provides specific guidance on this Topic, requiring that performance targets that affect vesting and that could be achieved after the requisite service period be treated as a performance condition.  A reporting entity should apply existing guidance in ASC Topic 718 as it relates to awards with performance conditions that affect vesting to account for such awards.  This varies from the previous practice, as such provisions were also accounted for as non-vesting restrictions which affect the determination of grant-date fair value and required expense recognition over the requisite service period regardless of whether the performance condition is met.  The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted.  An entity may apply the standards (1) prospectively to all share-based payment awards that are granted or modified on or after the effective date, or (2) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter.  The adoption of ASU 2014-12 is not expected to have an impact on our Consolidated Financial Statements.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 amends the guidance for revenue recognition to replace numerous, industry-specific requirements and converges areas under this topic with those of the International Financial Reporting Standards. The ASU implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. The amendment also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows

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from contracts with customers. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, and early adoption is prohibited. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. Management is currently assessing the impact the adoption of ASU 2014-09 will have on our Consolidated Financial Statements.

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QUARTERLY RESULTS OF OPERATIONS

The following tables set forth certain unaudited quarterly financial information:

	For the 13 Weeks Ended
(In millions)	May 3, 2014			August 2, 2014			November 1, 2014			January 31, 2015 (1)
Fiscal 2014
Net sales	$	2,479		$	2,440		$	2,459		$	4,983
Gross margin	918			916			908			1,688
Selling, general and administrative expenses	917			878			931			1,189
Depreciation and amortization	104			95			86			92
Other income, net	(12		)	(15		)	(16		)	(10		)
Operating (loss) earnings	(91		)	(42		)	(93		)	417
Net (loss) earnings	(196		)	(147		)	(212		)	267
Net (loss) earnings attributable to Toys “R” Us, Inc.	$	(196	)	$	(148	)	$	(213	)	$	265
	For the 13 Weeks Ended
(In millions)	May 4, 2013			August 3, 2013			November 2, 2013			February 1, 2014 (1)
Fiscal 2013
Net sales	$	2,408		$	2,377		$	2,491		$	5,267
Gross margin	900			920			896			1,673
Selling, general and administrative expenses	886			890			959			1,275
Depreciation and amortization	100			95			92			101
Goodwill impairment	—			—			—			378
Other (income) expense, net	(13		)	(19		)	(15		)	10
Operating loss	(73		)	(46		)	(140		)	(91		)
Net loss (2)	(111		)	(113		)	(605		)	(207		)
Net loss attributable to Toys “R” Us, Inc.	$	(111	)	$	(113	)	$	(605	)	$	(210	)

(1) Our Domestic and International businesses are highly seasonal with sales highest in the fourth quarter. During fiscals 2014, 2013 and 2012, 40%, 42% and 43%, respectively, of our total Net sales were generated in the fourth quarter. Our results of operations depend significantly upon the fourth quarter holiday selling season.

(2) For the fourth quarter of fiscal 2013, our Net loss was impacted by Goodwill impairment of $378 million associated with our Toys-Domestic and Toys-Japan reporting units, the incremental write-down of excess and obsolete inventory of $51 million, long-lived asset impairment of $37 million and a prior period vacation accrual correction of $17 million.

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PARENT COMPANY INFORMATION

Toys “R” Us, Inc.

Schedule I — Condensed Statements of Operations and Comprehensive Loss

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Revenues	$	—		$	—		$	—
General and administrative expenses	25			21			18
Depreciation and amortization	1			3			3
Other expense, net	—			1			—
Total operating expenses	26			25			21
Other (expense) income:
Interest expense, net	(78		)	(76		)	(83		)
Intercompany interest expense, net	(54		)	(63		)	(47		)
(Deficit) equity in pre-tax (loss) earnings of consolidated subsidiaries	(102		)	(706		)	242
(Loss) earnings before income taxes	(260		)	(870		)	91
Income tax expense	32			169			53
Net (loss) earnings	$	(292	)	$	(1,039	)	$	38
Comprehensive loss	$	(452	)	$	(1,120	)	$	(9	)

See accompanying notes to Condensed Financial Statements.

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Toys “R” Us, Inc.

Schedule I — Condensed Balance Sheets

(In millions)	January 31, 2015			February 1, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	11		$	79
Income taxes receivable	20			—
Prepaid expenses and other current assets	9			4
Due from subsidiary	376			316
Total current assets	416			399
Property and equipment, net	1			3
Deferred tax assets	2			2
Other assets	12			27
	$	431		$	431
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accrued expenses and other current liabilities	$	121		$	88
Income taxes payable	2			—
Total current liabilities	123			88
Long-term debt	872			872
Due to subsidiaries, net	461			46
Other non-current liabilities	70			73
Temporary equity	—			8
Stockholders’ deficit	(1,095		)	(656		)
	$	431		$	431

See accompanying notes to Condensed Financial Statements.

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Toys “R” Us, Inc.

Schedule I — Condensed Statements of Cash Flows

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Cash Flows from Operating Activities	$	(13	)	$	(21	)	$	114
Cash Flows from Investing Activities:
Investments in subsidiaries	5			(180		)	(33		)
Intercompany loan repayments by subsidiaries	2,056			1,956			2,107
Loans to subsidiaries	(2,116		)	(2,251		)	(2,005		)
Proceeds from redemption of debt securities	—			52			—
Net cash (used in) provided by investing activities	(55		)	(423		)	69
Cash Flows from Financing Activities:
Long-term debt borrowings	—			—			446
Long-term debt repayment	—			—			(400		)
Borrowings from subsidiaries	—			—			265
Other	—			(7		)	(17		)
Net cash (used in) provided by financing activities	—			(7		)	294
Cash and cash equivalents:
Net (decrease) increase during period	(68		)	(451		)	477
Cash and cash equivalents at beginning of period	79			530			53
Cash and cash equivalents at end of period	$	11		$	79		$	530
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	77		$	78		$	75

See accompanying notes to Condensed Financial Statements.

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Toys “R” Us, Inc.

Schedule I — Notes to Condensed Financial Statements

NOTE A — BASIS OF PRESENTATION

The Parent Company is a holding company that conducts substantially all of its business operations through its subsidiaries. As specified in certain of its subsidiaries’ debt agreements, there are restrictions on the Parent Company’s ability to obtain funds from certain of its subsidiaries through dividends, loans or advances (refer to Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT”). Accordingly, these condensed financial statements have been presented on a “parent-only” basis. Under a parent-only presentation, the Parent Company’s investments in its consolidated subsidiaries are presented under the equity method of accounting. These parent-only financial statements should be read in conjunction with Toys “R” Us, Inc.’s audited Consolidated Financial Statements included elsewhere herein.

In connection with the July 21, 2005 Merger and subsequent reorganization, the Parent Company borrowed $770 million and received a promissory note of $887 million (£509 million) as a dividend from its indirect wholly-owned subsidiary, Toys “R” Us (UK) Limited (“Toys Limited”). On January 25, 2012 the $770 million intercompany note payable to Toys Limited was amended to translate the outstanding principal and accrued interest on that date to pounds sterling. As of January 31, 2015 and February 1, 2014, Due to subsidiaries, net included the outstanding net intercompany receivable balance from Toys Limited of $175 million and $179 million, respectively.

Additionally included within Due to subsidiaries, net, as of January 31, 2015 and February 1, 2014 is an intercompany payable to Toys-Delaware of $755 million and $697 million, respectively, which includes accrued interest. The intercompany payable to Toys-Delaware includes long-term notes payable by Parent to Toys-Delaware as of January 31, 2015 and February 1, 2014 for which the amounts are listed in the table below. All of the notes are documented, unsecured, and include a market rate of interest. For fiscals 2014 and 2013, the long-term notes payable by Parent to Toys-Delaware were offset by $89 million and $90 million, respectively, of third party insurance liabilities for which Toys-Delaware is the primary obligor. The remaining intercompany payable balance includes $4 million of other payables to Toys-Delaware for fiscals 2014 and 2013, respectively.

(In millions)	Fiscal 2014		Fiscal 2013
Note issued by Parent in FY 2005	$	299	$	286
Note issued by Parent in FY 2009	222		201
Note issued by Parent in FY 2012 (1)	229		206
Note issued by Parent in FY 2012	90		90
Long-term notes payable by Parent to Toys-Delaware (2)	$	840	$	783

(1) Note is expressly subordinated in right of payment to the senior obligations of the Parent.

(2) Includes accrued and unpaid interest.

As of January 31, 2015 and February 1, 2014, an outstanding short-term loan of $376 million and $316 million, respectively, to Toys-Delaware was recorded in Due from subsidiary.

For fiscals 2014, 2013 and 2012, the income tax expense of $32 million, $169 million and $53 million, respectively, represents the Parent Company’s consolidated income tax expense. Such amounts include income tax expense of $91 million, $127 million and $105 million, respectively, related to our subsidiaries, which have not been consolidated for this presentation. The Parent Company is responsible for cash income tax payments on the separate company income of such subsidiaries for United States Federal and certain state filings.

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NOTE B — DEBT

A summary of the Parent Company’s Long-term debt as of January 31, 2015 and February 1, 2014 is outlined in the table below:

(In millions)	January 31, 2015		February 1, 2014
10.375% senior notes, due fiscal 2017	448		447
7.375% senior notes, due fiscal 2018	402		403
8.750% debentures, due fiscal 2021 (1)	22		22
Total Long-term debt	$	872	$	872

(1) Represents obligations of Toys “R” Us, Inc. and Toys–Delaware.

The total fair values of the Parent Company’s Long-term debt, with carrying values of $872 million at January 31, 2015 and February 1, 2014, respectively, were $639 million and $687 million, respectively. The fair values of the Parent Company’s Long-term debt are estimated using the quoted market prices for the same or similar issues and other pertinent information available to management as of the end of the respective periods.

The annual maturities of the Parent Company’s Long-term debt at January 31, 2015 are as follows:

(In millions)	Annual Maturities
2015	$	—
2016	—
2017	450
2018	400
2019	—
2020 and subsequent	22
Total	$	872

The Parent Company is a co-obligor of the outstanding debentures due fiscal 2021, and these debt securities are included in Long-term debt within the Parent Company Condensed Balance Sheets for stand-alone reporting purposes. However, it is expected all future principal and interest payments will be funded through the operating cash flows of Toys-Delaware. During fiscals 2014, 2013 and 2012, Toys-Delaware recorded interest expense related to the outstanding debentures due fiscal 2021 of $2 million, respectively, which is reflected as part of (Deficit) equity in pre-tax (loss) earnings of consolidated subsidiaries in the Parent Company Condensed Statements of Operations and Comprehensive Loss.

The Parent Company provides guarantees related to the uncommitted credit lines of Labuan in an aggregate amount up to HK$257 million ($33 million at January 31, 2015) for future borrowings. During fiscal 2012, the Parent Company provided the lenders of the Spain Propco Facility Agreement entered into on January 29, 2013 with a deficiency guarantee with respect to certain losses the lenders may suffer in certain circumstances.

For a discussion of the debt obligations of the Parent Company and its subsidiaries, see Note 2 to the Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

NOTE C — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We are exposed to market risk from potential changes in interest rates and foreign currency exchange rates. We regularly evaluate our exposure and enter into derivative financial instruments to economically manage these risks. We record all derivatives as either assets or liabilities on the Parent Company Condensed Balance Sheets measured at estimated fair value and we do not offset assets and liabilities with the same counterparty. We recognize the changes in fair value as unrealized gains and losses. The recognition of these gains and losses depends on our intended use of the derivatives and the resulting designation. In certain defined conditions, a derivative may be specifically designated as a hedge for a particular exposure.

Interest Rate Contracts

We and our subsidiaries have a variety of fixed and variable rate debt instruments and are exposed to market risks resulting from interest rate fluctuations. We enter into interest rate swaps and/or caps to reduce our exposure to variability in expected future cash outflows attributable to the changes in LIBOR rates. Some of our interest rate contracts may contain credit-risk

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related contingent features and are subject to master netting arrangements. As of January 31, 2015, our interest rate contracts have maturity dates through April 2015.

At January 31, 2015 and February 1, 2014, we had no derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 31, 2015 and February 1, 2014, we were not required to post collateral with any derivative counterparties.

The following table presents our outstanding interest rate contracts as of January 31, 2015 and February 1, 2014:

			January 31, 2015		February 1, 2014
(In millions)	Effective Date	Maturity Date	Notional  Amount		Notional  Amount
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (1)	January 2011	April 2015	$	500	$	500
1 Month USD LIBOR Interest Rate Cap (1)	January 2012	April 2015	500		500
1 Month USD LIBOR Interest Rate Cap (1)	January 2014	April 2015	311		311

(1) These interest rate caps are not designated as cash flow hedges in accordance with ASC 815.

Foreign Exchange Contracts

We occasionally enter into foreign currency forward contracts to economically hedge our short-term, cross-currency intercompany loans with our foreign subsidiaries. We enter into these contracts in order to reduce our exposure to the variability in expected cash outflows attributable to changes in foreign currency rates. These derivative contracts are not designated as hedges and are recorded on the Parent Company Condensed Balance Sheets at fair value with a gain or loss recorded on the Parent Company Condensed Statements of Operations and Comprehensive Loss in Interest expense, net. At January 31, 2015 and February 1, 2014, we had no outstanding foreign exchange contracts.

Our foreign exchange contracts typically mature within 12 months. Some of these contracts may contain credit-risk related contingent features and are subject to master netting arrangements. Some of these agreements contain provisions where we could be declared in default on our derivative obligations if we default on certain specified indebtedness. At January 31, 2015 and February 1, 2014, derivative liabilities related to agreements that contain credit-risk related contingent features had a fair value of $2 million and less than $1 million, respectively. We are not required to post collateral for these contracts.

The following table sets forth the net impact of the effective portion of Parent Company’s derivatives on Accumulated other comprehensive (loss) income for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014		February 2, 2013
Derivatives previously designated as cash flow hedges:
Beginning balance	$	1		$	1	$	1
Reclassifications from Accumulated other comprehensive      (loss) income - Interest Rate Contracts	(1		)	—		—
	(1		)	—		—
Ending balance	$	—		$	1	$	1

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The following table sets forth the impact of derivatives on Interest expense, net on the Parent Company Condensed Statements of Operations and Comprehensive Loss for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014			February 2, 2013
Derivatives not designated for hedge accounting:
Loss on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	$	—	$	(1	)	$	—
	—		(1		)	—
Derivatives previously designated as cash flow hedges:
Amortization of hedged caps	1		—			—
	1		—			—
Total Interest expense, net	$	1	$	(1	)	$	—

(1) Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, net, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

The following table contains the notional amounts and fair values of Parent Company’s outstanding derivative contracts as of January 31, 2015 and February 1, 2014:

	January 31, 2015				February 1, 2014
	Notional		Fair Value Assets/		Notional		Fair Value Assets/
(In millions)	Amount		(Liabilities)		Amount		(Liabilities)
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets (1)	$	1,311	$	—	$	—	$	—
Other assets	$	—	$	—	$	1,311	$	—

(1) Amounts as of January 31, 2015 includes reclassifications of contracts scheduled to mature within the next 12 months, which were previously included within Other assets as of February 1, 2014.

Refer to Note 3 to our Consolidated Financial Statements entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details on derivative instruments.

Offsetting of Derivatives

We present our derivatives at gross fair values in the Parent Company Condensed Balance Sheets. However, some of our interest rate and foreign exchange contracts are subject to master netting arrangements which allow net settlements under certain conditions. As of January 31, 2015 and February 1, 2014, the aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets were nominal, respectively, and the aggregate gross fair value of derivative assets which could be net settled against our derivative liabilities were nominal, respectively. As of January 31, 2015 and February 1, 2014, none of the master netting arrangements involved collateral.

NOTE D — COMMITMENTS AND CONTINGENCIES

Although the Parent Company does not currently have material legal proceedings pending against it, it may be subject to various claims and contingencies related to lawsuits, as well as commitments under contractual and other obligations. Refer to Note 14 to our Consolidated Financial Statements entitled “LITIGATION AND LEGAL PROCEEDINGS” for further information. Additionally, the Parent Company is a guarantor on certain leases entered into by its subsidiaries. For a discussion of the lease obligations of the Parent Company and its subsidiaries, see Note 9 to our Consolidated Financial Statements entitled “LEASES.”

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NOTE E — DISTRIBUTIONS AND CAPITAL CONTRIBUTIONS

Distributions

The Parent Company received cash distributions (inclusive of returns of capital) from certain of its subsidiaries of $93 million, $202 million and $203 million during fiscals 2014, 2013 and 2012, respectively. The cash distributions received included $79 million and $129 million in fiscals 2013 and 2012, respectively, from its subsidiary Toys-Delaware. No cash distributions were received from Toys-Delaware in fiscal 2014.

The cash distributions received also included $93 million, $123 million and $72 million, in fiscals 2014, 2013 and 2012, respectively, from certain of our property subsidiaries, which included no returns of capital in fiscal 2014 and returns of capital of $109 million and $10 million in fiscals 2013 and 2012, respectively. The cash distributions received during fiscals 2014, 2013 and 2012 from our property subsidiary TRU Propco I were $86 million, $115 million and $64 million, respectively.

Capital Contributions

During fiscal 2014, Parent Company made a capital contribution of $5 million to TRU Asia, Ltd., $1 million of which it used to pay contingent consideration related to the Labuan acquisition.

During fiscal 2013, Parent Company made a capital contribution of $274 million to Toys Europe, which it used in connection with the refinancing of the UK real estate credit facility. Additionally, during fiscal 2013, Parent Company made a capital contribution of $10 million to Toys Europe to assist in the funding of the Spain Propco Facility Agreement debt repayment for the fourth quarter of fiscal 2013. During fiscal 2012, Parent Company made a capital contribution of $30 million to Toys Europe, which it used in connection with the refinancing of the Spain Propco Facility. Refer to Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

Additionally, during fiscal 2012, Parent Company made a capital contribution of $5 million to TRU Asia, Ltd., which it used to pay contingent consideration related to the Labuan acquisition.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

(a) Disclosure Controls and Procedures

Disclosure controls and procedures are the controls and other procedures that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including the principal executive and principal financial officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

We have evaluated, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act as of the end of the fiscal year covered by this annual report.

Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of the end of the fiscal year covered by this Annual Report on Form 10-K to accomplish their objectives at the reasonable assurance level.

(b) Management’s Annual Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Securities Exchange Act Rule 15d-15(f). Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with United States Generally Accepted Accounting Principles.

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Under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, we conducted an assessment of the design and effectiveness of our internal control over financial reporting as of the end of the fiscal year covered by this report based on the framework issued by the Committee of Sponsoring Organizations (“COSO”) of the Treadway Commission in Internal Control—Integrated Framework (2013).

Based on this assessment, management concluded that, as of January 31, 2015, the Company’s internal control over financial reporting was effective.

Deloitte & Touche LLP, an independent registered public accounting firm which has audited and reported on the financial statements contained in this Annual Report on Form 10-K, has issued its written attestation report on the Company’s internal control over financial reporting which is included in this Annual Report on Form 10-K.

(c) Change in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during our fourth quarter of fiscal 2014 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Toys “R” Us, Inc.:

We have audited the internal control over financial reporting of Toys “R” Us, Inc. and subsidiaries (the "Company") as of January 31, 2015, based on criteria established in Internal Control - Integrated Framework (2013)issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's principal executive and principal financial officers, or persons performing similar functions, and effected by the company's board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of January 31, 2015, based on the criteria established in Internal Control - Integrated Framework (2013)issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements and financial statement scheduleas of and for the year ended January 31, 2015 of the Company and our report dated March 26, 2015 expressed an unqualified opinion on those financial statements and financial statement schedule.

/s/ Deloitte & Touche LLP

New York, New York

March 26, 2015

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ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Directors

The following persons were members of our Board of Directors (the “Board”) as of March 1, 2015. Each elected director will hold office until a successor is duly elected and qualified or until his or her earlier death, resignation or removal from office by our stockholders.

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Name	Age	Principal Occupation and Business Experience During Past Five Years and Other Directorships
Joshua Bekenstein	56	Mr. Bekenstein has been our director since September 2005. Mr. Bekenstein is currently a Managing Director of Bain Capital LLC (“Bain”), having joined the firm at its inception in 1984. Mr. Bekenstein currently serves as a member of the Boards of Directors of Bob’s Discount Furniture, Bombardier Recreational Products Inc., Bright Horizons Family Solutions, Inc., Burlington Coat Factory Warehouse Corporation, Canada Goose, Dollarama, The Gymboree Corporation, Michaels Stores, Inc., TOMS Shoes and Waters Corporation.
Richard Goodman	66	Mr. Goodman has been our director since October 2011. Mr. Goodman served as an Executive Vice President of Global Operations at PepsiCo, Inc. from March 2010 until his retirement at the end of 2011. From October 2006 to March 2010, Mr. Goodman served as Chief Financial Officer of PepsiCo Inc. Prior to that, from 2003 to October 2006, Mr. Goodman served as Chief Financial Officer of PepsiCo International. He has been a Director of Johnson Controls Inc. since 2008, of Western Union since January 2011 and of Kindred Healthcare since March 2014.
Daniel Guglielmone	48	Mr. Guglielmone has been our director since May 2013. Mr. Guglielmone has served as Senior Vice President of Vornado Realty Trust (“Vornado”) since September 2003.
Matthew S. Levin	48	Mr. Levin has been our director since July 2005. Mr. Levin has been a Managing Director at Bain since 2000. Mr. Levin also currently serves as a director of Bombardier Recreational Products Inc., Dollarama Capital Corporation, Michaels Stores, Inc., Unisource Worldwide, Inc., Edcon Holdings Pty Ltd., Lilliput Kidswear Ltd. and Guitar Centers, Inc.
Joseph Macnow	69	Mr. Macnow has been our director since May 2013. Mr. Macnow has served as Executive Vice President - Finance and Chief Administrative Officer of Vornado since June 2013. He served as Executive Vice President - Finance and Administration of Vornado from January 1998 to June 2013. He was Vice President and Chief Financial Officer of Vornado from 1985 to January 1998 and from March 2001 to June 2013. He has been the Vice President and Chief Financial Officer of Alexander’s, Inc. since August 1995.
Richard L. Markee	61	Mr. Markee has been our director since November 2013. Mr. Markee has served as the Executive Chairman of Vitamin Shoppe, Inc. (“Vitamin Shoppe”) since April 2011. From September 2009 to April 2011, he served as Chief Executive Officer and as Chairman of the Board of Directors of Vitamin Shoppe. Mr. Markee was an Operating Partner of Irving Place Capital Management, L.P., a private equity firm focused on making equity investments in middle-market companies, from November 2008 to September 2009. From 2006 to 2008, he was an Operating Partner of Bear Stearns Merchant Banking, the predecessor to Irving Place Capital Management, L.P.. In addition, Mr. Markee previously served in a number of capacities at the Company, including serving as Vice Chairman from 2004 to 2006 and Interim Chief Executive Officer from 2005 to 2006.
Wayne C. Sales	65	Mr. Sales has been our director since April 2014. Mr. Sales has been a director of SUPERVALU INC. (“SUPERVALU”) since 2006 and was a Non-Executive Chairman of the Board from 2010 to 2012. He served as Executive Chairman of the Board, Chief Executive Officer and President of SUPERVALU from July 2012 to February 2013.
Wendy Silverstein	54	Ms. Silverstein has been our director since September 2005. Ms. Silverstein has been Executive Vice President and Co-Head of Acquisitions and Capital Markets of Vornado since November 2010. She served as Executive Vice President — Capital Markets of Vornado from 1998 to October 2010.
Nathaniel H. Taylor	38	Mr. Taylor has been our director since January 2011. Mr. Taylor is a member of the general partner of KKR & Co. L.P., and he has been an investment professional at Kohlberg Kravis and Roberts & Co. L.P. and/or its affiliates, since November 2005.
Antonio Urcelay	62	Mr. Urcelay has served as the Chairman of the Board since November 2013. He has served as the Chief Executive Officer of the Company since October 2013. From May 2013 to October 2013, Mr. Urcelay served as Interim Chief Executive Officer of the Company. From July 2010 to October 2013, he also served as the Company’s President of Europe. Prior to that, Mr. Urcelay served as President of Continental Europe (Germany, Switzerland, Austria, France, Spain and Portugal) from August 2004 to July 2010.
Adam Waglay	32	Mr. Waglay has been our director since May 2013. Mr. Waglay has served as a Principal at KKR & Co. L.P. since July 2010. From July 2007 to July 2010, Mr. Waglay served as an Associate at Kohlberg Kravis and Roberts & Co. L.P. and/or its affiliates.
Gregory R. Why	48	Mr. Why has been our director since May 2013. Mr. Why has served as an Operating Partner at Bain since December 2009. From October 2006 until December 2009, Mr. Why served as an Executive Vice President at Bain.

In appointing Mr. Urcelay to the Board, the Board considered the intimate knowledge of the Company’s global business and operations that Mr. Urcelay brings to the Board from his experience as the Chief Executive Officer of the Company. In addition, the Board considered his significant experience and expertise in the retail industry gained over his more than 30 years of retail and consumer goods experience, including in his various roles at Toys “R” Us over a 17 year career. In his most recent

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role as President of Europe, he was responsible for the successful operation of more than 250 Toys “R” Us and Babies “R” Us stores in eight European countries: the United Kingdom, Austria, France, Germany, Poland, Portugal, Spain and Switzerland. This included providing leadership in asserting the company’s global status as the toy and baby products authority through marketing, merchandising, e-commerce, store support and customer service excellence. In 2011, Mr. Urcelay directed the company’s market entry into Poland, providing the gateway for potential further expansion in Europe.

In appointing Mr. Sales to the Board, the Board considered his significant experience and expertise in the retail industry including his prior service as Executive Chairman of the Board, Chief Executive Officer and President of SUPERVALU.

In appointing Mr. Markee to the Board, the Board considered his significant experience and expertise in the retail industry including his prior service as Chief Executive Officer of the Vitamin Shoppe and his prior service with the Company in which he served in a number of capacities, including serving as Vice Chairman from 2004 to 2006 and interim Chief Executive Officer from 2005 to 2006.

In appointing Mr. Goodman to the Board, the Board considered his significant business experience including his extensive knowledge of financial statements and reporting.

Other than Messrs. Urcelay, Goodman, Markee and Sales, each of the Directors was elected to the Board pursuant to a stockholders agreement dated July 21, 2005, as amended, by and among the Company and Bain, KKR and Vornado (collectively, the “Sponsors”) and a private investor (the “Stockholders’ Agreement”). Pursuant to such agreement, Messrs. Bekenstein, Levin and Why were appointed to the Board as a consequence of their respective relationships with Bain; Messrs. Waglay and Taylor were appointed to the Board as a consequence of their respective relationships with KKR; and Ms. Silverstein and Messrs. Macnow and Guglielmone were appointed to the Board as a consequence of their respective relationships with Vornado.

Executive Officers

The following persons were our Executive Officers as of March 1, 2015, having been elected to their respective offices by the Board:

Name	Age	Position with the Registrant
Antonio Urcelay (1)	62	Chairman of the Board; Chief Executive Officer
Michael J. Short	54	Executive Vice President — Chief Financial Officer
Richard Barry	48	Executive Vice President — Global Chief Merchandising Officer
Deborah Derby	51	Vice Chairman and Executive Vice President
Dr. Wolfgang Link	47	President — Toys “R” Us, Europe
Monika M. Merz	65	President — Toys “R” Us, Asia Pacific
Harry J. Mullany III	56	President — Toys “R” Us, U.S.
David J. Schwartz	47	Executive Vice President — General Counsel & Corporate Secretary

(1) See “Directors” above for Mr. Urcelay’s biography.

The following is a brief description of the business experience of each of our Executive Officers:

Mr. Short has served as our Executive Vice President — Chief Financial Officer since June 2014. From January 2007 to January 2014, Mr. Short served as Executive Vice President — Chief Financial Officer of AutoNation, an automotive retailer. From 2000 to 2007, Mr. Short served as Executive Vice President — Chief Financial Officer of Universal Orlando.

Mr. Barry has served as our Executive Vice President — Global Chief Merchandising Officer since October 2014. Mr. Barry served as our Executive Vice President — Chief Merchandising Officer from October 2012 to October 2014. From January 2012 to October 2012, Mr. Barry served as Senior Vice President — Chief Merchandising Officer. From March 2010 to January 2012, Mr. Barry served as Vice President — General Merchandising Manager and from September 2006 to March 2010, he served as Vice President — Divisional Merchandising Manager.

Ms. Derby has served as our Vice Chairman and Executive Vice President since March 2013. From September 2012 to March 2013, Ms. Derby served as a consultant at Kenneth Cole Productions, Inc. From February 2009 to February 2012, Ms. Derby served as our Chief Administrative Officer. Prior to that she served as the President of Babies “R” Us from May 2006 to February 2009. Ms. Derby currently serves as a member of the Board of Directors of the Vitamin Shoppe, Inc.

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Dr. Link has served as President, Toys “R” Us, Europe since October 2013. From August 2007 to October 2013, Dr. Link served as Managing Director, Toys “R” Us, Central Europe.

Ms. Merz has served as President — Toys “R” Us, Asia Pacific since November 2011. She served as the President and Chief Executive Officer of Toys “R” Us – Japan Ltd. (“Toys Japan”) from November 2007 to November 2011. From January 2000 until November 2007, Ms. Merz served as the President of Toys “R” Us Canada, Ltd. (“Toys Canada”). Prior to that, from October 1996 until January 2000, Ms. Merz served as Vice President and General Merchandise Manager for Toys Canada.

Mr. Mullany has served as President — Toys “R” Us, U.S. since November 2013. From February 2011 to March 2013, he served as Chief Executive Officer of Servicemaster Company, a provider of various services to residences and firms including home cleaning and maintenance, pest control and lawn fertilization. From January 2010 to November 2010, Mr. Mullany served as Executive Vice President and President, Wal-Mart North. From January 2006 to December 2009, he served as Senior Vice President and President, Northeast Division of Wal-Mart Stores Inc.

Mr. Schwartz has served as our Executive Vice President – General Counsel since October 2009 and has served as Corporate Secretary since April 2006. From September 2003 until October 2009, Mr. Schwartz served as Senior Vice President — General Counsel. From January 2002 until September 2003, Mr. Schwartz served as our Vice President — Deputy General Counsel, and served as Assistant Corporate Secretary from that time until April 2006. From February 2001 to January 2002, Mr. Schwartz served as our Vice President — Corporate Counsel and Assistant Corporate Secretary.

Section 16(a) Beneficial Ownership Reporting Compliance

As our equity securities are not registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), none of our directors, officers or ten percent holders were subject to Section 16(a) of the Exchange Act for the past fiscal year or the filing requirements thereof.

Code of Ethics

We have adopted a code of ethics that applies to our principal executive officer, principal financial officer and principal accounting officer or any person performing similar functions (the “Code of Ethics”). The Code of Ethics is available on the Corporate Governance page of our website at www.Toysrusinc.com. If we ever were to amend or waive any provision of our Code of Ethics, we intend to satisfy our disclosure obligations with respect to any such waiver or amendment by posting such information on our Internet website set forth above rather than by filing a Form 8-K. The Code of Ethics is also available in print, free of charge, to any investor who requests it by writing to: Toys “R” Us, Inc., One Geoffrey Way, Wayne, New Jersey 07470, Attention: Investor Relations.

Audit Committee

Our Board of Directors has a separately designated audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. The Audit Committee consists of Joseph Macnow, Adam Waglay and Richard Goodman, who serves as Chairman of the Audit Committee. Our Board of Directors has determined that each member of the Audit Committee is financially literate and that Mr. Goodman is an “audit committee financial expert” within the meaning of the regulations adopted by the Securities and Exchange Commission. The Board has not made a determination as to whether any Audit Committee members are independent.

ITEM 11. EXECUTIVE COMPENSATION

We refer to the persons included in the Summary Compensation Table below as our “named executive officers.” References to “2014,” “2013,” and “2012” mean, respectively, our fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013, respectively.

COMPENSATION DISCUSSION AND ANALYSIS

The following Executive Compensation discussion and analysis discusses our compensation policies and decisions regarding our named executive officers and describes the material elements of compensation for our named executive officers. Our named executive officers are:

• Antonio Urcelay, Chairman of the Board and Chief Executive Officer;

• Michael J. Short, Executive Vice President — Chief Financial Officer;

• Deborah Derby, Vice Chairman and Executive Vice President;

• Monika M. Merz, President — Toys “R” Us, Asia Pacific;

• Harry J. Mullany III, President — Toys “R” Us, U.S.; and

• F. Clay Creasey, Jr., Former Executive Vice President — Chief Financial Officer¹ 

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¹ Mr. Creasey’s employment was terminated in June 2014.

Role of Our Board of Directors in Compensation Decisions

Our Board of Directors acting through the Executive Committee of the Board pursuant to delegated authority has historically been ultimately responsible for approving both our compensation program and the specific compensation paid to each of our named executive officers. The Executive Committee of the Board, which is currently comprised of one designee from each of the three Sponsors, has discharged this responsibility pursuant to a charter approved by the Board.

Objective of Our Executive Compensation Program

The overall objective of our executive compensation program is to provide compensation opportunities that will allow us to attract and retain executive officers of a caliber and level of experience necessary to effectively manage our global business and motivate such executive officers to increase the value of our Company. We believe that, in order to achieve that objective, our program must:

• provide each executive officer with compensation opportunities that are competitive with the compensation opportunities available to executives in comparable positions at companies with whom we compete for talent;

• tie a significant portion of each executive officer’s compensation to our financial performance and his or her individual performance; and

• align the interests of our executive officers with those of our equity holders.

Summary of Significant 2014 Compensation Decisions

Personnel Changes

In June 2014, Mr. Short joined the Company as Executive Vice President — Chief Financial Officer replacing Mr. Creasey whose employment terminated in June 2014. Pursuant to his employment agreement, Mr. Short will be paid an annual base salary of $700,000 and he will be eligible to earn an annual bonus award in a target amount of up to 100% of his base salary (prorated for 2014). In addition, Mr. Short was granted a one-time award of 30,000 stock options, which will vest in four equal annual installments commencing October 10, 2015. In addition, Mr. Short received a one-time award of 450,000 stock options (“Additional Options”), 50% of which will vest in four equal annual installments commencing October 10, 2015 with the remaining Additional Options subject to performance and time vesting and which will only be deemed fully vested when they have both time vested and performance vested, as further described in “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—LONG-TERM INCENTIVES—2010 INCENTIVE PLAN” below. Mr. Short is also entitled to additional severance benefits and perquisites.

Option Exchanges

In September 2014, certain participants, including the named executive officers, were offered an opportunity to exchange their outstanding stock options that were granted prior to fiscal 2014 (“Old Options”) under the Company’s Amended and Restated 2005 Management Equity Plan, as amended (the “Management Equity Plan”), or the Company’s 2010 Incentive Plan, as amended (the “2010 Incentive Plan”), for new stock options granted under the 2010 Incentive Plan (“New Options”) on a one-for-one basis. The New Options have an exercise price of $8.00 per share. On October 10, 2014, the Company closed its offer with a total of 1,566,307 Old Options canceled and an equal amount of New Options issued under the 2010 Incentive Plan (the “2014 Option Exchange”). Mr. Urcelay and Mses. Derby and Merz elected to participate in the 2014 Option Exchange. See “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—LONG-TERM INCENTIVES—2010 INCENTIVE PLAN” below for further details.

Pursuant to the terms of an amendment to Mr. Urcelay’s employment agreement, on October 14, 2014 Mr. Urcelay forfeited 363,700 of his outstanding restricted stock units in exchange for a grant of 363,700 options under the 2010 Incentive Plan (the “Urcelay Options”). Fifty percent and 12.5% of the Urcelay Options vested on October 31, 2014, and January 31, 2015, respectively, and 12.5% will vest on each of April 30, 2015, July 31, 2015 and October 31, 2015, subject to Mr. Urcelay’s continued employment on each such date. The Urcelay Options are subject to the same accelerated vesting provisions that applied with respect to the canceled restricted stock units. The Urcelay Options have an exercise price of $8.00 per share. See “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—LONG-TERM INCENTIVES—2010 INCENTIVE PLAN” below for further details.

Additionally, on October 14, 2014, the Company and Mr. Mullany entered into an option exchange pursuant to which Mr. Mullany exchanged his 250,000 outstanding time-based options for 250,000 newly granted time-based options and his 250,000 outstanding performance-based options for 250,000 newly granted performance-based options (“Performance Options”). Mr. Mullany also received an additional 181,820 time-based options in connection with the cancellation of 90,910 unvested restricted stock units, in each case, under the 2010 Incentive Plan. See “ELEMENTS OF OUR EXECUTIVE

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COMPENSATION PROGRAM—LONG-TERM INCENTIVES—2010 INCENTIVE PLAN” below for further details.

Amendments to Employment Agreements

In October 2014, the Company and Mr. Urcelay and Ms. Derby entered into amended employment agreements.

Amendment to Mr. Urcelay’s Employment Agreement

On October 14, 2014, Toys “R” Us, Inc., Branch in Spain, a subsidiary of the Company (“Toys Spain”) and Mr. Urcelay entered into an amendment to Mr. Urcelay’s employment agreement with Toys Spain, dated March 3, 2014. The amendment provides that if Mr. Urcelay remains continuously employed with Toys through October 31, 2015, or if his employment is earlier terminated due to his death or Disability, by Toys Spain without Cause, or by him for Good Reason (as each such term is defined in Mr. Urcelay’s employment agreement), (i) he will receive a payment equal to $2,000,000 (the “Retention Bonus”) and (ii) he will be eligible to earn a performance bonus equal to $1,000,000 subject to the achievement of specified Consolidated Adjusted EBITDA for the twelve month period ending on the last day of the Company’s third fiscal quarter of 2015 (the “Special Performance Bonus”), subject, in each case, to the execution of a release of claims in favor of the Company, its subsidiaries and affiliates. The Company and Mr. Urcelay may mutually agree to extend the employment term for an additional one year period.

Amended and Restated Employment Agreement for Ms. Derby

In October 2014, the Company and Ms. Derby entered into an amended and restated employment agreement, which amended certain terms of Ms. Derby’s employment with the Company. In connection with her amended agreement, cash severance payable to Ms. Derby on a termination by the Company without Cause or by her for Good Reason will be (i) an amount equal to two times her base salary if such termination occurs on or prior to October 13, 2016 or (ii) if such termination occurs following October 13, 2016, an amount equal to two times the sum of her base salary and the average of the annual bonuses, if any, earned by Ms. Derby for the two fiscal years immediately preceding the date of termination. The amended and restated employment agreement also extends to 24 months the period during which Ms. Derby will receive continuation of medical, dental and life insurance benefits following a termination of her employment and the period during which Ms. Derby is subject to a post-termination non-competition covenant.

Retention Bonuses

The Company granted Mses. Derby and Merz retention bonuses. The Executive Committee of the Board determined these awards to be advisable in promoting retention and incentivizing these officers during the transition period.

The Company granted Ms. Derby a retention bonus in the amount of $1,400,000 payable on March 11, 2015 (the “2015 retention bonus”) and a retention bonus in the amount of $700,000 payable on March 11, 2016 (the “2016 retention bonus”), in each case subject to her continued employment with the Company on such dates. If Ms. Derby’s employment is terminated by the Company for any reason other than Cause or by her for Good Reason, the 2015 retention bonus will be paid to her on a pro rata basis based on the number of full months that have elapsed from March 11, 2013 and if such termination is on or after September 11, 2015, the 2016 retention bonus will be paid to her on a pro rata basis based on the number of full months that have elapsed from March 11, 2014.

On October 10, 2014, the Company entered into a letter agreement with Ms. Merz, pursuant to which the Company granted Ms. Merz an additional retention bonus in the amount of CAD $649,000 ($583,256 based on the Company’s average annual conversion rate in fiscal 2014), which will be payable on March 11, 2016 subject to her continued employment with the Company on such date. If Ms. Merz’s employment is terminated by the Company for any reason other than Cause on or after September 11, 2015, then the retention bonus will be paid to her on a pro rata basis based on the number of full months that have elapsed from March 11, 2014.

Special Bonuses

On September 8, 2014, the Company issued one time special cash bonus payments to Mr. Urcelay and Mses. Derby and Merz in the following amounts: $104,245, $119,632 and $67,654, respectively. This one-time special cash bonus was awarded in recognition of past hard work and contributions, and to ensure focus and commitment going forward.

Elements of Our Executive Compensation Program

Our executive compensation program consists of the following components:

• base salary;

• annual incentive awards;

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• long-term incentives;

• perquisites;

• other benefits; and

• benefits upon termination or change of control.

Mix of Total Compensation

Cash compensation includes base salary and annual incentive awards. The annual incentive for top executive officers, is targeted to approach or exceed base salaries to emphasize performance-based compensation. In fiscal 2014, we also awarded long-term cash compensation incentive opportunities. Perquisites and other types of non-cash benefits are used on a limited basis and typically represent a small portion of total compensation for our executive officers.

In February 2014, our management retained the services of the Hay Group to provide us insight regarding market practice including base salary competitiveness, bonus target and actual awards eligibility and long term incentive award targets and eligibility. Management reviewed the compensation of executive officers at a peer group consisting of the following 20 retailers: Amazon.com, Best Buy Co., Inc., Dick’s Sporting Goods, Inc., Dollar General Corporation, The Gap, Inc., The Home Depot, Inc., J.C. Penney Company, Inc., Kohl’s Corporation, Limited Brands, Inc., Lowe’s Companies, Inc., Macy’s, Inc., Michaels Stores, Inc., Nordstrom, Inc., Office Depot, Inc., OfficeMax Incorporated, PetSmart, Inc., Ross Stores, Inc., Staples, Inc., Target and The TJX Companies, Inc. Based upon the recommendations of our Human Resources Department, which included consideration of prior year performance ratings, information contained in the Hay Group analysis and internal pay equity, management presented its recommendations for overall compensation including the base salary, annual incentive awards and Long Term Incentive Program for fiscal 2014 to the Executive Committee of the Board. These changes included a shift toward granting cash awards rather than equity, with the exception of certain executives who received new hire equity grants. For further information see “NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND GRANTS OF PLAN-BASED AWARDS IN FISCAL 2014 TABLE—2010 INCENTIVE PLAN”.

Base Salary

Base salary provides fixed compensation and is designed to reward core competence in the executive officer’s role relative to his or her skills, experience and contributions to the Company.

In fiscal 2014, we hired Mr. Short as the Chief Financial Officer of the Company. In determining his base salary, we considered historical compensation for this position and internal pay equity along with the competitive market data previously provided by Hay Group in February 2014.

The Executive Committee of the Board reviews the base salary of each of our executive officers annually as part of the Company’s performance review process described below, as well as upon a promotion or other change in job responsibility. On an annual basis, the Executive Committee of the Board determines the range, if any, for merit-based increases for eligible employees of the Company (including our executive officers) based upon the recommendation of the Company’s human resources department, after taking into account a variety of factors, including the Company’s internal financial projections, the general economy and the Sponsors’ practices at companies in their investment portfolios. In formulating a proposed range of merit-based increases, the Company’s human resources department considers a number of different factors, including the Company’s budget for the year, internal financial projections and historical practice, and also reviews a number of broad-based third party surveys to gain a general background understanding of the current compensation practices and trends and a sense of the reasonableness of the proposed range.

Merit-based increases to the base salary of an executive officer are based on the Executive Committee of the Board’s assessment that the executive officer performed at or above his or her established goals. Increases in base salary due to a promotion or change in job responsibilities are based on the Executive Committee of the Board’s assessment of the responsibilities and importance of the executive officer’s new position compared to the executive officer’s prior position.

At the beginning of each fiscal year, each of our executive officers is required to establish his or her personal business goals for the year. For fiscal 2014, the key priority was to stabilize the business and put the company in a position for future growth while continuing to put the customer at the core of all we do. This focus is at the core of our strategic priorities for fiscal 2014, which was as follows:

• Transform the customer experience;

• Develop high performing, highly engaged diverse teams; and

• Become fit for growth.

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At the beginning of each fiscal year, our Chairman and Chief Executive Officer, reviews and approves the goals developed by each of our executive officers, other than himself, and the Executive Committee of the Board reviews and approves our Chairman and Chief Executive Officer’s goals. At the end of each fiscal year, our Chairman and Chief Executive Officer reviews the individual performance of each executive officer against his or her personal goals. Mr. Urcelay will also prepare a self-evaluation of his own performance. He then presents his conclusions and recommendations with respect to base salary adjustments to the Executive Committee of the Board. The Executive Committee of the Board considers these conclusions and recommendations when determining any adjustments to our executive officers’ base salaries.

The following table sets forth the personal business goals of our named executive officers for fiscal 2014:

Name	Personal Business Goals
Mr. Urcelay	•     Focus on improving metrics: slow sales decline, grow EBITDA and stabilize cash flow.
	•     Right size the cost structure, control expenses and improve processes.
	•     Provide a better customer experience in-store and online. Improve store conditions.
	•     Focus on the trends in the International business. Continue profitable growth in China and Southeast Asia.
	•     Provide leadership and stability to the organization while developing a high performing team.
Mr. Short	•     Lead the Fit for Growth initiative.
	•     Help drive the achievement of the Company’s fiscal 2014 key initiatives focusing on reducing expenses through critical IT improvements, refinancing savings opportunities and achieving expense control totals.
Ms. Derby	•     Support execution of the three pillars of the Strategic Plan (“Three Pillars”): (i) transform the customer experience, (ii) develop high performing, highly engaged diverse teams, and (iii) become fit for growth.
	•     Implement a comprehensive action plan to improve overall employee engagement.
	•     Acquire and develop the talent necessary for delivering the business strategy.
	•     Ensure we have the appropriate compensation and long-term incentive programs/solutions in place to retain, hire and motivate talent at all levels.
Ms. Merz	•     Drive improvements in loyalty and Customer Relationship Management (“CRM”) for all countries in Asia Pacific.
	•     Drive alignment of China and Southeast Asia processes and financial reporting to TRU Global standards.
	•     Drive Japanese team to improve margin dollars.
	•     Drive new store expansion strategy as well as improvement of existing store performance in China.
Mr. Mullany	•     Achieve U.S. financial plan, with focus on margin and SG&A, and put business on trajectory to achieve long term EBITDA growth.
	•     Execute Three Pillars: (i) transform the customer experience, (ii) develop high performing, highly engaged diverse teams, and (iii) become fit for growth.
	•     Continue to enhance and strengthen relationships with key vendors while developing 3-year strategic plan with key vendors.

We believe that the above criteria, when considered together, provide an appropriate method of measuring our executive officers’ personal performance. In March 2015, and based upon fiscal 2014 performance, the Executive Committee of the Board determined that there would be no increase in the annual base salaries of our named executive officers.

Annual Incentive Awards

Annual incentive awards are an important part of the overall compensation we pay our executive officers. Unlike base salary, which is fixed, the annual incentive awards are paid only if specified performance levels are achieved during the year. We believe that annual incentive awards encourage our executive officers to focus on specific short-term business and financial goals of the Company. Our executive officers receive annual cash incentive awards under the Toys “R” Us, Inc. Management Incentive Plan (the “Management Incentive Plan”).

Under the Management Incentive Plan, each executive officer has an annual incentive target payout expressed as a percentage of his or her base salary. The target bonus payouts as a percentage of base salary for our named executive officers were

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established in their employment agreements and may be subsequently adjusted based upon performance and/or a promotion in responsibility. Our named executive officers’ fiscal 2014 annual incentive award target payouts, expressed as a percentage of base salary, are as follows: for Mr. Urcelay, 150%; for Mr. Short, 100%; for Ms. Derby and Ms. Merz, 110% and for Mr. Mullany, 125%. As Mr. Creasey’s employment was terminated in June 2014, he was not eligible for an annual incentive award for fiscal 2014. Actual payouts under the annual incentive plan are a maximum of 150% of target payout for each named executive officer, however, the Executive Committee of the Board may determine to pay additional amounts to executive officers above such amounts.

Commencing in fiscal 2014, annual incentive payouts for our executive officers are paid from a pool that is funded based on the target award payouts for all executive officers, whereby 80% of the funding of the pool of such target amounts is based upon the Company’s financial performance (“Financial Component”) and 20% of the funding of the pool of such target amounts is for the personal performance of the executive officers (“Personal Component”), all as further described below. In order for there to be any funding of the pool based on the Personal Component, the Company must achieve Consolidated Adjusted Compensation EBITDA that results in a minimum of 50% payout of the target described below. Achievement of the Financial Component above the 50% level results in a commensurate funding of the Personal Component up to 150%. In allocating the payout from the annual incentive pool, the Executive Committee of the Board, in its sole discretion and based upon recommendations from Mr. Urcelay, determines the payout from the annual incentive pool to each executive officer (including Mr. Urcelay) based upon such executive officer’s individual performance including the achievement of their personal goals described above.

We believe that weighing the funding of the executive officers’ annual incentive pool and individual allocations in this way aligns the interests of our executive officers with the interests of our equity holders by motivating the executive officers to increase the value of the Company as a whole, while also rewarding each of the executive officers for his or her individual performance.

The Financial Component of the pool is based on a combination of certain financial metric targets and the targeted bonus of each executive officer and consists of: (i) the Adjusted Compensation EBITDA results for the Company as a whole (34.4% of the aggregate target funding), and for one or more segments or business units of the Company: Domestic segment (20.9% of the aggregate target funding), International (10.4% of the aggregate target funding), Japan (3.7% of the aggregate target funding), Toys (Labuan) Holding Limited (“Labuan”)(0.7% of the aggregate funding), Australia (0.5% of the aggregate target funding) and certain other international business units (4.3% of the aggregate target funding) and (ii) CINOP (as defined below) for the Company as a whole (21.9% of the aggregate target funding), and for one or more business units of the Company: Japan (1.2% of the aggregate target funding), Labuan (0.2% of the aggregate target funding), Australia (0.2% of the aggregate target funding) and certain other international business units (1.6% of the aggregate target funding). We believe that these Financial Component weightings motivate our executive officers to work to improve the Company with appropriate emphasis on specific business unit results related to our business objectives.

We calculate Adjusted Compensation EBITDA for this purpose, as earnings before interest, income taxes, depreciation and amortization, further adjusted for the effects of specified period charges and gains or losses, including, among others, changes in foreign currency, noncontrolling interest, gains or losses on liquidations of subsidiaries or sales of properties, asset impairments and accounting changes. More detail about the calculation of Adjusted Compensation EBITDA is set forth below. CINOP is defined as Cost Inventory Net of Payables. The definition of Cost Inventory is balance sheet inventory that is net of inventory reserves. The definition of Payables is total balance sheet accounts payables, which includes expense payables. CINOP was selected in fiscal 2014 to replace cash flow as a metric under the Financial Component in order to more closely align incentives with the near term goals of the Company’s current business strategies.

We believe that focusing the Financial Component on Adjusted Compensation EBITDA and CINOP closely aligns the executive officers’ interests with those of our equity holders. The Adjusted Compensation EBITDA and CINOP targets for the Company as a whole and each segment or business unit are established by the Executive Committee of the Board when it establishes our business plan as part of our annual financial planning process, during which we assess the future operating environment and build projections of anticipated results.

For fiscal 2015, we expect to maintain a design consistent with the 2014 design. However, we expect to replace the CINOP metric with an SG&A (cost reduction) metric and to change the weighting of the financial metrics.

The Executive Committee of the Board sets the threshold, target and maximum funding levels for the Financial Component of the Management Incentive Plan. Achievements at the respective levels would result in a pool funding at, above, or below the target level of each executive officer’s percentage of base salary allocable to the Financial Component (80% of the total). If the actual Adjusted Compensation EBITDA and CINOP performance is less than the minimum threshold, no funding based on the Financial Component would occur. If the actual Adjusted Compensation EBITDA and CINOP performance is greater than the

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maximum threshold, funding would be capped at 150% of target for that component. Straight interpolation determines the bonus payout funding for performance which falls between the minimum and maximum.

The Executive Committee of the Board sets the threshold, target and maximum payout levels for the Personal Component of the Management Incentive Plan for purposes of funding the pool from which the annual incentive awards are paid, provided that in order for there to be any funding of the pool based on the Personal Component, the Company must achieve Consolidated Adjusted Compensation EBITDA that results in a 50% payout of the target described below. This funding percentage is used to calculate the amount the Personal Component will fund the pool for annual incentive awards. If the Consolidated Adjusted Compensation EBITDA 50% payout threshold is not met, the Executive Committee of the Board has the discretion to fund the Personal Component at a level it determines appropriate.

Notwithstanding the formulas described above for the annual Management Incentive Plan, the Executive Committee of the Board has the discretion to adjust the Personal Component and/or Financial Component funding of the pool for payouts to executive officers.

The Adjusted Compensation EBITDA targets for fiscal 2014 were: $631,600,000 for the Company as a whole; $500,500,000 for our Domestic segment; $389,400,000 for our International segment; $462,000 for Australia; $40,727,000 for Labuan and $63,051,000 for Japan; (in each case, calculated using applicable foreign currency conversion rates). As described above, the Company needed to achieve a minimum payout at the 50% level of the Consolidated Adjusted Compensation EBITDA metric ($600,000,000) in order to meet the minimum criteria for funding the Personal Component of the annual incentive pool for executive officers.

In fiscal 2014, the actual Consolidated Adjusted Compensation EBITDA for the Company as a whole was higher than our Adjusted EBITDA due to adjustments of $22 million primarily related to the difference between the previous year’s period-end foreign currency translation rates and the actual foreign currency translation impact on our results of operations, and resulted in a payout of 150% of target for the metric. In fiscal 2014, the actual Consolidated Adjusted Compensation EBITDA results were $543,857,000 for our Domestic segment (payout of 150% of target for the metric). The following businesses of our International segment had the following Adjusted Compensation EBITDA results: $899,000 for Australia (payout of 150% of target for the metric); $44,673,000 for Labuan (payout of 150% of target for the metric) and $82,363,000 for Japan (payout of 150% of target for the metric). For more information on calculation of our Adjusted EBITDA, see Note 5 of Item 6 entitled “SELECTED FINANCIAL DATA” of this Annual Report on Form 10-K.

The CINOP targets for fiscal 2014 were: $856,149,000 for the Company as a whole; $36,306,000 for Australia; $3,990,000 for Labuan and $(25,000,000) for Japan; (in each case, calculated using applicable foreign currency conversion rates). In fiscal 2014, the actual consolidated CINOP results were $863,656,000 for the Company as a whole (payout of 91.7% of target for the metric). The following businesses of our International segment had the following CINOP results: $33,539,000 for Australia (payout of 150% of target for the metric), $2,766,000 for Labuan (payout of 150% of target for the metric) and $(25,708,000) for Japan (payout of 107.1% of target for the metric).

Based upon the achievement of the Financial Component metrics and Personal Component metrics for the management team as a whole, the pool for executive officers was funded at an aggregate of 127.0% of aggregate target bonuses for all executive officers for fiscal 2014.

Following the funding of the pool, the Executive Committee evaluated the performance of each individual executive officer, including their personal performance objectives described above, and determined to award the following final payouts for fiscal 2014: $2,165,000 for Mr. Urcelay, $550,000 for Mr. Short, $980,000 for Ms. Derby, $750,000 for Ms. Merz and $1,350,000 for Mr. Mullany. Mr. Creasey was not entitled to an annual incentive award as his employment terminated in June 2014.

The “Grants of Plan-Based Awards in Fiscal 2014” table shows the threshold, target and maximum Management Incentive Plan awards that each of our named executive officers was eligible to receive in fiscal 2014. The actual payouts under the Management Incentive Plan awards actually earned by our named executive officers in fiscal 2014 are discussed above and in the “Non-Equity Incentive Plan Compensation” column of the “SUMMARY COMPENSATION TABLE” below.

Long-Term Incentives

We believe that providing long-term incentives as a component of compensation helps us to attract and retain our executive officers. These incentives also align the financial rewards paid to our executive officers with the Company’s long-term performance, thereby encouraging our executive officers to focus on the Company’s long-term goals. Since the Merger, the Executive Committee of the Board has offered long-term incentives under the Management Equity Plan and the 2010 Incentive Plan, as further described below. For a description of awards made in fiscal 2014 under the 2010 Incentive Plan, see “—THE 2010 INCENTIVE PLAN” section and “GRANTS OF PLAN-BASED AWARDS IN FISCAL 2014” table below.

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The 2010 Incentive Plan

In fiscal 2010, our Board adopted the 2010 Incentive Plan. The purpose of the 2010 Incentive Plan is to promote our success, and enhance our value, by providing us with the flexibility to motivate, attract, and retain the services of our employees, officers, directors, and consultants through the granting of incentive awards from time to time to such persons and by providing them with an incentive for outstanding performance. The 2010 Incentive Plan is an omnibus plan that provides for the granting of stock options, stock appreciation rights, restricted stock, restricted and deferred stock units, cash or stock based performance awards, dividend equivalents and other stock or stock based awards.

Fiscal 2014

In February 2014, our management retained the services of the Hay Group to provide us insight regarding market practice including base salary competitiveness, bonus target and actual awards eligibility and long term incentive award targets and eligibility. Management reviewed the prevalent practice based upon a peer group consisting of the following 20 retailers: Amazon.com, Best Buy Co., Inc., Dick’s Sporting Goods, Inc., Dollar General Corporation, The Gap, Inc., The Home Depot, Inc., J.C. Penney Company, Inc., Kohl’s Corporation, Limited Brands, Inc., Lowe’s Companies, Inc., Macy’s, Inc., Michaels Stores, Inc., Nordstrom, Inc., Office Depot, Inc., OfficeMax Incorporated, PetSmart, Inc., Ross Stores, Inc., Staples, Inc., Target and The TJX Companies, Inc. Based upon the recommendations of our Human Resources Department, which included information contained in the Hay Group analysis, management presented its recommendations for the Long Term Incentive Program for fiscal 2014 to the Executive Committee of the Board. These changes included a shift toward granting cash awards rather than equity, with the exception of certain executives who received new hire equity grants. For further information see “NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND GRANTS OF PLAN-BASED AWARDS IN FISCAL 2014 TABLE—2010 INCENTIVE PLAN”.

In May 2014, we granted certain long-term performance cash awards under the 2010 Incentive Plan to our executive officers, including our named executive officers, as set forth in the “Grants of Plan-Based Awards in Fiscal 2014” table. The target long-term performance cash awards as a percentage of base salary for our named executive officers were approved by the Executive Committee of the Board as follows: 120% for Mr. Urcelay, 135% for Ms. Derby and 100% for Ms. Merz. Mr. Short and Mr. Mullany were not eligible for a long-term performance cash award for fiscal 2014 as they were provided certain equity awards in connection with the commencement of their employment.

The long-term performance cash award will vest and become payable based on achievement of the performance metric and continuous service over a two year period ending in April 2016. The performance metric for the vesting of the award is based on our consolidated Adjusted Compensation EBITDA achievement for fiscal 2015. These performance cash awards were made on the basis that this measurement period was in our best interests and sets realistic goals which will properly motivate our named executive officers. We believe that based upon fiscal 2014 results achievement of this performance metric is reasonably attainable at the minimum level.

For the performance cash awards, we must meet certain thresholds for the performance metric described above, before any payout is earned. The percentage of target award earned based on our achievement of such thresholds is as follows:

Minimum	50% of target earned
Target	100% of target earned
Maximum	150% of target earned

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Mr. Short

Pursuant to the term of his employment agreement, Mr. Short received a sign-on equity award of 30,000 stock options to acquire the Company’s common stock (the “Sign-On Options”). The Sign-On Options shall have a ten year term and vest in four equal annual installments of 7,500 Sign-On Options commencing in October 2015. In addition, Mr. Short received an award of 450,000 Additional Options, which have a ten year term. One half of the Additional Options will vest in four equal annual installments of 56,250 Additional Options commencing in October 2015. The remaining 225,000 Additional Options will be subject to performance and time vesting and will only be deemed fully vested when they have both time vested and performance vested. For the performance component, (i) 112,500 Additional Options will satisfy the performance vesting contingency upon the occurrence, on or before the tenth anniversary of the grant date, of certain liquidity events for the stockholders of the Company in which the consideration received by stockholders reflects a price of the Company’s common stock of at least $26.75 per share and (ii) the remaining 112,500 Award Options will satisfy the performance vesting contingency based upon the same criteria except that the price of the Company’s common stock shall be at a per share price of at least $33.50. For the options that satisfy the performance contingency criteria, such options will vest in four equal annual installments commencing with the first anniversary of the grant date. The Sign-On Options and Additional Options were awarded under the 2010 Incentive Plan.

2014 Option Exchange

In September 2014, certain participants were offered an opportunity to exchange their Old Options under the Company’s Management Equity Plan, or the Company’s 2010 Incentive Plan, for New Options on a one-for-one basis. On October 10, 2014, the Company closed its offer with a total of 1,566,307 Old Options canceled and an equal amount of New Options issued under the 2010 Incentive Plan.

Mr. Urcelay, Ms. Derby and Ms. Merz elected to participate in the 2014 Option Exchange, and exchanged 181,877, 36,523 and 48,896 Old Options, respectively, for an equal number of New Options. Pursuant to the terms of the 2014 Option Exchange, (i) New Options received in exchange for Old Options that were granted in 2013 will vest in four equal annual installments commencing on the first anniversary of October 10, 2014, the award exchange date, and (ii) New Options received in exchange for Old Options that were granted prior to 2013 (including 122,841 options held by Mr. Urcelay) will vest 50% on the award exchange date and 25% each of the first and second anniversaries of the award exchange date, in each case, subject to the employee’s continued employment on each such anniversary. The New Options for Mr. Urcelay and Ms. Merz are subject to immediate vesting upon retirement as they are currently retirement eligible. As a condition to participating in the 2014 Option Exchange, each executive agreed that all shares issued to the executive under the 2010 Incentive Plan or the Management Equity Plan will be subject to repurchase rights by the Company following a termination of employment and the exercise of any put rights on any shares held by the executive (or rights to net settlement of restricted stock units to cover tax withholding) will be subject to the prior approval of the Board. The Company has no plans to open a transaction window for participants to put the shares to the Company in the foreseeable future.

Mr. Urcelay

The amendment to Mr. Urcelay’s employment agreement provides that on October 14, 2014, Mr. Urcelay forfeited 363,700 of his outstanding restricted stock units in exchange for a grant of 363,700 options under the 2010 Incentive Plan (the “Urcelay Options”). Fifty percent and 12.5% of the Urcelay Options vested on October 31, 2014, and January 31, 2015, respectively, and 12.5% will vest on each of April 30, 2015, July 31, 2015 and October 31, 2015, subject to Mr. Urcelay’s continued employment on each such date. The Urcelay Options are subject to the same accelerated vesting if Mr. Urcelay’s employment is terminated due to his death or disability but there will be no additional vesting if such termination is due to Mr. Urcelay’s retirement. The Urcelay Options have the same exercise price per share as New Options. As a condition to this exchange, Mr. Urcelay agreed that the shares issued will be subject to repurchase rights by the Company following a termination of employment and the exercise of any put rights will be subject to the prior approval of the Board.

In addition, in October 2014, we extended the expiration dates of certain outstanding options awards, which included 122,841 option awards for Mr. Urcelay which were originally scheduled to expire in fiscal 2017, to October 10, 2021.

Mr. Mullany

In October 2014, the Company and Mr. Mullany entered into an option exchange pursuant to which Mr. Mullany exchanged his 250,000 outstanding time-based options for 250,000 newly granted time-based options and his 250,000 outstanding performance-based options for 250,000 newly granted performance-based options, and received an additional 181,820 time based options in connection with the cancellation of 90,910 unvested restricted stock units, in each case, under the 2010 Incentive Plan. The new options and the conditions to Mr. Mullany’s option exchange have terms substantially similar to those applicable to New Options described above, however, (i) the new options issued to Mr. Mullany in consideration of his performance-based options will vest only if the applicable performance-vesting conditions are satisfied: (a) 125,000

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performance-based options will satisfy the performance-vesting condition upon the occurrence, on or before November 5, 2023, of certain liquidity events for the Company’s sponsors in which the consideration received by the sponsors reflects a price of the Company’s common stock of at least $26.75 per share, and (b) the remaining 125,000 performance-based options will satisfy the performance-vesting condition based upon the same criteria except that the price of the Company’s common stock will be at a per share price of at least $33.50 and (ii) the options issued in replacement of the restricted stock units are subject to the same vesting schedule (including accelerated vesting provisions) that applied to the restricted stock units as of immediately prior to the cancellation (25% on each of November 5, 2014 and the next three annual anniversaries thereof). As a condition to this exchange, Mr. Mullany agreed that the shares issued will be subject to repurchase rights by the Company following a termination of employment and the exercise of any put rights will be subject to the prior approval of the Board.

Perquisites

We provide our executive officers with perquisites that we believe are reasonable and consistent with the perquisites that would be available to them at other potential employers. We provide each of our executive officers with a car allowance or company-leased car; financial planning, accounting and tax preparation services; legal services; an annual executive physical; and reimbursement of relocation expenses. In addition, in connection with Mr. Urcelay’s appointment to Chief Executive Officer, he has been granted additional perquisites as described in footnote 4 of the “SUMMARY COMPENSATION TABLE.” Also, in connection with Ms. Merz’s assignment in Japan, she has been granted additional perquisites as described in footnote 9 of the “SUMMARY COMPENSATION TABLE.” We believe that providing Mr. Urcelay and Ms. Merz with these additional perquisites was necessary in order to facilitate a smooth transition and allow them to focus on their respective business assignment. Perquisites are valued at the aggregate incremental cost to the Company.

For more information regarding perquisites for our executive officers, see the “SUMMARY COMPENSATION TABLE.”

Other Benefits

Other benefits for our executive officers include retirement benefits and health and insurance benefits. Based upon annual surveys sponsored by the Retail Benefits Group in which we have participated, we believe that our retirement program, including the amount of benefits, is comparable to those offered by other companies in the retail industry and, as a result, is needed to ensure that our executive compensation program remains competitive. The Retail Benefits Group consists of 34 member companies in which organizations must have $2 billion in annual retail revenue and employ at least 20,000 retail employees. The Retail Benefits Group provides a forum for the exchange of ideas and information so that member companies are better able to improve the efficiency and competitiveness of their benefit plans.

We maintain the “TRU” Partnership Employees’ Savings and Profit Sharing Plan (the “Savings Plan”) in which our U.S. named executive officers who have at least one year of employment with the Company are eligible to participate, along with a substantial majority of our employees. The Savings Plan is a 401(k) plan, which is qualified under tax rules applicable to retirement plans, under which the Company matches 100% up to the first 4% of each plan participant’s (including our executive officers) earnings up to the Internal Revenue Code limit for each respective year in which the executive officer participates in the Savings Plan. The Company match is 100% vested on the funding date.

We also maintain the Supplemental Executive Retirement Plan (the “SERP”) for U.S. officers of the Company, including executive officers, who have one year of employment with the Company. Participants are generally 100% vested in their SERP accounts after completing five years of employment with the Company. The SERP provides supplemental retirement benefits that restore benefits to individuals whose retirement benefits are affected by the Internal Revenue Code limit on the maximum amount of compensation that may be taken into account under the Savings Plan. We intend the SERP to constitute an unfunded deferred compensation plan that is a “top-hat” plan under the Employee Retirement Income Security Act of 1974. We believe the SERP gives our executive officers parity in terms of retirement benefits with our other employees whose benefits are not subject to these limitations. In addition, the SERP supports the financial security component of compensation by providing a level of retirement benefits that is based on the actual level of compensation earned by our named executive officers during their employment rather than only a portion of such compensation.

Ms. Merz participates in the Toys Canada Deferred Profit Sharing Plan (“Deferred Profit Sharing Plan”), a defined contribution plan that is tax-qualified in Canada. The Company contributes up to 8% of her earnings each year, and she is fully vested since participants are fully vested after 2 years. For fiscal 2014, Ms. Merz participated in the Toys Canada Registered Retirement Savings Plan (“RRSP”), a defined contribution plan that is tax-qualified in Canada, in which she can contribute between two percent and ten percent of her earnings annually and the Company will match 50% of such contribution up to two percent of her earnings. Any amounts the Company is not permitted to contribute under applicable law are instead paid out to Ms. Merz in a lump sum payment.

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Pursuant to his employment agreement, Mr. Urcelay is entitled to receive annual contributions equal to 15% of his base salary (the “Contribution Amount”). The Contribution Amount is utilized to purchase certain additional annuity products from MAPFRE Vida (the “MAPFRE Policies”), which provide certain payments to Mr. Urcelay upon maturity of each policy and prior to maturity, in the event of Mr. Urcelay’s disability or death.

Benefits Upon Termination or Change of Control

Pursuant to their employment agreements, our executive officers are entitled to benefits upon termination or change of control. We believe these benefits play an important role in attracting and retaining high caliber executive officers and permit our executive officers to focus on their responsibilities for the Company without distractions caused by uncertainties in the context of an actual or threatened change of control. We also believe these benefits play an important role in protecting the Company’s highly competitive business by restricting our executive officers from working for a competitor during the severance period. These benefits and restrictions are described in more detail below under the section “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

In fiscal 2014, the Company amended and restated the employment agreement for Ms. Derby in order to provide her with the similar severance benefits as the other executive officers. Also, the Company amended Mr. Urcelay’s contract to set forth certain benefits upon termination and to provide a retention bonus. Refer to “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL—EMPLOYMENT AGREEMENTS” for additional information on the severance payments that Mr. Urcelay, Ms. Derby and other named executive officers will be entitled to upon termination or a change in control.

Tax and Accounting Considerations

In making decisions about executive compensation, we take into account certain tax and accounting considerations. For example, we consider Section 409A of the Internal Revenue Code regarding non-qualified deferred compensation and Section 280G of the Internal Revenue Code with regard to change-in-control provisions. In making decisions about executive compensation, we also consider how various elements of compensation will affect our financial reporting. For example, we consider the impact of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, “Compensation—Stock Compensation” (“ASC 718”), which requires us to recognize the cost of employee services received in exchange for awards of equity instruments based upon the grant date fair value of those awards.

Compensation Committee Interlocks and Insider Participation

During fiscal 2014, Matthew S. Levin, Wendy Silverstein and Nathaniel H. Taylor were the members of the Executive Committee of the Board, which serves as the Company’s Compensation Committee.

During fiscal 2014, Ms. Derby served on the compensation committee of the board of directors of The Vitamin Shoppe, a company whose Executive Chairman, Richard L. Markee, serves as a member of the Board of the Company.

COMPENSATION COMMITTEE REPORT

The Executive Committee of the Board, which serves as the Company’s Compensation Committee, has reviewed and discussed the Compensation Discussion and Analysis section required by Item 402(b) of Regulation S-K with management. Based on such review and discussion, the Executive Committee of the Board recommended to the Board that the Compensation Discussion and Analysis section be included in this Annual Report on Form 10-K.

THE EXECUTIVE COMMITTEE OF THE BOARD

Matthew S. Levin

Wendy Silverstein

Nathaniel H. Taylor

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SUMMARY COMPENSATION TABLE

The following table summarizes the compensation awarded to, earned by or paid to the named executive officers for fiscals 2014, 2013 and 2012:

Name and Principal Position	Fiscal Year	Salary		Bonus		Stock Awards (1)(2)		Option Awards (2)		Non-Equity Incentive Plan Compen-sation		Change in Pension Value and Nonqualified Deferred Compensation Earnings		All Other Compensation			Total
Antonio Urcelay, Chairman of the Board and Chief Executive Officer(3)	2014	$	1,313,100	$	104,245	$	—	$	308,074	$	2,165,000	$	—	$	1,444,977	(4)	5,335,396
	2013	1,238,637		332,700		8,533,000		791,356		443,266		—		963,015			12,301,974
	2012	705,563		—		416,680		1,198,963		398,543		—		285,579			3,005,328
Michael J. Short, EVP - Chief Financial Officer(5)	2014	417,308		—		—		1,444,838		550,000		—		2,766		(6)	2,414,912
Deborah Derby, Vice Chairman & EVP	2014	700,000		119,632		—		43,750		980,000		—		157,819		(7)	2,001,201
	2013	627,308		115,000		350,100		735,311		—		—		1,553,518			3,381,237
Monika M. Merz, President - Toys “R” Us, Asia Pacific(8)	2014	583,256		67,654		—		58,572		750,000		—		1,058,761		(9)	2,518,243
	2013	621,921		—		471,300		471,767		230,672		—		1,196,182			2,991,842
	2012	651,160		—		333,344		542,166		284,201		—		1,418,899			3,229,770
Harry J. Mullany III, President - Toys “R” Us, US(10)	2014	1,000,000		—		—		520,000		1,350,000		—		90,337		(11)	2,960,337
	2013	226,923		300,000		2,000,020		4,687,500		—		—		72,502			7,286,945
F. Clay Creasey, Jr., Former EVP - Chief Financial Officer(12)	2014	240,000		—		—		—		—		—		741,799		(13)	981,799
	2013	596,923		—		435,000		426,075		—		—		51,147			1,509,145
	2012	577,692		—		283,316		522,050		217,595		—		70,195			1,670,848

(1) For 2012, assuming the maximum award is achieved, the value of the performance awards, using a $44.00 stock price (the fair value of our common stock on the date of grant), would be $833,360 for Mr. Urcelay and $666,688 for Ms. Merz.

(2) These amounts represent the aggregate grant date fair value of equity awards granted in the specified fiscal year as calculated pursuant to ASC 718 (excluding estimates of forfeitures related to service-based and performance-based vesting conditions). For additional information about the valuation assumptions with respect to equity awards, refer to Note 7 of the financial statements included in this Annual Report on Form 10-K entitled “STOCK-BASED COMPENSATION.” See the “OUTSTANDING EQUITY AWARDS AT 2014 FISCAL YEAR-END” table below for the vesting terms and conditions of these awards which are outstanding at the end of fiscal 2014. Amounts reported reflect the incremental expense recognized in fiscal 2014 (computed in accordance with ASC 718) related to the option exchanges which was $308,074 for Mr. Urcelay, $6,948 for Ms. Derby, $58,572 for Ms. Merz and $83,507 for Mr. Mullany. Amounts reported also reflect the incremental expense recorded during fiscals 2013 and 2012 (computed in accordance with ASC 718) related to certain awards that were required to be liability-classified as a result of Amendment No. 3 and Amendment No. 5 to the Management Equity Plan.  The incremental expense recognized in fiscal 2013 related to the option exchange and option extension which was $270,883 for Mr. Urcelay, $172 for Mr. Creasey, $172 for Ms. Derby and $10,333 for Ms. Merz. The incremental expense recognized in fiscal 2012 was $431,250 for Mr. Urcelay.

(3) Mr. Urcelay is compensated in Euros which are converted to USD each fiscal year based on the average monthly rate. The exchange rates are as follows:

• Fiscal 2014 - 1.0000 EURO = 1.3131 USD

• Fiscal 2013 - 1.0000 EURO = 1.3308 USD

• Fiscal 2012 - 1.0000 EURO = 1.2887 USD

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• For fiscal 2014, solely as it relates to the payment of the annual incentive, the payout will be converted to

Euros on the date of payment.

(4) Includes $798,233 for United States taxes paid by the Company, $410,344 for the purchase of annuity products under the MAPFRE Policies, $163,201 for commuting expenses, $22,093 for executive life insurance premiums, $35,963 for a leased car, $14,347 for executive medical premiums and $796 for financial planning services.

(5) Mr. Short was hired in June 2014. The amounts presented for fiscal 2014 represent his pro rata compensation.

(6) Includes $1,500 for an Executive Physical, $750 of Company contribution to a Health Savings Account, $324 for life insurance premiums and $192 for long-term disability premiums.

(7) Includes $83,596 for severance earned in fiscal 2014 related to Ms. Derby’s prior employment at the Company, $22,674 for a car allowance and for a leased car, $19,394 for financial planning services, $17,600 of Company contribution to the SERP, $10,200 of Company matching contribution to the Savings Plan, $1,750 for an Executive Physical, $1,250 of Company contribution to a Health Savings Account, $834 for life insurance premiums and $521 for long-term disability premiums.

(8) Ms. Merz is compensated in Canadian Dollars which are converted to USD each fiscal year based on the average monthly rate. The exchange rates are as follows:

• Fiscal 2014 - 1.0000 CAD = 0.8987 USD

• Fiscal 2013 - 1.0000 CAD = 0.9633 USD

• Fiscal 2012 - 1.0000 CAD = 1.0022 USD

• For fiscal 2014, solely as it relates to the payment of the annual incentive, the payout will be converted to

Canadian dollars on the date of payment.

While she is on an ex-patriate assignment in Japan, certain benefits are paid for in Japanese Yen which are converted to USD each fiscal year based on the average monthly rate. The exchange rates are as follows:

• Fiscal 2014 - 1.0000 JPY = 0.00937 USD

• Fiscal 2013 - 1.0000 JPY = 0.01012 USD

• Fiscal 2012 - 1.0000 JPY = 0.01241 USD

(9) Includes $436,309 for host country income tax payments for local benefits, $222,671 for Japanese estimated national income tax for fiscal 2014, $168,734 for housing, $85,985 for a Cost of Living Allowance (COLA), $69,330 Company contributions to the Deferred Profit Sharing Plan, the RRSP, or payments in lieu thereof due to statutory restrictions on maximum contributions, $33,130 for home leave for Ms. Merz and her spouse, $17,974 for a car allowance, $7,143 for premiums for ex-patriate health care coverage for Ms. Merz and her spouse, $5,248 for utilities, $3,804 for club fees for the American Club, $3,580 for Executive Wellness (benefit expenses not covered by the health plan), $2,876 for furniture rental, $1,348 for tax preparation and $629 for language lessons.

(10) Mr. Mullany was hired in November 2013. The amounts presented for fiscal 2013 represent his pro rata compensation.

(11) Includes $29,600 of Company contribution to the SERP, $25,843 for relocation expenses, $21,600 for a car allowance, $10,400 for financial planning services and $1,583 of Company contribution to a Health Savings Account, $808 for life insurance premiums and $503 for long-term disability premiums.

(12) Mr. Creasey’s employment was terminated in June 2014. The salary amount presented for fiscal 2014 represents his pro rata salary.

(13) Includes $720,002 for severance earned in fiscal 2014, $8,554 of Company matching contribution to the Savings Plan, $5,283 for a leased car, $4,492 for benefits continuation, $1,888 for financial planning services, $1,000 financial incentive under the Toys “R” Us, Inc. Corporate Travel and Expense Reimbursement Policy, $294 for life insurance premiums and $286 for long-term disability premiums.

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GRANTS OF PLAN-BASED AWARDS IN FISCAL 2014

The following table provides information on grants of plan-based awards to our named executive officers in fiscal 2014:

					Estimated Potential Payouts Under Non-Equity Incentive Plan Awards					Estimated Future Payouts Under Equity Incentive  Plan Awards				All Other Stock Awards: Number of Shares of Stock or Units(#)	All Other Option Awards: Number of Securities Underlying Options     (#)		Exercise or Base Price of Option Awards (#/sh)		Grant Date Fair Value of Stock and Option Awards(5)
Name	Award Type		Approval Date	Grant Date	Threshold(#)	Target (#)		Maximum (#)		Threshold (#)	Target (#)		Maximum (#)
Urcelay	MIP	(1)(2)(3)			—	$	1,969,650	$	2,954,475	—	—		—	—	—		$	—	$	—
	LTIP	(4)	3/11/2014	5/2/2014	787,860	1,575,720		2,363,580		—	—		—	—	—		—		—
			7/17/2014	10/10/2014	—	—		—		—	—		—	—	59,036	(6)	8.00		70,718		(6)
			7/17/2014	10/10/2014	—	—		—		—	—		—	—	122,841	(6)	8.00		237,356		(6)
			10/8/2014	10/14/2014	—	—		—		—	—		—	—	363,700	(7)	8.00		—		(7)
Short	MIP	(1)(2)(3)			—	700,000		1,050,000					—	—	—		—		—
			5/20/2014	10/10/2014	—	—		—		—	—		—	—	30,000		8.00		94,275
			5/20/2014	10/10/2014	—	—		—		—	—		—	—	225,000		8.00		707,063
			5/20/2014	10/10/2014	—	—		—		—	225,000	(8)	—	—	—		8.00		643,500		(8)
Derby	MIP	(1)(2)(3)			—	770,000		1,155,000		—	—		—	—	—		—		—
	LTIP	(4)	3/11/2014	5/2/2014	472,500	945,000		1,417,500		—	—		—	—	—		—		—
			7/17/2014	10/10/2014	—	—		—		—	—		—	—	36,523	(6)	8.00		43,750		(6)
Merz	MIP	(1)(2)(3)			—	641,582		962,373		—	—		—	—	—		—		—
	LTIP	(4)	3/11/2014	5/2/2014	291,628	583,256		874,884		—	—		—	—	—		—		—
			7/17/2014	10/10/2014	—	—		—		—	—		—	—	48,896	(6)	8.00		58,572		(6)
Mullany	MIP	(1)(2)(3)			—	1,250,000		1,875,000		—	—		—	—	—		—		—
			10/8/2014	10/14/2014	—	—		—		—	—		—	—	181,820	(9)	8.00		—		(9)
			7/30/2014	10/14/2014	—	—		—		—	—		—	—	250,000	(10)	8.00		260,000		(10)
			7/30/2014	10/14/2014	—	—		—		—	250,000	(10)	—	—	—		8.00		260,000		(10)
Creasey	MIP	(1)(2)(3)			—	600,000		900,000		—	—		—	—	—		—		—
	LTIP	(4)	3/11/2014	5/2/2014	150,000	300,000		450,000		—	—		—	—	—		—		—

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(1) These amounts reflect estimated possible payouts under our annual incentive awards granted for fiscal 2014. Each named executive officer’s target payout was the following percentage of his or her base salary: 150% for Mr. Urcelay, 125% for Mr. Mullany, 110% for Ms. Merz and Ms. Derby and 100% for Mr. Short. Mr. Creasey terminated in June 2014 and was not eligible for an annual incentive award in fiscal 2014. The target payout is weighted 80% on the Financial Component and 20% on the Personal Component. For more information, see “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—ANNUAL INCENTIVE AWARDS” section set forth above.

(2) The annual incentive pool for executive officers will only be funded if the Company meets the minimum achievement of the Financial Component metrics. There will only be funding of the annual incentive pool related to achievement of the Personal Component if the Company achieves a minimum Consolidated Adjusted Compensation EBITDA at the 50% payout level. If the annual incentive bonus pool is funded, there is no minimum payment allocation to any specific executive officer.

(3) The maximum, which refers to the maximum payout possible under the Management Incentive Plan, for fiscal 2014 was 150% of each executive officer’s annual bonus target. For a further description of these awards, see “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—ANNUAL INCENTIVE AWARDS” set forth above.

(4) These amounts reflect estimated possible payouts under our long-term incentive plan awards granted during fiscal 2014. For more information, see “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—LONG TERM INCENTIVE” section set forth above.

(5) These awards were granted under the 2010 Incentive Plan. These amounts represent the aggregate grant date fair value as calculated pursuant to ASC 718 (excluding estimates of forfeitures related to service-based and performance-based vesting conditions). For additional information about the valuation assumptions with respect to equity awards, refer to Note 7 of the financial statements included in this Annual Report on Form 10-K entitled “STOCK-BASED COMPENSATION” for further information.

(6) These New Options were granted as part of the 2014 Option Exchange. The amounts reported reflect the incremental expense (computed in accordance with ASC 718) associated with the 2014 Option Exchange and issuance of New Options.

(7) Pursuant to Mr. Urcelay’s employment agreement, these options were granted under the 2010 Incentive Plan in exchange for forfeiting 363,700 of his outstanding restricted stock units. There was no incremental expense associated with this exchange (computed in accordance with ASC 718).

(8) These options were granted under the 2010 Incentive Plan and 50% of the performance options will satisfy the performance vesting contingency upon the occurrence, on or before the 10th anniversary of the grant date, of certain liquidity events for the Sponsors as described in Mr. Short’s employment agreement in which the consideration received by the Sponsors reflects a price of the Company’s common stock of at least $26.75 per share and the remaining 50% will satisfy the performance vesting contingency based on the same criteria except that the price of the Company’s common stock shall be at a per share price of at least $33.50. For options which satisfy the performance criteria, such options will vest in equal annual installments over a four year period commencing with the first anniversary of the grant date.

(9) These options were granted under the 2010 Incentive Plan in exchange for forfeiting 90,910 outstanding restricted stock units. There was no incremental expense associated with this exchange (computed in accordance with ASC 718).

(10) These options were granted under the 2010 Incentive Plan in exchange for forfeiting his 250,000 outstanding time-based options and his 250,000 outstanding performance-based options. 50% of the performance options will satisfy the performance vesting contingency upon the occurrence, on or before the 10th anniversary of the grant date, of certain liquidity events for the Sponsors in which the consideration received by the Sponsors reflects a price of the Company’s common stock of at least $26.75 per share and the remaining 50% will satisfy the performance vesting contingency based on the same criteria except that the price of the Company’s common stock shall be at a per share price of at least $33.50. For options which satisfy the performance criteria, such options will vest in equal annual installments over a four year period commencing with the first anniversary of the grant date. The amounts reported reflect the incremental expense of the exchange (computed in accordance with ASC 718).

NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND THE GRANTS OF PLAN-BASED AWARDS IN FISCAL 2014 TABLE:

Management Equity Plan

Until fiscal 2011, we utilized awards under the Management Equity Plan as a long term incentive to attract and retain our officers. Commencing in fiscal 2011, our compensation strategy for our named executive officers included grants under the 2010 Incentive Plan and as further described below, we will no longer be making grants to our officers under the Management Equity Plan.

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Our executive officers who were employed at the time of the Merger (including Mr. Urcelay and Ms. Merz) were offered the opportunity at that time to invest in the Company along with the Sponsors, by either making a cash investment to purchase restricted shares of common stock under the Management Equity Plan or rolling over previously existing options into the Management Equity Plan. Our executive officers who were hired after the Merger were provided the opportunity to make a cash investment to purchase restricted shares of common stock. The equity ownership of our named executive officers is set forth in the beneficial ownership table in Item 12 entitled “SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.” These shares are “restricted” in that the common stock is subject to certain transfer restrictions, as well as, in some cases, a put right exercisable in certain circumstances by the holder and a call right exercisable by us (and, if not exercised by us, by the Sponsors). In connection with the 2014 Option Exchange, each executive agreed that all shares issued to the executive under the 2010 Incentive Plan or the Management Equity Plan will be subject to repurchase rights by the Company following a termination of employment and the exercise of any put rights on any shares held by the executive (or rights to net settlement of restricted stock units to cover tax withholding) will be subject to the prior approval of the Board. The Company has no plans to open a transaction window for participants to put the shares to the Company in the foreseeable future.

Participants under the Management Equity Plan are generally subject to certain restrictive covenants, including confidentiality, non-competition and non-solicitation covenants, during their employment and for a specified period of time after termination of employment.

In the event of a corporate transaction, such as a stock split, reorganization, merger, consolidation or other change in common stock, the Board, in its discretion, will make such changes in the number and type of shares covered by outstanding awards to prevent dilution or enlargement of the rights of participants under the Management Equity Plan.

During fiscal 2014, no named executive officer was granted an equity award pursuant to the Management Equity Plan. In connection with the amendment to the 2010 Incentive Plan, the Company made the determination to no longer issue any awards under the Management Equity Plan and that the number of shares of common stock of the Company available for issuance under the 2010 Incentive Plan was increased by the number of shares available for issuance under the Management Equity Plan as of July 17, 2014 and any shares that after July 17, 2014 would have otherwise been available for issuance thereunder.

2010 Incentive Plan

The 2010 Incentive Plan is an omnibus plan that provides for the granting of stock options, stock appreciation rights, restricted stock, restricted and deferred stock units, cash or stock based performance awards, dividend equivalents and other stock or stock based awards.

Under the 2010 Incentive Plan, shares of common stock covered by awards that are terminated, canceled, forfeited or settled in cash, lapse without the payment of consideration, or are otherwise withheld, repurchased or not issued, may be granted again under the 2010 Incentive Plan. Generally, an unexercised or restricted award will not be transferable or assignable by a participant other than to the Company or an affiliate or by will, estate planning or by the laws of descent and distribution. Recipients of specified awards under the 2010 Incentive Plan are also subject to the same restrictive covenants as those contained in the Management Equity Plan, as amended.

In the event of a corporate transaction, such as a stock dividend, stock split, spin-off, rights offering, reorganization, recapitalization, merger, or large nonrecurring cash dividend, the Board, in its discretion, will make changes to the 2010 Incentive Plan and awards, which may include adjusting the number and kind of shares subject to outstanding awards or adjusting the exercise price of outstanding awards, to prevent dilution or enlargement of the rights of participants immediately resulting from such corporate transaction.

The Board at any time may terminate the 2010 Incentive Plan and make such amendments as it deems advisable under the 2010 Incentive Plan, provided that certain amendments are subject to stockholder approval and the Board may not change any terms of an award agreement in a manner adverse to a participant without the prior written approval of such participant. More detail about stock options and other awards held by our named executive officers (including the vesting provisions related to these grants) are shown in the tables that follow this discussion, including the “OUTSTANDING EQUITY AWARDS AT 2014 FISCAL YEAR-END” table.

The 2010 Incentive Plan was amended in order to eliminate the prohibition on repricing stock options and stock appreciation rights without the prior approval of the Company’s stockholders. Effective as of September 2014, the 2010 Incentive Plan was further amended to provide that no further awards would be granted under the Management Equity Plan and the number of shares of common stock of the Company available for issuance under the 2010 Incentive Plan was increased by the number of shares available for issuance under the Management Equity Plan as of July 17, 2014 and any shares that after July 17, 2014 would have otherwise been available for issuance thereunder.

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OUTSTANDING EQUITY AWARDS AT 2014 FISCAL YEAR-END

The following table provides information with respect to the option awards and stock awards held by the named executive officers at fiscal year-end:

		Option Awards							Stock Awards
Name	Grant Date	Number of Securities Underlying Unexercised Options Exercisable (#)	Number of Securities Underlying Unexercised Options Unexercis-able (#)	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price		Option Expiration Date		Number of Shares or Units of Stock  That Have Not Vested	Market Value of Shares or Units of Stock That Have Not Vested(8)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights  That Have Not Vested	Equity Incentive Plan  Awards: Market or Payout Value of Unearned Shares, Units or Other Rights  That Have Not Vested
Urcelay(10)	5/24/2013(1)	—	—	—	$	—	—		17,720	$	141,760	—	—
	10/10/2014(2)	61,420	61,421	—	8.00		10/10/2021	(7)	—	—		—	—
	10/10/2014(3)	—	59,036	—	8.00		12/23/2023		—	—		—	—
	10/14/2014(4)	227,312	136,388	—	8.00		11/5/2023		—	—		—	—
Short	10/10/2014(3)	—	30,000	—	8.00		10/10/2024		—	—		—	—
	10/10/2014(3)	—	225,000	—	8.00		10/10/2024		—	—		—	—
	10/10/2014(5)	—	—	225,000	8.00		10/10/2024		—	—		—	—
Derby	5/24/2013(1)	—	—	—	—		—		11,670	93,360		—	—
	10/10/2014(3)	—	36,523	—	8.00		12/23/2023		—	—		—	—
Merz(10)	5/24/2013(1)	—	—	—	—		—		15,710	125,680		—	—
	10/10/2014(3)	—	48,896	—	8.00		12/23/2023		—	—		—	—
Mullany	10/14/2014(3)	—	250,000	—	8.00		11/5/2023		—	—		—	—
	10/14/2014(6)	—	—	250,000	8.00		11/5/2023		—	—		—	—
	10/14/2014(9)	45,455	136,365	—	8.00		11/5/2023		—	—		—	—
Creasey	—	—	—	—	—		—		—	—		—	—

(1) These awards vest 50% on the second anniversary of the grant date, 25% on the third anniversary of the grant date and 25% on the fourth anniversary of the grant date. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(2) These options vest 50% on the grant date, 25% on the first anniversary of the grant date and 25% on the second anniversary of the grant date. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(3) These options vest in four equal annual installments beginning on the first anniversary of the grant date. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(4) The options issued in replacement of the restricted stock units are subject to the same vesting schedule that applied to the restricted stock units as of immediately prior to the cancellation (fifty percent and 12.5% vested on October 31, 2014, and January 31, 2015, respectively, and 12.5% will vest on each of April 30, 2015, July 31, 2015 and October 31, 2015). The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(5) These stock options are subject to a performance component, where 50% of the stock options will satisfy the performance vesting contingency upon the occurrence, on or before the tenth anniversary of the grant date, of certain liquidity events for the Sponsors as described in Mr. Short’s employment agreement in which the consideration received by Sponsors reflects a price of the Company’s common stock of at least $26.75 per share and the remaining 50% of the stock options will satisfy the performance vesting contingency based upon the same criteria except that the price of the Company’s common stock shall be at a per share price of at least $33.50. For the options that satisfy the performance contingency criteria, such options will vest in equal annual installments over a four year period commencing with the

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first anniversary of the grant date. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(6) These stock options are subject to a performance component, where 50% of the stock options will satisfy the performance vesting contingency upon the occurrence, on or before the tenth anniversary of the grant date, of certain liquidity events for the Sponsors as described in Mr. Mullany’s employment agreement in which the consideration received by Sponsors reflects a price of the Company’s common stock of at least $26.75 per share and the remaining 50% of the stock options will satisfy the performance vesting contingency based upon the same criteria except that the price of the Company’s common stock shall be at a per share price of at least $33.50. For the options that satisfy the performance contingency criteria, such options will vest in equal annual installments over a four year period commencing with the first anniversary of the grant date. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(7) The option expiration date was extended to October 10, 2021 as part of the extension of the expiration dates of certain outstanding option awards under the Management Equity Plan in November 2013. For a further description of this extension, see “COMPENSATION DISCUSSION AND ANALYSIS—SUMMARY OF SIGNIFICANT 2014 COMPENSATION DECISIONS” set forth above.

(8) In calculating the amounts set forth in the table, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

(9) The options issued in replacement of the restricted stock units are subject to the same vesting schedule that applied to the restricted stock units as of immediately prior to the cancellation (25% on each of November 5, 2014 and the next three anniversaries thereof). The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(10) With the exception of Mr. Urcelay’s October 14, 2014 grant of 363,700 options, the awards granted to Mr. Urcelay and Ms. Merz on October 10, 2014 will become fully vested and exercisable upon retirement as they meet the age and service criteria for retirement (i.e. voluntary termination of employment after attaining age 60 with at least ten years of continuous service to the Company).

OPTION EXERCISES AND STOCK VESTED FOR FISCAL 2014

The following table provides information regarding the values realized by our named executive officers upon the exercise of stock options and vesting of stock awards in fiscal 2014:

	Option Awards			Stock Awards
Name	Number of Shares Acquired on Exercises	Value Realized on Exercises		Number of Shares Acquired on Vesting	Value Realized on Vesting
Urcelay	—	$	—	—	$	—
Short	—	—		—	—
Derby	—	—		—	—
Merz	—	—		—	—
Mullany	—	—		—	—
Creasey	—	—		—	—

NONQUALIFIED DEFERRED COMPENSATION FOR FISCAL 2014

The following table provides information regarding contributions, earnings and balances for our named executive officers under nonqualified deferred compensation plans:

Name	Executive Contributions in Last FY		Registrant Contributions in Last FY (1)(2)		Aggregate Earnings in Last FY(3)			Aggregate Withdrawals / Distributions		Aggregate Balance at Last FYE (4)
Urcelay(5)	$	—	$	410,344	$	75,369		$	—	$	1,206,706
Short	—		—		—			—		—
Derby	—		17,600		(99		)	—		30,240
Merz	—		—		—			—		—
Mullany	—		29,600		(248		)	—		29,352
Creasey	—		—		16,687			290,237		—

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(1) We make an annual contribution to the SERP for each U.S. executive officer who is employed on the last day of the SERP plan year. The amount of the contribution is equal to 4% of that portion of the eligible executive officer’s “total compensation” in excess of the dollar limits under Internal Revenue Code Section 401(a)(17). Due to the fact that Mr. Short’s employment commenced in June 2014, he was not eligible to participate in the Savings Plan and the SERP plan as he did not yet satisfy length of employment criteria set forth under the plans. Generally, total compensation means compensation as reported on Form W-2 with the Internal Revenue Service or such other definition as is utilized under the Savings Plan. However, total compensation includes amounts paid pursuant to our Management Incentive Plan but does not include sign-on bonuses, retention bonuses, project completion bonuses or other types of success bonuses. The Executive Committee of the Board may at its discretion also credit additional notional contributions if the Company had an exceptional year.

(2) All contributions that we made for each executive officer during fiscal 2014 were included in the “All Other Compensation” column of the “SUMMARY COMPENSATION TABLE” above.

(3) Earnings on nonqualified deferred compensation were not required to be reported in the “SUMMARY COMPENSATION TABLE”. Each US executive’s SERP account is credited or debited with “Declared Interest,” which is based upon hypothetical investments selected by the executive officer pursuant to procedures established by the administrative committee that administers the SERP. The Administrator of the SERP determines the number of investment options available under the SERP and such investment options are comprised of a subset of the investment options available under the Savings Plan. Participants in the SERP have the right to change their hypothetical investment selections on a daily basis. The contributions made by the Company vest five years after the executive officer’s first day of employment with the Company. All SERP distributions are paid in lump sums upon termination of the participant’s employment with the Company.

(4) Of the aggregate balance amount set forth in this column, $12,738 and $230,177 was previously reported in the Summary Compensation table for Ms. Derby and Mr. Creasey, respectively, for prior fiscal years and $1,198,271 was previously reported in the Summary Compensation Table for contributions to the Spain Savings Plan and the MAPFRE policies for Mr. Urcelay for prior fiscal years.

(5) These amounts reflect the annuity products purchased for the benefit of Mr. Urcelay under the MAPFRE Polices.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL

Employment Agreements

We maintain employment agreements with each of our named executive officers. These agreements provide certain benefits upon termination of employment or change of control and certain restrictive covenants, as described below.

For Mr. Urcelay

Termination Without Cause or Resignation For Good Reason. If Mr. Urcelay’s employment is terminated for reasons other than cause or if he resigns for Good Reason (as defined in his employment agreement) prior to October 31, 2015, which shall not include retirement, he will receive:

• upon execution of a release of claims in favor of the Company, a payment of €2,444,400 (“Severance Compensation”) payable in twenty four (24) monthly installments, except such amount will be payable in a lump sum, subject to statutory limitations, if the executive’s termination of employment occurs within two years after a change in control (as defined in the 2010 Incentive Plan);

• for eighteen (18) months: (i) continuation of car benefit, excluding gas, maintenance and other usage-related expenses, (ii) continuation of health benefits and (iii) continuation of the use of his Company provided laptop computer and cell phone, except that he will be responsible for the costs of all telephone calls (collectively referred to herein as (“Continued Benefits”); and

• continuation of Company contributions to his defined contribution plan and provision of tax advice for eighteen (18) months (“Pension Payments”).

In addition, if Mr. Urcelay’s employment is terminated by the Company without cause (but not if his employment terminates for any other reason), he will receive a pro rata portion of his retention bonus in the amount of €1,164,000 granted in March 2013 (based on the number of months elapsed since March 2013) and such amount shall be paid as a lump sum payment within thirty (30) days following the date of such termination (but in no event later than March 14 of the calendar year following the calendar year in which such termination date occurs).

Mr. Urcelay will not receive any of the above severance benefits:

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• upon termination of his employment for Cause or upon resignation (other than resignation for a Good Reason which shall not include if Mr. Urcelay is required to step down as the Company Chief Executive Officer prior to October 31, 2015 because a new chief executive officer is appointed) or upon retirement;

• if he is removed from the position of Chief Executive Officer within twenty four (24) months following a Change in Control and if he is offered another professional position in the Company with equivalent target compensation in the Madrid, Spain area; or

• as it relates to the Severance Compensation, upon termination of his employment at any time on or after October 31, 2015 for any reason, whether with or without Cause, or for his resignation with or without Good Reason.

If Mr. Urcelay’s employment is terminated for reasons other than Cause or if he resigns for Good Reason (as defined in his employment agreement) or if his employment is terminated due to his death or disability prior to October 31, 2015, which shall not include retirement, he will receive:

• upon execution of a release of claims in favor of the Company, a payment of $2,000,000 retention bonus (“Retention Bonus”) payable in a lump sum payment.

• a bonus equal to $1,000,000 (“Special Performance Bonus”) if the Company’s consolidated adjusted EBITDA for the twelve (12) month period ending on the last day of the Company’s third quarter of fiscal 2015 exceeds the target level of consolidated adjusted EBITDA established by the Company’s Executive Committee of the Board for such period and if achieved, amount will be paid in a lump sum payment within forty five (45) days of the end of the third quarter for fiscal 2015.

If Mr. Urcelay is required to step down as the Company Chief Executive Officer prior to October 31, 2015 because a new chief executive officer is appointed and his employment is not terminated prior to October 31, 2015, Mr. Urcelay will not be entitled to the Severance Compensation, the Continued Benefits and the Pension Payments but he will still be eligible to earn his Retention Bonus and Special Performance Bonus.

If Mr. Urcelay is terminated for Cause or resigns (other than resignation for a Good Reason) prior to October 16, 2015, Mr. Urcelay must reimburse the Company for 50% of his €250,000 one-time offer acceptance bonus award.

If Mr. Urcelay’s employment terminates due to his retirement, there will be no accelerated time vesting of the 363,700 options granted on October 14, 2014 in exchange for the cancellation of his 363,700 restricted stock units. See “— THE 2010 INCENTIVE PLAN” for a description of accelerated vesting terms otherwise applicable to Mr. Urcelay’s equity awards.

Restrictive Covenants. Mr. Urcelay’s benefits described above are subject to his promise that for a period of twenty four months following the termination of his employment, he will not:

• engage in any business that directly or indirectly is a Competitive Business (as defined in his employment agreements);

• enter the employ of, or render any services to, any person who or which engages in a Competitive Business;

• acquire a financial interest in, or otherwise become actively involved with, any Competitive Business, directly or indirectly;

• interfere with, or attempt to interfere with, business relationships between the Company or any of its affiliates and customers, clients, suppliers, partners, members or investors of the Company or its affiliates;

• solicit to leave the employment of, or encourage any employee of the Company or its affiliates to leave the employment of, the Company or its affiliates;

• hire any such employee who was employed by the Company or its affiliates as of the date of his termination of employment with the Company or who left the employment of the Company or its affiliates coincident with, or within one year prior to, the termination of his employment with the Company; and

• solicit to leave the employment of, or encourage to cease to work with, as applicable, the Company or its affiliates or any consultant, supplier or service provider under contract with the Company or its affiliates.

In addition, during the term of employment and anytime thereafter, Mr. Urcelay has agreed not to use for his benefit or disclose any of the Company’s confidential information.

For Messrs. Mullany and Short and Ms. Derby

Termination for Cause, Resignation Without Good Reason.  If one of the above named executives’ employment is terminated for cause or he or she resigns without good reason (as such terms are defined in each of their employment agreements), the executive will receive:

• any base salary earned, but unpaid as of the date of his or her termination;

• any employee benefits that he or she may be entitled to under the Company’s employee benefit plans; and

• any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of the executive’s termination.

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In addition, if the employment for Messrs. Mullany and Short is terminated for cause or he resigns without good reason, executive shall be required to reimburse the Company for relocation expenses as follows:

• If it occurs on or before the first anniversary for Mr. Mullany and second anniversary for Mr. Short of the commencement date of employment, the executive shall reimburse the Company 100% of the relocation expenses, (solely as it relates to Mr. Mullany, less any income the Company received from the sale of his residence) (net of any commissions, fees or other expenses incurred by the Company)), within five (5) business days of the executive’s last date of employment with the Company.

• If it occurs after the first anniversary for Mr. Mullany and second anniversary for Mr. Short of the commencement date of employment but before the second anniversary for Mr. Mullany and third anniversary for Mr. Short of the commencement date, the executive shall reimburse the Company 50% of the Relocations Expenses, (solely as it relates to Mr. Mullany, less any income the Company received from the sale of his residence (net of any commissions, fees or other expenses incurred by the Company)), within five business days of the executive’s last date of employment with the Company.

In addition, Ms. Derby shall also be entitled to the following (the “Continued Benefit Coverage”):

• continued medical, dental and life insurance benefit coverage, a portion paid by Ms. Derby, until the earlier to occur of (x) twenty four (24) months from date of termination and (y) the date on which Ms. Derby is eligible for coverage under substantially comparable benefit plans (the “Benefit Continuation Period”) and upon expiration of the Benefit Continuation Period, Ms. Derby shall be entitled to pay the premium charged to former employees of the Company pursuant to Section 4980B of the Code for continued benefit coverage until Ms. Derby turns 65.

Termination Due to Death or Disability.  If one of the above named executives dies, or if we terminate the executive’s employment due to disability, the executive (or the executive’s estate) will receive:

• any base salary earned, but unpaid as of the date of the executive’s termination;

• any employee benefits that he may be entitled to under the Company’s employee benefit plans;

• any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of the executive’s termination; and

• a pro rata portion of the executive’s annual incentive award for the current fiscal year earned through the date of termination, based on the Company’s actual results as opposed to the executive’s target annual incentive award.

In addition, Ms. Derby shall also be entitled to the following if we terminate her employment due to disability:

• Continued Benefit Coverage;

• a pro rata portion of her 2015 retention bonus and the 2016 retention bonus (based on the number of months elapsed since March 2013 and March 2014, respectively) in the event her employment is terminated due to disability: (i) before March 11, 2015 and (ii) after September 11, 2015 but before March 11, 2016, respectively, and such amount shall be paid as a lump sum payment within thirty (30) days following the date of such termination (but in no event later than March 14 of the calendar year following the calendar year in which such termination date occurs).

Termination Without Cause or Resignation for Good Reason.  If one of the above named executives’ employment is terminated without cause or the executive resigns for good reason, the executive will receive:

• any base salary earned, but unpaid as of the date of the executive’s termination;

• any employee benefits that the executive may be entitled to under the Company’s employee benefit plans;

• any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of the executive’s termination;

• a pro rata portion of the executive’s annual incentive award earned through the date of termination, based on the Company’s actual results as opposed to the executive’s target annual incentive award; and

• continuation of medical, dental and life insurance benefits, with the executive paying a portion of such costs as if his employment had not terminated, until the earlier to occur of (i) the end of the twenty four (24) month period (in the case of Mr. Mullany and Ms. Derby) or the end of an eighteen (18) month period (in the case of Mr. Short) commencing on the date of termination of employment or (ii) the date on which the executive commences to be eligible for coverage under substantially comparable medical, dental and life insurance benefit plans from any subsequent employer.

Messrs. Mullany and Short shall also be entitled to the following;

• upon execution of a release of claims in favor of the Company, an amount equal to (i) two times the sum of his then-current base salary if such termination occurs prior to second anniversary of employment (November 15, 2015 for Mr. Mullany and June 23, 2016 for Mr. Short) or (ii) if such termination occurs after the second anniversary, an amount equal to times the sum of (x) his then-current base salary and (y) his target annual bonus, which amount is payable in

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twenty four (24) monthly installments, except such amount will be payable in a lump sum, subject to statutory limitations, if the executive’s termination of employment occurs within two years after a change in control (as defined in the 2010 Incentive Plan).

In addition, Ms. Derby shall also be entitled to the following:

• upon execution of a release of claims in favor of the Company, an amount equal to (i) two times the sum of her then-current base salary if such termination occurs on or prior to October 13, 2016 or (ii) if such termination occurs after October 13, 2016, an amount equal to two times the sum of her base salary and the average of the annual bonuses, if any, earned by Ms. Derby for the two fiscal years immediately preceding the date of termination, payable within sixty (60) days following executive’s termination of employment, but in no event later than March 15 following the year in which executive’s employment was terminated.

• Upon expiration of the Benefit Continuation Period, Ms. Derby shall be entitled to pay the premium charged to former employees of the Company, pursuant to Section 4980B of the Code, for continued benefit coverage until Ms. Derby turns 65.

• In addition, Ms. Derby shall be entitled to a pro rata portion of her 2015 retention bonus and the 2016 retention bonus (based on the number of months elapsed since March 2013 and March 2014, respectively) in the event her employment is terminated: (i) before March 11, 2015 and (ii) after September 11, 2015 but before March 11, 2016, respectively, and such amount shall be paid as a lump sum payment within thirty (30) days following the date of such termination (but in no event later than March 14 of the calendar year following the calendar year in which such termination date occurs).

Restrictive Covenants.  During the term of their employment and during the twenty four (24) month period commencing on the date of termination of employment, each of Messrs. Mullany and Short and Ms. Derby have agreed not to:

• engage in any business that directly or indirectly is a Competitive Business (as defined in each of their employment agreements);

• enter the employ of, or render any services to, any person who or which engages in a Competitive Business;

• acquire a financial interest in, or otherwise become actively involved with, any Competitive Business, directly or indirectly;

• interfere with, or attempt to interfere with, business relationships between the Company or any of its affiliates and customers, clients, suppliers, partners, members or investors of the Company or its affiliates;

• solicit to leave the employment of, or encourage any employee of the Company or its affiliates to leave the employment of, the Company or its affiliates;

• hire any such employee who was employed by the Company or its affiliates as of the date of executive’s termination of employment with the Company or who left the employment of the Company or its affiliates coincident with, or within one year prior to, the termination of his or her employment with the Company; and

• solicit to leave the employment of, or encourage to cease to work with, as applicable, the Company or its affiliates or any consultant, supplier or service provider under contract with the Company or its affiliates.

In addition, during the term of their employment and anytime thereafter, each of the above named executive officers has agreed not to use for their benefit or disclose any of the Company’s confidential information.

For Ms. Merz

Termination for Cause, Resignation Without Good Reason (including Retirement).  If Ms. Merz’s employment is terminated for cause or she resigns without good reason (as such terms are defined in each of their employment agreements), she will receive:

• any base salary earned, but unpaid as of the date of her termination; and

• any employee benefits that she may be entitled to under Toys “R” Us Canada Ltd.’s employee benefit plans.

Termination Due to Disability. If we terminate her employment due to disability, she will receive such amounts, if any, then required to be paid pursuant to the common laws of Canada.

Termination Due to Death.  If Ms. Merz’s employment is terminated due to her death, her estate will receive:

• any base salary earned, but unpaid as of the date of her termination;

• any employee benefits that she may be entitled to under the Toys “R” Us Canada Ltd.’s employee benefit plans; and

• any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of her termination.

Termination Without Cause, Resignation for Good Reason or Termination due to Reassignment of Position.  If Ms. Merz’s employment is terminated without cause or she resigns for good reason (which shall include notice by the Company that it is not

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extending Ms. Merz’s employment term or the attempted reassignment of Ms. Merz to a new position and for which she rejects or refuses such reassignment), she will receive:

• any base salary earned, but unpaid as of the date of her termination;

• any employee benefits that she may be entitled to under the Company’s employee benefit plans;

• any annual incentive award for the immediately preceding fiscal year that is earned, but unpaid as of the date of her termination;

• a pro rata portion of her annual incentive award earned through the date of termination, based on the Company’s actual results as opposed to her target annual incentive award;

• upon execution of a release of claims in favor of the Company, an amount equal to two (2) times the sum of: (x) her current base salary for the fiscal year in which her employment was terminated and (y) her target annual incentive award, payable in equal installments for twenty four (24) months in accordance with normal payroll periods; provided if Ms. Merz is terminated without cause or resigns for good reason within six months prior to, or two years following, a change in control, such payment will be in a lump sum;

• continuation of dental and life insurance benefits, with the executive paying a portion of such costs as if her employment had not terminated, until the earlier to occur of (i) the end of the twenty four (24) month period commencing on the date of termination of employment or (ii) such time as she accepts other employment and becomes eligible for dental and life insurance coverage.

In addition, if Ms. Merz’s employment is terminated by the Company without cause (but not if her employment terminates for any other reason), she will receive a pro rata portion of her retention bonuses, CAD $1,298,000 and CAD $649,000, respectively, granted in fiscal years 2013 and 2014 (based upon the number of months elapsed since March 2013 and March 2014, respectively) in the event her employment is terminated: (i) before March 11, 2015 and (ii) after September 11, 2015 and before March 11, 2016, respectively, and such amount shall be paid as a lump sum payment within thirty (30) days following the date of such termination.

Upon the expiration or the termination of her employment agreement (except by the Company for Cause or by Ms. Merz without Good Reason), the Company will pay the reasonably necessary shipping and travel costs to relocate Ms. Merz and her spouse from Japan to her residence in Canada.

Restrictive Covenants.  During the term of her employment and during the two (2) years thereafter, Ms. Merz has agreed not to:

• engage either directly or indirectly in a Competitive Business (as defined in her employment agreement);

• enter the employ of, or render any services to, any person who or which engages in a Competitive Business;

• acquire a financial interest in, or otherwise become actively involved with, any Competitive Business, directly or indirectly;

• interfere with, or attempt to interfere with, business relationships between the Company or any of its affiliates and customers, clients, suppliers, partners, members or investors of the Company or its affiliates;

• solicit to leave the employment of, or encourage any employee of the Company or its affiliates to leave the employment of, the Company or its affiliates;

• hire any such employee who was employed by the Company or its affiliates as of the date of her termination of employment with the Company or who left the employment of the Company or its affiliates coincident with, or within one year prior to, the termination of her employment with the Company; and

• solicit to leave the employment of, or encourage to cease to work with, as applicable, the Company or its affiliates or any consultant, supplier or service provider under contract with the Company or its affiliates.

For Mr. Creasey

Prior to Mr. Creasey’s termination on June 19, 2014, we maintained an employment agreement with him with similar terms and restrictive covenants to the agreement described above for Mr. Mullany. The termination of his employment with us was treated as a termination without cause pursuant to his employment agreement. Pursuant to his employment agreement, Mr. Creasey is entitled to receive a severance payment of $2,400,000 over a twenty four (24) month period. In addition, Mr. Creasey is entitled to continuation of medical, dental and life insurance benefits, with Mr. Creasey paying a portion of such costs as if his employment had not terminated, until the earlier to occur of (i) June 2016 or (ii) the date on which Mr. Creasey commences to be eligible for coverage under substantially comparable medical, dental and life insurance benefit plans from any subsequent employer. The estimated Company cost for these continued benefits is $15,548. In addition, pursuant to the terms of the employment agreement, Mr. Creasey is subject to a non-compete covenant for a twenty four (24) month period.

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Management Equity Plan

The Management Equity Plan governs the vesting and exercise of stock options and restricted stock (issued under the Management Equity Plan) upon termination of employment.

Under the Management Equity Plan, as amended, including an amendment to which each of the named executive officers has elected to be bound, the unvested portion of options will accelerate and become vested if an executive officer ceases to be employed by the Company or any of its subsidiaries upon retirement (defined as reaching the age of 60 with ten or more years of service to the Company), death or disability. In addition, the unvested portion of options will accelerate and become vested upon a change in control as defined in the Management Equity Plan. If an executive officer ceases to be employed for any other reason, then the portion of such executive officer’s stock options that have not fully vested as of such executive officer’s date of termination of employment (the “Termination Date”) shall expire at such time.

The portion of an executive officer’s stock options that have fully vested as of such executive officer’s Termination Date shall expire (i) 30 days after such executive officer’s Termination Date if the executive officer is terminated without Cause (as defined in the Management Equity Plan) when the executive officer is not retirement eligible, or if the executive officer resigns for any reason other than retirement; provided that if the executive officer is terminated without Cause and has been employed by the Company for a period of four or more consecutive years, such expiration date will be 30 days following the next date at which the Board determines fair market value of the Company’s shares of common stock, (ii) one year after the termination date if an executive officer is terminated due to death, disability or retirement or is terminated without Cause after becoming eligible for retirement and (iii) immediately upon termination if such executive officer is terminated with Cause.

If the Company terminates an executive’s employment for Cause (as defined in the Management Equity Plan) or the executive retires or resigns and violates his non-competition covenant, the Company and the Sponsors may purchase, solely at their option, the executive’s shares of common stock at the lesser of (i) the value on the date of issuance and (ii) the fair value. If executive dies or becomes disabled or resigns with or without Good Reason (as defined in his or her employment agreement) or if the Company terminates executive’s employment without Cause (as defined in the Management Equity Plan), the Company and the Sponsors may purchase, solely at their option, executive’s shares of common stock at fair value. See “NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND THE GRANTS OF PLAN-BASED AWARDS IN FISCAL 2014 TABLE” above and the “SUMMARY OF PAYMENTS AND BENEFITS UPON TERMINATION OR CHANGE IN CONTROL” tables below for more information.

The 2010 Incentive Plan

The 2010 Incentive Plan and the award agreements thereunder govern the vesting and exercise of stock options, restricted stock and restricted stock units (issued under the 2010 Incentive Plan) upon termination of employment.

Under the 2010 Incentive Plan and the award agreements thereunder, if an executive officer ceases to be employed by the Company or any of its subsidiaries for any reason (other than death, disability, retirement or change in control (as such terms are defined in the 2010 Incentive Plan)), then the portion of such executive officer’s stock options, cash or stock-based performance awards, restricted stock and restricted stock units that have not fully vested as of such executive officer’s date of termination of employment (the “Termination Date”) shall expire at such time. In the event an executive officer ceases to be employed by the Company or any of its subsidiaries by reason of death, disability or retirement and unless their award agreement or employment agreement states otherwise, then (i) all outstanding stock options will become fully vested; (ii) all time-based vesting restrictions will lapse and be deemed fully satisfied as on the Termination Date; and (iii) all the payout opportunities attainable under outstanding performance-based awards will be deemed to have been earned by the executive officer as of the Termination Date (except as it relates to Mr. Short’s Additional Options and Mr. Mullany’s Performance Options, in which case the performance vesting conditions will not be waived) and the amount to be paid to the executive officer, if any, will be based on the actual level of achievement of all relevant performance goals against target and will be measured as of the end of the performance period in which such termination occurred and such amount will be a pro rata payout based upon the length of time within the performance period that had elapsed prior to the Termination Date over the performance period. As of March 2015, both Mr. Urcelay and Ms. Merz are currently retirement eligible. The grant of 363,700 restricted stock units to Mr. Urcelay, which was subsequently exchanged for options on October 14, 2014 will not be subject to accelerated vesting if his employment terminates due to his retirement.

Under the 2010 Incentive Plan and the award agreements thereunder, the portion of an executive officer’s stock options that have fully vested as of such executive officer’s Termination Date shall expire (i) one year after such executive officer’s Termination Date if the executive officer is terminated due to death, disability or retirement or is terminated without cause when retirement eligible; (ii) 90 days after such executive officer’s Termination Date if the executive officer is terminated by the Company without cause or by the executive officer for good reason (as defined in the 2010 Incentive Plan); (iii) 30 days after such

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executive officer’s Termination Date if the executive officer is terminated by the executive officer without good reason; and (iv) immediately upon termination if such executive officer is terminated with cause.

Upon the occurrence of a change in control (as defined in the 2010 Incentive Plan), (i) awards for outstanding stock options will become fully exercisable, (ii) all other outstanding awards will no longer be subject to time-based vesting restrictions, and (iii) awards subject to performance-vesting conditions will be deemed to have fully earned a pro rata payout of the target payout based upon the length of time within the performance period that had elapsed prior to the change in control over the performance period, provided that the performance-vesting conditions will not be waived for Mr. Short’s Additional Options and Mr. Mullany’s Performance Options. Please see “NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND THE GRANTS OF PLAN-BASED AWARDS IN FISCAL 2014 TABLE” above and the “SUMMARY OF PAYMENTS AND BENEFITS UPON TERMINATION OR CHANGE IN CONTROL” tables below for more information.

Summary of Payments and Benefits Upon Termination or Change in Control

The following tables summarize the estimated value of the termination payments and benefits that each of our named executive officers, other than Mr. Creasey, would receive if there was a change in control and/or his or her employment was terminated on January 31, 2015 under the various circumstances described in the tables. Unless otherwise indicated in the tables below, the awards granted under the Management Equity Plan and the 2010 Incentive Plan are subject to the repurchase rights and obligations described above:

ANTONIO URCELAY⁽¹⁾ 

Type of Payment	Termination for Cause or Resignation Without Good Reason(2)		Termination Without Cause or Resignation for Good Reason		Retirement		Death		Long-Term Disability		Change  in Control		Termination or Specified Resignation Due to a Change of Control
Severance (3)	$	—	$	3,209,742	$	—	$	—	$	—	$	—	$	3,209,742
Fiscal 2014 Annual Bonus	—		—		—		—		—		—		—
Fiscal 2013 Restricted Stock Unit Grant (4)	—		—		141,760		141,760		141,760		141,760		141,760
Fiscal 2014 Stock Option Grant (5)	—		—		—		—		—		—		—
2014 LTIP(6)	—		—		303,300		303,300		303,300		606,600		606,600
Retention(7)	—		3,401,078		—		2,000,000		2,000,000		—		3,401,078
Special Performance Bonus(8)			1,000,000		—		1,000,000		1,000,000		—		1,000,000
Executive Retirement Plan - MAPFRE VIDA (9)	—		—		1,206,706		1,206,706		1,206,706		—		—
Executive Life Insurance (10)	—		—		—		6,565,500		6,565,500		—		—
Benefit Continuation & Other Perquisites (11)	—		692,325		—		—		—		—		692,325
TOTAL	$	—	$	8,303,145	$	1,651,766	$	11,217,266	$	11,217,266	$	748,360	$	9,051,505

(1) All amounts calculated in Euros have been converted to USD using the rate of 1.0000 EURO = 1.3131 USD.

(2) If Mr. Urcelay is terminated by the Company for Cause or resigns without Good Reason after October 2014 but before October 2015, he must reimburse the Company for 50% of his €250,000 acceptance bonus.

(3) Represents the maximum amount of severance that Mr. Urcelay may receive. All severance amounts are payable over a twenty four (24) month period, except such amount will be payable in a lump sum, subject to statutory limitations, if Mr. Urcelay’s termination of employment occurs within two years of a change in control.

(4) Pursuant to the 2010 Incentive Plan, the unvested portion of restricted stock units, will accelerate and become vested upon retirement, death, disability or change in control. In calculating the amounts set forth in the table, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of our shares of common stock is only available when a valuation is performed.

(5) Pursuant to the 2010 Incentive Plan, the unvested portion of options will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of our shares of common stock is only available when a valuation is performed. Because the per share value of $8.00 is equal to the option exercise price of $8.00, no value is reflected in the table.

(6) Pursuant to the 2010 Incentive Plan, unless otherwise provided by an employment agreement, upon retirement, death or disability, the performance cash award is deemed earned as of the date of termination and the award is based on actual achievement at the end of the performance period. In calculating the amounts set forth in the table, we assumed

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achievement of the financial metric at threshold. Upon change in control, the performance cash award is deemed earned at target achievement. The payout is prorated based on the elapsed time within the performance period prior to the date of termination or change in control.

(7) In the event Mr. Urcelay is terminated by the Company without Cause, due to death, disability or resignation for Good Reason, in each case prior to October 31, 2015, the Retention Bonus of $2,000,000 is payable. In the event Mr. Urcelay is terminated by the Company for any reason other than cause, the Special Transition Bonus of €1,164,000 is payable pro rata based on the number of full months from March 11, 2013 to the date of termination.

(8) In the event Mr. Urcelay is terminated by the Company without Cause, due to death, disability or resignation for Good Reason, in each case prior to October 31, 2015, the Special Performance Bonus is payable subject to Adjusted Compensation EBITDA performance.

(9) This amount represents Mr. Urcelay’s benefit entitlement under the MAPFRE Policies. For more information on Mr. Urcelay’s balance, see the Nonqualified Deferred Compensation for Fiscal 2014 table above.

(10) All benefit eligible employees in Spain receive, at no cost to the individual, a life insurance benefit. Mr. Urcelay’s benefit amount is equal to five times his base salary.

(11) Represents estimated Company costs of the following benefits and perquisites based on fiscal 2014 actual amounts for the duration of eighteen (18) months, as set forth in Mr. Urcelay’s employment agreement: $615,516 for Company contributions to his Defined Contribution Plan, $53,945 for a Company car, $21,521 for health benefit continuation and $1,194 for tax advice and $150 for continued use of Company provided laptop and cell phone.

MICHAEL J. SHORT

	Termination for Cause or Resignation Without Good Reason(1)		Termination Without Cause or Resignation For Good  Reason		Retirement		Death		Long-Term Disability		Change in Control		Termination Without  Cause or Resignation for Good Reason in Connection with a Change of Control
Severance (2)	$	—	$	1,400,000	$	—	$	—	$	—	$	—	$	1,400,000
Fiscal 2014 Annual Bonus	550,000		550,000		—		550,000		550,000		550,000		550,000
Fiscal 2014 Stock Option Grant (3)	—		—		—		—		—		—		—
Benefit Continuation (4)	—		16,059		—		—		—		—		16,059
TOTAL	$	550,000	$	1,966,059	$	—	$	550,000	$	550,000	$	550,000	$	1,966,059

(1) If the employment for Mr. Short is terminated for cause or he resigns without good reason, he will be required to reimburse the Company for relocation expenses as per the terms of his employment agreement.

(2) Severance amounts payable due to a Termination Without Cause or Resignation For Good Reason are payable over a two (2) year period. Upon a Change in Control, such payments will be paid in a lump-sum amount, subject to statutory limitations.

(3) Pursuant to the 2010 Incentive Plan, the unvested portion of time-based options will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of shares of our common stock is only available when a valuation is performed.

Because the per share value of $8.00 is equal to the option exercise price of $8.00, no value is reflected in the table. In addition, no value is reflected in the table for the performance-based options, as the performance criteria has not been met as of fiscal year-end 2014.

(4) Represents estimated Company costs based on fiscal 2015 projections for medical, dental and life insurance coverage for the duration of the eighteen (18) month severance period.

All U.S. benefit eligible employees receive, at no cost to the individual, the following life insurance benefit and long-term disability coverage: (i) a life insurance benefit in an amount equal to the individual’s base salary plus annual incentive award target, up to a maximum of $1,000,000 and (ii) long-term disability coverage in an amount per month equal to 60% of the individual’s monthly base salary, up to a maximum of $10,000 per month. The long-term disability benefit is payable beginning twenty six (26) weeks after the onset of the disability and is payable for the duration of the disability up to age 65.

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DEBORAH DERBY

Type of Payment	Termination for Cause or Resignation Without Good  Reason		Termination Without Cause or Resignation For Good  Reason		Retirement		Death		Long-Term Disability		Change in Control		Termination Without  Cause or Resignation for Good Reason in Connection with a Change of Control
Severance (1)	$	—	$	1,400,000	$	—	$	—	$	—	$	—	$	1,400,000
Fiscal 2014 Annual Bonus	980,000		980,000		—		980,000		980,000		980,000		980,000
Fiscal 2013 Restricted Stock Unit Grant(2)	—		—		—		93,360		93,360		93,360		93,360
Fiscal 2014 Stock Option Grant(3)	—		—		—		—		—		—		—
2014 LTIP (4)	—		—		—		181,897		181,897		363,793		363,793
Retention	—		1,283,333		—		—		1,283,333		—		1,283,333
Benefit Continuation (5)	228,892		228,892		—		—		228,892		—		228,892
TOTAL	$	1,208,892	$	3,892,225	$	—	$	1,255,257	$	2,767,482	$	1,437,153	$	4,349,378

(1) Severance amounts payable due to a Termination Without Cause or Resignation For Good Reason are payable in a lump sum within sixty (60) days following termination of employment.

(2) Pursuant to the 2010 Incentive Plan, the unvested portion of restricted stock units will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

(3) Pursuant to the 2010 Incentive Plan, the unvested portion of options will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of our shares of common stock is only available when a valuation is performed. Because the per share value of $8.00 is equal to the option exercise price of $8.00, no value is reflected in the table.

(4) Pursuant to the 2010 Incentive Plan, upon retirement, death or disability, the performance cash award is deemed earned as of the date of termination and the award is based on actual achievement at the end of the performance period. In calculating the amounts set forth in the table, we assumed achievement of the financial metric at threshold. Upon change in control, the performance cash award is deemed earned at target achievement. The payout is prorated based on the elapsed time within the performance period prior to the date of termination or change in control.

(5) Represents Company costs based on an average annual rate of $17,167 for medical, dental and life insurance coverage until Ms. Derby reaches the age of 65.

Upon any termination, Ms. Derby has the right to withdraw her Savings Plan balance, which, as of January 31, 2015, was $77,252. In addition, upon any termination other than for cause, as defined in the SERP, the Company will pay Ms. Derby the outstanding balance in her SERP account, which, as of January 31, 2015, was $30,240.

All U.S. benefit eligible employees receive, at no cost to the individual, the following life insurance benefit and long-term disability coverage: (i) a life insurance benefit in an amount equal to the individual’s base salary plus annual incentive award target, up to a maximum of $1,000,000 and (ii) long-term disability coverage in an amount per month equal to 60% of the individual’s monthly base salary, up to a maximum of $10,000 per month. The long-term disability benefit is payable beginning twenty six (26) weeks after the onset of the disability and is payable for the duration of the disability up to age 65.

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MONIKA M. MERZ⁽¹⁾ 

Type of Payment	Termination for Cause or Resignation Without Good  Reason		Termination Without Cause or Resignation For Good  Reason		Termination due to Reassignment of Position		Expiration  of Employment Term		Retirement		Death		Long-Term Disability		Change in Control		Termination Without  Cause or Resignation for Good Reason in Connection with a Change of Control
Severance (2)	$	—	$	2,449,676	$	2,449,676	$	2,449,676	$	—	$	—	$	—	$	—	$	2,449,676
Fiscal 2014 Annual Bonus	—		750,000		750,000		750,000		—		750,000		—		—		750,000
Fiscal 2013 Restricted Stock Unit Grant(3)	—		—		—		—		125,680		125,680		125,680		125,680		125,680
Fiscal 2014 Stock Option Grant(4)	—		—		—		—		—		—		—		—		—
2014 LTIP (5)	—		—		—		—		112,267		112,267		112,267		224,534		224,534
Retention	—		1,069,303		—		—		—		—		—		—		1,069,303
Benefit Continuation (6)	—		14,286		14,286		14,286		—		—		—		—		14,286
TOTAL	$	—	$	4,283,265	$	3,213,962	$	3,213,962	$	237,947	$	987,947	$	237,947	$	350,214	$	4,633,479

(1) All amounts calculated in Canadian dollars have been converted to USD using the rate of 1.0000 CAD = 0.8987 USD.

(2) All severance amounts are payable over a two year period. Upon a Change in Control, such payments will be paid in a lump sum amount.

(3) Pursuant to the 2010 Incentive Plan, the unvested portion of restricted stock units will accelerate and become vested upon retirement, death, disability or a change in control. In calculating the amounts set forth in the table, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

(4) Pursuant to the 2010 Incentive Plan, the unvested portion of options will accelerate and become vested upon retirement, death or disability based on actual results. In calculating the amounts set forth in the table, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed. Because the per share value of $8.00 is equal to the option exercise price of $8.00, no value is reflected in the table.

(5) Pursuant to the 2010 Incentive Plan, upon retirement, death or disability, the performance cash award is deemed earned as of the date of termination and the award is based on actual achievement at the end of the performance period In calculating the amounts set forth in the table, we assumed achievement of the financial metric at threshold. Upon change in control, the performance cash award is deemed earned at target achievement. The payout is prorated based on the elapsed time within the performance period prior to the date of termination or change in control.

(6) Represents estimated Company costs of dental and life insurance coverage based on fiscal 2015 actual amounts for the duration of the two (2) year severance period. The amount excludes estimates for certain relocation costs from Japan to Ms. Merz’s residence in Canada upon termination.

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HARRY J. MULLANY III

Type of Payment	Termination for Cause or ResignationWithout Good  Reason(1)		Termination Without Cause or Resignation For Good  Reason		Retirement		Death		Long-Term Disability		Change in Control		Termination Without  Cause or Resignation for Good Reason in Connection with a Change of Control
Severance (2)	$	—	$	2,000,000	$	—	$	—	$	—	$	—	$	2,000,000
Fiscal 2014 Annual Bonus	1,350,000		1,350,000		—		1,350,000		1,350,000		1,350,000		1,350,000
Fiscal 2014 Stock Option Grant(3)	—		—		—		—		—		—		—
Benefit Continuation(4)	—		21,413		—		—		—		—		21,413
TOTAL	$	1,350,000	$	3,371,413	$	—	$	1,350,000	$	1,350,000	$	1,350,000	$	3,371,413

(1) In the event Mr. Mullany is terminated by the Company for Cause or resigns without Good Reason after November 2014 but before November 2015, he must reimburse the Company for 50% of the sign-on bonus.

(2) Severance amounts payable due to a Termination Without Cause or Resignation For Good Reason are payable over a two (2) year period. Upon a Change in Control, such payments will be paid in a lump-sum amount, subject to statutory limitations.

(3) Pursuant to the 2010 Incentive Plan, the unvested portion of time-based options will accelerate and vest upon retirement, death, disability or change in control. In calculating the amounts set forth in the table, for the time-based options, we utilized a per share value of $8.00, which was the fair value of our shares of common stock as of July 17, 2014. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed. Because the per share value of $8.00 is equal to the option exercise price of $8.00, no value is reflected in the table. In addition, no value is reflected in the table for the performance-based options, as the performance criteria has not been met as of fiscal year-end 2014.

(4) Represents estimated Company costs based on fiscal 2015 projections for medical, dental and life insurance coverage for the duration of the two (2) year severance period.

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DIRECTOR COMPENSATION IN FISCAL 2014

Other than Messrs. Goodman, Markee and Sales, we currently do not pay our directors any compensation for serving on our Board of Directors. We plan on paying all non-employee directors that are not affiliated with the Sponsors an annual cash retainer, which ranges from $100,000 to $150,000 along with an annual award of restricted stock units, which ranges from $100,000 to $150,000. Commencing April 2014, Mr. Goodman’s annual cash retainer was increased from $75,000 to $100,000. The restricted stock units vest in full one-year from the grant date. In addition, any director not affiliated with the Sponsors that chairs a committee will also receive an additional annual payment of $15,000 ($50,000 for the chair of our Audit Committee, which amount was increased from $20,000 commencing April 2014). The table below sets forth payments made to our non-management directors in fiscal 2014:

Name	Fees Earned or Paid in Cash ($)		Stock Awards (5) ($)		Option Awards ($)	Non-Equity Incentive Plan Compensation ($)	Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)	All Other Compensation ($)	Total ($)
Joshua Bekenstein	—		—		—	—	—	—	—
Michael D. Fascitelli	—		—		—	—	—	—	—
Richard Goodman(4)	136,250	(1)	100,000	(1)	—	—	—	—	236,250
Daniel Guglielmone	—		—		—	—	—	—	—
Matthew S. Levin	—		—		—	—	—	—	—
Joseph Macnow	—		—		—	—	—	—	—
Richard L. Markee(6)	150,000	(2)	150,000	(2)	—	—	—	—	300,000
Wayne C. Sales(7)	112,500	(3)	150,000	(3)					262,500
Wendy Silverstein	—		—		—	—	—	—	—
Nathaniel H. Taylor	—		—		—	—	—	—	—
Antonio Urcelay	—		—		—	—	—	—	—
Michael Ward	—		—		—	—	—	—	—
Adam Waglay	—		—		—	—	—	—	—
Gregory R. Why	—		—		—	—	—	—	—

(1) During fiscal 2014, Mr. Goodman was paid $136,250, which amount represents his annual cash retainer and his Audit Committee Chairman retainer. In addition, Mr. Goodman was granted an award of $100,000 of restricted stock units, which amount represents his annual grant for fiscal 2014.

(2) During fiscal 2014, Mr. Markee was paid $150,000, which amount represents his annual cash retainer. In addition, Mr. Markee was granted $150,000 of restricted stock units, which amount represents his annual grant for fiscal 2014.

(3) During fiscal 2014, Mr. Sales was paid $112,500, which amount represents his annual cash retainer. In addition, Mr. Sales was granted $150,000 of restricted stock units, which amount represents his annual grant for fiscal 2014.

(4) At the end of fiscal 2014, Mr. Goodman held 12,500 unvested restricted stock units. In addition, Mr. Goodman has deferred receipt of shares deliverable upon settlement of 3,409 restricted stock units, which were awarded for his services in Fiscal 2011 and 2012, until his resignation from the Company’s Board of Directors. Mr. Goodman has deferred receipt of shares deliverable upon settlement of 3,335 restricted stock units, which were awarded for his services in Fiscal 2013, until the earlier of June 30, 2018 or his separation from service from the Company's Board of Directors.

(5) These amounts represent the aggregate grant date fair value of equity awards granted in fiscal 2013 as calculated pursuant to ASC 718 (excluding estimates of forfeitures related to service-based and performance-based vesting conditions). For additional information about the valuation assumptions with respect to equity awards, refer to Note 7of the financial statements included in this Annual Report on Form 10-K entitled “STOCK-BASED COMPENSATION.”

(6) At the end of fiscal 2014, Mr. Markee held 18,750 unvested restricted stock units. In addition, Mr. Markee has deferred receipt of shares deliverable upon settlement of 3,410 restricted stock units, which were awarded for his services in Fiscal 2013, until his separation from service from the Company's Board of Directors.

(7) At the end of fiscal 2014, Mr. Sales held 18,750 unvested restricted stock units.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table presents information regarding beneficial ownership of our Common Stock, as of March 1, 2015, by the named executive officers, each of our directors, all of our directors and executive officers as a group and each person who is known by us to beneficially own more than 5% of our Common Stock:

	Amount and Nature of Beneficial Ownership *
Name of Beneficial Owner	Shares	Total Beneficial Ownership (1)	Percent of Outstanding Shares (2)
Affiliates of Bain Capital Investors, LLC (3)	16,040,405	16,040,405	32.60	%
Toybox Holdings, LLC (4)	16,040,405	16,040,405	32.60	%
Vornado Truck LLC (5)	16,040,405	16,040,405	32.60	%
Joshua Bekenstein (3)	—	—	—	%
F. Clay Creasey	—	—	—	%
Deborah Derby	35,182	35,182	0.07	%
Richard Goodman	—	6,744	0.01	%
Daniel Guglielmone (5)	—	—	—	%
Matthew S. Levin (3)	—	—	—	%
Joseph Macnow (5)	—	—	—	%
Richard L. Markee	—	3,410	0.01	%
Monika M. Merz	10,524	10,524	0.02	%
Harry J. Mullany III	22,728	68,183	0.14	%
Wayne C. Sales	—	—	—	%
Michael J. Short	—	—	—	%
Wendy Silverstein (5)	—	—	—	%
Nathaniel H. Taylor (4)	—	—	—	%
Antonio Urcelay	6,425	340,619	0.69	%
Adam Waglay (4)	—	—	—	%
Gregory R. Why (3)	—	—	—	%
Directors and executive officers as a group (19 persons)	84,680	474,483	0.96	%

* For purposes of this table, “beneficial ownership” is determined in accordance with Rule 13d-3 under the Exchange Act pursuant to which a person or group of persons is deemed to have “beneficial ownership” of any shares of Common Stock with respect to which such person has (or has the right to acquire within 60 days, i.e., by April 30, 2015 in this case) sole or shared voting power or investment power.

(1) Total Beneficial Ownership includes shares, deferred stock units deliverable within 60 days and options exercisable within 60 days.

(2) Unless otherwise indicated, the beneficial ownership of any named person does not exceed, in the aggregate, one percent of our outstanding equity securities on March 1, 2015, as adjusted as required by applicable rules.

(3) Includes shares held by Bain Capital (TRU) VIII, L.P., Bain Capital (TRU) VIII-E, L.P., Bain Capital (TRU) VIII Coinvestment, L.P., Bain Capital Integral Investors, LLC and BCIP TCV, LLC (collectively, the “Bain Capital Entities”). Bain Capital Investors, LLC (“BCI”) is the general partner of Bain Capital Partners VIII, L.P. which is the general partner of Bain Capital (TRU) VIII, L.P. and Bain Capital (TRU) VIII Coinvestment, L.P. BCI is also the general partner of Bain Capital Partners VIII E, L.P. which is the general partner of Bain Capital (TRU) VIII-E, L.P. BCI is also the Administrative Member of Bain Capital Integral Investors, LLC and BCIP TCV, LLC. By virtue of the relationships described above, each of the foregoing entities may be deemed to beneficially own the shares held by the Bain Capital Entities. Each such entity disclaims beneficial ownership of the shares held by the Bain Capital Entities except to the extent of its pecuniary interest therein. The address of each of the Bain entities is c/o BCI at 111 Huntington Avenue, Boston, MA 02199. Each of Joshua Bekenstein, Matthew S. Levin and Gregory R. Why is a managing director of BCI and a director of our Company. As a result, and by virtue of the relationships described in this footnote (3), each of Messrs. Bekenstein, Levin and Why may be deemed to be the beneficial owner of the shares held by the Bain Capital Entities. Each of Messrs. Bekenstein, Levin and Why disclaims beneficial ownership of the shares held by the Bain Capital Entities.

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(4) Shares owned of record by Toybox Holdings, LLC are also beneficially owned by its majority member, KKR Millennium Fund L.P. As the sole general partner of KKR Millennium Fund L.P., KKR Associates Millennium L.P. may be deemed to be the beneficial owner of such securities beneficially owned by KKR Millennium Fund L.P. As the sole general partner of KKR Associates Millennium L.P., KKR Millennium GP LLC also may be deemed to be the beneficial owner of such securities beneficially owned by KKR Millennium Fund L.P. Each of KKR Fund Holdings L.P. (as the designated member of KKR Millennium GP LLC); KKR Fund Holdings GP Limited (as a general partner of KKR Fund Holdings L.P.); KKR Group Holdings L.P. (as a general partner of KKR Fund Holdings L.P. and the sole shareholder of KKR Fund Holdings GP Limited); KKR Group Limited (as the sole general partner of KKR Group Holdings L.P.); KKR & Co. L.P. (as the sole shareholder of KKR Group Limited) and KKR Management LLC (as the sole general partner of KKR & Co. L.P.) may also be deemed to be the beneficial owner of the securities beneficially owned by KKR Millennium Fund L.P. As the designated members of KKR Management LLC, Henry R. Kravis and George R. Roberts may also be deemed to beneficially own the securities beneficially owned by KKR Millennium Fund L.P. Messrs. Kravis and Roberts have also been designated as managers of KKR Millennium GP LLC by KKR Fund Holdings L.P. Messrs. Taylor and Waglay are members of our Board of Directors and are each an executive of Kohlberg Kravis Roberts & Co. L.P. and/or one or more of its affiliates. Each of Messrs. Taylor and Waglay disclaim beneficial ownership of the securities held by Toybox Holdings, LLC. For a description of material relationships between KKR and us over the last three years, see Item 13 entitled “Certain Relationships and Related Transactions and Director Independence” of this Annual Report on Form 10-K. The address of the entities listed above and Mr. Kravis, is c/o Kohlberg Kravis Roberts & Co. L.P., West 57^th Street, Suite 4200, New York, New York 10019. For Messrs. Roberts, Taylor and Waglay, the address is c/o Kohlberg Kravis Roberts & Co. L.P., 2800 Sand Hill Road, Menlo Park, CA 94025.

(5) Represents shares of record held by Vornado Truck LLC. As the owner of 100% of the equity of Vornado Truck LLC, Vornado Realty L.P. may be deemed to be the beneficial owner of such shares. Also, as the sole general partner of Vornado Realty L.P., Vornado Realty Trust may be deemed to be the beneficial owner of such shares. Also, Messrs. Macnow and Guglielmone and Ms. Silverstein are members of our Board of Directors and also executives of Vornado Realty Trust. As such, these persons may be deemed to be beneficial owners of these shares. These persons disclaim beneficial ownership of shares held by Vornado Truck LLC. The address for each of these persons and entities is c/o Vornado Realty Trust, 888 Seventh Avenue, New York, New York 10019.

Equity Compensation Plan Information

The following table sets forth information as of January 31, 2015 regarding the Company’s equity compensation plans:

	( a )		( b )		( c )
Plan Category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted- average exercise price of outstanding options, warrants, and rights		Number of securities remaining available for future issuance under equity compensation (excluding securities reflected in column (a))
Equity compensation plans approved by security holders	3,922,371	(1)	$	8.00	933,862	(2)
Equity compensation plans not approved by security holders	—		—		—
Total	3,922,371		$	8.00	933,862

(1) Represents the shares of our common stock issuable pursuant to outstanding options under the 2010 Incentive Plan.

(2) Represents the shares of our common stock which may be issued pursuant to future issuances under the 2010 Incentive Plan.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Advisory Agreement

Certain affiliates of the Sponsors provide management and advisory services to us pursuant to an advisory agreement executed at the closing of the merger transaction effective as of July 21, 2005 and amended June 10, 2008, February 1, 2009 and August 29, 2014 (“Advisory Agreement”). The initial term of the Advisory Agreement is ten years. After ten years, it extends annually for one year unless we or the affiliates of the Sponsors provide notice of termination to the other. Prior to an amendment in August 2014, described below, the management and advisory fees paid to the affiliates of the Sponsors (the “Advisory Fees”) increased 5% per year during the ten-year term of the agreement with the exception of fiscal 2009.

In August 2014, the Advisory Agreement was amended in order to reduce the Advisory Fees to $17 million for fiscal year 2014 and each year thereafter.  If in the future we successfully complete an initial public offering (“IPO”), the Sponsors may elect to

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receive from the proceeds of such IPO, an amount equal to the aggregate difference between: (x) the Advisory Fees that we would have paid in fiscal year 2014 and each fiscal year thereafter had such amounts not been fixed and (y) the Advisory Fees that were actually paid by us for fiscal year 2014 and each fiscal year thereafter. We recorded Advisory Fees of $17 million, $22 million and $21 million for fiscals 2014, 2013 and 2012, respectively. During fiscals 2014, 2013 and 2012, we also paid the Sponsors fees of less than $1 million, respectively, for out-of-pocket expenses.

Additionally, the Advisory Agreement provides that affiliates of the Sponsors will be entitled to receive a fee equal to 1% of the aggregate transaction value in connection with certain financing, acquisition, disposition and change of control transactions (“Transaction Fees”). The Advisory Agreement includes customary exculpation and indemnification provisions in favor of the Sponsors and their affiliates. In the event that the Advisory Agreement is terminated by the affiliates of the Sponsors or us, the affiliates of the Sponsors will receive all unpaid Advisory Fees, all unpaid Transaction Fees and expenses due under the Advisory Agreement with respect to periods prior to the termination date plus the net present value of the Advisory Fees that would have been payable for the remainder of the applicable term of the Advisory Agreement. Transaction fees are capitalized as deferred debt issuance costs and are amortized over the term of the related debt agreement and included in Other assets on our Consolidated Balance Sheet.

Other Relationships and Transactions with our Sponsors

In connection with the amendment and restatement of the ABL Facility on March 21, 2014, we incurred Transaction Fees of $19 million pursuant to the terms of the Advisory Agreement.

In connection with entering into the Secured Term B-4 Loan and Tranche A-1 Loan on October 24, 2014, we incurred Transaction Fees of $13 million pursuant to the terms of the Advisory Agreement. Investment funds or accounts advised by or affiliated with Kohlberg Kravis and Roberts & Co. L.P. (collectively, “KKR”) owned an aggregate of $96 million of the Secured Term B-4 Loan as of January 31, 2015.

In connection with the Propco I Term Loan Facility entered into on August 21, 2013, we incurred Transactions Fees of $10 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $17 million of the Propco I Term Loan Facility as of January 31, 2015 and February 1, 2014, respectively.

In connection with the UK Propco Facility Agreement entered into on March 25, 2013, we incurred Transactions Fees of $4 million pursuant to the terms of the Advisory Agreement.

In connection with the France Propco Facility Agreement entered into on February 27, 2013, we incurred Transactions Fees of $1 million pursuant to the terms of the Advisory Agreement.

In connection with the Spain Propco Facility Agreement entered into on January 29, 2013, we incurred Transaction Fees of $1 million pursuant to the terms of the Advisory Agreement.

In connection with the offering of the 2017 Notes on August 1, 2012, we incurred Transaction Fees of $4 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $9 million of the 2017 Notes as of January 31, 2015 and February 1, 2014, respectively.

In connection with the Second Incremental Secured Term Loan facility entered into on April 10, 2012, we incurred Transaction Fees of $2 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $2 million and $9 million of the Second Incremental Secured Term Loan facility as of January 31, 2015 and February 1, 2014, respectively.

KKR owned an aggregate of $12 million and $50 million of the Incremental Secured Term Loan facility as of January 31, 2015 and February 1, 2014, respectively. In addition, KKR owned an aggregate of $9 million of the 7.375% senior secured notes due fiscal 2016 as of February 1, 2014, $70 million of the Secured term loan facility as of February 1, 2014, and $5 million of the Propco II Notes as of February 1, 2014. For further details, see Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

From time to time, we and our subsidiaries, as well as the Sponsors or their affiliates, may acquire debt or debt securities issued by us or our subsidiaries in open market transactions, tender offers, exchange offers, privately negotiated transactions or otherwise. During fiscals 2014, 2013 and 2012, affiliates of Vornado and KKR held debt and debt securities issued by the Company and its subsidiaries. The interest amounts paid on such debt and debt securities held by related parties were $10 million in fiscals 2014 and 2013, respectively. In fiscal 2012, the interest amounts paid on such debt and debt securities held by related parties were $8 million.

Additionally, under lease agreements with affiliates of Vornado, we paid an aggregate amount of $8 million in fiscals 2014 and 2013, respectively, and $10 million in fiscal 2012 with respect to 0.7%, 0.8% and 0.9%, respectively, of our operated stores,

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which include Express stores. Of the aggregate amount paid in fiscals 2014, 2013 and 2012, $2 million, respectively, was allocable to joint-venture parties not otherwise affiliated with Vornado.

In connection with the closing of the 2005 acquisition, we entered into a Stockholders Agreement with the Sponsors and certain other investors, and members of our management are bound by certain of the provisions of such agreement. The Stockholders Agreement and management stockholder addendum are each filed as an exhibit to this Annual Report on Form 10-K.

Each of the Sponsors, either directly or through affiliates, has ownership interests in a broad range of companies (“Portfolio Companies”) with whom we may from time to time enter into commercial transactions in the ordinary course of business, primarily for the purchase of goods and services. We believe that none of our transactions or arrangements with Portfolio Companies are significant enough to be considered material to the Sponsors or to our business.

Management Equity Plan and the 2010 Incentive Plan

Since the 2005 acquisition, our officers and certain employees participate in the Management Equity Plan. The Management Equity Plan provided for the granting of non-qualified stock options (including “rollover options” (as defined in the Management Equity Plan)) to purchase shares of common stock, as well as restricted stock to our officers, directors, employees, consultants and advisors. In fiscal 2010, our Board adopted the 2010 Incentive Plan. The 2010 Incentive Plan is an omnibus plan that provides for the granting of stock options, restricted stock, restricted and deferred stock units, cash or stock-based performance awards, dividend equivalents and other stock awards. The 2010 Incentive Plan provides that the total number of shares of our common stock that may be issued under the 2010 Incentive Plan is 3,750,000 and the maximum number of such shares of our common stock for which incentive stock options may be granted under the 2010 Incentive Plan is 500,000. In connection with Amendment No. 2 to the 2010 Incentive Plan effective September 2014, the number of shares available for issuance under the 2010 Incentive Plan were increased by the number of shares available for issuance under the Management Equity Plan as of July 17, 2014 and any shares that after July 17, 2014 would have otherwise been available for issuance thereunder. For a description of the Management Equity Plan and the 2010 Incentive Plan, see Item 11 entitled “EXECUTIVE COMPENSATION” of this Annual Report on Form 10-K.

Review, Approval or Ratification of Transactions with Related Persons

Our Board has adopted written policies and procedures for the review of any transaction, arrangement or relationship in which the Company is a participant, the amount involved exceeds $120,000, and one of our executive officers, directors, director nominees (or their immediate family members) or 5% stockholders or an employee serving in the capacity of an executive officer of a 5% stockholder or any consultant or an advisor of a 5% stockholder who participates in meetings of our management or Board, each of whom we refer to as a “related person,” has a direct or indirect material interest.

If a related person proposes to enter into such a transaction, arrangement or relationship, which we refer to as a “related person transaction,” the related person must report the proposed related person transaction to our General Counsel. The policy calls for the proposed related person transaction to be reviewed and, if deemed appropriate, approved by our Board’s Audit Committee. The policy also permits the Chairman of the Audit Committee to review and, if deemed appropriate, approve proposed related person transactions that arise between meetings, subject to providing notice to the other members of the Audit Committee at the next meeting of the Audit Committee. Any related person transactions that are ongoing in nature will be reviewed annually. A related person transaction reviewed under the policy will be considered approved or ratified if it is authorized by the Audit Committee (or its Chairman) after full disclosure of the related person’s interest in the transaction. The Audit Committee (or its Chairman) will review and consider such information regarding the related person transaction as it deems appropriate under the circumstances.

The Audit Committee (or its Chairman) may approve or ratify the transaction only if the Audit Committee or its Chairman, as applicable, determines that, under all of the circumstances, the transaction is not inconsistent with the Company’s best interests. The Audit Committee (or its Chairman) may impose any conditions on the related person transaction that it deems appropriate.

Director Independence

Each of the members of our Board of Directors, other than Mr. Urcelay, our Chief Executive Officer, and Messrs. Goodman, Sales and Markee, is affiliated with the Sponsors as further described in Item 10 entitled “DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE” of this Annual Report on Form 10-K and our Board of Directors has not made a determination as to whether any of our directors are independent.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Appointment of Independent Registered Public Accounting Firm

The Audit Committee appointed Deloitte & Touche LLP (“D&T”) as the Company’s independent registered public accounting firm to conduct the audit of the Company’s Consolidated Financial Statements for fiscals 2014 and 2013.

Audit Fees and Non-audit Fees

The aggregate fees billed by D&T and their respective affiliates for professional services rendered for the audit of the annual Consolidated Financial Statements for fiscals 2014 and 2013 and for the reviews of the financial statements included in our Quarterly Reports on Form 10-Q for those fiscal years, and for other services rendered during those fiscal years on our behalf were as follows:

	Fiscal 2014		Fiscal 2013
Audit Fees (1)	$	4,880,000	$	4,635,000
Audit-Related Fees (2)	$	1,585,000	$	1,998,000
Tax Fees (3)	$	166,000	$	564,000
Total Fees	$	6,631,000	$	7,197,000

(1) For fiscals 2014 and 2013, the audit fees consisted of fees for professional services performed in connection with the audit of the Company’s annual consolidated financial statements, review of financial statements included in our 10-Q filings, the Sarbanes-Oxley Section 404 audit and services that are normally provided in connection with statutory and regulatory filings or engagements.

(2) For fiscal 2014, audit-related fees primarily consisted of fees related to special purpose audits, the COSO 2013 implementation and refinancing transactions. For fiscal 2013, audit-related fees primarily consisted of fees related to special purpose audits and refinancing transactions.

(3) For fiscals 2014 and 2013, tax fees consisted of a variety of U.S. Federal, state and non-U.S. tax consultation services.

Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm

The Audit Committee has adopted a policy for the pre-approval of all audit and permissible non-audit services provided by D&T. These services may include audit services, audit-related services, tax services and other services. Under the policy, pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is subject to a specific budget. In addition, the Audit Committee may also pre-approve particular services on a case-by-case basis. The Audit Committee may delegate pre-approval authority to one or more of its members. Such member or members must report any decision to the Audit Committee at its next scheduled meeting.

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PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Financial Statements and financial statement schedules

(1) and (2) The financial statements and financial statement schedules required to be filed as part of this report are set forth in Item 8 entitled “FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA” of this Annual Report on Form 10-K.

(3) Exhibits. See Item 15(b) below.

(b) Exhibits required by Item 601 of Regulation S-K

The information required by this item is incorporated herein by reference from the Index to Exhibits beginning on page 157 of this Annual Report on Form 10-K. We will furnish to any security holder, upon written request, any exhibit listed in the accompanying Index to Exhibits upon payment by such security holder of our reasonable expenses in furnishing any such exhibit. Written requests should be sent to Investor Relations, Toys “R” Us Inc., One Geoffrey Way, Wayne, New Jersey 07470.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

TOYS “R” US, INC.

(Registrant)

/S/    ANTONIO URCELAY        

Antonio Urcelay

Chairman of the Board and

Chief Executive Officer

Date: March 26, 2015

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on the 26th day of March 2015.

Signature	Title
/s/    ANTONIOURCELAY     Antonio Urcelay	Chairman of the Board, Chief Executive Officer and Director (Principal Executive Officer)
/s/    MICHAELJ. SHORT Michael J. Short	Executive Vice President – Chief Financial Officer (Principal Financial Officer)
/s/    CHARLESD. KNIGHT  Charles D. Knight	Senior Vice President – Corporate Controller (Principal Accounting Officer)
* Joshua Bekenstein	Director
* Richard Goodman	Director
* Daniel Guglielmone	Director
* Matthew S. Levin	Director
* Joseph Macnow	Director
* Richard L. Markee	Director
* Wayne C. Sales	Director
* Wendy Silverstein	Director
* Nathanial H. Taylor	Director
* Adam Waglay	Director
* Gregory R. Why	Director

The foregoing constitutes all of the Board of Directors and the Principal Executive, Financial and Accounting Officers of the Registrant.

*By	/S/    ANTONIO URCELAY
	Antonio Urcelay
	Attorney-In-Fact

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SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT

We have not sent a copy of our annual report or proxy statement to our security holders.

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INDEX TO EXHIBITS

The following is a list of all exhibits filed as part of this Report:

Exhibit No.	Document
2.1	Reorganization Agreement, dated June 10, 2008, by and between the Registrant and Toys “R” Us Holdings, Inc. (filed as Exhibit 2.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 10, 2008 and incorporated herein by reference).
3.1	Amended and Restated Certificate of Incorporation of the Registrant filed with the Secretary of State of the State of Delaware on June 10, 2008 (filed as Exhibit 3.2 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 10, 2008 and incorporated herein by reference).
3.2	Amended and Restated By-Laws of the Registrant, dated June 10, 2008 (filed as Exhibit 3.3 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 10, 2008 and incorporated herein by reference).
4.1	Indenture between the Registrant and Fleet Bank, as trustee, pursuant to which securities in one or more series up to $300,000,000 in principal amount may be issued by the Registrant (filed as Exhibit 4 to the Registrant’s Registration Statement on Form S-3, File No. 33-42237, filed on August 31, 1991 and incorporated herein by reference).
4.2	Form of the Registrant’s 8.75% Debentures due 2021 (filed as Exhibit 4 to the Registrant’s Current Report on Form 8-K, dated August 29, 1991 and incorporated herein by reference).
4.3	First Supplemental Indenture, dated as of January 1, 1996, among Toys “R” Us – Delaware, Inc., Toys “R” Us, Inc. and United Jersey Bank, as trustee (filed as Exhibit 4.3 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009, filed on March 31, 2009 and incorporated herein by reference).
4.4	Second Supplemental Indenture, dated as of November 15, 2006, among Toys “R” Us – Delaware, Inc., Toys “R” Us, Inc. and The Bank of New York, as trustee (filed as Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 12, 2006 and incorporated herein by reference).
4.5	Form of the Registrant’s 7.375% Notes due 2018 (filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K, File No. 001-11609, filed on September 22, 2003 and incorporated herein by reference).
4.6	Indenture, dated as of May 28, 2002, between the Registrant and The Bank of New York, as trustee (filed as Exhibit 4.3 to the Post-Effective Amendment to the Registrant’s Registration Statement on Form S-3, File No. 333-84254, filed on May 29, 2002 and incorporated herein by reference).
4.7	First Supplemental Indenture, dated as of May 28, 2002, between the Registrant and The Bank of New York, as trustee (filed as Exhibit 4.4 to the Post-Effective Amendment to the Registrant’s Registration Statement on Form S-3, File No. 333-84254, filed on May 29, 2002 and incorporated herein by reference).
4.8	Indenture for the 8.50% Senior Secured Notes due 2017, dated November 20, 2009 (“Propco II Notes”), among Toys “R” Us Property Company II, LLC, the Registrant and the Guarantors named therein and The Bank of New York Mellon, as trustee and collateral agent (filed as Exhibit 4.14 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 30, 2010, filed on March 24, 2010 and incorporated herein by reference).
4.9	Form of the 8.50% Senior Secured Notes due 2017 (included in Exhibit 4.8).
4.10	Registration Rights Agreement, dated November 20, 2009, among Toys “R” Us Property Company II, LLC and the initial purchasers of the Propco II Notes, which was executed in connection with the issuance of the Propco II Notes (filed as Exhibit 4.16 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 30, 2010, filed on March 24, 2010 and incorporated herein by reference).
4.11	Indenture for the 10.375% Senior Notes due 2017, dated August 1, 2012, between the Registrant and The Bank of New York Mellon, as Trustee (filed as Exhibit 4.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 7, 2012 and incorporated herein by reference).
4.12	Form of the 10.375% Senior Notes (included in Exhibit 4.11).

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Exhibit No.	Document
4.13	Registration Rights Agreement, dated August 1, 2012, among the Registrant, and the Initial Purchasers named therein, of the Registrant’s 10.375% Senior Notes due 2017 (filed as Exhibit 4.3 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 7, 2012 and incorporated herein by reference).
4.14	Substantially all other long-term debt of the Registrant (which other debt does not exceed on an aggregate basis 10% of the total assets of the Registrant and its subsidiaries on a consolidated basis) is evidenced by, among other things, (i) industrial revenue bonds issued by industrial development authorities and guaranteed by the Registrant, (ii) mortgages held by third parties on real estate owned by the Registrant and (iii) stepped coupon guaranteed bonds held by a third party and guaranteed by the Registrant, any of which the Registrant will furnish to the Commission upon request.
10.1	Third Amended and Restated Credit Agreement, dated as of March 21, 2014, among Toys “R” Us - Delaware, Inc., as the Lead Borrower, Toys “R” Us (Canada) Ltd., Toys “R” Us (Canada) Ltee, as the Canadian Borrower, and certain other subsidiaries of Toys “R” Us - Delaware, Inc., as Facility Guarantors, Bank of America N.A., as Administrative Agent, as Canadian Agent and Co-Collateral Agent, Wells Fargo Bank, National Association, as Co-Collateral Agent, and the Lenders named therein, Wells Fargo Bank National Association and JPMorgan Chase Bank, N.A., as Co-Syndication Agents, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs Bank USA and Bank of Montreal as Co-Documentation Agents, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Bank National Association and JPMorgan Securities, LLC, as Joint Lead Arrangers, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Bank National Association, JPMorgan Securities, LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and Goldman Sachs Bank USA as Joint Bookrunners (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 12, 2014 and incorporated herein by reference).
10.2	First Amendment, dated as of October 24, 2014 to the Third Amended and Restated Credit Agreement, dated as of March 21, 2014 (and related security agreement attached as Annex C).
10.3	Amended and Restated Intercreditor Agreement, dated as of August 24, 2010, among Toys “R” Us - Delaware, Inc., the Guarantors named therein, Bank of America, N.A., as ABL Agent and as Term Agent and The Bank of New York Mellon, as Notes Agent (filed as Exhibit 4.5 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 10, 2010 and incorporated herein by reference).
10.4	Amendment No. 1, dated as of October 24, 2014, to the Amended and Restated Intercreditor Agreement, dated as of August 24, 2010, as amended, by and among Bank of America, N.A, as Term Agent and as ABL Agent and Toys “R” Us - Delaware, Inc., as the ABL Lead Borrower and the Term Borrower and certain other subsidiaries of Toys “R” Us - Delaware, Inc., as Facility Guarantors (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
10.5	Amended and Restated Syndicated Facility Agreement, dated as of October 15, 2009 and amended and restated as of March 8, 2011, among Toys “R” Us Europe, LLC, TRU Australia Holdings, LLC, Toys “R” Us (UK) Limited, Toys “R” Us Limited, Toys “R” Us (Australia) Pty Ltd, Toys “R” Us GmbH, Toys “R” Us SARL, Toys “R” Us Iberia, S.A., the other Obligors party thereto from time to time, the Lenders party thereto from time to time, Deutsche Bank AG, New York Branch, as Administrative Agent and Security Agent, Deutsche Bank AG, London Branch, as Facility Agent, Deutsche Bank AG, New York Branch and Bank of America, N.A., as Co-Collateral Agents, Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Joint Lead Arrangers, Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Joint Book-Runners, Bank of America, N.A., as Syndication Agent and Citibank, N.A. and Goldman Sachs Lending Partners LLC, as Documentation Agents (filed as Exhibit 10.4 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 29, 2011, filed on March 24, 2011 and incorporated herein by reference).

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Exhibit No.	Document
10.6	Incremental Commitment Agreement, dated as of April 28, 2011, to the Amended and Restated Syndicated Facility Agreement, dated as of October 15, 2009 and amended and restated as of March 8, 2011, among Toys “R” Us Europe, LLC, TRU Australia Holdings, LLC, Toys “R” Us (UK) Limited, Toys “R” Us (Australia) Pty Ltd., and other Obligors party thereto from time to time, the Lenders party thereto, Deutsche Bank AG, New York Branch, as Administrative Agent and Security Agent, Deutsche Bank AG, London Branch, as Facility Agent, Deutsche Bank AG, New York Branch and Bank of America, N.A., as Co-Collateral Agents, Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Joint Lead Arrangers, Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Joint Book-Runners, Bank of America, N.A., as Syndication Agent and Citibank, N.A. and Goldman Sachs Lending Partners LLC, as Documentation Agents (filed as Exhibit 10.5 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 28, 2012, filed on March 21, 2012 and incorporated herein by reference).
10.7	Amendment and Restatement Agreement, dated as of July 24, 2013, relating to the UK Propco Facility Agreement, dated as of March 25, 2013, among Toys “R” Us Properties (UK) Limited, as borrower, Debussy DTC PLC, as original lender, Elavon Financial Services Limited, as facility agent and U.S. Bank Trustees Limited, as security agent (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 17, 2013 and incorporated herein by reference).
10.8	Amended and Restated Credit Agreement (the “New Secured Term Loan”), dated as of August 24, 2010 by and among Toys “R” Us - Delaware, Inc., as Borrower, Banc of America, N.A., as Administrative Agent and as Collateral Agent, Goldman Sachs Credit Partners L.P. and JPMorgan Chase Bank, N.A., as Syndication Agents, the Lenders named therein, Credit Suisse Securities (USA) LLC and Wells Fargo Bank, N.A., as Documentation Agents, Banc of America Securities LLC, J.P. Morgan Securities, Inc. and Goldman Sachs Lending Partners LLC, as Joint Lead Arrangers and Banc of America Securities LLC, J. P. Morgan Securities Inc., Wells Fargo Securities, LLC, Goldman Sachs Lending Partners LLC, Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and Deutsche Bank Securities Inc., as Joint Bookrunning Managers (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 10, 2010 and incorporated herein by reference).
10.9	Amendment No. 1, dated as of September 20, 2010, to the New Secured Term Loan (filed as Exhibit 10.7 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 29, 2011, filed on March 24, 2011 and incorporated herein by reference).
10.10	Amendment No. 2, dated as of April 10, 2012, to the New Secured Term Loan, dated as of August 24, 2010 by and between, among others, Toys “R” Us - Delaware, Inc., as the Borrower, Bank of America, N.A. as Administrative Agent, and the other agents and the lenders party thereto (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 8, 2012 and incorporated herein by reference).
10.11	Amendment No. 3, dated as of October 24, 2014, to the New Secured Term Loan, dated as of August 24, 2010 by and between, among others, Toys “R” Us - Delaware, Inc., as the Borrower, Bank of America, N.A. as Administrative Agent, and the other agents and the lenders party thereto (and related security agreement attached as Annex 3).
10.12	Guarantee, dated as of October 24, 2014 among Wayne Real Estate Parent Company, LLC as the Guarantor and Bank of America, N.A., as Administrative Agent under the New Secured Term Loan, dated as of August 24, 2010, for the Benefit of the Term-B Lenders defined therein (filed as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
10.13	Incremental Joinder Agreement, dated as of May 25, 2011, to the New Secured Term Loan, dated as of August 24, 2010 by and between, among others, Toys “R” Us - Delaware, Inc., as the Borrower, Bank of America, N.A. as Administrative Agent, and the other agents and the lenders party thereto (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 10, 2011 and incorporated herein by reference).
10.14	Incremental Joinder Agreement No. 2, dated as of April 10, 2012, to the New Secured Term Loan, dated as of August 24, 2010 by and between, among others, Toys “R” Us - Delaware, Inc., as the Borrower, Bank of America, N.A. as Administrative Agent, and the other agents and the lenders party thereto (filed as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 8, 2012 and incorporated herein by reference).

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Exhibit No.	Document
10.15	Term Loan Credit Agreement, dated as of August 21, 2013, among Toys “R” Us Property Company I, LLC, as Borrower, the Lenders named therein, Goldman Sachs Lending Partners LLC, as Administrative Agent, Joint Lead Arrangers and Bookrunners, Deutsche Bank Securities, Inc., J.P. Morgan Securities LLC, and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Joint Lead Arrangers and Bookrunners, Citigroup Global Markets Inc. and Wells Fargo Securities, LLC, as Joint Lead Arrangers, Goldman Sachs Lending Partners LLC, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Co-Syndication Agents, Citigroup Global Markets Inc. and Wells Fargo Securities, LLC, as Co-Documentation Agents (filed as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 17, 2013 and incorporated herein by reference).
10.16	Stockholders Agreement among Toys “R” Us Holdings, Inc. (subsequently assumed by the Registrant), Funds managed by Bain Capital Partners, LLC or its Affiliates, Toybox Holdings LLC and Vornado Truck LLC and certain other persons, dated as of July 21, 2005 (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 10, 2008 and incorporated herein by reference).
10.17	Amendment No. 1, dated June 10, 2008, to the Stockholders Agreement among Toys “R” Us Holdings, Inc. (subsequently assumed by the Registrant), Funds managed by Bain Capital Partners, LLC or its Affiliates, Toybox Holdings LLC and Vornado Truck LLC and certain other persons, dated as of July 21, 2005 (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 10, 2008 and incorporated herein by reference).
10.18	Management Stockholders Addendum incorporated in and made a part of the Toys “R” Us Holdings, Inc. 2005 Management Equity Plan (filed as Exhibit 10.18 to the Registrant’s Form S-1/A, filed on July 9, 2010 and incorporated herein by reference).
10.19	Advisory Agreement, dated as of July 21, 2005, among the Registrant, Toys “R” Us Holdings, Inc. (subsequently assumed by the Registrant), Bain Capital Partners, LLC, Bain Capital, Ltd., Kohlberg Kravis Roberts & Co. L.P. and Vornado Truck LLC (filed as Exhibit 10.20 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 14, 2005 and incorporated herein by reference).
10.20	Amendment No. 1, dated June 10, 2008, to the Advisory Agreement among the Registrant, Toys “R” Us Holdings, Inc. (subsequently assumed by the Registrant), Bain Capital Partners, LLC, Bain Capital, Ltd., Kohlberg Kravis Roberts & Co. L.P. and Vornado Truck LLC, dated as of July 21, 2005 (filed as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 10, 2008 and incorporated herein by reference).
10.21	Amendment No. 2, dated February 1, 2009, to the Advisory Agreement among the Registrant, Bain Capital Partners, LLC, Bain Capital, Ltd., Kohlberg Kravis Roberts & Co., L.P. and Vornado Truck LLC, dated as of July 21, 2005 (filed as Exhibit 10.26 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009, filed on March 31, 2009 and incorporated herein by reference).
10.22	Amendment No. 3, dated August 29, 2014, to the Advisory Agreement among the Registrant, Bain Capital Partners, LLC, Bain Capital, Ltd., Kohlberg Kravis Roberts & Co., L.P. and Vornado Truck LLC (filed as Exhibit 10.7 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
10.23	Registration Rights Agreement, dated as of July 21, 2005, among Toys “R” Us Holdings, Inc. (subsequently assumed by the Registrant), Funds managed by Bain Capital Partners, LLC or its Affiliates, Toybox Holdings LLC, Vornado Truck LLC and certain other Persons (filed as Exhibit 10.12 on the Registrant’s Form S-1/A, filed on July 9, 2010 and incorporated herein by reference).
10.24	Amendment No. 1, dated June 10, 2008, to the Registration Rights Agreement among Toys “R” Us Holdings, Inc. (subsequently assumed by the Registrant), Funds managed by Bain Capital Partners, LLC or its Affiliates, Toybox Holdings LLC, Vornado Truck LLC and certain other Persons, dated as of July 21, 2005 (filed as Exhibit 10.13 on the Registrant’s Form S-1/A, filed on July 9, 2010 and incorporated herein by reference).
10.25	Form of Advancement and Indemnification Rights Agreement (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 4, 2009 and incorporated herein by reference).

160

Exhibit No.	Document
10.26*	Amended and Restated Toys “R” Us Holdings, Inc. 2005 Management Equity Plan, (subsequently assumed by the Registrant), adopted on August 3, 2007 (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 18, 2007 and incorporated herein by reference).
10.27*	Amendment No. 1, dated June 10, 2008, to the Amended and Restated Toys “R” Us Holdings, Inc. 2005 Management Equity Plan, (subsequently assumed by the Registrant and renamed the Amended and Restated Toys “R” Us, Inc. Management Equity Plan), adopted on August 3, 2007 (i) (“MEP”), (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 10, 2008 and incorporated herein by reference).
10.28*	Amendment No. 2, effective as of June 8, 2009, to the MEP (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 9, 2009 and incorporated herein by reference).
10.29*	Amendment No. 3, effective as of November 29, 2010, to the MEP (filed as Exhibit 10.21 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 29, 2011, filed on March 24, 2011 and incorporated herein by reference). (i)
10.30*	Amendment No. 4, effective as of March 2, 2012 to the MEP (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 8, 2012 and incorporated herein by reference).
10.31*	Amendment No. 5, effective as of May 21, 2012 to the MEP (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 8, 2012 and incorporated herein by reference).
10.32*	Amendment No. 6, effective as of March 12, 2013 to the MEP (filed as Exhibit 10.28 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 2, 2013, filed on March 29, 2013 and incorporated herein by reference).
10.33*	Form of Toys “R” Us, Inc. Non-Qualified Stock Option for Executive Officers for awards under the MEP (filed as Exhibit 10.35 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009, filed on March 31, 2009 and incorporated herein by reference).
10.34*	Form of Amendment to Initial MEP Options (filed as Exhibit 10.31 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 1, 2014, filed on March 31, 2014 and incorporated herein by reference).
10.35*	Form of Toys “R” Us, Inc. Restricted Stock Agreement (with Consideration) for Executive Officers for awards under the MEP (filed as Exhibit 10.36 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009, filed on March 31, 2009 and incorporated herein by reference).
10.36*	Form of Toys “R” Us, Inc. Restricted Stock Agreement (without Consideration) for Executive Officers awarded under the MEP (filed as Exhibit 10.37 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009, filed on March 31, 2009 and incorporated herein by reference).
10.37*	Toys “R” Us, Inc. 2010 Incentive Plan (the “2010 Incentive Plan”) (filed as Exhibit 10.26 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 29, 2011, filed on March 24, 2011 and incorporated herein by reference).
10.38*	Amendment No. 2, dated September 4, 2014, to the 2010 Incentive Plan (filed as Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
10.39*	October 2014 Non-Qualified Stock Option Agreement, effective October 10, 2014, to the 2010 Incentive Plan, as amended, for all countries other than France (filed as Exhibit 10.6 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
10.40*	Form of Toys “R” Us, Inc. NonQualified Stock Option Agreement for Executive Officers for awards under the 2010 Incentive Plan (filed as Exhibit 10.29 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 28, 2012, filed on March 21, 2012 and incorporated herein by reference).

161

Exhibit No.	Document
10.41*	Form of Amendment to the Form of Toys “R” Us, Inc. NonQualified Stock Option Agreement for Executive Officers for awards under the 2010 Incentive Plan (filed as Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 8, 2012 and incorporated herein by reference).
10.42*	Form of Toys “R” Us, Inc. Performance-Based NonQualified Stock Option Agreement for Executive Officers for awards under the 2010 Incentive Plan (filed as Exhibit 10.38 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 1, 2014, filed on March 31, 2014 and incorporated herein by reference).
10.43*	Form of Toys “R” Us, Inc. Restricted Performance-Based Stock Award Agreement for Executive Officers for awards under the 2010 Incentive Plan (filed as Exhibit 10.30 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 28, 2012, filed on March 21, 2012 and incorporated herein by reference).
10.44*	Form of Toys “R” Us, Inc. Restricted Performance-Based Stock Unit Award Agreement for Executive Officers for awards under the 2010 Incentive Plan (filed as Exhibit 10.31 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 28, 2012, filed on March 21, 2012 and incorporated herein by reference).
10.45*	Form of Toys “R” Us, Inc. Restricted Stock Unit Award Agreement for Non-Employee Directors for awards under the 2010 Incentive Plan (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 17, 2013 and incorporated herein by reference).
10.46*	Form of Toys “R” Us, Inc. Restricted Stock Unit Award Agreement for Executive Officers for awards under the 2010 Incentive Plan (filed as Exhibit 10.42 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 1, 2014, filed on March 31, 2014 and incorporated herein by reference).
10.47*	Form of Officer Incentive Cash Award Agreement for awards under the Toys “R” Us, Inc. 2010 Incentive Plan (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 12, 2014 and incorporated herein by reference).
10.48*	Form of Toys “R” Us (Canada) Ltd. Deferred Profit Sharing Plan Rules (filed as Exhibit 10.27 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 29, 2011, filed on March 24, 2011 and incorporated herein by reference).
10.49*	Amended and Restated Toys “R” Us, Inc. Grantor Trust Agreement, dated as of January 31, 2003, between Registrant and Wachovia Bank, N.A. (filed as Exhibit 10.24 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2004, File No. 001-11609, filed on April 14, 2004 and incorporated herein by reference).
10.50*	Toys “R” Us, Inc. Supplemental Executive Retirement Plan, effective as of February 1, 2006 (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on December 22, 2006 and incorporated herein by reference).
10.51*	Amendment No. 1, effective as of February 1, 2008, to the Toys “R” Us, Inc. Supplemental Executive Retirement Plan, effective as of February 1, 2006 (filed as Exhibit 10.32 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009, filed on March 31, 2009 and incorporated herein by reference).
10.52*	Employment Agreement between Toys “R” Us, Inc. and F. Clay Creasey, Jr., dated as of December 10, 2012 (filed as Exhibit 10.45 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 2, 2013, filed on March 29, 2013 and incorporated herein by reference).
10.53*	Letter Agreement, dated October 20, 2004, between Toys “R” Us, Inc. and Antonio Urcelay (filed as Exhibit 10.44 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 28, 2006 and incorporated herein by reference).
10.54*	Salary Adjustment Letter, dated March 11, 2013, between Toys “R” Us, Inc. and Antonio Urcelay (filed as Exhibit 10.47 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 2, 2013, filed on March 29, 2013 and incorporated herein by reference).
10.55*	Letter Agreement, dated July 1, 2013, between Toys “R” Us, Inc. and Antonio Urcelay (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 17, 2013 and incorporated herein by reference).

162

Exhibit No.	Document
10.56*	Side Letter, dated July 1, 2013, between Toys “R” Us, Inc. and Antonio Urcelay (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 17, 2013 and incorporated herein by reference).
10.57*	Letter Agreement, dated October 16, 2013, between Toys “R” Us, Inc. and Antonio Urcelay (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 17, 2013 and incorporated herein by reference).
10.58*	Letter Agreement between Toys “R” Us, Inc. Sucursal en Espana and Antonio Urcelay, dated as of March 3, 2014 (filed as Exhibit 10.55 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 1, 2014, filed on March 31, 2014 and incorporated herein by reference).
10.59*	Amendment, dated October 14, 2014, to the Employment Agreement between Toys “R” Us, Inc. Sucursal en Espana, and Antonio Urcelay, dated March 3, 2014 (filed as Exhibit 10.11 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
10.60*	Employment Agreement between Toys “R” Us (Canada) Ltd. and Monika M. Merz, dated as of January 23, 2013 (filed as Exhibit 10.48 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 2, 2013, filed on March 29, 2013 and incorporated herein by reference).
10.61*	Employment Agreement between Toys “R” Us, Inc. and Harry J. Mullany III, dated as of October 16, 2013 (filed as Exhibit 10.57 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 1, 2014, filed on March 31, 2014 and incorporated herein by reference).
10.62*	2014 Option and Restricted Stock Unit Exchange Notice to Harry J. Mullany III, effective as of October 24, 2014 (filed as Exhibit 10.10 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
10.63*	Employment Agreement between Toys “R” Us, Inc. and Michael J. Short, dated as of June 19, 2014 (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on September 10, 2014 and incorporated herein by reference).
10.64*	Separation and Release Agreement between Toys “R” Us, Inc. and Deborah Derby, dated as of February 17, 2012 (filed as Exhibit 10.58 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 1, 2014, filed on March 31, 2014 and incorporated herein by reference).
10.65*	Amended and Restated Employment Agreement between Toys “R” Us, Inc. and Deborah M. Derby, dated as October 13, 2014 (filed as Exhibit 10.8 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
10.66*	Form of Special Transition Bonus Grant, dated March 11, 2013 (filed as Exhibit 10.50 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 2, 2013, filed on March 29, 2013 and incorporated herein by reference).
10.67*	Form of Retention Bonus Agreement for Executive Vice Presidents (filed as Exhibit 10.9 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 11, 2014 and incorporated herein by reference).
12	Statement re: computation of ratio of earnings to fixed charges.
18	Preferability Letter provided by Deloitte & Touche LLP, the Registrant’s independent registered public accounting firm, to change the measurement date in connection with the Registrant’s annual goodwill impairment test.
21	Subsidiaries of the Registrant as of January 31, 2015.
24	Power of Attorney, dated March 17, 2015.

163

Exhibit No.	Document
31.1	Certification of Chief Executive Officer pursuant to Rule 13a – 14(a) and Rule 15d – 14(a) of the Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Rule 13a – 14(a) and Rule 15d – 14(a) of the Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

* Management contract or compensatory plan, contract or arrangement.

(i) The provisions of this Amendment are only applicable to those participants under the Management Equity Plan who consented to be bound by this Amendment.

164

EX-10.2

Exhibit 10.2

FIRST AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT AND TO SECURITY AGREEMENT

FIRST AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT AND TO SECURITY AGREEMENT (this “Amendment”) dated as of October 24, 2014 by and among

TOYS “R” US-DELAWARE, INC., a corporation organized under the laws of the State of Delaware, with its principal executive offices at One Geoffrey Way, Wayne, New Jersey, for itself and as agent (in such capacity, the “Lead Borrower”) for the other Domestic Borrowers now or hereafter party hereto;

The DOMESTIC BORROWERS party hereto;

TOYS “R” US (CANADA) LTD. TOYS “R” US (CANADA) LTEE (the “Canadian Borrower”), a corporation organized under the laws of the Province of Ontario with its principal executive offices at 2777 Langstaff Road, Concord, Ontario L4K 4M5;

The FACILITY GUARANTORS party hereto;

BANK OF AMERICA, N.A., a national banking association, having a place of business at 100 Federal Street, Boston, Massachusetts 02110, as administrative agent (in such capacity, the “Administrative Agent”) for its own benefit and the benefit of the other Secured Parties;

BANK OF AMERICA, N.A. (acting through its Canada branch), a banking corporation carrying on business under the Bank Act (Canada), having a place of business at 181 Bay Street, 4^th Floor, Toronto, Ontario, Canada M5J 2V8, as Canadian Administrative Agent (in such capacity, the “Canadian Agent”) for its own benefit and the benefit of the other Secured Parties;

BANK OF AMERICA, N.A., a national banking association, having a place of business at 100 Federal Street, Boston, Massachusetts 02110, and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, having a place of business at One Boston Place, 19th Floor, Boston, Massachusetts 02108, as co-collateral agents (collectively, in such capacity, the “Co-Collateral Agents”) for their own benefit and the benefit of the other Secured Parties; and

The LENDERS party hereto;

in consideration of the mutual covenants herein contained and benefits to be derived herefrom.

WITNESSETH:

WHEREAS, the Loan Parties, the Lenders, the Administrative Agent, the Canadian Agent and the Co-Collateral Agents, among others, have entered into a certain Third Amended and Restated Credit Agreement dated as of March 21, 2014 (the “Credit Agreement”); and

WHEREAS, the Lead Borrower has informed the Administrative Agent that it intends to (a) create a new tranche of Term B-4 Loans under that certain Amended and Restated Credit Agreement dated as of August 24, 2010 among the Lead Borrower, the lenders party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the other parties thereto, as amended and in effect (the “Existing Term Loan Agreement”), (b) permit certain Term B-2 Lenders and certain Term B-3 Lenders to elect to extend the maturity of their Term B-2 Loans and Term B-3 Loans, respectively, by an exchange into Term B-4 Loans, (c) refinance all of its outstanding Initial Loans under the Existing Term Loan Agreement, (d) redeem (whether through tender offer, or otherwise), defease, or discharge all of the Borrower’s outstanding 7.375% Senior Secured Notes due 2016 (including payment of accrued and unpaid interest, premiums and other amounts due), and (e) reinstate the Tranche A-1 Commitments under the Credit Agreement and request certain other modifications to the Credit Agreement, including, without limitation, an extension of the Maturity Date with respect to the Tranche A-1 Commitments; and

WHEREAS, the Domestic Loan Parties have entered into a Security Agreement (the “Security Agreement”) dated as of July 21, 2005 in favor of the Administrative Agent, for the benefit of itself and the other Secured Parties, pursuant to which the Domestic Loan Parties have granted a Lien in certain of their assets to secure the Obligations; and

WHEREAS, the Loan Parties, the Lenders, the Administrative Agent, the Canadian Agent and the Co-Collateral Agents have agreed to amend the Credit Agreement, the Security Agreement and the other Loan Documents as set forth herein.

NOW THEREFORE, in consideration of the mutual promises and agreements herein contained, the parties hereto hereby agree as follows:

1. Incorporation of Terms and Conditions of Credit Agreement. All of the terms and conditions of the Credit Agreement (including, without limitation, all definitions set forth therein) are specifically incorporated herein by reference. All capitalized terms not otherwise defined herein shall have the same meaning as in the Credit Agreement, as applicable.

2. Representations and Warranties. Each Loan Party hereby represents and warrants that after giving effect to this Amendment, (i) no Default or Event of Default exists under the Credit Agreement or under any other Loan Document, and (ii) all representations and warranties contained in the Credit Agreement and in the other Loan Documents are true and correct in all material respects (except in the case of any representation and warranty qualified by “materiality” or “Material Adverse Effect”, which is true and correct in all respects) as of the date hereof, except to the extent that such representations and warranties specifically refer to an

earlier date, in which case they are true and correct in all material respects as of such earlier date.

3. Ratification of Loan Documents. The Credit Agreement, as hereby amended, and all other Loan Documents (including, without limitation, the documents listed on Schedule I hereto), are hereby ratified and re-affirmed in all respects and shall continue in full force and effect. Without limiting the foregoing, each of the Loan Parties hereby acknowledges, confirms and agrees that any and all Collateral previously pledged to the Administrative Agent or the Canadian Agent, as applicable, for the benefit of the Secured Parties, pursuant to the Loan Documents shall continue to secure all Obligations of the Loan Parties at any time outstanding, as such Obligations have been, and may hereafter be, amended, restated, supplemented, increased or otherwise modified from time to time.

4. Amendment to Credit Agreement, Security Agreement and Other Loan Documents.

a. Composite Credit Agreement. The Credit Agreement is hereby amended in its entirety to reflect the modifications identified in the document annexed hereto as Annex A.

b. Exhibits to Credit Agreement. The Exhibits to the Credit Agreement are hereby amended as follows:

i. Exhibit J (Compliance Certificate) to the Credit Agreement is hereby deleted in its entirety and the Exhibit J attached hereto is substituted in its stead.

ii. Exhibit K (Borrowing Base Certificate) to the Credit Agreement is hereby deleted in its entirety and the Exhibit K attached hereto is substituted in its stead.

iii. Exhibit A-2 (Form of Assignment and Acceptance (Tranche A-1 Loans), Exhibit D-2 (Form of Domestic Tranche A-1 Note) and Exhibit E-2 (Form of Canadian Tranche A-1 Note) are hereby incorporated into the Credit Agreement.

c. Schedules to Credit Agreement. The Schedules to the Credit Agreement are hereby amended as follows:

i. Schedule 1.1 (Lenders and Commitments) to the Credit Agreement is hereby deleted in its entirety and the Schedule 1.1 attached hereto is substituted in its stead.

ii. Schedules 3.01 and 3.12 to the Credit Agreement are hereby deleted in their entirety and Schedule 3.01 and Schedule 3.12 attached hereto are substituted in their stead.

d. Intercreditor Agreement. The Intercreditor Agreement is hereby amended in its entirety to reflect the modifications identified in the document annexed hereto as Annex B.

e. Security Agreement. The Security Agreement (and the Exhibits, Schedules and Annexes thereto) is hereby amended in its entirety to reflect the modifications identified in the document annexed hereto as Annex C.

5. Consent to Amendment.    The Required Lenders hereby consent to the amendment of the Term Loan on the terms set forth in the amendment documents furnished to the Administrative Agent and waive any Default or Event of Default under SECTION 6.09 of the Credit Agreement in connection therewith.

6. Appointment of Tranche A-1 Agents. The Loan Documents are hereby amended to reflect the following additional Persons as agents in the capacities set forth below:

Tranche A-1 Agent:    Bank of America, N.A.

Tranche A-1 Joint Lead Arrangers:    Bank of America, N.A., Goldman Sachs Bank USA, JPMorgan Securities, LLC, and Wells Fargo Bank, National Association.

Tranche A-1 Joint Bookrunners:    Bank of America, N.A., Goldman Sachs Bank USA, JPMorgan Securities, LLC, and Wells Fargo Bank, National Association.

7. Conditions to Effectiveness. This Amendment shall not be effective (the “First Amendment Effective Date”) until each of the following conditions precedent has been fulfilled (or waived) to the reasonable satisfaction of the Administrative Agent:

a. This Amendment shall have been duly executed and delivered by the Loan Parties and the Required Lenders.

b. All action on the part of the Loan Parties necessary for the valid execution, delivery and performance by the Loan Parties of this Amendment shall have been duly and effectively taken. The Lenders shall have received such customary corporate resolutions, certificates and other customary corporate documents as the Administrative Agent shall reasonably request.

c. The Lenders shall have received customary opinions of counsel to the Loan Parties.

d. After giving effect to this Amendment, no Default or Event of Default shall have occurred and be continuing.

e. After giving effect to this Amendment, Excess Availability shall be not less than $300,000,000.

f. No event shall have occurred after March 21, 2014 that could reasonably be expected to have a Material Adverse Effect on the Loan Parties, taken as a whole.

g. The Loan Parties shall have paid to the Administrative Agent the fees set forth in that certain fee letter dated as of September 26, 2014 among the Loan Parties, Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPFS”), and the Administrative Agent, and shall have reimbursed the Administrative Agent and MLPFS for all reasonable and documented out-of-pocket costs and expenses, including, reasonable and documented attorneys’ fees of one counsel, in connection with or relating to this Amendment.

h. The amendment to the Term Loan in the form furnished to the Administrative Agent shall have been executed and shall be in full force and effect. Reasonably contemporaneously with the effectiveness of this Amendment, the outstanding Initial Loans under the Existing Term Loan Agreement shall have been refinanced, and all of the Borrower’s outstanding 7.375% Senior Secured Notes due 2016 (including payment of accrued and unpaid interest, premiums and other amounts due) shall have been redeemed (whether through tender offer or otherwise), defeased or discharged.

8. Binding Effect. The terms and provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their heirs, representatives, successors and assigns.

9. Multiple Counterparts; Effectiveness. This Amendment may be executed in multiple counterparts, each of which shall constitute an original and together which shall constitute but one and the same instrument. Delivery of any executed counterpart of a signature page of this Amendment by telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Amendment.

10. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT WITHOUT GIVING EFFECT TO OTHER CONFLICTS OF LAWS PRINCIPLES THEREOF.

IN WITNESS WHEREOF, this Amendment has been duly executed and delivered by each of the parties hereto as of the date first above written.

TOYS “R” US-DELAWARE, INC., as Lead Borrower
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer
TOYS “R” US (CANADA) LTD. TOYS “R” US (CANADA) LTEE, as a Canadian Borrower
By:	/s/ Robert S. Zarra
Name:	Robert S. Zarra
Title:	Vice-President, Secretary-Treasurer
TRU-SVC, LLC, as a Facility Guarantor
By:	TOYS “R” US-DELAWARE, INC., its sole member
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer
TOYS ACQUISITION, LLC, as a Facility Guarantor
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer

Signature Page to First Amendment to Third Amended and Restated Credit Agreement

TRU OF PUERTO RICO, INC., as a Facility Guarantor
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer
GEOFFREY HOLDINGS, LLC, as a Facility Guarantor
By:	TOYS “R” US-DELAWARE, INC., its sole member
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer

Signature Page to First Amendment to Third Amended and Restated Credit Agreement

BANK OF AMERICA, N.A., as Administrative Agent, as Co-Collateral Agent, as Swingline Lender, and as a Domestic Lender
By:	/s/ Christine Hutchinson
Name:	Christine Hutchinson
Title:	Director

Signature Page to First Amendment to Third Amended and Restated Credit Agreement

[Additional Lender Signatures On File With Administrative Agent]

Signature Page to First Amendment to Third Amended and Restated Credit Agreement

Annex A

Third Amended and Restated Credit Agreement

[See Attached]

Annex A

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

dated as of

March 21, 2014

TOYS “R” US-DELAWARE, INC.

The Lead Borrower

for

THE BORROWERS PARTY HERETO

THE FACILITY GUARANTORS PARTY HERETO

BANK OF AMERICA, N.A.

as Administrative Agent

BANK OF AMERICA, N.A. (acting through its Canada branch)

as Canadian Agent

BANK OF AMERICA, N.A.

WELLS FARGO BANK, NATIONAL ASSOCIATION

as Co-Collateral Agents

THE LENDERS

NAMED HEREIN

WELLS FARGO BANK, NATIONAL ASSOCIATION

JPMORGAN CHASE BANK, N.A.

as Co-Syndication Agents

CITIGROUP GLOBAL MARKETS INC.

DEUTSCHE BANK SECURITIES INC.

GOLDMAN SACHS BANK USA

BANK OF MONTREAL

as Co-Documentation Agents

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

WELLS FARGO BANK, NATIONAL ASSOCIATION

JPMORGAN SECURITIES, LLC

as Joint Lead Arrangers

and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

WELLS FARGO BANK, NATIONAL ASSOCIATION

JPMORGAN SECURITIES, LLC

CITIGROUP GLOBAL MARKETS INC.

DEUTSCHE BANK SECURITIES INC.

GOLDMAN SACHS BANK USA

as Joint Bookrunners

TABLE OF CONTENTS

ARTICLE I Definitions; Interpretive Provisions			2
SECTION 1.01	Definitions		2
SECTION 1.02	Terms Generally	64	66
SECTION 1.03	Accounting Terms; GAAP	65	66
SECTION 1.04	Times of Day	65	67
ARTICLE II Amount and Terms of Credit		65	67
SECTION 2.01	Commitment of the Lenders	65	67
SECTION 2.02	Increase in Total Commitments	66	68
SECTION 2.03	Reserves; Changes to Reserves	68	70
SECTION 2.04	Making of Loans	69	71
SECTION 2.05	Overadvances	71	73
SECTION 2.06	Swingline Loans	72	73
SECTION 2.07	Notes	72	74
SECTION 2.08	Interest on Revolving Credit Loans	73	75
SECTION 2.09	Conversion and Continuation of Revolving Credit Loans	74	76
SECTION 2.10	Alternate Rate of Interest for Revolving Credit Loans	75	77
SECTION 2.11	Change in Legality	76	78
SECTION 2.12	Default Interest	76	78
SECTION 2.13	Letters of Credit	76	78
SECTION 2.14	Increased Costs	84	85
SECTION 2.15	Termination or Reduction of Commitments	85	87
SECTION 2.16	Optional Prepayment of Loans; Reimbursement of Lenders	85	87
SECTION 2.17	Mandatory Prepayment of Loans; Mandatory Reduction or Termination of Commitments; Cash Collateral	88	89
SECTION 2.18	Cash Management	90	92
SECTION 2.19	Fees	93	95
SECTION 2.20	Maintenance of Loan Account; Statements of Account	95	97
SECTION 2.21	Payments; Sharing of Setoff	95	97
SECTION 2.22	Settlement Amongst Lenders	96	98
SECTION 2.23	Taxes	98	100
SECTION 2.24	Mitigation Obligations; Replacement of Lenders	101	103
SECTION 2.25	Designation of Lead Borrower as Domestic Borrowers' Agent	102	104
SECTION 2.26	Security Interests in Collateral	103	105
SECTION 2.27	Defaulting Lenders	103	105
SECTION 2.28	Extension of Commitments
SECTION 2.29	Excess Cash Flow
ARTICLE III Representations and Warranties		105	107
SECTION 3.01	Organization; Powers	106	107
SECTION 3.02	Authorization; Enforceability	106	108
SECTION 3.03	Government Approvals; No Conflicts	106	108
SECTION 3.04	Financial Condition; No Material Adverse Effect	107	108
SECTION 3.05	Properties	107	109
SECTION 3.06	Litigation and Environmental Matters	107	109

SECTION 3.07	Compliance with Laws and Agreements	108	109
SECTION 3.08	Investment Company Status	108	110
SECTION 3.09	Taxes	108	110
SECTION 3.10	ERISA; Canadian Defined Benefit Pension Plans	108	110
SECTION 3.11	Disclosure	109	110
SECTION 3.12	Subsidiaries	109	110
SECTION 3.13	[Reserved.]	109	111
SECTION 3.14	Labor Matters	109	111
SECTION 3.15	Security Documents	109	111
SECTION 3.16	Federal Reserve Regulations	110	112
SECTION 3.17	Solvency	110	112
ARTICLE IV Conditions		110	112
SECTION 4.01	Effective Date	110	112
SECTION 4.02	Conditions Precedent to Each Loan and Each Letter of Credit	112	114
ARTICLE V Affirmative Covenants		113	115
SECTION 5.01	Financial Statements and Other Information	113	115
SECTION 5.02	Notices of Material Events	117	118
SECTION 5.03	Information Regarding Collateral	117	119
SECTION 5.04	Existence; Conduct of Business	118	119
SECTION 5.05	Payment of Obligations	118	119
SECTION 5.06	Maintenance of Properties	118	120
SECTION 5.07	Insurance	118	120
SECTION 5.08	Books and Records; Inspection and Audit Rights; Appraisals; Accountants	119	121
SECTION 5.09	Physical Inventories	121	122
SECTION 5.10	Compliance with Laws	121	123
SECTION 5.11	Use of Proceeds and Letters of Credit	121	123
SECTION 5.12	Additional Subsidiaries	121	123
SECTION 5.13	Further Assurances	122	123
SECTION 5.14	Retention of Financial Consultant	122	124
ARTICLE VI Negative Covenants		123	124
SECTION 6.01	Indebtedness and Other Obligations	123	124
SECTION 6.02	Liens	123	124
SECTION 6.03	Fundamental Changes	123	125
SECTION 6.04	Investments, Loans, Advances, Guarantees and Acquisitions	123	125
SECTION 6.05	Asset Sales	124	125
SECTION 6.06	Restricted Payments; Certain Payments of Indebtedness	124	125
SECTION 6.07	Transactions with Affiliates	126	127
SECTION 6.08	Restrictive Agreements	127	129
SECTION 6.09	Amendment of Material Documents	128	129
SECTOIN 6.10	Availability	128	129
SECTION 6.11	Fiscal Year	128	129
SECTION 6.12	Designated Account	128	130
SECTION 6.13	Canadian Defined Benefit Pension Plan	128	130
ARTICLE VII Events of Default		128	130

SECTION 7.01	Events of Default	128	130
SECTION 7.02	Remedies on Default or Master Lease Liquidation Event	132	133
SECTION 7.03	Application of Proceeds	132	134
ARTICLE VIII The Agents		135	136
SECTION 8.01	Appointment an Administration by Administrative Agent	135	136
SECTION 8.02	Appointment of Co-Collateral Agents	135	137
SECTION 8.03	Appointment of Canadian Agent	135	137
SECTION 8.04	Sharing of Excess Payments	137	138
SECTION 8.05	Agreement of Applicable Lenders	137	139
SECTION 8.06	Liability of Agents	137	139
SECTION 8.07	Notice of Default	138	140
SECTION 8.08	Credit Decisions	139	140
SECTION 8.09	Reimbursement and Indemnification	139	141
SECTION 8.10	Rights of Agents	140	141
SECTION 8.11	Notice of Transfer	140	141
SECTION 8.12	Successor Agents	140	142
SECTION 8.13	Relation Among the Lenders	141	142
SECTION 8.14	Reports and Financial Statements	141	142
SECTION 8.15	Agency for Perfection	142	143
SECTION 8.16	[Reserved.]	142	144
SECTION 8.17	Risk Participation	142	144
SECTION 8.18	Collateral Matters	143	144
SECTION 8.19	Co-Syndication Agents, Co-Documentation Agents, Arrangers and Bookrunners	144	146
ARTICLE IX Miscellaneous		144	146
SECTION 9.01	Notices	144	146
SECTION 9.02	Waivers; Amendments	145	146
SECTION 9.03	Expenses; Indemnity; Damage Waiver	148	149
SECTION 9.04	Successors and Assigns	149	151
SECTION 9.05	Survival	152	154
SECTION 9.06	Counterparts; Integration; Effectiveness	153	155
SECTION 9.07	Severability	153	155
SECTION 9.08	Right of Setoff	153	155
SECTION 9.09	Governing Law; Jurisdiction; Consent to Service of Process	154	156
SECTION 9.10	WAIVER OF JURY TRIAL	155	156
SECTION 9.11	Press Releases and Related Matters	155	156
SECTION 9.12	Headings	155	157
SECTION 9.13	Interest Rate Limitation	155	157
SECTION 9.14	Additional Waivers	156	157
SECTION 9.15	Confidentiality	158	160
SECTION 9.16	Patriot Act; Proceeds of Crime Act	159	161
SECTION 9.17	Foreign Asset Control Regulations	159	161
SECTION 9.18	Limitation Of Canadian Loan Parties' Liability	160	161
SECTION 9.19	Judgment Currency	160	162
SECTION 9.20	Language	161	163
SECTION 9.21	Existing Credit Agreement Amended and Restated	161	163
SECTION 9.22	Keepwell	161	163

EXHIBITS

Exhibit A:	Form of Assignment and Acceptance
Exhibit B:	Form of Customs Broker Agreement
Exhibit C-1:	Notice of Borrowing (Domestic Borrowers)
Exhibit C-2:	Notice of Borrowing (Canadian Borrower)
Exhibit D:	Revolving Credit Note to Domestic Lenders
Exhibit D-2:	Domestic Tranche A-1 Note
Exhibit E:	Revolving Credit Note to Canadian Lenders
Exhibit E-2:	Canadian Tranche A-1 Note
Exhibit F:	Swingline Note to Domestic Swingline Lender
Exhibit G:	Swingline Note to Canadian Swingline Lender
Exhibit H:	Form of Joinder
Exhibit I:	Form of Credit Card Notification
Exhibit J:	Form of Compliance Certificate
Exhibit K:	Form of Borrowing Base Certificate
Exhibit L:	Terms of Subordination
Exhibit M:	Closing Agenda
Exhibit N:	Form of Tri-Party Agreement

SCHEDULES

Schedule 1.1:	Lenders and Commitments
Schedule 3.06(a):	Disclosed Matters
Schedule 3.06(b):	Environmental Matters
Schedule 3.12:	Subsidiaries; Joint Ventures
Schedule 5.01(b):	Business Segment Reporting Requirements
Schedule 5.01(i):	Reporting Requirements
Schedule 6.01:	Existing Indebtedness
Schedule 6.01(z):	Existing Joint Venture Guarantees
Schedule 6.02:	Existing Encumbrances
Schedule 6.04:	Existing Investments
Schedule 6.04(g):	Investment Policy
Schedule 6.07:	Transaction with Affiliates

Annex A

THIRD AMENDED AND RESTATED CREDIT AGREEMENT dated as of March 21, 2014 among:

TOYS “R” US-DELAWARE, INC., a corporation organized under the laws of the State of Delaware, with its principal executive offices at One Geoffrey Way, Wayne, New Jersey, for itself and as agent (in such capacity, the “Lead Borrower”) for the other Domestic Borrowers now or hereafter party hereto;

The DOMESTIC BORROWERS;

TOYS “R” US (CANADA) LTD. TOYS “R” US (CANADA) LTEE (the “Canadian Borrower”), a corporation organized under the laws of the Province of Ontario with its principal executive offices at 2777 Langstaff Road, Concord, Ontario L4K 4M5;

The FACILITY GUARANTORS;

BANK OF AMERICA, N.A., a national banking association, having a place of business at 100 Federal Street, Boston, Massachusetts 02110, as administrative agent (in such capacity, together with any replacement thereof pursuant to SECTION 8.12 hereof, the “Administrative Agent”) for its own benefit and the benefit of the other Secured Parties;

BANK OF AMERICA, N.A. (acting through its Canada branch), a banking corporation carrying on business under the Bank Act (Canada), having a place of business at 181 Bay Street, 4^th Floor, Toronto, Ontario, Canada M5J 2V8, as Canadian Administrative Agent (in such capacity, together with any replacement thereof pursuant to SECTION 8.12 hereof, the “Canadian Agent”) for its own benefit and the benefit of the other Secured Parties;

BANK OF AMERICA, N.A., a national banking association, having a place of business at 100 Federal Street, Boston, Massachusetts 02110, and WELLS FARGO BANK, NATIONAL ASSOCIATION, a Delaware limited liability companynational banking association, having a place of business at One Boston Place, 19th Floor, Boston, Massachusetts 02108, as co-collateral agents (collectively, in such capacity, together with any replacement thereof pursuant to SECTION 8.12 hereof, the “Co-Collateral Agents”) for their own benefit and the benefit of the other Secured Parties; and

The LENDERS;

in consideration of the mutual covenants herein contained and benefits to be derived herefrom, the parties hereto agree as follows:

WITNESSETH:

WHEREAS, the Borrowers have entered into a Credit Agreement, dated as of July 21, 2005 (as amended and in effect prior to June 24, 2009, the “Original Credit Agreement”), among such Borrowers, the “Lenders” as defined therein, Bank of America, N.A. as “Administrative Agent”, Bank of America, N.A. (acting through its Canada branch) as “Canadian Agent”, Deutsche Bank Trust Company Americas as “Collateral Agent” and the other agents and parties thereto; and

WHEREAS, the Borrowers previously amended and restated the Original Credit Agreement by entering into an Amended and Restated Credit Agreement, dated as of June 24, 2009 (as amended and in effect prior to August 10, 2010, the “First Restated Credit Agreement”), among such Borrowers, the other

“Loan Parties” as defined therein, Bank of America N.A., as “Administrative Agent”, Bank of America, N.A. (acting through its Canada branch) as “Canadian Agent”, and Bank of America, N.A. and Wells Fargo Bank, National Association (as successor by merger to Wells Fargo Retail Finance, LLC), as “Co-Collateral Agents”, the “Lenders” as defined therein and the other agents and parties thereto; and

WHEREAS, the Borrowers previously amended and restated the First Restated Credit Agreement by entering into a Second Amended and Restated Credit Agreement, dated as of August 10, 2010 (as amended and in effect prior to the Effective Date, the “Existing Credit Agreement”), among such Borrowers, the other “Loan Parties” as defined therein, Bank of America N.A., as “Administrative Agent”, Bank of America, N.A. (acting through its Canada branch) as “Canadian Agent”, and Bank of America, N.A. and Wells Fargo Bank, National Association (as successor by merger to Wells Fargo Retail Finance, LLC), as “Co-Collateral Agents”, the “Lenders” as defined therein and the other agents and parties thereto; and

WHEREAS, in accordance with SECTION 9.02 of the Existing Credit Agreement, the Borrowers, the Lenders, the Agents and the Canadian Agent desire to amend and restate the Existing Credit Agreement as provided herein.

NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in this Agreement, and for good and valuable consideration, the receipt of which is hereby acknowledged, the undersigned hereby agree that the Existing Credit Agreement shall be amended and restated in its entirety to read as follows (it being agreed that this Agreement shall not be deemed to evidence or result in a novation or repayment and reborrowing of the Obligations under the Existing Credit Agreement):

ARTICLE I

Definitions; Interpretive Provisions

SECTION 1.01    Definitions.

As used in this Agreement, the following terms have the meanings specified below:

“2016 Notes” has the meaning assigned to such term in the definition of “Indentures.”

“2017 Notes” has the meaning assigned to such term in the definition of “Indentures.”

“2018 Notes” has the meaning assigned to such term in the definition of “Indentures.”

“ACH” means automated clearing house transfers.

“Accelerated Borrowing Base Delivery Event” means the occurrence of any of the following: (a) the occurrence and continuance of any Specified Default or (b) the failure of the Borrowers for five (5) consecutive days to maintain Excess Availability of at least twelve and one-half percent (12.5%) of the Line Cap(i) $150,000,000 during the period from March 1 through November 30 of each year, or (ii) $200,000,000 during the period from December 1 through the last day of February of each year.

“Access Agreement” means (a) that certain Intercreditor Agreement (Pool A), dated as of July 21, 2005, between the Administrative Agent and Giraffe Properties, LLC (n/k/a Toys “R” Us Property Company II, LLC) and (b) that certain Intercreditor Agreement (Pool B), dated as of July 21, 2005, between the Administrative Agent and MPO Properties, LLC.

2

“Accommodation Payment” has the meaning provided in SECTION 9.14.

“Account(s)” means “accounts” and “payment intangibles” as defined in the UCC, and also means a right to payment of a monetary obligation, whether or not earned by performance, (a) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (b) for services rendered or to be rendered, or (c) arising out of the use of a credit or charge card or information contained on or for use with the card. The term “Account” does not include (a) rights to payment evidenced by chattel paper or an instrument, (b) commercial tort claims, (c) deposit accounts, (d) investment property, (e) letter-of-credit rights or letters of credit, or (f) rights to payment for money or funds advanced other than rights arising out of the use of a credit or charge card or information contained on or for use with the card.

“Acquisition” means, with respect to a specified Person, (a) an Investment in or a purchase of a 50% or greater interest in the Capital Stock of any other Person, (b) a purchase or acquisition of all or substantially all of the assets of any other Person, or (c) any merger or consolidation of such Person with any other Person, in each case in any transaction or group of transactions which are part of a common plan.

“Additional Commitment Lender” shall have the meaning provided in SECTION 2.02.

“Adjusted LIBO Rate” means, with respect to any LIBO Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of one percent) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate, but in no event, in the case of Tranche A-1 Loans, shall the Adjusted LIBO Rate be less than one percent (1.00%) per annum.

“Adjusted Payment Conditions” means, at the time of determination with respect to a specified transaction or payment, that (a) no Specified Default then exists or would arise as a result of the entering into of such transaction or the making of such payment, (b) after giving effect to such transaction or payment, the Pro Forma Availability Condition has been satisfied, and (c) either (i) the Consolidated Fixed Charge Coverage Ratio, as calculated on a trailing twelve months basis after giving effect to such transaction or payment, is greater than 1.1:1.0, or (ii) after giving effect to such transaction or payment, the Pro Forma Availability for each of the six Fiscal Months following, and after giving effect to, such transaction or payment, will be greater than twenty-five percent (25%) of the Line Cap. Prior to undertaking any transaction or payment which is subject to the Adjusted Payment Conditions, the Loan Parties shall deliver to the Administrative Agent evidence of satisfaction of the conditions contained in clauses (b) and (c) above on a basis reasonably satisfactory to the Administrative Agent, providedthat no such evidence shall be required to be delivered if, at the time of such transaction or payment, no Loans are outstanding hereunder.

“Administrative Agent” has the meaning provided in the preamble to this Agreement.

“Advisory Fees” means annual advisory fees, closing fees and transaction fees payable by the Loan Parties pursuant to the Advisory Agreement, but not to exceed the amounts payable thereunder as in effect on the Effective Date.

“Advisory Agreement” means the Advisory Agreement dated as of July 21, 2005 by and among the Parent, Bain Capital Partners, LLC, Bain Capital, Ltd., Toybox Holdings, LLC and Vornado Truck LLC, as amended and in effect from time to time in a manner not prohibited hereunder.

- 3-

“Affiliate” means, with respect to a specified Person, any other Person that directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with the Person specified.

“Agents” means collectively, the Administrative Agent and the Co-Collateral Agents.

“Agreement” means this Amended and Restated Credit Agreement, as modified, amended, supplemented or restated, and in effect from time to time.

“Agreement Value” means for each Hedge Agreement, on any date of determination, an amount determined by the Administrative Agent in its reasonable discretion equal to:

(a)    In the case of a Hedge Agreement documented pursuant to an ISDA Master Agreement, the amount, if any, that would be payable by any Loan Party to its counterparty to such Hedge Agreement, as if (i) such Hedge Agreement was being terminated early on such date of determination, (ii) such Loan Party was the sole “Affected Party” (as therein defined) and (iii) the Administrative Agent was the sole party determining such payment amount (with the Administrative Agent making such determination pursuant to the provisions of the form of ISDA Master Agreement);

(b)    In the case of a Hedge Agreement traded on an exchange, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss on such Hedge Agreement to the Loan Party which is party to such Hedge Agreement, determined by the Administrative Agent based on the settlement price of such Hedge Agreement on such date of determination; or

(c)    In all other cases, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss on such Hedge Agreement to the Loan Party that is party to such Hedge Agreement determined by the Administrative Agent as the amount, if any, by which (i) the present value of the future cash flows to be paid by such Loan Party exceeds (ii) the present value of the future cash flows to be received by such Loan Party, in each case pursuant to such Hedge Agreement.

“Applicable Law” means, as to any Person: (a) all laws, statutes, rules, regulations, orders, codes, ordinances or other requirements having the force of law; and (b) all court orders, decrees, judgments, injunctions, notices, binding agreements and/or rulings, in each case of or by any Governmental Authority which has jurisdiction over such Person, or any property of such Person.

“Applicable Lenders” means the Required Lenders, the Supermajority Lenders, or all Lenders, as applicable.

“Applicable Margin” means:

(a)    From and after the Effective Date until August 2, 2014, the percentages set forth in Level II of the pricing grid below; and

(b)    On the first day of each Fiscal Quarter thereafter (each, an “Adjustment Date”), the Applicable Margin shall be determined from the pricing grid below based upon Average Daily Excess Availability for the Fiscal Quarter ended immediately preceding such Adjustment Date, provided that if any Borrowing Base Certificates are at any time restated or otherwise revised (including as a result of an audit) or if the information set forth in any Borrowing Base Certificates

- 4-

otherwise proves to be false or incorrect such that the Applicable Margin would have been higher than was otherwise in effect during any period, without constituting a waiver of any Default or Event of Default arising as a result thereof, interest due under this Agreement shall be immediately recalculated at such higher rate for any applicable periods and shall be due and payable on demand.

Level	Average Daily Excess Availability	Tranche A LIBO Loans to the Domestic Borrowers Applicable Margin	Tranche A Prime Rate and Tranche A Canadian Prime Rate Applicable Margin	Tranche A BA Equivalent Loans	Tranche A LIBO Loans to the Canadian Borrower made in Dollars
I	Equal to or greater than fifty percent (50%) of the Line Cap	1.50%	0.50%	1.50%	1.50%
II	Less than fifty percent (50%) of the Line Cap	1.75%	0.75%	1.75%	1.75%

“Appraised Value” means the Average Seasonal Net Appraised Recovery Value of the Borrowers’ Inventory as set forth in the Borrowers’ stock ledger (expressed as a percentage of the Cost of such Inventory) as determined from time to time by reference to the most recent appraisal received by the Agents conducted by an independent appraiser reasonably satisfactory to the Agents. Initially, the Appraised Value shall be separately established for TRU Inventory and BRU Inventory; in the event that the Lead Borrower and the Agents so agree, the Appraised Value may be determined through a combined appraisal of the TRU Inventory and BRU Inventory.

“Approved Fund” means any Fund that is administered or managed by (a) a Credit Party, (b) an Affiliate of a Credit Party (c) an entity or an Affiliate of an entity that administers or manages a Credit Party, or (d) the same investment advisor or an advisor under common control with such Credit Party or advisor, as applicable.

“Arrangers” means, collectively, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Bank, National Association and JPMorgan Securities, LLC.

“Assignment and Acceptance” means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by SECTION 9.04), and accepted by the Administrative Agent, in the form of Exhibit A, or any other form approved by the Administrative Agent.

“Availability Reserves” means, without duplication of any other Reserves or items that are otherwise addressed or excluded through eligibility criteria, such reserves as any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) from time to time determines in its reasonable commercial discretion exercised in good faith as being appropriate (a) to reflect any impediments to the realization upon the Collateral included in the Tranche A Borrowing Base, Incremental Availability or Canadian Borrowing Base, (b) to reflect claims and liabilities that any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) determines will need to be satisfied in connection with the realization upon such Collateral, or(c) to reflect criteria, events, conditions, contingencies or risks which adversely affect any component of the Tranche A Borrowing Base, the Canadian Borrowing Base or the Collateral or the validity or enforceability of this Agreement or the other Loan Documents or any of the material rights or

- 5-

remedies of the Secured Parties hereunder or thereunder, or (d) to reflect the outstanding amount of Bank Products and Cash Management Reserves, provided that no Availability Reserve shall be established pursuant to this clause (d) until Excess Availability is less than or equal to fifteen percent (15%) of the Line Cap. Upon the determination by any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) that an Availability Reserve should be established or modified, the Co-Collateral Agents shall notify the Administrative Agent in writing and the Administrative Agent shall thereupon establish or modify such Availability Reserve, subject to the other provisions of this Agreement. In the event that the Co-Collateral Agents do not agree on the establishment or amount of Reserves to be imposed, the Administrative Agent shall nevertheless undertake such action with respect thereto as any Co-Collateral Agent may request (subject to the other provisions of this Agreement); provided that the amount of Reserves established or increased by any Co-Collateral Agent in the event of any such disagreement may not exceed $35,000,000 in the aggregate at any time outstanding for all such disagreements; and further provided that the Administrative Agent may not, without the prior consent of such Co-Collateral Agent, reduce or eliminate any such Reserves established under this sentence; and further provided that if the Co-Collateral Agents subsequently agree on the establishment or amount of Reserves to be imposed after their initial disagreement, the Reserves so established upon such agreement shall not be subject to the first proviso hereof and shall not be included in calculating the amount of Reserves permitted under such first proviso.

“Average Daily Excess Availability” means, as of any date of determination, the average daily Excesss Availability for the immediately preceding Fiscal Quarter most recently ended.

“Average Seasonal Net Appraised Recovery Value” means the average monthly net appraised recovery value (expressed as a percentage of Cost) of the Borrowers’ Inventory during the High Selling Period or the Low Selling Period, as applicable.

“BA Equivalent Loan” shall mean any Loan in CD$ bearing interest at a rate determined by reference to the BA Rate in accordance with the provisions of Article II.

“BA Equivalent Loan Borrowing” shall mean any Borrowing comprised of BA Equivalent Loans.

“BA Rate” means, for the Interest Period of each BA Equivalent Loan, the rate of interest per annum equal to the annual rates applicable to CD$ Bankers’ Acceptances having an identical or comparable term as the proposed BA Equivalent Loan displayed and identified as such on the display referred to as the "CDOR Page" (or any display substituted therefor) of Reuter Monitor Money Rates Service as at approximately 10:00 A.M. on such day (or, if such day is not a Business Day, as of 10:00 A.M. on the immediately preceding Business Day), plus five (5) basis points; providedthat if such rates do not appear on the CDOR Page at such time on such date, the rate for such date will be the annual discount rate (rounded upward to the nearest whole multiple of 1/100 of 1%) as of 10:00 A.M. on such day at which a Canadian chartered bank listed on Schedule 1 of the Bank Act (Canada) as selected by the Canadian Agent is then offering to purchase CD$ Bankers’ Acceptances accepted by it having such specified term (or a term as closely as possible comparable to such specified term), plus five (5) basis points.

“Bank of America” means Bank of America, N.A., a national banking association, and its Subsidiaries, Affiliates and branches.

“Bank of America-Canada Branch” means Bank of America, N.A. (acting through its Canada branch).

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“Bank of Canada Overnight Rate” means, on any date of determination, the rate of interest charged by the Bank of Canada on one-day Canadian dollar loans to financial institutions, for such date.

“Bank Products” means any services or facilities provided to any Loan Party by any Lender or any of its Affiliates on account of (i) each Hedge Agreement that (a) is in effect on the Effective Date with a counterparty that is a Credit Party as of the Effective Date or (b) is entered into after the Effective Date with any counterparty that is a Credit Party at the time such Hedge Agreement is entered into, or (ii) supply chain financing services, including, without limitation, trade payable services and supplier accounts receivable purchases and factoring.

“Bankruptcy Code” means each of (i) Title 11, U.S.C., as now or hereafter in effect, or any successor thereto, and (ii) the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada) and the Winding-up and Restructuring Act (Canada), as now or hereafter in effect, or any successor thereto.

“Blocked Account” has the meaning provided in SECTION 2.18(c).

“Blocked Account Agreement” has the meaning provided in SECTION 2.18(c).

“Blocked Account Banks” means the banks with whom deposit accounts are maintained in which material amounts (as reasonably determined by the Co-Collateral Agents) of funds of any of the Loan Parties from one or more DDAs are concentrated and with whom a Blocked Account Agreement has been, or is required to be, executed in accordance with the terms hereof.

“Board” means the Board of Governors of the Federal Reserve System of the United States of America.

“Bookrunners” means, collectively, MLPFS, Wells Fargo Bank, National Association, JPMorgan Securities, LLC, Citigroup Global Markets, Inc., Deutsche Bank Securities Inc., and Goldman Sachs Bank USA, in their capacities as bookrunners hereunder.

“Borrower” means the Lead Borrower, each other Domestic Borrower and the Canadian Borrower; “Borrowers” shall mean, collectively, the Domestic Borrowers and the Canadian Borrower.

“Borrowing” means (a) the incurrence of Revolving Credit Loans or Tranche A-1 Loans of a single Type, on a single date and having, in the case of LIBO Loans and BA Equivalent Loans, a single Interest Period, or (b) a Swingline Loan.

“Borrowing Base Certificate” has the meaning provided in SECTION 5.01(f).

“Borrowing Request” means a request by the Lead Borrower on behalf of any of the Domestic Borrowers or by the Canadian Borrower for a Borrowing in accordance with SECTION 2.04.

“Breakage Costs” has the meaning provided in SECTION 2.16(b).

“BRU Inventory” means all Inventory of the Loan Parties which is offered for sale (or is designated for sale) at any “Babies “R” Us” Store, including, but not limited to, any such Inventory held for sale in internet and other direct sales, and all Inventory of the Loan Parties specifically designated as “Babies “R” Us” Inventory at any distribution center or warehouse maintained by the Loan Parties.

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“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in Boston, Massachusetts are authorized or required by law to remain closed; provided, however, that when used in connection with a LIBO Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market; providedfurther that, when used in connection with any Loan to the Canadian Borrower, the term “Business Day” shall also exclude any day on which banks are authorized or required by law to be closed in Toronto, Ontario, Canada.

“Canadian Agent” has the meaning set forth in the preamble hereto.

“Canadian Availability” means, at any time of calculation, the lesser of (a) or (b), where:

(a)    is the result of:

(i)    the Canadian Credit Ceiling,

Minus

(ii)    The Total Canadian Revolver Outstandings,

(b)    is the result of:

(i)    The Canadian Borrowing Base,

Minus

(ii)    The Total Canadian Revolver Outstandings.

In calculating Canadian Availability at any time and for any purpose under this Agreement, any amount calculated or referenced in dollars shall also refer to the eEquivalent aAmount in CDN$.

“Canadian Borrower” means Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee, a corporation organized under the laws of the Province of Ontario.

“Canadian Borrowing Base” means, at any time of calculation, an amount equal to the Equivalent Amount in dollars of:

(a)    the face amount of Eligible Credit Card Receivables of the Canadian Loan Parties multiplied by ninety percent (90%);

plus

(b)    the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of TRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for TRU Inventory, multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of TRU Inventory;

plus

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(c)    (i) prior to the time that more than ten (10) “Babies “R” Us” Stores are operating in Canada and the BRU Inventory in Canada has been separately appraised, the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of BRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for TRU Inventory multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of TRU Inventory; and (ii) after more than ten (10) “Babies “R” Us” Stores are operating in Canada and the BRU Inventory in Canada has been separately appraised, the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of BRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for BRU Inventory, multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of BRU Inventory;

plus

(d)    the Cost of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of TRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for TRU Inventory, multiplied by the Appraised Value of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of TRU Inventory; providedthat in no event shall the amounts available to be borrowed pursuant to this clause (d), together with amounts available to be advanced under clause (e) of this definition and clauses (d) and (e) of the definition of “Tranche A Borrowing Base”, exceed 12.5% of the Combined Borrowing Base in the aggregate;

plus

(e)    (i) prior to the time that more than ten (10) “Babies “R” Us” Stores are operating in Canada and the BRU Inventory in Canada has been separately appraised, the Cost of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of BRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for TRU Inventory multiplied by the Appraised Value of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of TRU Inventory; and (ii) after more than ten (10) “Babies “R” Us” Stores are operating in Canada and the BRU Inventory in Canada has been separately appraised, the Cost of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of BRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for BRU Inventory, multiplied by the Appraised Value of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of BRU Inventory; providedthat in no event shall the amounts available to be borrowed pursuant to this clause (e), together with amounts available to be advanced under clause (d) of this definition and clauses (d) and (e) of the definition of “Tranche A Borrowing Base”, exceed 12.5% of the Combined Borrowing Base;

plus

(f)    the lesser of (i) the FMV of Eligible Real Estate of the Canadian Loan Parties, less the Canadian Realty Reserves, multiplied by fifty percent (50%), or (ii) ten percent (10%) of the Combined Borrowing Base (which Combined Borrowing Base shall be calculated without giving effect to this clause (ii));

minus

- 9-

(g)    the then amount of all Availability Reserves and, as long as Eligible Real Estate is included in the Canadian Borrowing Base, Canadian Sales Reserves.

“Canadian Commitment” shall mean, with respect to each Canadian Lender, the commitment of such Canadian Lender hereunder to make Revolving Credit ExtensionsLoans to the Canadian Borrower and to participate in Letters of Credit and Swingline Loans to the Canadian Borrower in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased from time to time pursuant to SECTION 2.02 or reduced from time to time pursuant to SECTION 2.15 and SECTION 2.17.

“Canadian Commitment Percentage” shall mean, with respect to each Canadian Lender, that percentage of the Canadian Commitments of all Canadian Lenders hereunder to make Revolving Credit ExtensionsLoans to the Canadian Borrower and to participate in Letters of Credit and Swingline Loans to the Canadian Borrower in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased from time to time pursuant to SECTION 2.02 or reduced from time to time pursuant to SECTION 2.15 and SECTION 2.17.

“Canadian Concentration Account” has the meaning provided in SECTION 2.18(d).

“Canadian Credit Ceiling” means, initially, $200,000,000, as such amount may be increased from time to time pursuant to SECTION 2.02 or decreased from time to time pursuant to SECTION 2.15 and SECTION 2.17.

“Canadian Defined Benefit Pension Plan” means a pension plan for the purposes of any applicable pension benefits standards statute or regulation in Canada, which contains a “defined benefit provision,” as defined in subsection 147.1(1) of the Income Tax Act (Canada) other than a multi-employer pension plan in respect of which the obligations of the Loan Party are limited to a fixed amount set out in a collective agreement.

“CanadianExcessIncrementalAvailability” means(a), at any time of calculation, an amount equal to the Equivalent Amount in dollars of the lesser of (i) the Canadian Commitments or (ii) the Canadian$125,000,000 and the sum of theBforrllowingBase minus (b) the Total Canadian Outstandings.:

(a)the face amount of Eligible Credit Card Receivables of the Canadian Loan Parties multiplied by ten percent (10%);

plus

(b)the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of TRU Inventory, net of Inventory Reserves, multiplied by ten percent (10%), multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of TRU Inventory;

plus

(c)(i) prior to the time that more than ten (10) “Babies “R” Us” Stores are operating in Canada and the BRU Inventory in Canada has been separately appraised, the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of BRU

- 10-

Inventory, net of Inventory Reserves, multiplied by ten percent (10%) multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of TRU Inventory; and (ii) after more than ten (10) “Babies “R” Us” Stores are operating in Canada and the BRU Inventory in Canada has been separately appraised, the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of BRU Inventory, net of Inventory Reserves, multiplied by the percent (10%), multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Canadian Loan Parties consisting of BRU Inventory;

plus

(d)the Cost of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of TRU Inventory, net of Inventory Reserves, multiplied by ten percent (10%), multiplied by the Appraised Value of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of TRU Inventory;

plus

(e)(i) prior to the time that more than ten (10) “Babies “R” Us” Stores are operating in Canada and the BRU Inventory in Canada has been separately appraised, the Cost of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of BRU Inventory, net of Inventory Reserves, multiplied by ten percent (10%) multiplied by the Appraised Value of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of TRU Inventory; and (ii) after more than ten (10) “Babies “R” Us” Stores are operating in Canada and the BRU Inventory in Canada has been separately appraised, the Cost of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of BRU Inventory, net of Inventory Reserves, multiplied by ten percent (10%), multiplied by the Appraised Value of Eligible In-Transit Inventory of the Canadian Loan Parties consisting of BRU Inventory;

plus

(f)the FMV of Eligible Real Estate of the Canadian Loan Parties, less the Canadian Realty Reserves, multiplied by fifteen percent (15%);

plus

(g) sixty-four percent (64%) of the Required Availability Amount

“Canadian Lenders” means the Lenders having Canadian Commitments or holding Canadian Tranche A-1 Loans from time to time or at any time. Any Person may be a Canadian Lender only if (i) it is a financial institution that is listed on Schedule I, II or III of the Bank Act (Canada) or is not a foreign bank for purposes of the Bank Act (Canada), and if such financial institution is not resident in Canada and is not deemed to be resident in Canada for purposes of the Income Tax Act (Canada), then such financial institution deals at arm’s length with each Canadian Loan Party for purposes of the Income Tax Act (Canada), and (ii) it or any of its Affiliates also has Domestic Commitments in an amount at least equal to its Canadian Commitment.

“Canadian Letter of Credit” shall mean a Letter of Credit that is issued pursuant to this Agreement for the account of the Canadian Borrower.

“Canadian Letter of Credit Outstandings” shall mean, at any time, the sum of (a) with respect to Canadian Letters of Credit outstanding at such time, the aggregate maximum amount that then is, or at any

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time thereafter may become, available for drawing or payment thereunder plus, without duplication, (b) all amounts theretofore drawn or paid under Canadian Letters of Credit for which the applicable Issuing Bank has not then been reimbursed.

“Canadian Letter of Credit Sublimit” means $30,000,000.

“Canadian Liabilities” means (a) (i) the principal of, and interest on, the Loans made hereunder to, or for the benefit of, the Canadian Borrower or any of its Subsidiaries, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise (including all interest that accrues after the commencement of any case or proceeding by or against the Canadian Borrower or any of its Subsidiaries under the Bankruptcy Code, whether or not allowed in such case or proceeding), (ii) other amounts owing by the Canadian Borrower or any of its Subsidiaries under this Agreement and the other Loan Documents in respect of any Canadian Letter of Credit, when and as due, including payments in respect of reimbursement of disbursements, interest thereon and obligations to provide cash collateral, and (iii) all other monetary obligations, including fees, costs, expenses and indemnities (including all fees, costs, expenses and indemnities that accrue after the commencement of any case or proceeding by or against the Canadian Borrower or any of its Subsidiaries under the Bankruptcy Code, whether or not allowed in such case or proceeding), whether primary, secondary, direct, contingent, fixed or otherwise, of the Canadian Borrower or any of its Subsidiaries to any of the Secured Parties under this Agreement and the other Loan Documents, (b) the due and punctual payment and performance of all covenants, agreements, obligations and liabilities of the Canadian Borrower or any of its Subsidiaries under or pursuant to this Agreement or the other Loan Documents, and (c) any Cash Management Services or Bank Products entered into or furnished to the Canadian Borrower or any of its Subsidiaries.

“Canadian Loan to Value” means the difference between (i) the Total Canadian Outstandings and (ii) the sum of (A) the Canadian Borrowing Base (without giving effect to clause (f) thereof) plus the amounts calculated under clauses (a) through and including (e) of the definition of Canadian Incremental Availability plus (B) 100% of the FMV of Eligible Real Estate of the Canadian Loan Parties, less the Canadian Realty Reserves.

“Canadian Loan Party” means the Canadian Borrower and each Canadian Subsidiary which becomes a Loan Party pursuant to the terms of SECTION 5.12.

“Canadian Loans” means, collectively, the Loans made by the Canadian Lenders pursuant to ARTICLE II.

“Canadian Overadvance” means a Credit Extension to the Canadian Borrower to the extent that, immediately after the making of such Credit Extension, Canadian Availability is less than zero.

“Canadian Pledge” means the pledge of 65% of the voting Capital Stock and 100% of the non-voting Capital Stock of the Canadian Borrower and related stock certificates, dividends, distributions, rights and proceeds of the foregoing pursuant to the Security Agreement.

“Canadian Prime Rate” means, for any day, the highest of: (a) the rate of interest publicly announced from time to time by Bank of America-Canada Branch as its reference rate of interest for loans made either (i) in CD$ to Canadian customers and designated as its “prime” rate, or (ii) in dollars to Canadian customers and designated as its “base rate”; (b) in respect of CD$, the higher of (i) the Bank of Canada Overnight Rate, plus one-half of one percent (0.50%) per annum, or (ii) the BA Rate (calculated utilizing a one-month Interest Period) plus one percent (1.00%) per annum; or (c) the Adjusted LIBO Rate (calculated utilizing

- 12-

the LIBO Rate for a one-month Interest Period) plus one percent (1.00%) per annum. The “prime” rate or “base rate”, as applicable, is a rate set by Bank of America-Canada Branch based upon various factors, including Bank of America-Canada Branch’s costs and desired return, general economic conditions and other factors and is used as a reference point for pricing some loans. If for any reason the Canadian Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the LIBO Rate for any reason, including the inability or failure of the Canadian Agent to obtain sufficient quotations thereof in accordance with the terms hereof, the Canadian Prime Rate shall be determined without regard to clause (a)(i) of the definition of Adjusted LIBO Rate until the circumstances giving rise to such inability no longer exist. Any change in the Canadian Prime Rate due to a change in Bank of America-Canada Branch’s “prime” rate or “base rate”, as applicable, or the BA Rate or the Adjusted LIBO Rate shall be effective on the effective date of such change in Bank of America-Canada Branch’s “prime” rate or “base rate”, as applicable, or the BA Rate or the Adjusted LIBO Rate, respectively.

“Canadian Realty Reserves” means, without duplication of any other Reserves, such reserves as any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) from time to time determines in its reasonable commercial discretion exercised in good faith as being appropriate to reflect any impediments to the realization upon any Collateral consisting of Eligible Real Estate of the Canadian Loan Parties (including, without limitation, claims that any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) determines will need to be satisfied in connection with the realization upon such Eligible Real Estate and any Environmental Compliance Reserve with respect to such Eligible Real Estate). Canadian Realty Reserves shall include, without limitation, a reserve in an amount equal to ten percent (10%) of the FMV of any Eligible Real Estate of the Canadian Borrower which is subject to a right of first refusal or similar right to which the Mortgage in favor of the Canadian Agent is subject.

“Canadian Sales Reserve” means a Reserve in an amount equal to 10% of the FMV of each parcel of Eligible Real Estate sold by the Canadian Loan Parties not constituting Excess Canadian Real Estate; providedthat the maximum aggregate Canadian Sales Reserve shall not exceed $10,000,000.

“Canadian Security Documents” means the General Security Agreement, Mortgages, and the deed of hypothec charging the universality of moveable property, in each case granted by the Canadian Borrower and each other Canadian Loan Party in favor of the Canadian Agent.

“Canadian Subsidiary” means any Subsidiary of the Canadian Borrower organized under the laws of Canada or any province thereof.

“Canadian Swingline Loan Ceiling” means $20,000,000, as such amount may be increased or reduced in accordance with the provisions of this Agreement.

“Canadian Tranche A-1 Lender” means each Person who makes a Tranche A-1 Loan to the Canadian Borrower in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time.

“Canadian Tranche A-1 Loans” means all Tranche A-1 Loans made to the Canadian Borrower pursuant to this Agreement. As of the First Amendment Effective Date, the aggregate of all Canadian Tranche A-1 Loans totals $125,000,000.

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“Canadian Tranche A-1 Notes” means the promissory notes of the Canadian Borrower substantially in the form of Exhibit E-2, payable to the order of a Canadian Lender, evidencing the Tranche A-1 Loans made to the Canadian Borrower.

“Canadian Total Commitment Increase Amount” means, as of any proposed Commitment Increase Date, $150,000,000 minus the aggregate amount of Commitment Increases of the Canadian Commitments from and after the Effective Date to and including such Commitment Increase Date; provided that in no event shall the sum of the Total Commitments plus all outstanding Tranche A-1 Loans exceed $3,000,000,000 at any time.

“Canadian Total Commitments” means the aggregate of the Canadian Commitments of all Canadian Lenders. On the Effective Date, the Canadian Total Commitments are $200,000,000.

“Canadian Unused Fee” has the meaning provided in SECTION 2.19(c).

“Capital Expenditures” means, with respect to the Loan Parties for any period, the additions to property, plant and equipment and other capital expenditures of the Loan Parties that are (or would be) set forth in a Consolidated statement of cash flows of the Loan Parties for such period prepared in accordance with GAAP; providedthat “Capital Expenditures” shall not include (i) any additions to property, plant and equipment and other capital expenditures made with (A) the proceeds of any equity securities issued or capital contributions received, or Indebtedness borrowed (excluding borrowings under this Agreement, the Term Loan, or the Permanent Financing Facility) by any Loan Party or any Subsidiary in connection with such capital expenditures, (B) the proceeds from any casualty insurance or condemnation or eminent domain, to the extent that the proceeds therefrom are utilized for capital expenditures within twelve months of the receipt of such proceeds, (C) the proceeds from any sale or other disposition of any Loan Party’s assets (other than assets constituting Collateral consisting of Inventory, Accounts, and Eligible Real Estate and the proceeds thereof), to the extent that the proceeds therefrom are utilized for capital expenditures within twelve months of the receipt of such proceeds, (ii) any portion of the purchase price of a Permitted Acquisition which is allocated to property, plant or equipment acquired as part of such Permitted Acquisition, or (iii) any expenditures which are contractually required to be, and are, reimbursed to the Loan Parties in cash by a third party (including landlords) during such period of calculation.

“Capital Lease Obligations” means, with respect to any Person for any period, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP; for purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP consistently applied with the principles existing on the Effective Date.

“Capital Stock” means, as to any Person that is a corporation, the authorized shares of such Person’s capital stock, including all classes of common, preferred, voting and nonvoting capital stock, and, as to any Person that is not a corporation or an individual, the membership or other ownership interests in such Person, including, without limitation, the right to share in profits and losses, the right to receive distributions of cash and other property, and the right to receive allocations of items of income, gain, loss, deduction and credit and similar items from such Person, whether or not such interests include voting or similar rights entitling the holder thereof to exercise Control over such Person, collectively with, in any such case, all warrants, options and other rights to purchase or otherwise acquire, and all other instruments convertible into or exchangeable for, any of the foregoing.

- 14-

“Cash Collateral Account” means an interest bearing account established by the Loan Parties (other than the Canadian Borrower and its Subsidiaries) with the Administrative Agent, for its own benefit and the benefit of the other Secured Parties, at Bank of America under the sole and exclusive dominion and control of the Administrative Agent, in the name of the Administrative Agent or as the Administrative Agent shall otherwise direct, in which deposits are required to be made in accordance with this Agreement, and, in the case of the Canadian Borrower and its Subsidiaries, an interest bearing account established by the Canadian Borrower and its Subsidiaries with the Canadian Agent, for its own benefit and the benefit of the other Secured Parties, at Bank of America-Canada Branch under the sole and exclusive dominion and control of the Canadian Agent, in the name of the Canadian Agent or as the Canadian Agent shall otherwise direct, in which deposits are required to be made in accordance with this Agreement.

“Cash Collateralize” has the meaning provided in SECTION 2.13(j).

“Cash Dominion Event” means the occurrence of any of the following: (a) the occurrence and continuance of any Specified Default; (b) the failure of the Borrowers to maintain Excess Availability for any three (3) days (whether or not consecutive) during any thirty (30) day period of at least $150,000,000; or (c) the failure of the Borrowers to maintain Excess Availability at any time of at least $130,000,000. For purposes of this Agreement, the occurrence of a Cash Dominion Event shall be deemed continuing (A) so long as such Specified Default has not been cured or waived, (B) if the Cash Dominion Event arises as a result of the Borrowers’ failure to maintain Excess Availability as required pursuant to clause (b) hereunder, until Excess Availability has exceeded $150,000,000 for thirty (30) consecutive days, or (C) if the Cash Dominion Event arises as a result of the Borrowers’ failure to maintain Excess Availability as required pursuant to clause (c) hereunder, until Excess Availability has exceeded the $130,000,000 for thirty (30) consecutive days; providedthat a Cash Dominion Event may not be so cured on more than two (2) occasions in any period of 365 consecutive days.

“Cash Management Reserves” means such reserves as any Co-Collateral Agent (after consultation with the other Co-Collateral Agent), from time to timeafter the occurrence and during the continuation of a Cash Dominion Event, determines in its reasonable commercial discretion exercised in good faith as being appropriate to reflect the reasonably anticipated liabilities and obligations of the Loan Parties with respect to Cash Management Services then provided or outstanding.

“Cash Management Services” means any one or more of the following types of services or facilities provided to any Loan Party by any Lender or any of its Affiliates: (a) ACH transactions; (b) cash management services, including, without limitation, controlled disbursement services, treasury, depository, overdraft and electronic funds transfer services; (c) foreign exchange facilities; (d) credit card processing services; (e) purchase cards; and (f) credit or debit cards.

“Cash Receipts” has the meaning provided in SECTION 2.18(d).

“CD$” means Canadian dollars.

“CERCLA” means the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601 et seq.

“Change in Control” means, at any time:

(a)    occupation of a majority of the seats (other than vacant seats) on the board of directors (or other body exercising similar management authority) of the Parent by Persons who were neither

- 15-

(i) nominated by the board of directors of the Parent (or prior to the consummation of a Qualifying IPO, the Sponsor) nor (ii) appointed by directors so nominated; or

(b)    after the consummation of a Qualifying IPO, any person or “group” (within the meaning of the Securities and Exchange Act of 1934, as amended), other than any one or more of the Sponsor Group, is or becomes the beneficial owner (within the meaning of Rule 13d-3 or 13d-5 of the Securities and Exchange Act of 1934, as amended, except that such person shall be deemed to have “beneficial ownership” of all Capital Stock that such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of (i) twenty-five percent (25%) or more (on a fully diluted basis) of the total then outstanding Capital Stock of the Parent entitled to vote for the election of directors of the Parent, and (ii) Capital Stock of the Parent entitled to vote for the election of directors of the Parent in an amount greater than the number of shares of such Capital Stock beneficially owned by the Sponsor Group (or over which the Sponsor Group has voting control); or

(c)    prior to the consummation of a Qualifying IPO, a change in the Control of the Parent such that the Loan Parties are not Controlled by any one or more of the Sponsor Group; or

(d)    the Parent fails at any time to own, directly or indirectly, 100% of the Capital Stock of each Loan Party free and clear of all Liens (other than those Liens specified in clauses (a), (e), (i) and (l) of the definition of Permitted Encumbrances), except where such failure is as a result of a transaction permitted by the Loan Documents.

“Change in Law” means (a) the adoption or taking effect of any law, rule, regulation or treaty after the Effective Date, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority after the Effective Date, or (c) compliance by any Credit Party (or, for purposes of SECTION 2.14, by any lending office of such Credit Party or by such Credit Party’s holding company, if any) with any request, rule, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the Effective Date; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“Charges” has the meaning provided in SECTION 9.13.

“Charter Document” means as to any Person, its partnership agreement, certificate of incorporation, operating agreement, membership agreement or similar constitutive document or agreement or its by-laws.

“Class” (a) when used with respect to commitments, refers to whether such commitment is a Commitment or an Extended Commitment of a given Extension Series or a New Extended Commitment, (b) when used with respect to Loans or a Borrowing, refers to whether such Loans, or the Loans comprising such Borrowing, are Revolving Credit Loans, Loans under Extended Commitments of a given Extension Series or Loans under New Extended Commitments, and (c) when used with respect to Lenders, refers to whether such Lenders have a Loan or commitment with respect to a particular Class of Loans or commitments.

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“Closing Date” means July 21, 2005.

“CMBS Facilities” mean the mortgage, mezzanine, high yield or similar financing arrangements of certain Special Purpose Entities that are direct or indirect subsidiaries of the Lead Borrower in an aggregate principal amount of up to $800,000,000, and any refinancing, extension or replacement thereof.

“Co-Collateral Agents” has the meaning provided in the preamble to this Agreement.

“Co-Documentation Agents” means, collectively, Citigroup Global Markets, Inc., Deutsche Bank Securities Inc., Goldman Sachs Bank USA, and Bank of Montreal, in their capacities as co-documentation agents hereunder.

“Co-Syndication Agents” means, collectively, Wells Fargo Bank, National Association and JPMorgan Chase Bank, N.A., in their capacities as co-syndication agents hereunder.

“Code” means the Internal Revenue Code of 1986 and the United States Treasury regulations promulgated thereunder, as amended from time to time.

“Collateral” means any and all “Collateral” or words of similar intent as defined in any applicable Security Document; providedthat (a) any assets of the Canadian Borrower and its Subsidiaries shall secure only the Canadian Liabilities, and (b) any Lien on intellectual property rights shall be limited to a non-exclusive right to use such assets in connection with a Liquidation.

“Combined Availability” means (a) the sum of the Line Cap plus Canadian Incremental Availability plus Domestic Incremental Availability minus (b) Total Outstandings.

“Combined Borrowing Base” means the sum of (a) the Tranche A Borrowing Base plus (b) the Canadian Borrowing Base.

“Commercial Letter of Credit” means any Letter of Credit issued for the purpose of providing the primary payment mechanism in connection with the purchase of any materials, goods or services by a Borrower in the ordinary course of business of such Borrower.

“Commitment” means, with respect to each Lender, the aggregate commitment(s) of such Lender hereunder in the amount set forth opposite its name on Schedule 1.1 hereto (being the aggregate of the Domestic Commitments and the Canadian Commitments of such Lender) or as may subsequently be set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement.

“Commitment Increase” shall have the meaning provided in SECTION 2.02(a).

“Commitment Increase Date” shall have the meaning provided in SECTION 2.02(c).

“Commitment Percentage” means, with respect to each Lender, that percentage of the Commitments of all Lenders hereunder, in the amount set forth opposite such Lender’s name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement.

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.).

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“Compliance Certificate” has the meaning provided in SECTION 5.01(d).

“Consolidated” means, when used to modify a financial term, test, statement, or report of a Person, the application or preparation of such term, test, statement or report (as applicable) based upon the consolidation, in accordance with GAAP, of the financial condition or operating results of such Person and its Subsidiaries.

“Consolidated Current Assets” means, at any date, all amounts (other than cash and cash equivalents) that would, in conformity with GAAP, be set forth opposite the caption “total current assets” (or any like caption) on a consolidated balance sheet of the Lead Borrower and its Subsidiaries (but not including Propco) at such date. For the avoidance of doubt, any assets related to income taxes shall be excluded from calculation of Consolidated Current Assets.

“Consolidated Current Liabilities” means, at any date, all amounts that would, in conformity with GAAP, be set forth opposite the caption “total current liabilities” (or any like caption) on a consolidated balance sheet of Lead Borrower and its Subsidiaries (but not Propco) at such date, but excluding the current portion of any Funded Debt of Borrower and its Subsidiaries (but not including Propco). For the avoidance of doubt, any liabilities related to income taxes and short term borrowings shall be excluded from the calculation of Consolidated Current Liabilities.

“Consolidated EBITDA” means, with respect to any Person for any period, the sum (without duplication) of (a) Consolidated Net Income for such period, plus, in each case to the extent deducted in determining Consolidated Net Income for such period, (b) depreciation, amortization, and all other non-cash charges (other than non-cash charges for which a cash payment will be required to be made in that period), (c) provisions for Taxes based on income, (d) Consolidated Interest Expense, (e) Advisory Fees, and (f) unusual, non-recurring or extraordinary expenses, losses or charges as reasonably approved by the Administrative Agent; provided, however, that, upon the termination of the Canadian Commitments in accordance with the terms of this Agreement, the results of the Canadian Borrower and any Canadian Subsidiaries shall be excluded from the calculation of Consolidated EBITDA.

“Consolidated Fixed Charge Coverage Ratio” means, with respect to any Person for any period, the ratio of (a) (i) Consolidated EBITDA for such period minus (ii) Capital Expenditures during such period, to (b) the sum of (i) Debt Service Charges payable in cash during such period plus (ii) federal, state and foreign income Taxes paid in cash (net of refunds received) during such period, all as determined on a Consolidated basis in accordance with GAAP; provided, however, that, upon the termination of the Canadian Commitments in accordance with the terms of this Agreement, the results of the Canadian Borrower and any Canadian Subsidiaries shall be excluded from the calculation of the Consolidated Fixed Charge Coverage Ratio. For purposes of determining the Consolidated Fixed Charge Coverage Ratio, GAAP shall be consistently applied with the principles existing on the Effective Date.

“Consolidated Interest Coverage Ratio” means, with respect to any Person for any period, the ratio of Consolidated EBITDA of such Person for such period to the Consolidated Interest Expense of such Person for such period. For purposes of determining the Consolidated Interest Coverage Ratio, GAAP shall be consistently applied with the principles existing on the Effective Date.

“Consolidated Interest Expense” means, with respect to any Person for any period, total interest expense (including that attributable to Capital Lease Obligations in accordance with GAAP) of such Person on a Consolidated basis with respect to all outstanding Indebtedness of such Person, including, without limitation, the Obligations and all commissions, discounts and other fees and charges owed with respect

- 18-

thereto, but excluding (x) any non-cash or deferred interest financing costs, including on account of bridge, commitment and other financing fees, all as determined on a Consolidated basis in accordance with GAAP, and (y) amortization of deferred financing fees, debt issuance costs, commissions, fees and expenses; provided, however, that, upon the termination of the Canadian Commitments in accordance with the terms of this Agreement, interest expense of the Canadian Borrower and any Canadian Subsidiaries shall be excluded from the calculation of Consolidated Interest Expense.

“Consolidated Net Income” means, with respect to any Person for any period, the net income (or loss) of such Person on a Consolidated basis for such period taken as a single accounting period determined in accordance with GAAP; provided, however, that there shall be excluded (a) the income (or loss) of such Person in which any other Person has a joint interest, except to the extent of the amount of dividends or other distributions actually paid in cash to such Person during such period, (b) the income of any direct or indirect Subsidiary of a Person to the extent that the declaration or payment of dividends or similar distributions by that Subsidiary of that income is not at the time permitted by operation of the terms of its Charter Documents or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary, and (c) upon the termination of the Canadian Commitments in accordance with the terms of this Agreement, the income (or loss) of the Canadian Borrower and any Canadian Subsidiaries.

“Consolidated Working Capital” means, at any date, the excess of Consolidated Current Assets on such date over Consolidated Current Liabilities on such date.

“Contract Consideration” has the meaning assigned to such term in the definition of “Excess Cash Flow.”

“Control” means the possession, directly or indirectly, of the power (a) to vote 50% or more of the securities having ordinary voting power for the election of directors (or any similar governing body) of a Person, or (b) to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. The terms “Controlling” and “Controlled” have meanings correlative thereto.

“Cost” means the cost of purchases, as reported on the Borrowers’ financial stock ledger based upon the Borrowers’ accounting practices in effect on the Effective Date or thereafter consented to by the Administrative Agent, whose consent will not be unreasonably withheld. “Cost” does not include inventory capitalization costs or other non-purchase price charges (except for freight charges with respect to all Inventory (other than unpaid freight charges for Eligible In-Transit Inventory) to the extent treated consistently with the Borrowers’ accounting practices in effect on the Effective Date) used in the Borrowers’ calculation of cost of goods sold.

“Credit Card Notifications” has the meaning provided in SECTION 2.18(c).

“Credit Extensions” mean each of the following: (a) a Borrowing and (b) an L/C Credit Extension.

“Credit Party” means (a) the Lenders, (b) the Agents and the Canadian Agent and their respective Affiliates and branches, (c) the Issuing Banks, (d) the Arrangers and (e) the successors and permitted assigns of each of the foregoing.

“Credit Party Expenses” means, without limitation, all of the following to the extent incurred in connection with this Agreement and the other Loan Documents: (a) all reasonable out-of-pocket expenses

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incurred by the Administrative Agent, the Co-Collateral Agents, the Canadian Agent and the Arrangers in connection with the preparation of the Loan Documents and the syndication of the credit facilities provided for herein, including, without limitation, the reasonable fees, charges and disbursements of one United States counsel for the Administrative Agent and its Affiliates, one Canadian counsel for the Canadian Agent and its Affiliates and branches (plus local counsel in any other jurisdiction to the extent reasonably necessary), and outside consultants for the Agents and the Canadian Agent consisting of one inventory appraisal firm and one Canadian real estate appraisal firm, one commercial finance examination firm and one Canadian environmental engineering firm; (b) all reasonable out-of-pocket expenses incurred by the Administrative Agent, the Co-Collateral Agents, the Canadian Agent and the Arrangers in connection with the administration of this Agreement and the other Loan Documents and any amendments, modifications or waivers requested by a Loan Party of the provisions hereof or thereof (whether or not any such amendments, modifications or waivers shall be consummated), including the reasonable fees, charges and disbursements of one United States counsel for Bank of America and its Affiliates and one Canadian counsel for the Canadian Agent and its Affiliates and branches (plus local counsel in any other jurisdiction to the extent reasonably necessary); (c) all reasonable out-of-pocket expenses incurred by the Issuing Banks in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder; (d) all reasonable out-of-pocket expenses incurred by the Administrative Agent, the Co-Collateral Agents, the Canadian Agent and their respective Affiliates and branches in connection with the enforcement and protection of their rights in connection with the Loan Documents (including all such out-of-pocket expenses incurred during any workout, restructuring or related negotiations in respect of such Loan Documents), including the reasonable fees, charges and disbursements of one United States counsel for Bank of America and its Affiliates, one Canadian counsel for the Canadian Agent and its Affiliates (plus local counsel in any other jurisdiction to the extent reasonably necessary) and outside consultants for the Agents (including, without limitation, except as permitted in clause (e) hereof, one inventory appraisal firm and one real estate appraisal firm, one commercial finance examination firm and one environmental engineering firm); and (e) all reasonable out-of-pocket expenses incurred by the Administrative Agent, the Co-Collateral Agents, the Canadian Agent and their respective Affiliates and branches in connection with the enforcement of their rights in any case under the Bankruptcy Code or any judicial proceeding commenced by any Loan Party against the Credit Parties relating to the Loan Documents after the occurrence and during the continuance of an Event of Default, including the reasonable fees, charges and disbursements of one United States counsel for Bank of America and its Affiliates, one Canadian counsel for the Canadian Agent and its Affiliates (plus local counsel in any other jurisdiction to the extent reasonably necessary) and outside consultants for the Agents (including, without limitation, inventory appraisal firm(s) and real estate appraisal firm(s), commercial finance examination firm(s) and environmental engineering firm(s)); providedthat, in addition to the foregoing, the Lenders who are not the Agents or the Canadian Agent shall be entitled to reimbursement for no more than one counsel representing all such Lenders (absent a conflict of interest in which case the Lenders may engage and be reimbursed for additional counsel). Credit Party Expenses shall not include the allocation of any overhead expenses of any Credit Party.

“Customer Credit Liabilities” means, at any time, the aggregate remaining balance at such time of (a) outstanding gift certificates and gift cards of the Loan Parties entitling the holder thereof to use all or a portion of the certificate or gift card to pay all or a portion of the purchase price for any Inventory, and (b) outstanding merchandise credits and customer deposits of the Loan Parties, net of any dormancy reserves maintained by the Loan Parties on their books and records in the ordinary course of business consistent with past practices.

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“Customs Broker Agreement” means an agreement in substantially the form attached hereto as Exhibit B among a Loan Party, a customs broker or other carrier, and the Administrative Agent or the Canadian Agent, as applicable, in which the customs broker or other carrier acknowledges that it has control over and holds the documents evidencing ownership of the subject Inventory or other property for the benefit of the Administrative Agent or the Canadian Agent, as applicable, and agrees, upon notice from the Administrative Agent or the Canadian Agent, as applicable, to hold and dispose of the subject Inventory and other property solely as directed by the Administrative Agent or the Canadian Agent, as applicable.

“DDAs” means any checking or other demand deposit account maintained by the Loan Parties. All funds in such DDAs shall be conclusively presumed to be Collateral and proceeds of Collateral and the Agents, the Canadian Agent and the Lenders shall have no duty to inquire as to the source of the amounts on deposit in the DDAs.

“Debt Service Charges” means, for any period, the sum of (a) Consolidated Interest Expense payable in cash, plus (b) scheduled principal payments made or required to be made (after giving effect to any prepayments paid in cash that reduce the amount of such required payments) on account of Indebtedness, including the full amount of any non-recourse Indebtedness (excluding the Obligations, payments to reimburse any drawings under any commercial letters of credit, and any payments on Indebtedness required to be made on the final maturity date thereof, but including, without limitation, Capitalized Lease Obligations) for such period, plus (c) scheduled mandatory payments on account of Disqualified Capital Stock (whether in the nature of dividends, redemption, repurchase or otherwise) required to be made during such period, in each case determined in accordance with GAAP; provided, however, that, upon the termination of the Canadian Commitments in accordance with the terms of this Agreement, Debt Service Charges attributable to the Canadian Borrower and any Canadian Subsidiaries shall be excluded from the calculation of Debt Service Charges.

“Default” means any event or condition described in SECTION 7.01 that constitutes an Event of Default or that upon notice, lapse of any cure period set forth in SECTION 7.01, or both, would, unless cured or waived, become an Event of Default.

“Default Rate” has the meaning provided in SECTION 2.12.

“Defaulting Lender” means, subject to SECTION 2.27(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder, or (ii) pay to any Agent, any Issuing Bank, the Swingline Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swingline Loans) within two Business Days of the date when due, (b) has notified the Borrower, any Agent, any Issuing Bank or the Swingline Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect, or has publicly announced that it does not intend to comply with its funding obligations under other loan agreements, credit agreements or similar facilities generally, (c) has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under the Bankruptcy Code or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or

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liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Capital Stock in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or Canada or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by any Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above, and of the effective date of such status, shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to SECTION 2.27(b)) as of the date established therefor by the Administrative Agent in a written notice of such determination, which shall be delivered by the Administrative Agent to the Borrower, the Issuing Banks, the Swingline Lender and each other Lender promptly following such determination.

“Designated Account” has the meaning provided in SECTION 2.18(d); provided, however, that notwithstanding anything to the contrary contained therein, in no event shall the amounts deposited into the Designated Account at any time exceed $25,000,000 in the aggregate.

“Determination Date” shall mean the date upon which each of the following has occurred:

(a)    The Canadian Commitments and/or the Domestic Commitments have been terminated by the Required Lenders (or are deemed terminated) upon the occurrence of an Event of Default; and

(b)    The Obligations and/or the Canadian Liabilities have been declared to be due and payable (or has become automatically due and payable) and have not been paid in accordance with the terms of this Agreement.

“Disbursement Accounts” has the meaning provided in SECTION 2.18(g).

“Disclosed Matters” means the actions, suits and proceedings and the environmental matters disclosed on Schedule 3.06(a) and Schedule 3.06(b).

“Disqualified Capital Stock” means any Capital Stock which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, (a) is mandatorily redeemable in whole or in part prior to the Maturity Date, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, (b) is convertible into or exchangeable (unless at the sole option of the issuer thereof) for (i) Indebtedness or any Capital Stock referred to in (a) above prior to the Maturity Date, or (c) contains any mandatory repurchase obligation which comes into effect prior to the Maturity Date; providedthat any Capital Stock that would not constitute Disqualified Capital Stock but for provisions thereof giving holders thereof (or the holders of any security into or for which such Capital Stock is convertible, exchangeable or exercisable) the right to require the issuer thereof to redeem such Capital Stock upon the occurrence of a change in control or an asset sale shall not constitute Disqualified Capital Stock.

“dollars” or “$” refers to lawful money of the United States of America.

“Domestic Availability” means the lesser of (a) or (b), where:

(a)    is the result of:

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(i)    The Revolving Credit Ceiling,

Minus

(ii)    The Total Domestic Revolver Outstandings,

Minus

(iii)    The Total Canadian Revolver Outstandings.

(b)    is the result of the following:

(i)    The Tranche A Borrowing Base, as determined from the most recent Borrowing Base Certificate (as adjusted pursuant to SECTION 2.03hereof);

Minus

(ii)    The Total Domestic Revolver Outstandings.

“Domestic Borrowers” means, collectively, the Lead Borrower, the other Domestic Borrowers identified on the signature pages hereto and each Other Borrower who becomes a Domestic Borrower hereunder in accordance with the terms of this Agreement.

“Domestic Commitment” shall mean, with respect to each Domestic Lender, the commitment of such Domestic Lender hereunder to make Revolving Credit ExtensionsLoans to the Domestic Borrowers and to participate in Letters of Credit and Swingline Loans to the Domestic Borrowers in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased from time to time pursuant to SECTION 2.02 or reduced from time to time pursuant to SECTION 2.15 and SECTION 2.17.

“Domestic Commitment Percentage” shall mean, with respect to each Domestic Lender, that percentage of the Domestic Commitments of all Domestic Lenders hereunder to make Revolving Credit ExtensionsLoans to the Domestic Borrowers and to participate in Letters of Credit and Swingline Loans to the Domestic Borrowers, in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased from time to time pursuant to SECTION 2.02 or reduced from time to time pursuant to SECTION 2.15 and SECTION 2.17.

“Domestic Concentration Account” has the meaning provided in SECTION 2.18(d).

“Domestic Incremental Availability” means, at any time of calculation, an amount equal to the lesser of $155,000,000 or the sum of the following:

(a)the face amount of Eligible Credit Card Receivables of the Domestic Borrowers multiplied by ten percent (10%);

plus

(b)the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Domestic Borrowers consisting of TRU Inventory, net of Inventory Reserves, multiplied by ten

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percent (10%), multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Domestic Borrowers consisting of TRU Inventory;

plus

(c)the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Domestic Borrowers consisting of BRU Inventory, net of Inventory Reserves, multiplied by the percent (10%), multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Domestic Borrowers consisting of BRU Inventory;

plus

(d)the Cost of Eligible In-Transit Inventory of the Domestic Borrowers consisting of TRU Inventory, net of Inventory Reserves, multiplied by ten percent (10%), multiplied by the Appraised Value of Eligible In-Transit Inventory of the Domestic Borrowers consisting of TRU Inventory;

plus

(e)the Cost of Eligible In-Transit Inventory of the Domestic Borrowers consisting of BRU Inventory, net of Inventory Reserves, multiplied by ten percent (10%), multiplied by the Appraised Value of Eligible In-Transit Inventory of the Domestic Borrowers consisting of BRU Inventory;

plus

(F)thirty-six percent (36%) of the Required Availability Amount.

“Domestic Lenders” means the Lenders having Domestic Commitments or hold Domestic Tranche A-1 Loans from time to time or at any time.

“Domestic Letter of Credit” means a Letter of Credit that is issued pursuant to this Agreement for the account of a Domestic Borrower.

“Domestic Letter of Credit Outstandings” means, at any time, the sum of (a) with respect to Domestic Letters of Credit outstanding at such time, the aggregate maximum amount that then is, or at any time thereafter may become, available for drawing or payment thereunder, plus, without duplication, (b) all amounts theretofore drawn or paid under Domestic Letters of Credit for which the applicable Issuing Bank has not then been reimbursed.

“Domestic Letter of Credit Sublimit” means, at any time, the sum of $400,000,000 less the then Canadian Letter of Credit Outstandings, as such amount may be increased or reduced in accordance with the terms of this Agreement.

“Domestic Loan Party” means any Loan Party other than a Canadian Loan Party.

“Domestic Loans” means, collectively, the Loans made by the Domestic Lenders pursuant to Article II.

“Domestic Overadvance” means a Credit Extension to the Domestic Borrowers to the extent that, immediately after the making of such Credit Extension, Domestic Availability is less than zero.

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“Domestic Swingline Loan Ceiling” means (a) from January 1^st through August 31^st of each year, $50,000,000 and (b) from September 1^st through December 31^st of each year, $100,000,000, as such amount may be increased or reduced in accordance with the provisions of this Agreement.

“Domestic Subsidiary” means any Subsidiary other than a Foreign Subsidiary.

“Domestic Tranche A-1 Lender” means each Person who makes a Tranche A-1 Loan to the Domestic Borrowers in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time.

“Domestic Tranche A-1 Loans” means all Tranche A-1 Loans made to the Domestic Borrowers pursuant to this Agreement. As of the First Amendment Effective Date, the aggregate of all Domestic Tranche A-1 Loans totals $155,000,000.

“Domestic Tranche A-1 Notes” means the promissory notes of the Domestic Borrowers substantially in the form of Exhibit D-2, payable to the order of a Domestic Lender, evidencing the Tranche A-1 Loans made to the Domestic Borrowers.

“Domestic Total Commitments” means the aggregate of the Domestic Commitments of all Domestic Lenders. On the Effective Date, the Domestic Total Commitments are $1,850,000,000.

“Earn-Out Obligations” means the maximum amount of all obligations incurred or to be incurred in connection with any Acquisition of a Person pursuant to a Permitted Acquisition under non-compete agreements, consulting agreements, earn-out agreements and similar deferred purchase arrangements.

“Effective Date” means March 21, 2014.

“Eligible Assignee” means a commercial bank, insurance company, or company engaged in the business of making commercial loans or a commercial finance company, which Person, together with its Affiliates, has a combined capital and surplus in excess of $500,000,000, or any Lender or Affiliate of any Credit Party under common control with such Credit Party, or an Approved Fund of any Credit Party, or any Person to whom a Credit Party assigns its rights and obligations under this Agreement as part of an assignment and transfer of such Credit Party’s rights in and to a material portion of such Credit Party’s portfolio of asset based credit facilities; providedthat, in any event, “Eligible Assignee” shall not include (x) any natural person, (y) the Parent, or (z) the Sponsor Group or any of their respective Affiliates to the extent that, after giving effect to any proposed assignment, the Sponsor Group and their respective Affiliates would hold in the aggregate more than 25% of the sum of the then outstanding Commitments and Tranche A-1 Loans (or if the Commitments have been terminated, the Total Outstandings); providedthat, (1) to the extent that the Sponsor Group or any of their respective Affiliates hold in the aggregate more than 10% of the sum of the then outstanding Commitments and Tranche A-1 Loans (or if the Commitments have been terminated, the Total Outstandings), the Sponsor Group and their respective Affiliates shall be subject to clauses (a) and (b) of the definition of Sponsor Lender Limitations with respect to that portion of their outstanding Commitments and Tranche A-1 Loans (or if the Commitments have been terminated, the Total Outstandings) which exceeds 10%, and (2) the Sponsor Group and each of their respective Affiliates shall in all events be subject to the provisions of clause (c) of the definition of Sponsor Lender Limitations. Upon the occurrence of an Event of Default, no Person (other than a Lender) shall be an “Eligible Assignee” if the assignment of any Commitment to such Person would cause such Person to have Commitments in

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excess of the sum of twenty-five percent (25%) of the then outstanding Total Commitmentsand Tranche A-1 Loans (or if the Commitments have been terminated, the Total Outstandings).

“Eligible Credit Card Receivables” means, as of any date of determination, Accounts due to a Loan Party from major credit card processors (including, but not limited to, VISA, Mastercard, American Express, Diners Club and DiscoverCard) as arise in the ordinary course of business and which have been earned by performance, that are not excluded as ineligible by virtue of one or more of the criteria set forth below. None of the following shall be deemed to be Eligible Credit Card Receivables:

(a)    Accounts due from major credit card processors that have been outstanding for more than five (5) Business Days from the date of sale (except that, with respect to those due from American Express to the Canadian Loan Parties, that have been outstanding for more than ten (10) Business Days from the date of sale), or for such longer period(s) as may approved by the Co-Collateral Agents;

(b)    Accounts due from major credit card processors with respect to which a Loan Party does not have good, valid and marketable title thereto, free and clear of any Lien (other than Liens granted to the Administrative Agent or the Canadian Agent, as applicable, for its own benefit and the benefit of the other Secured Parties pursuant to the Security Documents, those Liens specified in clauses (a) and (e) of the definition of Permitted Encumbrances and Permitted Encumbrances having priority by operation of Applicable Law over the Lien of the Administrative Agent or Canadian Agent, as applicable) (the foregoing not being intended to limit the discretion of the Co-Collateral Agents to change, establish or eliminate any Reserves on account of any such Liens);

(c)    Accounts due from major credit card processors that are not subject to a first priority (except as provided in clause (b), above) security interest in favor of the Administrative Agent or the Canadian Agent, as applicable, for its own benefit and the benefit of the other Secured Parties;

(d)    Accounts due from major credit card processors which are disputed, or with respect to which a claim, counterclaim, offset or chargeback has been asserted, by the related credit card processor (but only to the extent of such dispute, counterclaim, offset or chargeback) (it being the intent that chargebacks in the ordinary course by the credit card processors shall not be deemed violative of this clause);

(e)    Except as otherwise approved by the Co-Collateral Agents, Accounts due from major credit card processors as to which the credit card processor has the right under certain circumstances to require a Loan Party to repurchase the Accounts from such credit card processor; or

(f)    Accounts due from major credit card processors (other than Visa, Mastercard, American Express, Diners Club and Discover) which any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) determines in its commercial reasonable discretion acting in good faith to be unlikely to be collected.

“Eligible In-Transit Inventory” means, as of any date of determination, without duplication of other Eligible Inventory, Inventory (a) (i) which has been delivered to a carrier in a foreign port or foreign airport for receipt by a Loan Party in the United States or Canada within sixty (60) days of the date of determination, but which has not yet been received by a Loan Party or (ii)which has been delivered to a carrier in the

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United States or Canada for receipt by a Loan Party in the United States or Canada within five (5) Business Days of the date of determination, but which has not yet been received by a Loan Party, (b) for which the purchase order is in the name of a Loan Party and title has passed to a Loan Party, (c) except as otherwise agreed by the Co-Collateral Agents, for which a Loan Party is designated as “shipper” and/or the consignor and the document of title or waybill reflects a Loan Party as consignee (along with delivery to a Loan Party or its customs broker of the documents of title, to the extent applicable, with respect thereto), (d) as to which the Administrative Agent or the Canadian Agent, as applicable, has control over the documents of title, to the extent applicable, which evidence ownership of the subject Inventory (such as by the delivery of a Customs Broker Agreement), (e) as to which a Tri-Party Agreement has been executed and delivered in favor of the Co-Collateral Agents, (f) which is insured in accordance with the provisions of this Agreement and the other Loan Documents, including, without limitation marine cargo insurance; and (g) which otherwise is not excluded from the definition of Eligible Inventory; providedthat the Administrative Agent may (and shall, at the written direction of any Co-Collateral Agent, after consultation with the other Co-Collateral Agent), upon notice to the Lead Borrower, exclude any particular Inventory from the definition of “Eligible In-Transit Inventory” in the event that the Administrative Agent or any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) determines that such Inventory is subject to any Person’s right or claim which is (or is capable of being) senior to, or pari passu with, the Lien of the Administrative Agent or the Canadian Agent (such as, without limitation, a right of stoppage in transit), as applicable, or may otherwise adversely impact the ability of the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, to realize upon such Inventory.

“Eligible Inventory” means, as of any date of determination, without duplication, (a) Eligible Letter of Credit Inventory, (b) Eligible In-Transit Inventory, (c) Inventory reported at Location 5001 in the Loan Parties’ books and records (such being cross-docked product and not then included in the Loan Parties’ stock ledger but which is otherwise Eligible Inventory), and (d) items of Inventory of a Loan Party that are finished goods, merchantable and readily saleable to the public in the ordinary course that are not excluded as ineligible by virtue of the one or more of the criteria set forth below. None of the following shall be deemed to be Eligible Inventory:

(a)    Inventory that is not solely owned by a Loan Party, or is leased by or is on consignment to a Loan Party, or as to which the Loan Parties do not have title thereto;

(b)    Inventory (other than any Eligible Letter of Credit Inventory and Eligible In-Transit Inventory) that is not located in the United States of America or Canada (or any territories or possessions thereof);

(c)    Inventory (other than any Eligible Letter of Credit Inventory and Eligible In-Transit Inventory) that is not located at a location that is owned or leased by the Loan Parties, except to the extent that the Loan Parties shall have used commercially reasonable efforts to furnish (in the case of each such location leased by a third party for which the Loan Parties contracted with such third party on or before the Effective Date), or shall have furnished (in the case of each such location leased by a third party for which the Loan Parties contracted with such third party after the Effective Date), the Administrative Agent or the Canadian Agent, as applicable, with (i) any UCC financing statements, PPSA filings or other registrations that the Administrative Agent or the Canadian Agent, as applicable, may reasonably determine to be necessary to perfect its security interest in such Inventory at such location, and (ii) an intercreditor agreement (containing, among other things, a lien waiver) executed by the Person owning or leasing any such location on terms reasonably acceptable to the Co-Collateral Agents and, if applicable, the Canadian Agent; providedthat, with respect to any location which is leased by a third party as of the Effective Date and which contains

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Inventory to be utilized to fulfill internet orders or Inventory to be forwarded to stores or distribution centers of the Loan Parties, such Inventory shall not be deemed ineligible solely by virtue of this clause (c) if such an intercreditor agreement is not obtained by the Borrowers (after having used commercially reasonable efforts to obtain same); providedfurther that any Inventory located at a location described in clauses (i) and/or (ii) below shall not be deemed ineligible solely by virtue of this clause (c) even if such an intercreditor agreement is not furnished for any such location: (i) any location that is not owned or leased by the Loan Parties at which Inventory of a Domestic Loan Party is located (or locations under the control of the same Person other than store leases) having a value of less than or equal to $20,000,000 at Cost (or, with respect to seasonal locations, at which Inventory is located having a value less than or equal to $40,000,000 at Cost for a period of not greater than 60 days), or (ii) any location that is not owned or leased by the Loan Parties at which Inventory of a Canadian Loan Party is located (or under the control of the same Person other than store leases) having a value of less than or equal to $5,000,000 at Cost (or, with respect to seasonal locations, at which Inventory is located having a value less than or equal to $10,000,000 at Cost for a period of not greater than 60 days);

(d)    Inventory that is located at a distribution center that is leased by the Loan Parties, except to the extent that (unless otherwise agreed by the Co-Collateral Agents or the Canadian Agent, as applicable) the Loan Parties shall have used commercially reasonable efforts to furnish (in the case of each such distribution center for which the Loan Parties have entered into a lease on or before the Effective Date), or shall have furnished (in the case of each such distribution center for which the Loan Parties have entered into a lease after the Effective Date), the Administrative Agent or the Canadian Agent, as applicable, with a landlord’s lien waiver and collateral access agreement on terms reasonably acceptable to the Co-Collateral Agents or the Canadian Agent, as applicable, executed by the Person owning any such distribution center; providedthat any Inventory located at a distribution center described in clauses (i) and/or (ii) below shall not be deemed ineligible solely by virtue of this clause (d) even if such a landlord’s lien waiver and collateral access agreement is not furnished for any such distribution center: (i) any distribution center at which Inventory of a Domestic Loan Party is located (or locations under the control of the same Person other than store leases) having a value of less than or equal to $20,000,000 at Cost (or, with respect to seasonal warehouses, at which Inventory is located having a value less than or equal to $40,000,000 at Cost for a period of not greater than 60 days), or (ii) any distribution center at which Inventory of a Canadian Loan Party is located (or under the control of the same Person other than store leases) having a value of less than or equal to $5,000,000 at Cost (or, with respect to seasonal warehouses, at which Inventory is located having a value less than or equal to $10,000,000 at Cost for a period of not greater than 60 days);

(e)    Inventory that represents goods which (i) are damaged, defective, “seconds,” or otherwise unmerchantable, (ii) are to be returned to the vendor, (iii) are work in process, raw materials, or that constitute spare parts or supplies used or consumed in a Loan Party’s business (iv) are bill and hold goods, or (v) are not in compliance in all material respects with all standards imposed by any Governmental Authority having regulatory authority with respect thereto;

(f)    Except as otherwise agreed by the Co-Collateral Agents, Inventory that represents goods that do not conform in all material respects to the representations and warranties contained in this Agreement or any of the Security Documents;

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(g)    Inventory that is not subject to a perfected first priority security interest in favor of the Administrative Agent or Canadian Agent, as applicable, for its own benefit and the benefit of the other Secured Parties (subject only to Permitted Encumbrances having priority by operation of Applicable Law);

(h)    Inventory which consists of samples, labels, bags, packaging materials, and other similar non-merchandise categories;

(i)    Inventory as to which casualty insurance in compliance with the provisions of SECTION 5.07 is not in effect;

(j)    Inventory which has been sold but not yet delivered or Inventory to the extent that any Loan Party has accepted a deposit therefor; or

(k)    Inventory acquired in a Permitted Acquisition, unless the Co-Collateral Agents shall have received or conducted (i) appraisals, from appraisers reasonably satisfactory to the Co-Collateral Agents, of such Inventory to be acquired in such Acquisition and (ii) such other due diligence as the Co-Collateral Agents may reasonably require, all of the results of the foregoing to be reasonably satisfactory to the Co-Collateral Agents.

“Eligible Letter of Credit Inventory” means, as of any date of determination (without duplication of other Eligible Inventory), Inventory:

(a)    (i) which has been delivered to a carrier in a foreign port or foreign airport for receipt by a Loan Party in the United States or Canada within sixty (60) days of the date of determination, but which has not yet been received by a Loan Party, or (ii) which has been delivered to a carrier in the United States or Canada for receipt by a Loan Party in the United States or Canada within five (5) Business Days of the date of determination, but which has not yet been received by a Loan Party;

(b)    the purchase order for which is in the name of a Loan Party, title has passed to a Loan Party and the purchase of which is supported by a Commercial Letter of Credit issued under this Agreement having an initial expiry, subject to the proviso hereto, within 120 days after the date of initial issuance of such Commercial Letter of Credit; providedthat ninety percent (90%) of the maximum Stated Amount all such Commercial Letters of Credit shall not, at any time, have an initial expiry greater than ninety (90) days after the original date of issuance of such Commercial Letters of Credit;

(c)    except as otherwise agreed by the Co-Collateral Agents, for which a Loan Party is designated as “shipper” and/or consignor and the document of title or waybill reflects a Loan Party as consignee (along with delivery to a Loan Party or its customs broker of the documents of title, to the extent applicable, with respect thereto);

(d)    as to which the Administrative Agent or the Canadian Agent, as applicable, has control over the documents of title, to the extent applicable, which evidence ownership of the subject Inventory (such as by the delivery of a Customs Broker Agreement);

(e)    which is insured in accordance with the provisions of this Agreement and the other Loan Documents, including, without limitation marine cargo insurance;

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(f)    as to which a Tri-Party Agreement has been executed and delivered in favor of the Co-Collateral Agents, and

(g)    Which otherwise is not excluded from the definition of Eligible Inventory;

providedthat the Administrative Agent may (and shall, at the written direction of any Co-Collateral Agent, after consultation with the other Co-Collateral Agent), upon notice to the Lead Borrower, exclude any particular Inventory from the definition of “Eligible Letter of Credit Inventory” in the event that the Administrative Agent or any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) determines that such Inventory is subject to any Person’s right or claim which is (or is capable of being) senior to, or pari passu with, the Lien of the Administrative Agent or the Canadian Agent (such as, without limitation, a right of stoppage in transit), as applicable, or may otherwise adversely impact the ability of the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, to realize upon such Inventory.

“Eligible Real Estate” means Real Estate which satisfies each of the following conditions:

(a)    Either (i) a Canadian Loan Party owns fee title or (ii) a Canadian Loan Party is ground lessee under a ground lease on real estate improved by a building owned by such Canadian Loan Party, the terms and conditions of which ground lease permit assignment and mortgaging thereof in the Co-Collateral Agents’ and the Canadian Agent’s reasonable commercial discretion exercised in good faith;

(b)    The applicable Canadian Loan Party has executed and delivered to the Canadian Agent such Mortgages as the Co-Collateral Agents and the Canadian Agent may reasonably request;

(c)    The applicable Canadian Loan Party shall have delivered to the Co-Collateral Agents (i) title insurance and environmental site assessments reasonably satisfactory to the Co-Collateral Agents and the Canadian Agent, and (ii) other real estate items, if any, as reasonably required by, and reasonably satisfactory to, the Co-Collateral Agents and the Canadian Agent;

(d)    The Canadian Agent has a perfected first priority lien in such Real Estate (subject only to Permitted Encumbrances having priority by operation of Applicable Law) for its own benefit and the benefit of other Secured Parties;

(e)    Each such parcel of Real Estate has been appraised by a third party appraiser reasonably acceptable to the Agents and the Canadian Agent;

(f)    Either (i) the Real Estate is used by a Canadian Loan Party for offices, as a Store or distribution center, or is being held for sale and, if more than twelve (12) months have elapsed from the date such Real Estate was initially held for sale, the Co-Collateral Agents and the Canadian Agent shall have received an updated appraisal of such Real Estate, or (ii) the Real Estate is leased by a Canadian Loan Party to another Person, the terms of such lease and the creditworthiness of the lessee are reasonably satisfactory to the Co-Collateral Agents, and the Co-Collateral Agents and the Canadian Agent shall have received an updated appraisal of such Real Estate reflecting the effect of such lease on FMV, providedthat Real Estate described in this clause (f)(ii) shall not comprise more than 25% of the Canadian Borrowing Base; and

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(g)    As to any particular property, except as otherwise agreed by the Co-Collateral Agents, the Canadian Borrower is in compliance in all material respects with the representations, warranties and covenants set forth in the Mortgage relating to such property.

“Enumerated Default” means the failure of any Loan Party to comply with the terms of SECTION 2.18(c)(ii), SECTION 2.18(d), SECTION 2.18(e), SECTION 2.18(f), or SECTION 2.18(h) or the occurrence of any Event of Default specified in SECTION 7.01(a), SECTION 7.01(b), SECTION 7.01(h), or SECTION 7.01(i).

“Environmental Compliance Reserve” means, with respect to Eligible Real Estate, any reserve which any Co-Collateral Agent (after consultation with the other Co-Collateral Agent and the Canadian Agent), from time to time in its reasonable commercial discretion exercised in good faith, establishes for estimable amounts that are reasonably likely to be expended by any of the Canadian Loan Parties in order for such Loan Party and its operations and property (a) to comply with any notice from a Governmental Authority asserting non-compliance with Environmental Laws, or (b) to correct any such non-compliance with Environmental Laws relating to such Eligible Real Estate.

“Environmental Laws” means all Applicable Laws issued, promulgated or entered into by or with any Governmental Authority, relating in any way to the protection of human health or the environment, to the handling, treatment, storage, disposal of Hazardous Materials or to the assessment or remediation of any Release or threatened Release of any Hazardous Material to the environment.

“Environmental Liability” means any liability, contingent or otherwise (including, without limitation, any liability for damages, natural resource damage, costs of environmental remediation, administrative oversight costs, fines, penalties or indemnities), of any Loan Party directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release or threatened Release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“Equipment” has the meaning set forth in the Security Documents.

“Equivalent Amount” means, on any date, the rate at which CD$ may be exchanged into dollars, determined by reference to the Bank of Canada noon rate as published on the Reuters Screen BOFC on the immediately preceding Business Day. In the event that such rate does not appear on such Reuters page, “Equivalent Amount” shall mean, on any date, the amount of dollars into which an amount of CD$ may be converted or the amount of CD$ into which an amount of dollars may be converted, in either case, at, in the case of the Canadian Borrower, the Canadian Agent’s spot buying rate in Toronto as at approximately 12:00 noon (Toronto time) on such date and, in the case of a Domestic Borrower, the Administrative Agent’s spot buying rate in New York as at approximately 12:00 noon (New York City time) on the immediately preceding Business Day.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time and the regulations promulgated and rulings issued thereunder.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with Lead Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

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“ERISA Event” means: (a) with respect to the Domestic Borrowers, any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30 day notice period is waived); (b) with respect to the Domestic Borrowers, the failure of any Plan to satisfy the minimum funding standards (as defined in Section 412 of the Code or Section 302 of ERISA) applicable to such Plan, whether or not waived, and with respect to the Canadian Borrower, the existence with respect to any Plan of any due but un-remitted contribution, whether or not waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Lead Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the Lead Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the Lead Borrower or any of its ERISA Affiliates of any liability in excess of $100,000,000 (or such lesser amount as would reasonably be expected to result in a Material Adverse Effect) with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the Lead Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Lead Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability in excess of $100,000,000 (or such lesser amount as would reasonably be expected to result in a Material Adverse Effect) or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.

“Event of Default” has the meaning provided in SECTION 7.01. An “Event of Default” shall be deemed to have occurred and to be continuing unless and until that Event of Default has been duly waived in writing in accordance with the terms of this Agreement.

“Excess Availability” means the difference between (a) the Line Cap and (b) the Total Revolver Outstandings.

“Excess Canadian Real Estate” means Eligible Real Estate of the Canadian Loan Parties having a FMV in excess of $150,000,000.

“Excess Cash Flow” means, for any Fiscal Year of the Borrower commencing with the Fiscal Year ending January, 2016, an amount equal to the excess of:

(a)the sum, without duplication, of:

(i) Consolidated Net Income for such period,

(ii) an amount equal to the amount of all non-cash charges to the extent deducted in arriving at such Consolidated Net Income,

(iii) an amount equal to the provision for taxes based on income, profits or capital of the Loan Parties, including federal, foreign, state, franchise, excise and similar taxes and foreign withholding taxes paid or accrued during such period to the extent deducted in arriving at such Consolidated Net Income,

(iv) decreases in Consolidated Working Capital for such period (other than any such decreases arising from acquisitions by the Loan Parties completed during such period),

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(v) an amount equal to the aggregate net non-cash loss on the sale, lease, transfer or other Disposition of assets by the Loan Parties during such period (other than sales, leases, transfers or other dispositions in the ordinary course of business) to the extent deducted in arriving at such Consolidated Net Income, and

(vi) cash receipts in respect of Hedge Agreements during such Fiscal Year to the extent not otherwise included in Consolidated Net Income;

over (b) the sum, without duplication, of:

(i) an amount equal to the amount of all non-cash credits included in arriving at such Consolidated Net Income and cash charges described in clauses (a) through (c) of the definition of Consolidated Net Income and included in arriving at such Consolidated Net Income,

(ii) without duplication of amounts deducted pursuant to clause (xi) below in prior years, the amount of Capital Expenditures made in cash during such period,

(iii) the aggregate amount of all principal payments of unsubordinated Indebtedness of the Loan Parties and of Parent (with respect to Indebtedness of Parent, to the extent financed or paid by a Borrower or a Loan Party) including (A) the principal component of payments in respect of Capital Lease Obligations, (B) the amount of any scheduled repayment of the Term Loans pursuant to the Term Loan Agreement, and (C) the amount of a mandatory prepayment of the Term Loans pursuant to the Term Loan Agreement to the extent required due to an asset sale, but excluding prepayments of Loans made hereunder during such period (except to the extent there is an equivalent permanent reduction in Commitments), except, in each case, to the extent financed with the proceeds of other Indebtedness of the Loan Parties, Parent or their Subsidiaries (other than Propco),

(iv) an amount equal to the aggregate net non-cash gain on the sale, lease, transfer or other Disposition of assets by the Loan Parties during such period (other than sales in the ordinary course of business) to the extent included in arriving at such Consolidated Net Income,

(v) increases in Consolidated Working Capital for such period (other than any such increases arising from acquisitions by the Loan Parties completed during such period),

(vi) payments by the Loan Parties during such period in respect of long-term liabilities of the Loan Parties other than Indebtedness,

(vii) without duplication of amounts deducted pursuant to clause (xi) below in prior Fiscal Years, the aggregate amount of cash consideration paid by the Loan Parties (on a Consolidated basis) in connection with Investments (including acquisitions) made during such period in accordance with the

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terms hereof to the extent that such Investments were financed with internally generated cash flow of the Loan Parties,

(viii) the amount of dividends paid during such period (on a consolidated basis) by the Loan Parties in accordance with the terms hereof to the extent such dividends were financed with internally generated cash flow of the Loan Parties,

(ix) the aggregate amount of expenditures actually made by the Loan Parties in cash during such period (including expenditures for the payment of financing fees) to the extent that such expenditures are not expensed during such period,

(x) the aggregate amount of any premium, make-whole or penalty payments actually paid in cash by the Loan Parties during such period that are required to be made in connection with any pre-payment of Indebtedness,

(xi) without duplication of amounts deducted from Excess Cash Flow in prior periods, the aggregate consideration required to be paid in cash by the Loan Parties pursuant to binding contracts (the “Contract Consideration”) entered into prior to or during such period relating to Permitted Acquisitions or Capital Expenditures to be consummated or made during the period of four consecutive Fiscal Quarters of the Lead Borrower and its Subsidiaries following the end of such period, provided that to the extent the aggregate amount of internally generated cash actually utilized to finance such Permitted Acquisitions or Capital Expenditures during such period of four consecutive Fiscal Quarters is less than the Contract Consideration, the amount of such shortfall shall be added to the calculation of Excess Cash Flow at the end of such period of four consecutive Fiscal Quarters,

(xii) the amount of taxes (including penalties and interest) paid in cash in such period,

(xiii) cash expenditures in respect of Hedge Agreements during such Fiscal Year to the extent not deducted in arriving at such Consolidated Net Income, and

(xiv) the amount of cash payments made in respect of pension obligations and other post-employment benefits obligations in such period to the extent not deducted in arriving at such Consolidated Net Income and the amount representing accrued expenses for cash payments (including with respect to retirement plan obligations) that are not paid in cash in such Fiscal Year; provided that such amounts will be added to Excess Cash Flow for the following Fiscal Year to the extent not paid in cash during such following Fiscal Year.

“Excess Swingline Loans” has the meaning provided in SECTION 2.22(b).

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“Excluded Swap Obligation” means, with respect to any Loan Party, any Swap Obligation if, and to the extent that, all or a portion of the guaranty of such Loan Party under the Facility Guarantee of, or the grant under a Loan Document by such Loan Party of a security interest to secure, such Swap Obligation (or any guaranty thereof) is or becomes illegal under the Commodity Exchange Act (or the application or official interpretation thereof) by virtue of such Loan Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to SECTION 9.22 hereof and any and all guarantees of such Loan Party’s Swap Obligations by other Loan Parties) at the time the guaranty of such Loan Party, or grant by such Loan Party of a security interest, becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one Hedge Agreement, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to Hedge Agreements for which such guaranty or security interest becomes illegal.

“Excluded Taxes” means, with respect to the Agents, the Canadian Agent, any Lender, any Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of any Loan Party under any Loan Document, (a) income or franchise taxes imposed on (or measured by) its gross or net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which any Borrower is located, (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by a Borrower under SECTION 2.24(b) or a Lender that becomes a Domestic Lender by virtue of the application of SECTION 8.17), any withholding tax that (i) is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office other than at the request of a Borrower under SECTION 2.24), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrowers with respect to such withholding tax pursuant to SECTION 2.23(a), or (ii) is attributable to such Foreign Lender’s failure to comply with SECTION 2.23(e), (d) in the case of a Canadian Lender (other than an assignee pursuant to a request by a Borrower under SECTION 2.24(b) or a Lender that becomes a Domestic Lender by virtue of the application of SECTION 8.17), any withholding tax that is imposed on amounts payable to such Canadian Lender at the time such Canadian Lender becomes a party to this Agreement (or designates a new lending office other than at the request of a Borrower under SECTION 2.24) or is attributable to such Canadian Lender’s failure to comply with SECTION 2.23(j), except to the extent that such Canadian Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Canadian Borrower with respect to such withholding tax pursuant to SECTION 2.23(a); providedthat the provisions of the foregoing clause (d) shall not apply upon and after the occurrence of the Determination Date; providedfurther that each such Lender shall use reasonable efforts to eliminate or reduce amounts payable pursuant to this clause (d), and (e) any withholding tax that is imposed by reason of FATCA.

“Existing Revolver Tranche” has the meaning provided in SECTION 2.28(a).

“Extended Commitments” has the meaning provided in SECTION 2.28(a).

“Extending Revolving Credit Lender” has the meaning provided in SECTION 2.28(b).

“Extension Amendment” has the meaning provided in SECTION 2.28(d).

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“Extension Election” has the meaning provided in SECTION 2.28(b).

“Extension Request” has the meaning provided in SECTION 2.28(a).

“Extension Series” has the meaning provided in SECTION 2.28(a).

“Facility Guarantee” means (a) any Guarantee of the Obligations and Other Liabilities executed by the Domestic Borrowers and their respective Material Subsidiaries (other than Foreign Subsidiaries, Toys ‘R’ Us Service, LLCand, Geoffrey, LLC and its Subsidiariesand any Special Refinancing Subsidiary) in favor of the Administrative Agent and the other Secured Parties (it being understood that the Canadian Borrower and its Foreign Subsidiaries shall not be required to execute a Facility Guarantee of the Obligations or Other Liabilities of the Domestic Borrowers), and (b) in addition to the Guarantee described in clause (a), any Guarantee of the Canadian Liabilities executed by any of the Canadian Borrower’s Subsidiaries in favor of the Canadian Agent and the other Secured Parties.

“Facility Guarantors” means any Person executing a Facility Guarantee.

“Facility Guarantors’ Collateral Documents” means all security agreements, Mortgages, pledge agreements, deeds of trust, and other instruments, documents or agreements executed and delivered by the Facility Guarantors to secure the Facility Guarantee, the Obligations, the Other Liabilities, or the Canadian Liabilities, as applicable.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successior version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

“Federal Funds Effective Rate” means, for any day, the rate per annum equal to the weighted average (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Administrative Agent.

“Financial Consultant” has the meaning provided in SECTION 5.14.

“Financial Officer” means, with respect to any Loan Party, the chief financial officer, the senior vice president of finance, treasurer, assistant treasurer, controller or assistant controller of such Loan Party.

“First Amendment Effective Date” means October 24, 2014.

“Fiscal Month” means any fiscal month of any Fiscal Year, which month shall generally end on the last Saturday of each calendar month in accordance with the fiscal accounting calendar of the Borrowers.

“Fiscal Quarter” means any fiscal quarter of any Fiscal Year, which quarters shall generally end on the last Saturday of each April, July, October or January of such Fiscal Year in accordance with the fiscal accounting calendar of the Borrowers.

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“Fiscal Year” means any period of twelve consecutive months ending on the Saturday closest to January 31 of any calendar year.

“Fixed Assets” means Equipment and Real Estate.

“FMV” means, as to any Eligible Real Estate, the fair market value of such Eligible Real Estate determined in accordance with an appraisal from an independent appraisal firm, each reasonably acceptable to the Co-Collateral Agents.

“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than the United States of America or any State thereof or the District of Columbia.

“Foreign Subsidiary” means any Subsidiary that is organized under the laws of a jurisdiction other than the United States of America or any State, commonwealth or territory thereof or the District of Columbia.

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with respect to any Issuing Bank, such Defaulting Lender’s Commitment Percentage of the Letter of Credit Outstandings other than Letter of Credit Outstandings as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or cash collateralized in accordance with the terms hereof, and (b) with respect to the Swingline Lender, such Defaulting Lender’s Commitment Percentage of Swingline Loans other than Swingline Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders in accordance with the terms hereof.

“Fund” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.

“Funded Debt” means, as to any Person, all Indebtedness (of the type described in clauses (a), (b), (e), (f) and (h), of the definition of such term) of such Person that matures more than one year from the date of its creation or matures within one year from the date of its creation but is renewable or extendible, at the option of such Person, to a date more than one year from such date or arises under a revolving credit or similar agreement that obligates the lender or lenders to extend credit during a period of more than one year from such date, including all current maturities and current sinking fund payments in respect of such Indebtedness whether or not required to be paid within one year from the date of its creation and, in the case of the Borrowers, Indebtedness in respect of the Loans.

“GAAP” means principles which are consistent with those promulgated or adopted by the Financial Accounting Standards Board and its predecessors (or successors) in effect and applicable to that accounting period in respect of which reference to GAAP is being made; providedthat, with respect to Foreign Subsidiaries of Borrower organized under the laws of Canada, “GAAP” shall mean principles which are consistent with those promulgated or adopted by the Canadian Institute of Chartered Accountants and its predecessors (or successors) in effect and applicable to the accounting period in respect of which reference to GAAP is being made.

“General Security Agreement” means the General Security Agreement dated as of the Closing Date among the Canadian Borrower and its Subsidiaries and the Canadian Agent for the benefit of the Secured Parties thereunder, as amended and in effect from time to time.

“Geoffrey” means Geoffrey, LLC, a Delaware limited liability company.

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“Geoffrey Collateral” shall have the meaning assigned to such term in the Term Loan Credit Agreement.

“Governmental Authority” means the government of the United States of America, Canada, any other nation or any political subdivision thereof, whether state, local or provincial, and any agency, authority, instrumentality, regulatory body, court, tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; providedthat the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.For the avoidance of doubt, the term “Guarantee” as used herein shall not be deemed to include the IntermediateCo Unsecured Guarantee.

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, mold, fungi or similar bacteria, and all other substances or wastes of any nature regulated pursuant to any Environmental Law because of their dangerous or deleterious properties, including any material listed as a hazardous substance under Section 101(14) of CERCLA.

“Hedge Agreement” means any derivative agreement, or any interest rate protection agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement designed to hedge against fluctuations in interest rates or foreign exchange rates or commodity prices.

“High Selling Period” means (i) with respect to the TRU Inventory owned by the Domestic Loan Parties and all Inventory owned by the Canadian Loan Parties, the period in each year commencing on October 15^th and ending on the first Sunday after December 15^th, and (ii) with respect to BRU Inventory owned by the Domestic Loan Parties, the period commencing each year on February 1^st and ending on October 31^st.

“ICE LIBOR” has the meaning assigned to such term in the definition of “LIBO Rate”.

“Incremental Availability” means, Canadian Incremental Availability or Domestic Incremental Availability, as applicable, and collectively means the sum of both of them.

“Indebtedness” of any Person means, without duplication:

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(a)    All obligations of such Person for borrowed money(including any obligations which are without recourse to the credit of such Person); provided, however, that, other than for purposes of calculating the Consolidated Fixed Charge Coverage Ratio, Excess Cash Flow, or the Consolidated Interest Coverage Ratio, all such obligations and liabilities which are limited in recourse to such property shall be included in Indebtedness only to the extent of the lesser of the fair market value of such property and the then outstanding amount of such Indebtedness;

(b)    All obligations of such Person evidenced by bonds, debentures, notes or similar instruments;

(c)    All obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person; provided, however, that all such obligations and liabilities which are limited in recourse to such property shall be included in Indebtedness only to the extent of the lesser of the fair market value of such property and the then outstanding amount of such Indebtedness;

(d)    All obligations of such Person in respect of the deferred purchase price of property or services (excluding accrued expenses and accounts payable incurred in the ordinary course of business);

(f)    All Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed; provided, however, that, other than for purposes of calculating the Consolidated Fixed Charge Coverage Ratio, Excess Cash Flow, or the Consolidated Interest Coverage Ratio, all such obligations and liabilities which are limited in recourse to such property shall be included in Indebtedness only to the extent of the lesser of the fair market value of such property and the then outstanding amount of such Indebtedness;

(g)    All Guarantees by such Person of Indebtedness of others;

(h)    All Capital Lease Obligations of such Person; provided, however, that all such obligations and liabilities which are limited in recourse to such property shall be included in Indebtedness only to the extent of the lesser of the fair market value of such property and the then outstanding amount of such Indebtedness;

(i)    All obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty;

(j)    All obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances;

(k)    The Agreement Value of all Hedge Agreements;

(l)    The principal and interest portions of all rental obligations of such Person under any Synthetic Lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an operating lease in accordance with GAAP; and

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(m)    Indebtedness consisting of Earn-Out Obligations in connection with Permitted Acquisitions but only to the extent that the contingent consideration relating thereto is not paid within thirty (30) days after the amount due is finally determined;

Indebtedness shall not include (A) any sale-leaseback transactions to the extent the lease or sublease thereunder is not required to be recorded under GAAP as a Capital Lease, (B) any obligations relating to overdraft protection and netting services, or (C) any preferred stock required to be included as Indebtedness in accordance with GAAP and FAS 150.

The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Indemnitee” has the meaning provided in SECTION 9.03(b).

“Indentures” means each of:

(a)    the Indenture, dated as of August 24, 2010, originally between the Lead Borrower and The Bank of New York Mellon, as Trustee, with respect to 7.375% Senior Secured Notes due 2016 (such Notes, the “2016 Notes”);

(b)     the Indenture, dated as of August 1, 2012, originally between the Parent and The Bank of New York Mellon, as Trustee, with respect to 10.375% Senior Secured Notes due 2017 (such Notes, the “2017 Notes”);

(c)    the Indenture, dated as of May 28, 2002, originally between the Parent and The Bank of New York, as Trustee, with respect to 7.375% Notes due 2018 (such Notes, the “2018 Notes”); and

(d)    the Indenture, dated as of August 29, 1991, originally between the Parent and The Bank of New York, as successor Trustee, with respect to Debentures due 2021;

each as modified, amended, supplemented or restated and in effect from time to time.

“Information” has the meaning provided in SECTION 9.15.

“Informational Website” has the meaning provided in SECTION 5.01.

“Intellectual Property Rights Agreement” means the agreement dated as of the Closing Date between Geoffrey and the Administrative Agent, for its own benefit and the benefit of the Secured Parties.

“Intercreditor Agreement” means that certain Intercreditor Agreement dated as of July 19, 2006 by and between the Agents and Banc of America Bridge LLC, as administrative agent for the holders of the Term Loan, as amended and in effect from time to time, and any other intercreditor agreement reasonably satisfactory to the Administrative Agent that relates to the Obligations hereunder and the Term Loan and is designated as an “Intercreditor Agreement” for purposes of this Agreement.

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“Interest Payment Date” means (a) with respect to any Prime Rate Loan (including a Swingline Loan), the last day of each calendar quarter, and (b) with respect to any LIBO Loan or BA Equivalent Loan, on the last day of the Interest Period applicable to the Borrowing of which such LIBO Loan or BA Equivalent Loan is a part, and, in addition, if such LIBO Loan or BA Equivalent Loan has an Interest Period of greater than ninety (90) days, on the last day of every third month of such Interest Period.

“Interest Period” means, with respect to any LIBO Borrowing or BA Equivalent Loan, the period commencing on the date of such Borrowing and ending (i) with respect to LIBO Borrowings only, on the day that is one (1) week thereafter, or (ii) ending on the numerically corresponding day in the calendar month that is one (1), two (2), three (3), or six (6) months thereafter (or, if consented to by all Domestic Lenders or all Canadian Lenders, as applicable, nine (9) or twelve (12) months thereafter) (or such shorter period, to the extent available, to which the Administrative Agent or the Canadian Agent, as applicable, may reasonably consent), as the Lead Borrower or the Canadian Borrower, as applicable, may elect by notice to the Administrative Agent or the Canadian Agent in accordance with the provisions of this Agreement; provided, however, that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (b) any Interest Period of one month or more that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month during which such Interest Period ends) shall end on the last Business Day of the calendar month of such Interest Period, and (c) no Interest Period shall extend beyond the Maturity Date. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

“IntermediateCo” means Wayne Real Estate Parent Company, LLC, aDelaware limited liability company.

“IntermediateCo Unsecured Guarantee” means that certain guarantee agreement, dated as of the First Amendment Effective Date, pursuant to which IntermediateCo shall provide an unsecured guarantee to the Term B-4 Lenders.

“Inventory” has the meaning assigned to such term in the Security Agreement or the General Security Agreement and, as regards the Canadian Borrower, includes all “inventory” as defined in the PPSA.

“Inventory Advance Rate” means ninety percent (90%).

“Inventory Reserves” means such reserves as may be established from time to time by any Co-Collateral Agent (after consultation with the other Co-Collateral Agent), in its reasonable commercial discretion exercised in good faith, with respect to changes in the determination of the saleability, at retail, of the Eligible Inventory or which reflect such other factors as negatively affect the market value of the Eligible Inventory.

“Investment” means, with respect to any Person:

(a)    Any Capital Stock of another Person, evidence of Indebtedness or other security of another Person, including any option, warrant or right to acquire the same;

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(b)    Any loan, advance, contribution to capital, extension of credit (except for current trade and customer accounts receivable for inventory sold or services rendered in the ordinary course of business) to another Person;

(c)    Any Acquisition; and

(d)    Any other investment of money or capital in order to obtain a profitable return,

in all cases, whether now existing or hereafter made. For purposes of calculation, the amount of any Investment outstanding at any time shall be the aggregate cash Investment less all cash returns, cash dividends and cash distributions (or the fair market value of any non-cash returns, dividends and distributions) received by such Person.

“ISDA Master Agreement” means the form entitled “2002 ISDA Master Agreement” or such other replacement form then currently published by the International Swap and Derivatives Association, Inc., or any successor thereto.

“ISP” means, with respect to any Letter of Credit, the International Standby Practices 1998 (International Chamber of Commerce Publication No. 590) and any subsequent revision thereof adopted by the International Chamber of Commerce on the date such Letter of Credit is issued.

“Issuing Banks” means, individually and collectively, (a) as to the Domestic Borrowers, each of Bank of America, N.A., Wells Fargo Bank, National Association, JPMorgan Chase Bank, N.A., and no more than one other Domestic Lender selected by the Lead Borrowerand, who agrees to serve as an Issuing Bank and who is approved by the Administrative Agent in its reasonable discretion (such approval not to be unreasonably withheld), and (b) as to the Canadian Borrower, each of Bank of America-Canada Branch and no more than one other Canadian Lender selected by the Canadian Borrower andwho agrees to serve as an Issuing Bank and who is approved by the Canadian Agent in its reasonable discretion (such approval not to be unreasonably withheld), in each case in its capacity as the issuer of Letters of Credit hereunder, and any successor in such capacity. Any Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate.

“Joinder Agreement” shall mean an agreement, in the form attached hereto as Exhibit H, pursuant to which, among other things, a Person becomes a party to, and bound by the terms of, this Agreement and/or the other Loan Documents in the same capacity and to the same extent as either a Borrower or a Facility Guarantor, as the Administrative Agent may determine.

“Judgment Conversion Date” has the meaning set forth in SECTION 9.19.

“Judgment Currency” has the meaning set forth in SECTION 9.19.

“Latest Maturity Date” means, at any date of determination, the latest maturity or

expiration date applicable to any Commitment hereunder at such time, including the latest

maturity or expiration date of any Extended Commitment as extended in accordance with this Agreement from time to time.

“Landlord Lien State” means Washington, Virginia, Pennsylvania and such other state(s) or province(s) in which a landlord’s claim for rent has priority by operation of Applicable Law over the lien of the Administrative Agent or the Canadian Agent in any of the Collateral.

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“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof, or the renewal thereof.

“L/C Credit Support” has the meaning set forth in SECTION 2.13(k).

“Lead Borrower” has the meaning set forth in the Preamble to this Agreement.

“Lease” means any agreement, whether written or oral, no matter how styled or structured, pursuant to which a Loan Party is entitled to the use or occupancy of any space in a structure, land, improvements or premises for any period of time.

“Lenders” means, collectively, the Domestic Lenders and the Canadian Lenders and each assignee that becomes a party to this Agreement as set forth in SECTION 9.04(b) and each Additional Commitment Lender that becomes a party to this Agreement as set forth in SECTION 2.02.

“Letter of Credit” means a letter of credit that is (i) issued by an Issuing Bank pursuant to this Agreement for the account of a Borrower, (ii) a Standby Letter of Credit or Commercial Letter of Credit, issued in connection with the purchase of Inventory by a Borrower and for other purposes for which such Borrower has historically obtained letters of credit, or for any other purpose that is reasonably acceptable to the Administrative Agent or the Canadian Agent, as applicable, and (iii) in form reasonably satisfactory to the applicable Issuing Bank.

“Letter of Credit Disbursement” means a payment made by an Issuing Bank to the beneficiary of, and pursuant to, a Letter of Credit.

“Letter of Credit Outstandings” means, collectively, Canadian Letter of Credit Outstandings and Domestic Letter of Credit Outstandings. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of any Rule under the ISP or any article of the UCP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

“Letter of Credit Fees” means the fees payable in respect of Letters of Credit pursuant to SECTION 2.19.

“LIBO Borrowing” means a Borrowing comprised of LIBO Loans.

“LIBO Loan” shall mean any Loan bearing interest at a rate determined by reference to the Adjusted LIBO Rate in accordance with the provisions of Article II.

“LIBO Rate” means:

(a)    for any Interest Period with respect to a LIBO Loan, the rate per annum equal to the London interbank offered rate administered by ICE Benchmark Administration Limited (“ICE LIBOR”), as published by Reuters (or other commercially available source providing quotations of ICE LIBOR as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period. If such rate is not available at such time for any reason, then the “LIBO Rate” for such Interest Period shall be the rate per annum determined by the Agent to be the rate at which deposits in Ddollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the LIBO Loan being made, continued or Converted by Bank of America

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and with a term equivalent to such Interest Period would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period; and

(b)    for any interest calculation with respect to a Prime Rate Loan on any date, the rate per annum equal to (i) ICE LIBOR, as published by Reuters (or other commercially available source providing quotations of ICE LIBOR as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to such date for Dollar deposits being delivered in the London interbank market for a term of one month commencing that day or (ii) if such published rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which deposits in Ddollars for delivery on the date of determination in same day funds in the approximate amount of the Prime Rate Loan being made or maintained and with a term equal to one month would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at the date and time of determination.

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, collateral assignment, charge or security interest in, on or of such asset, and, with respect to the Canadian Borrower, also includes any prior claim or deemed trust in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

“Line Cap” means, at any time of determination, the lesser of (a) the sum of the Total Commitments or (b) the Combined Borrowing Base.

“Liquidation” means the exercise by the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, of those rights and remedies accorded to the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, under the Loan Documents and Applicable Law as a creditor of the Loan Parties, including (after the occurrence and during the continuation of an Event of Default) the conduct by the Loan Parties, acting with the consent of the Co-Collateral Agents, of any public, private or “Going-Out-Of-Business Sale” or other disposition of Collateral for the purpose of liquidating the Collateral. Derivations of the word “Liquidation” (such as “Liquidate”) are used with like meaning in this Agreement.

“Liquidation Percentage” shall mean, (a) for any Lender(other than a Tranche A-1 Lender), a fraction, the numerator of which is the sum of such Lender's Domestic Commitment and Canadian Commitment on the Determination Date and the denominator of which is the sum of the Total Commitments of all Lenders on the Determination Date., and (b) for any Tranche A-1 Lender, a fraction, the numerator of which is such Tranche A-1 Lender's outstanding Tranche A-1 Loans on the Determination Date and the denominator of which is the sum of all outstanding Tranche A-1 Loans of all Tranche A-1 Lenders on the Determination Date .

“Loan Account” has the meaning provided in SECTION 2.20.

“Loan Documents” means this Agreement, the Notes, the Letters of Credit, the Intercreditor Agreement and the Security Documents and any other instrument or agreement now or hereafter executed and delivered by a Loan Party in connection herewith that is expressly designated to be a “Loan

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Document” (excluding agreements entered into in connection with any transaction arising out of any Bank Product or Cash Management Services), each as amended and in effect from time to time.

“Loan Party” or “Loan Parties” means the Borrowers and the Facility Guarantors.

“Loans” means all Revolving Credit Loans (including Domestic Loans and Canadian Loans), Swingline Loans, Tranche A-1 Loans and other advances to or for account of any of the Borrowers pursuant to this Agreement.

“Low Selling Period” means (i) with respect to the TRU Inventory owned by the Domestic Loan Parties and all Inventory owned by the Canadian Loan Parties, the period in each year commencing on the first day after the first Sunday after December 15^th and ending on October 14^th of the subsequent year and (ii) with respect to BRU Inventory owned by the Domestic Loan Parties, the period in each year commencing on November 1 and ending on January 31 of the subsequent year.

“Margin Stock” has the meaning assigned to such term in Regulation U.

“Master Lease” means, collectively, each of the Master Leases entered into by a Loan Party with any Special Purpose Entity of the Parent and its Subsidiaries, and any and all modifications thereto, substitutions therefore and replacements thereof made with the consent of the Co-Collateral Agents or not in violation of the provisions of SECTION 6.09.

“Master Lease Liquidation Event” means the acceleration of any Indebtedness of a Special Purpose Entity (or any successor in interest thereto) which is secured by the Real Estate which is the subject of a Master Lease, whether under the CMBS Facilities, the Supplemental Real Estate Facilities or otherwise, and the commencement of the exercise of remedies seeking to collect such Indebtedness (including, without limitation, foreclosure, by the holder of such Indebtedness), as a result of which either (a) the Loan Parties occupying such Real Estate could reasonably be expected to be dispossessed of such Real Estate due to the failure by the Loan Party to fulfill the terms of any SNDA or (b) any Access Agreement could reasonably be expected to be unenforceable or ineffective.

“Material Adverse Effect” means any event, facts, or circumstances, which, after the Effective Date, has a material adverse effect on (a) the business, assets, financial condition or income of the Loan Parties taken as a whole or (b) the validity or enforceability of this Agreement or the other Loan Documents in any material respect or any of the material rights or remedies of the Secured Parties hereunder or thereunder.

“Material Indebtedness” means Indebtedness (other than the Obligations) of the Loan Parties, individually or in the aggregate, having an aggregate principal amount exceeding $190,000,000.

“Material Canadian Subsidiary” means, as to any Person, a Canadian Subsidiary of such Person that, as of the end of the most recent Fiscal Quarter for which annual financial statements or quarterly financial statements (whichever are more recent) are available prior to the date of determination, (a) owns assets consisting of Inventory, Accounts, and Eligible Real Estate of more than $5,000,000, individually, or collectively with all non-Material Canadian Subsidiaries, more than $15,000,000 of such assets, (b) owns tangible net assets (as determined in accordance with GAAP), whether or not of the type included in the Canadian Borrowing Base of more than $20,000,000 or (c) has been designated by the Lead Borrower in a written notice to the Administrative Agent as a Material Canadian Subsidiary. The designation of a Subsidiary as a “Material Canadian Subsidiary” shall be permanent notwithstanding any subsequent

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reduction in such Subsidiary’s net tangible assets, unless otherwise consented to by the Administrative Agent.

“Material Domestic Subsidiary” means, as to any Person, a Domestic Subsidiary of such Person that, as of the end of the most recent Fiscal Quarter for which annual financial statements or quarterly financial statements (whichever are more recent) are available prior to the date of determination, (a) owns assets consisting of Inventory and Accounts of more than $10,000,000, individually, or collectively with all non-Material Domestic Subsidiaries, more than $40,000,000 of such assets, (b) owns tangible net assets (as determined in accordance with GAAP), whether or not of the type included in the Tranche A Borrowing Base of more than $50,000,000 or (c) has been designated by the Lead Borrower in a written notice to the Administrative Agent as a Material Domestic Subsidiary. The designation of a Subsidiary as a “Material Domestic Subsidiary” shall be permanent notwithstanding any subsequent reduction in such Subsidiary’s net tangible assets, unless otherwise consented to by the Administrative Agent. Notwithstanding the foregoing, Geoffrey Holdings LLC (as well as any successor direct parent company of Geoffrey) and each other Subsidiary of the Lead Borrower that is a Loan Party on the Effective Date (in each case so long as they are a Subsidiary of a Loan Party), shall at all times be deemed a Material Domestic Subsidiary.

“Material Subsidiary” means a Material Canadian Subsidiary or a Material Domestic Subsidiary, as the case may be.

“Maturity Date” means, subject to SECTION 2.17, (a) with respect to all Obligations other than the Tranche A-1 Loans, the date that is five (5) years from the Effective Date, and (b) with respect to Tranche A-1 Loans, the date that is five (5) years from the First Amendment Effective Date.

“Maximum Rate” has the meaning provided in SECTION 9.13.

“Minority Lenders” has the meaning provided in SECTION 9.02(c).

“MLPFS” means Merrill Lynch, Pierce, Fenner & Smith Incorporated and its successors.

“Monthly Excess Availability” means, for any date of calculation, Excess Availability on the last day of each month during such measurement period.

“Moody’s” means Moody’s Investors Service, Inc.

“Mortgages” means the Collateral Mortgages, Assignments of Leases and Rents, Hypothecs of Immoveable Property and any other security documents granting a Lien on Real Estate between the Loan Party owning the Real Estate encumbered thereby and the Canadian Agent for the benefit of the Canadian Agent and the other Secured Parties.

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

“Net Proceeds” means, with respect to any event, (a) the cash proceeds received in respect of such event, including (i) any cash received in respect of any non-cash proceeds, but only as and when received, (ii) in the case of a casualty, insurance proceeds, and (iii) in the case of a condemnation or similar event, condemnation awards and similar payments, in each case net of (b) the sum of (i) all reasonable fees and out-of-pocket fees and expenses (including appraisals, and brokerage, legal, title and recording or transfer tax expenses and commissions) paid by any Loan Party or a Subsidiary to third parties (other than Affiliates, except to the extent permitted under SECTION 6.07 hereof) in connection with such event, and (ii) in the case of a sale or other disposition of an asset (including pursuant to a casualty or condemnation), the amount

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of all payments required to be made by any Loan Party or any of their respective Subsidiaries as a result of such event to repay (or to establish an escrow for the repayment of) any Indebtedness (other than the Obligations and any other obligations secured by the Security Documents) secured by a Permitted Encumbrance that is senior to the Lien of the Administrative Agent or Canadian Agent, as applicable, and (iii) as long as the Determination Date has not occurred, capital gains or other income taxes paid or payable as a result of any such sale or disposition (after taking into account any available tax credits or deductions).

“New Extended Commitments” has the meaning provided in SECTION 2.28(c).

“New Revolving Commitment Lenders” has the meaning provided in SECTION 2.28(c).

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

“Notes” means, collectively, (a) the Revolving Credit Notesand, (b) the Swingline Notes, and (c) the Tranche A-1 Notes, each as may be amended, supplemented or modified from time to time.

“Obligations” means (a) (i) the principal of, and interest (including all interest that accrues after the commencement of any case or proceeding by or against any Borrower or Facility Guarantor under the Bankruptcy Code or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding) on the Loans and Facility Guarantees, (ii) other amounts owing by the Loan Parties under this Agreement or any other Loan Document in respect of any Letter of Credit, including payments in respect of reimbursement of disbursements, interest thereon and obligations to provide cash collateral and (iii) all other monetary obligations, including fees, costs, expenses and indemnities (including all fees, costs, expenses and indemnities that accrue after the commencement of any case or proceeding by or against any Borrower or Facility Guarantor under the Bankruptcy Code or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding), whether primary, secondary, direct, contingent, fixed or otherwise, of the Loan Parties to the Secured Parties under this Agreement and the other Loan Documents, and (b) the due and punctual payment and performance of all the covenants, agreements, obligations and liabilities of each Loan Party under or pursuant to this Agreement and the other Loan Documents. Without limiting the foregoing, for purposes of clarity, whenever used herein the term “Obligations” shall include all Canadian Liabilities.

“Other Borrower” means each Person who shall from time to time enter into a Joinder Agreement as a “Domestic Borrower” hereunder.

“Other Liabilities” means (a) any Cash Management Services furnished to any of the Loan Parties or any of their Subsidiaries and/or (b) any transaction with any Agent, the Canadian Agent, any Lender or any of their respective Affiliates, which arises out of any Bank Product entered into with any Loan Party and any such Person, as each may be amended from time to time.

“Other Taxes” means any and all current or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document.

“Participant” shall have the meaning provided in SECTION 9.04(e).

“Participant Register” has the meaning provided in SECTION 9.04(e).

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“Parent” means Toys “R” Us, Inc., a Delaware corporation.

“Payment Conditions” means, at the time of determination with respect to a specified transaction or payment, that (a) no Specified Default then exists or would arise as a result of the entering into of such transaction or the making of such payment, (b) after giving effect to such transaction or payment, the Pro Forma Availability Condition has been satisfied, and (c) either (i) the Consolidated Fixed Charge Coverage Ratio, as calculated on a trailing twelve months basis after giving effect to such transaction or payment, is greater than 1.0:1.0, or (ii) after giving effect to such transaction or payment, the Pro Forma Availability for each of the six Fiscal Months following, and after giving effect to, such transaction or payment, will be greater than twenty-five percent (25%) of the Line Cap. Prior to undertaking any transaction or payment which is subject to the Payment Conditions, the Loan Parties shall deliver to the Administrative Agent evidence of satisfaction of the conditions contained in clauses (b) and (c) above on a basis reasonably satisfactory to the Administrative Agent; providedthat no such evidence shall be required to be delivered if, at the time of such transaction or payment, no Loans are outstanding hereunder.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

“Permanent Financing Facility” means any Indebtedness facility or facilities, the proceeds of which are used for any purpose determined by the Responsible Officers in their reasonable business judgment and otherwise permitted hereunder, so long as after giving effect thereto (i) the final maturity date of such Indebtedness (including all options of the Borrowers to extend the maturity date included in the documentation evidencing same) shall be on or after the Maturity Date, and (ii) no scheduled principal amortization in excess of $200,000,000 in any Fiscal Year or $500,000,000 in the aggregate after the Effective Date is required until on or after the Maturity Date.

“Permitted Acquisition” means any Acquisition in which each of the following conditions is satisfied:

(a)    No Default or Event of Default then exists or would arise from the consummation of such Acquisition;

(b)    Such Acquisition shall have been approved by the Board of Directors of the Person (or similar governing body if such Person is not a corporation) which is the subject of such Acquisition and such Person shall not have announced that it will oppose such Acquisition or shall not have commenced any action which alleges that such Acquisition will violate Applicable Law;

(c)    The Lead Borrower shall have furnished the Administrative Agent with five (5) Business Days prior written notice of such intended Acquisition and shall have furnished the Administrative Agent with (i) a current draft of the acquisition agreement and other material acquisition documents relating to the Acquisition and (ii) to the extent the purchase price relating to the Acquisition is in excess of $100,000,000 (excluding such portion of the purchase price consisting of Capital Stock or Subordinated Indebtedness of a Loan Party (or cash proceeds of the issuance of the foregoing) or contingent Earn-Out Obligations), a summary of due diligence undertaken by the Borrowers in connection with such Acquisition, applicable financial statements of the Person which is the subject of such Acquisition, pro forma projected financial statements for

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the twelve (12) month period following such Acquisition after giving effect to such Acquisition (including balance sheets, cash flows and income statements by month for the acquired Person, individually, and on a Consolidated basis with all Loan Parties) and such other information readily available to the Loan Parties as the Administrative Agent shall reasonably request;

(d)    To the extent the purchase price relating to the Acquisition is in excess of $100,000,000 and any portion of such amount is financed with the proceeds of any Credit Extensions, the legal structure of the Acquisition shall be acceptable to the Administrative Agent in its reasonable discretion (provided the Administrative Agent’s indication of acceptability shall not be unreasonably withheld or delayed);

(e)    If the Acquisition is an Acquisition of Capital Stock, (i) a Loan Party shall acquire and own, directly or indirectly, a majority of the Capital Stock in the Person being acquired and (ii) shall Control a majority of any voting interests or otherwise Control the governance of the Person being acquired;

(f)    Any material assets acquired shall be utilized in, and if the Acquisition involves a merger, consolidation or stock acquisition, the Person which is the subject of such Acquisition shall be engaged in, a business otherwise permitted to be engaged in by a Borrower under this Agreement;

(g)    If the Person which is the subject of such Acquisition will be maintained as a Subsidiary of a Loan Party, or if the assets acquired in an acquisition will be transferred to a Subsidiary which is not then a Loan Party, such Subsidiary shall have been joined as a “Borrower” hereunder or as a Facility Guarantor, as required by SECTION 5.12, and the Administrative Agent or the Canadian Agent, as applicable, shall have received a first priority security and/or mortgage interest (subject only to Permitted Encumbrances (x) having priority by operation of Applicable Law on Collateral included in the Tranche A Borrowing Base and/or the Canadian Borrowing Base, or (y) on any Collateral not described in clause (x) above) in such Subsidiary’s Inventory, Accounts and other property constituting Collateral under the Security Documents in order to secure the Obligations and the Other Liabilities (or the Canadian Liabilities if such Person is a Canadian Loan Party); and

(h)    The Borrowers shall have satisfied the Payment Conditions.

“Permitted Canadian Overadvance” means a Canadian Overadvance made by the Canadian Agent, in its reasonable discretion, or at the direction of any Co-Collateral Agent, which:

(a)    Is made to maintain, protect or preserve the Collateral and/or the Secured Parties’ rights under the Loan Documents or which is otherwise for the benefit of the Secured Parties; or

(b)    Is made to enhance the likelihood of, or maximize the amount of, repayment of any Obligation; or

(c)    Is made to pay any other amount chargeable to the Canadian Borrower hereunder; and

(d)    Together with all other Permitted Canadian Overadvances then outstanding, shall not (i) exceed the lesser of $10,000,000 or five percent (5%) of the Canadian Borrowing Base in

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the aggregate outstanding at any time, (ii) unless a Liquidation is occurring, remain outstanding for more than forty-five (45) consecutive Business Days, and (iii) unless a Liquidation is occurring, be made more than on one occasion during any 180 consecutive day period or on more than two occasions in any twelve month period, unless, in the case of clauses (ii) and (iii), the Required Lenders otherwise agree;

providedhowever, that the foregoing shall not (i) modify or abrogate any of the provisions of SECTION 2.13(e) regarding any Lender’s obligations with respect to Letter of Credit Disbursements, or (ii) result in any claim or liability against the Canadian Agent or any Co-Collateral Agent (regardless of the amount of any Canadian Overadvance) for “inadvertent Canadian Overadvances” (i.e. where a Canadian Overadvance results from changed circumstances beyond the control of the Canadian Agent or the Co-Collateral Agents (such as a reduction in the collateral value)) and such “inadvertent Overadvances” shall not reduce the amount of Permitted Canadian Overadvances allowed hereunder; providedfurther that in no event shall the Canadian Agent make a Canadian Overadvance, if after giving effect thereto, the principal amount of the Canadian Loans and the then amount of the Canadian Letter of Credit Outstandings would exceed the aggregate of the Canadian Commitments (as in effect prior to any termination of the Canadian Commitments pursuant to SECTION 7.01).

“Permitted Disposition” means any of the following:

(a)    (i) Licenses, sublicenses, settlement of claims, and entering into co-existence agreements with respect to intellectual property or (ii) licenses of licensed departments of a Loan Party or any of its Subsidiaries, in each case, in the ordinary course of business or (iii) the sale, transfer or other disposition of intellectual property (or related rights thereto) to Geoffrey so long as such intellectual property (or related rights thereto) is subject to the Intercompany Licenses (as defined in the Security Agreement) and the Intellectual Property Rights Agreement;

(b)    As long as no breach of the provisions of SECTION 6.10 hereof then exists or would arise therefrom, bulk sales or other dispositions of the Loan Parties’ Inventory not in the ordinary course of business in connection with Store closings, at arm’s length; providedthat such Store closures and related Inventory dispositions shall not exceed (i) in any Fiscal Year of the Parent and its Subsidiaries, fifteen percent (15%) of the number of the Loan Parties’ Stores as of the beginning of such Fiscal Year (net of new Store openings) and (ii) in the aggregate from and after the Effective Date, thirty percent (30%) of the number of the Loan Parties’ Stores in existence as of the Effective Date (net of new Store openings); providedfurther that all sales of Inventory in connection with Store closings in a transaction or series of related transactions which in the aggregate involve Inventory having a value greater than $20,000,000 at Cost shall be in accordance with liquidation agreements and with professional liquidators reasonably acceptable to the Co-Collateral Agents; providedfurther that all Net Proceeds received in connection therewith, whether or not a Cash Dominion Event then exists, shall be paid over to the Administrative Agent on receipt by the Loan Parties and shall be utilized to prepay the Loans in the order of priority set forth in SECTION 7.03; and providedfurther that, notwithstanding the existence of a breach of the provisions of SECTION 6.10 hereof, such bulk sales or dispositions may be undertaken in accordance with this clause (b) if, as a result thereof, Excess Availability would be greater than existed prior to such disposition;

(c)    Dispositions of assets (other than Real Estate and other than assets included in the Canadian Borrowing Base or the Tranche A Borrowing Base) that are substantially worn, damaged, obsolete or, in the judgment of a Loan Party, no longer useful or necessary in its business or that of any Subsidiary;

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(d)    Sales, transfers and dispositions among the Loan Parties; providedthat no such sales, transfers or dispositions shall be made from a Domestic Loan Party to a Canadian Loan Party, if, after giving effect thereto, the provisions of SECTION 6.10 hereof would be breached;

(e)    As long as no Specified Default then exists or would arise therefrom, sales and transfers of Real Estate of any Domestic Loan Party (or sales or transfers of any Person or Persons created to hold such Real Estate or the equity interests in such Person or Persons), including sale-leaseback transactions involving any such Real Estate, as long as: (i) such sale or transfer is made for fair market value; (ii) any such lease is on market terms (iii) if such sale or transfer is made to a non-Affiliated Person, the consideration received for such sale or transfer is at least 50% cash or, if such sale or transfer is to an Affiliated Person, the entire consideration received for such sale or transfer is paid in cash;

providedthat, in the case of any sale-leaseback transaction permitted hereunder, the Agents shall have received from each such purchaser or transferee a collateral access agreement on terms and conditions reasonably satisfactory to the Agents; provided further that, notwithstanding the existence of a breach of the provisions of SECTION 6.10 hereof, sales (but not transfers) of Real Estate of the Domestic Loan Parties may be undertaken in accordance with this clause (e) if, as a result thereof, Excess Availability would be greater than existed prior to such sales;

(f)    Sales or forgiveness of Accounts in the ordinary course of business or in connection with the collection or compromise thereof;

(g)    Leases, subleases, licenses and sublicenses of real or personal property entered into by Loan Parties and their Subsidiaries in the ordinary course of business at arm’s length and on market terms;

(h)    Sales of non-core assets acquired in connection with Permitted Acquisitions which are not used in the business of the Loan Parties;

(i)    Issuances of equity by Foreign Subsidiaries (other than the Canadian Borrower or any other Canadian Subsidiary) to qualifying directors of such Foreign Subsidiaries;

(j)    As long as no Event of Default would arise therefrom, sales or other dispositions of Permitted Investments (other than those described in clauses (h)(ii), (i), (n), (o), (p), (u), (v), and (x) of the definition thereof) and the Loan Parties’ interest in SALTRU Associates JV;

(k)    Any disposition of Real Estate to a Governmental Authority as a result of a condemnation of such Real Estate; providedthat all Net Proceeds received from Real Estate of the Canadian Loan Parties in connection therewith are applied to the Canadian Liabilities, if then required in accordance with SECTION 2.17 or SECTION 2.18 hereof;

(l)    The making of (i) Permitted Investments, and (ii) Restricted Payments and other payments, in each case under this clause (ii) to the extent permitted under SECTION 6.06;

(m)    Permitted Encumbrances;

(n)    Leasing of Real Estate no longer used in the business of the Loan Parties;

(o)    Exchanges or swaps of Equipment, Store leases and other Real Estate of the Domestic Loan Parties having substantially equivalent value; providedthat, upon the completion of any such

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exchange or swap, (i) the Administrative Agent or the Canadian Agent, as applicable, for its own benefit and the benefit of other Secured Parties, has a perfected first priority lien (subject only to Permitted Encumbrances having priority by operation of Applicable Law) in such Equipment received by the Loan Parties, and (ii) all Net Proceeds, if any, received in connection with any such exchange or swap of Equipment are applied to the Obligations or the Canadian Liabilities, as applicable, if then required in accordance with SECTION 2.17 or SECTION 2.18 hereof;

(p)    Forgiveness of Permitted Investments described in clauses (h)(ii), (i), and (n) of the definition thereof as long as the Payment Conditions are satisfied at the time of forgiveness or as otherwise provided under clause (v) of the definition of “Permitted Investments”;

(q)    As long as no Event of Default exists or would arise as a result of the transaction, sales of a Subsidiary (or any Special Purpose Entity or its subsidiaries) or any business segment, or any portion thereof (including, in each case, sales of any Person created to hold such assets), (i) to a Person other than a Loan Party or a Subsidiary or Affiliate of a Loan Party, for fair market value, or (ii) to a Subsidiary or Affiliate of a Loan Party, if the Payment Conditions are satisfied; providedthat, in each case, such sale shall be for cash in an amount at least equal to the greater of the amounts advanced or available to be advanced against the assets included in the sale under the Tranche A Borrowing Base or Canadian Borrowing Base, as applicable; providedfurther that all Net Proceeds, if any, received in connection with any such sales are applied to the Obligations or the Canadian Liabilities, as applicable, if then required in accordance with SECTION 2.17 or SECTION 2.18 hereof;

(r)    As long as no breach of the provisions of SECTION 6.10 hereof exists or would arise as a result of the transaction, sales or other dispositions of Real Estate of the Canadian Loan Parties for fair market value; providedthat such sale shall be for cash in an amount at least equal to the greater of the amounts advanced or available to be advanced against the assets included in the sale under the Canadian Borrowing Base; providedfurther that all Net Proceeds, if any, received in connection with any such sales are applied to the Canadian Liabilities, if then required in accordance with SECTION 2.17 or SECTION 2.18 hereof; and provided further that, notwithstanding the existence of a breach of the provisions of SECTION 6.10 hereof, sales of Real Estate of the Canadian Loan Parties may be undertaken if, as a result thereof, Excess Availability would be greater than existed prior to such sale;

(s)    As long as no Specified Default exists or would arise as a result of the transaction, other dispositions of assets (other than Real Estate and assets included in the Canadian Borrowing Base or the Tranche A Borrowing Base) in an aggregate amount for all Loan Parties not to exceed $100,000,000 in any Fiscal Year; providedthat all Net Proceeds, if any, received in connection with any such sales are applied to the Obligations or the Canadian Liabilities, as applicable, if then required in accordance with SECTION 2.17 or SECTION 2.18 hereof; providedfurther that, notwithstanding the existence of a breach of the provisions of SECTION 6.10 hereof, such dispositions may be undertaken in accordance with this clause (s) if, as a result thereof, Excess Availability would be greater than existed prior to such dispositions; and

(t)    Sale-leaseback transactions of Equipment, to the extent not otherwise prohibited hereunder.

“Permitted Domestic Overadvance” means a Domestic Overadvance made by the Administrative Agent, in its reasonable discretion, or at the direction of any Co-Collateral Agent, which:

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(a)    Is made to maintain, protect or preserve the Collateral and/or the Secured Parties’ rights under the Loan Documents or which is otherwise for the benefit of the Secured Parties; or

(b)    Is made to enhance the likelihood of, or maximize the amount of, repayment of any Obligation; or

(c)    Is made to pay any other amount chargeable to any Domestic Borrower hereunder; and

(d)    Together with all other Permitted Domestic Overadvances then outstanding, shall not (i) exceed the lesser of $100,000,000 or five percent (5%) of the Tranche A Borrowing Base in the aggregate outstanding at any time, (ii) unless a Liquidation is occurring, remain outstanding for more than forty-five (45) consecutive Business Days, and (iii) unless a Liquidation is occurring, be made more than on one occasion during any 180 consecutive day period or on more than two occasions in any twelve month period, unless, in the case of clauses (ii) and (iii), the Required Lenders otherwise agree;

providedhowever, that the foregoing shall not (i) modify or abrogate any of the provisions of SECTION 2.13(e) regarding any Lender’s obligations with respect to Letter of Credit Disbursements, or (ii) result in any claim or liability against the Administrative Agent or any Co-Collateral Agent (regardless of the amount of any Domestic Overadvance) for “inadvertent Domestic Overadvances” (i.e. where a Domestic Overadvance results from changed circumstances beyond the control of the Administrative Agent or the Co-Collateral Agents (such as a reduction in the collateral value)) and such “inadvertent Overadvances” shall not reduce the amount of Permitted Domestic Overadvances allowed hereunder; providedfurther that in no event shall the Administrative Agent make a Domestic Overadvance, if after giving effect thereto, the principal amount of the Domestic Loans and the then amount of the Domestic Letter of Credit Outstandings would exceed the aggregate of the Domestic Commitments (as in effect prior to any termination of the Domestic Commitments pursuant to SECTION 7.01).

“Permitted Encumbrances” means:

(a)    Liens imposed by law for Taxes that are not required to be paid pursuant to SECTION 5.05;

(b)    Carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by Applicable Law (i) arising in the ordinary course of business and securing obligations that are not overdue by more than sixty (60) days, (ii) (A) that are being contested in good faith by appropriate proceedings, (B) as to which the applicable Loan Party or Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (iii) the existence of which would not reasonably be expected to result in a Material Adverse Effect;

(c)    Pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;

(d)    Deposits to secure, or relating to, the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds (and Liens arising in accordance

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with Applicable Law in connection therewith), and other obligations of a like nature, in each case in the ordinary course of business;

(e)    Judgment Liens in respect of judgments that do not constitute an Event of Default under SECTION 7.01(k);

(f)    Easements, covenants, conditions, restrictions, building code laws, zoning restrictions, rights-of-way, development, site plan or similar agreements and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or materially interfere with the ordinary conduct of business of a Loan Party and such other minor title defects, or survey matters that are disclosed by current surveys, but that, in each case, do not interfere with the current use of the property in any material respect;

(g)    Any Lien on any property or asset of any Loan Party set forth on Schedule 6.02; providedthat, if such Lien secures Indebtedness, such Lien shall secure only the Indebtedness listed on Schedule 6.01 as of the Effective Date (and extensions, renewals and replacements thereof permitted under SECTION 6.01);

(h)    (i) Liens on fixed or capital assets acquired by any Loan Party which are permitted under clause (e) of the definition of Permitted Indebtedness, so long as (A) with respect to purchase money Liens and capital leases, such Liens and the Indebtedness secured thereby are incurred prior to or within ninety (90) days after such acquisition or the completion of the construction or improvement thereof (other than refinancings thereof permitted hereunder), (B) the Indebtedness secured thereby does not exceed 100% of the cost of acquisition or improvement of such fixed or capital assets, (C) such Liens shall not violate the terms of the Indentures, and (D) such Liens shall not extend to any other property or assets of the Loan Parties; and (ii) Liens incurred in connection with sale-leaseback transactions of fixed or capital assets permitted under clause (m) of the definition of Permitted Indebtedness, so long as (A) such Liens shall not violate the terms of the Indentures, and (B) such Liens shall not extend to any other property or assets of the Loan Parties;

(i)    Liens in favor of the Administrative Agent or the Canadian Agent, as applicable, for its own benefit and the benefit of the other Secured Parties;

(j)    Landlords’ and lessors’ Liens in respect of rent not in default for more than sixty (60) days or the existence of which, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect;

(k)    Possessory Liens in favor of brokers and dealers arising in connection with the acquisition or disposition of Investments owned as of the Effective Date and Permitted Investments; providedthat such liens (a) attach only to such Investments and (b) secure only obligations incurred in the ordinary course and arising in connection with the acquisition or disposition of such Investments and not any obligation in connection with margin financing;

(l)    Liens arising solely by virtue of any statutory or common law provisions relating to banker’s liens, liens in favor of securities intermediaries, rights of setoff or similar rights and remedies as to deposit accounts or securities accounts or other funds maintained with depository institutions or securities intermediaries;

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(m)    Liens on Real Estate or on the Capital Stock of the Persons owning such Real Estate to finance or refinance Indebtedness permitted by clause (j) of the definition of Permitted Indebtedness; providedthat such Liens shall not apply to any property or assets of the Loan Parties other than the Real Estate or Capital Stock so financed or refinanced;

(n)    Liens attaching solely to cash earnest money deposits in connection with any letter of intent or purchase agreement in connection with a Permitted Acquisition;

(o)    Liens arising from precautionary UCC filings regarding “true” operating leases or the consignment of goods to a Loan Party;

(p)    Voluntary Liens on Fixed Assets in existence at the time such Fixed Assets are acquired pursuant to a Permitted Acquisition or on Fixed Assets of a Subsidiary of a Loan Party in existence at the time such Subsidiary is acquired pursuant to a Permitted Acquisition; providedthat such Liens are not incurred in connection with or in anticipation of such Permitted Acquisition and do not attach to any other assets of any Loan Party or any of its Subsidiaries;

(q)    Liens in favor of customs and revenues authorities imposed by Applicable Law arising in the ordinary course of business in connection with the importation of goods and securing obligations (i) that are not overdue by more than sixty (60) days, (ii)(A) that are being contested in good faith by appropriate proceedings, (B) as to which the applicable Loan Party or Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (iii) the existence of which would not reasonably be expected to result in a Material Adverse Effect;

(r)    Liens placed on any of the assets or equity interests of a Foreign Subsidiary (other than the Canadian Borrower or any other Canadian Loan Party);

(s)    Any interest or title of a licensor, sublicensor, lessor or sublessor under any license or operating or true lease agreement;

(t)    Licenses, sublicenses, leases or subleases granted to third Persons in the ordinary course of business;

(u)    The replacement, extension or renewal of any Permitted Encumbrance; providedthat such Lien shall at no time be extended to cover any assets or property other than such assets or property subject thereto on the Effective Date or the date such Lien was incurred, as applicable;

(v)    Liens on insurance proceeds incurred in the ordinary course of business in connection with the financing of insurance premiums;

(w)    Liens on securities which are the subject of repurchase agreements incurred in the ordinary course of business;

(x)    Liens arising by operation of law under Article 4 of the UCC (or any similar law in Canada) in connection with collection of items provided for therein;

(y)    Liens arising by operation of law under Article 2 of the UCC (or any similar laws in Canada) in favor of a reclaiming seller of goods or buyer of goods;

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(z)    Liens on deposit accounts or securities accounts in connection with overdraft protection and netting services;

(aa)     Security given to a public or private utility or any Governmental Authority as required in the ordinary course of business;

(bb)    With respect to any Real Property located in Canada, any rights, reservations, limitations and conditions contained in the grant from the Crown or any Crown Patent;

(cc)    Liens on royalty payments due or to become due to Geoffrey and its Subsidiaries to secure Indebtedness described in clause (y) of the definition of Permitted Indebtedness;

(dd)    Liens on assets not otherwise permitted hereunder; providedthat (i) if such Liens secure Indebtedness, such Indebtedness is Permitted Indebtedness and (ii) no Collateral consisting of Inventory, Accounts, and Eligible Real Estate and the proceeds thereof is subject to any such Liens (other than those Permitted Encumbrances described in clauses (a) and (b) of the definition of Permitted Encumbrances) and (iii) the aggregate outstanding principal amount of the obligations secured by such Liens does not exceed (as to all Loan Parties) $100,000,000 at any one time;

(ee)    Liens in favor of a financial institution encumbering deposits (including the right of setoff) held by such financial institution in the ordinary course of business in respect of Indebtedness permitted hereunder and which are within the general parameters customary in the banking industry;

(ff)    Liens in the nature of the right of setoff in favor of counterparties to contractual agreements with the Loan Parties (other than the Sponsor Related Parties (other than the Parent and any of its Subsidiaries)) in the ordinary course of business;

(gg)    Liens to secure Indebtedness, to the extent permitted under clauses (h), (i), (w), (aa) and (bb) of the definition of Permitted Indebtedness, provided that the holders of Indebtedness under clauses (h), (i), (aa) and (bb) shall have entered into an intercreditor agreement with the Agents on terms reasonably satisfactory to the Administrative Agent; and

(hh)    Liens on the assets of the Lead Borrower and certain of its Domestic Subsidiaries to secure Indebtedness under the Term Loan;and

(ii)Liens securing the Special Refinancing Indebtedness to the extent such Liens are contemplated in the definition of “Special Refinancing Indebtedness”;

provided, however, that, except as provided in any one or more of clauses (a) through (hh) above, the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness for borrowed money. The designation of a Lien as a Permitted Encumbrance shall not limit or restrict the ability of the Agents to establish any Reserve relating thereto.

“Permitted Indebtedness” means each of the following:

(a)    Indebtedness created under the Loan Documents;

(b)    Indebtedness set forth on Schedule 6.01 and extensions, renewals and replacements of any such Indebtedness, so long as, after giving effect thereto, (i) the principal amount of the

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Indebtedness outstanding at such time is not increased (except by the amount of any accrued interest, reasonable closing costs, expenses, fees, and premium paid in connection with such extension, renewal or replacement), (ii) if the final maturity date of such Indebtedness on Schedule 6.01 is prior to the Maturity Date, the result of such extension, renewal or replacement shall not be an earlier maturity date or decreased weighted average life, and (iii) if the final maturity date of such Indebtedness on Schedule 6.01 is after the Maturity Date, the result of such extension, renewal or replacement shall not be a maturity date earlier than the Maturity Date;

(c)    Indebtedness of any Loan Party to any other Loan Party or to the Parent or any of the Parent’s other Subsidiaries;

(d)    Guarantees by any Loan Party of Indebtedness or other obligations arising in the ordinary course of business of any other Loan Party;

(e)    (i) Purchase money Indebtedness of any Loan Party to finance the acquisition or improvement of any fixed or capital assets (other than Real Estate), including Capital Lease Obligations (including therein any Indebtedness incurred in connection with sale-leaseback transactions permitted under clause (m) of this definition), and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof or result in an earlier maturity date or decreased weighted average life thereof; providedthat the holders of such Indebtedness are not afforded covenants, defaults, rights or remedies more burdensome in any material respect to the obligor or obligors than those contained in the Indebtedness being extended, renewed or replaced; and (ii) Indebtedness secured by Liens on the Loan Parties’ Equipment in an amount not to exceed $150,000,000, and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof or result in an earlier maturity date or decreased weighted average life thereofprovidedfurtherthat, in each case, if requested by the Co-Collateral Agents, the Loan Parties will use commercially reasonable efforts to cause the holder of such Indebtedness to enter into an intercreditor agreement with the Co-Collateral Agents or the Canadian Agent, as applicable, providing for access and use of the property during a Liquidation on terms reasonably satisfactory to the Co-Collateral Agents;

(f)    Indebtedness under Hedge Agreements, other than for speculative purposes, entered into in the ordinary course of business (including on behalf of an Affiliate of a Loan Party);

(g)    Contingent liabilities under surety bonds or similar instruments incurred in the ordinary course of business in connection with the construction or improvement of retail stores;

(h)    Indebtedness of the Lead Borrower and the Domestic Subsidiaries which are guarantors under the Term Loan; providedthat in no event shall the principal amount of such Indebtedness, when combined with Indebtedness outstanding under clauses (i), (aa) and (bb) of this definition, exceed $2,750,000,000 (plus non-cash accruals of interest, accretion or amortization of original issue discount and/or payment-in-kind interest) at any time outstanding;

(i)    Indebtedness under the Permanent Financing Facility; providedthat in no event shall the principal amount of such Indebtedness, when combined with Indebtedness outstanding under clauses (h), (aa) and (bb) of this definition, exceed $2,750,000,000 (plus non-cash accruals of

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interest, accretion or amortization of original issue discount and/or payment-in-kind interest) at any time outstanding;

(j)    Indebtedness incurred for the construction or acquisition or improvement of, or to finance or to refinance, any Real Estate owned by any Loan Party (including therein any Indebtedness incurred in connection with sale-leaseback transactions permitted under clause (m) hereof); providedthat, (i) the incurrence of such Indebtedness shall not violate or result in a default under the Indentures and (ii) with respect to any Eligible Real Estate, the proceeds therefrom are at least equal to the amounts then available to be borrowed with respect thereto under the Canadian Borrowing Base and (iii) all Net Proceeds received in connection with any Indebtedness are applied to the Canadian Liabilities if then required in accordance with SECTION 2.17 or SECTION 2.18 hereof;

(k)    Indebtedness with respect to the deferred purchase price for any Permitted Acquisition; providedthat such Indebtedness does not require the payment in cash of principal (other than in respect of working capital adjustments) prior to the Maturity Date, has a maturity which extends beyond the Maturity Date, and is subordinated to the Obligations and the Other Liabilities on terms materially consistent with Exhibit L hereto or otherwise reasonably acceptable to the Agents;

(l)    Indebtedness due to the Sponsor, Sponsor Related Parties, and/or other stockholders of the Parent and its Affiliates (excluding the Parent and any of its Subsidiaries); providedthat such Indebtedness does not require the payment in cash of principal or interest at a rate in excess of 10% per annum prior to the Maturity Date, has a maturity which extends beyond the Maturity Date, and is subordinated to the Obligations and Other Liabilities on terms reasonably acceptable to the Agents;

(m)    Indebtedness incurred in connection with sale-leaseback transactions permitted hereunder;

(n)    Subordinated Indebtedness;

(o)    Indebtedness incurred by any Foreign Subsidiary (other than the Canadian Borrower or any other Canadian Loan Party) for working capital or general corporate purposes which is not guaranteed by or secured by any assets of any Loan Party (other than the capital stock of such Foreign Subsidiary);

(p)    Indebtedness constituting the obligation to make purchase price adjustments and indemnities in connection with Permitted Acquisitions;

(q)    Guarantees and letters of credit and surety bonds issued in connection with Permitted Acquisitions and Permitted Dispositions;

(r)    Indebtedness incurred in the ordinary course of business in connection with the financing of insurance premiums;

(s)     Indebtedness consisting of the deferred purchase price (including notes issued to officers, directors and employees) for the purchase or redemption of equity interests (or option or warrants or similar instruments) of a Loan Party or Affiliate;

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(t)     Indebtedness of any Loan Party acquired pursuant to a Permitted Acquisition (or Indebtedness assumed at the time, and as a result, of a Permitted Acquisition); providedthat, in each case, such Indebtedness was not incurred in connection with, or in anticipation or contemplation of, such Permitted Acquisition;

(u)    Indebtedness relating to surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

(v)    Wwithout duplication of any other Indebtedness, non-cash accruals of interest, accretion or amortization of original issue discount and/or pay-in-kind interest;

(w)    Indebtedness relating to letters of credit obtained in the ordinary course of business; providedthat the security for any such documentary letter of credit may be secured only by Liens attaching to the related documents of title and not the Inventory represented thereby;

(x)    Indebtedness under each guaranty of recourse obligations and environmental indemnity agreement executed and delivered by the Lead Borrower in connection with the CMBS Facilities or any Supplemental Real Estate Facilities;

(y)    Indebtedness of Geoffrey and its Subsidiaries in connection with the financing of the anticipated royalty payments due or to become due to such Persons;

(z)    Guarantiees of joint venture Indebtedness described in Schedule6.01(z);

(aa)    Indebtedness under the Supplemental Real Estate Facilities; providedthat in no event shall the principal amount of such Indebtedness, when combined with Indebtedness outstanding under the Term Loan, under the Permanent Financing Facility and under clause (bb) of this definition, exceed $2,750,000,000 (plus non-cash accruals of interest, accretion or amortization of original issue discount and/or payment-in-kind interest) at any time outstanding;

(bb)    Otherother Indebtedness (other than Subordinated Indebtedness) so long as at the time of incurrence thereof either (A) the aggregate principal amount of such Indebtedness does not exceed $750,000,000 at any time outstanding (and provided that in no event shall the principal amount of such Indebtedness, when combined with Indebtedness outstanding under the Term Loan, under the Permanent Financing Facility and under clause (aa) of this definition, exceed $2,750,000,000 (plus non-cash accruals of interest, accretion or amortization of original issue discount and/or payment-in-kind interest) at any time outstanding) or (B) the Consolidated Interest Coverage Ratio is at least 2.0:1.0;and

(cc)contribution Indebtedness in an amount equal to the amount of cash equity contributed to the Borrower directly or indirectly by Parent;

(cc)Otherdd)other unsecured Indebtedness in an aggregate principal amount not exceeding $100,000,000 at any time outstanding.; and

(ee)Indebtedness, in an amount up to the Special Refinancing Indebtedness Amount, directly or indirectly, repay, refinance or replace (and in the case of any commitments, terminate) all Term B-2 Loans, Term B-3 Loans, and the Tranche A-1 Loans; provided that, (i) such Indebtedness does not mature earlier than or have a weighted average life to maturity shorter than the Latest Maturity Date, (ii) such Indebtedness shall only be secured by the assets securing the

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Term B-2 Loans and the Term B-3 Loans, (iii) such Indebtedness shall only be guaranteed by the Facility Guarantors (iv) such Indebtedness is subject to the relevant Intercreditor Agreement(s), (v) such Indebtedness has terms and conditions (excluding pricing, interest rate margins, rate floors, discounts, fees, premiums and prepayment or redemption provisions) that are not materially more favorable (when taken as a whole) to the lenders or investors providing such Indebtedness than the terms and conditions of the Term B-2 Loans, the Term B-3 Loans and the Tranche A-1 Loans (when taken as a whole) are to the applicable lenders (except for covenants or other provisions applicable only to periods after the Latest Maturity Date at the time of such refinancing), (vi) such Indebtedness is either (A) incurred by the Lead Borrower or (B) owed to a Special Refinancing Subsidiary through interercompany loans, (vii) the Geoffrey Collateral can secure no more than $200 million of such Indebtedness and any Lien on the Geoffrey Collateral shall be secured on a pari passu basis with the Liens securing the Term B-4 Loans, but in all events the Liens on the Geoffrey Collateral shall be subject to the terms of the Intellectual Property Rights Agreement, and (y) the Collateral can secure no more than $200 million of such Indebtedness on a pari passu basis with the Liens securing the Term B-4 Loans, (viii) the Collateral can secure no more than $280,000,000 of such Indebtedness on a senior basis to the Liens securing the Term B-4 Loans, (ix) such Indebtedness is secured by the Canadian Pledge on a junior priority basis to the Liens securing the Term B-4 Loans and (x) such Indebtedness is not secured by Liens other than those set forth in clauses (ii), (vii), (viii) and (ix) above (such Indebtedness, the “Special Refinancing Indebtedness”).

“Permitted Investments” means each of the following:

(a)    Direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America or, with respect to the Canadian Loan Parties, Canada (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America or Canada, as applicable) or any state or state agency thereof, in each case maturing within one (1) year from the date of acquisition thereof;

(b)    Investments in commercial paper maturing within 360 days from the date of acquisition thereof and having, at the date of acquisition, the highest or next highest credit rating obtainable from S&P or from Moody’s;

(c)    Investments in certificates of deposit, banker’s acceptances and time deposits maturing within 360 days from the date of acquisition thereof which are issued or guaranteed by, or placed with, and demand deposit and money market deposit accounts issued or offered by, any Lender or any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof (or with respect to the Canadian Loan Parties, Canada or any province thereof) that has a combined capital and surplus and undivided profits of not less than $500,000,000;

(d)    Fully collateralized repurchase agreements with a term of not more than thirty (30) days for securities described in clause (a) above (without regard to the limitation on maturity contained in such clause) and entered into with a financial institution satisfying the criteria described in clause (c) above or with any primary dealer;

(e)    Shares of any money market or mutual fund that has substantially all of its assets invested in the types of investments referred to in clauses (a) through (d), above;

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(f)    Investments existing on the Effective Date and set forth on Schedule 6.04;

(g)    Investments made in accordance with the investment policy of the Borrowers set forth as Schedule 6.04(g) hereto;

(h)    Investments made by (i) any Loan Party in any other Loan Party or (ii) as long as no Specified Default then exists or would arise therefrom, any Loan Party in any Subsidiary or Affiliate of any Loan Party (other than to the Sponsors, Sponsor Related Parties or any other stockholder of the Parent) in an aggregate amount not to exceed $25,000,000 at any time outstanding (or in an aggregate amount exceeding $25,000,000025,000,000, providedthat the Pro Forma Availability Condition has been satisfied at the time such Investment is made), in each case determined without regard to any write-downs or write-offs thereof;

(i)    Provided no Specified Default then exists or would arise therefrom, (A) loans made by any Loan Party to any other Loan Party or any Subsidiary or Affiliate of any Loan Party (other than to the Sponsors, Sponsor Related Parties or any other stockholder of the Parent) solely for the purpose of (1) paying scheduled principal payments (including at maturity) due and payable by such Loan Party, Subsidiary or any such Affiliate, or (2) payments in respect of Guarantees of Indebtedness of another Loan Party or any Subsidiary or any such Affiliate of a Loan Party due and payable by such Loan Party, Subsidiary or Affiliate, or (B) loans made by any Loan Party to the Parent or any Subsidiary or any Affiliate of any Loan Party (other than to the Sponsors, Sponsor Related Parties or any other stockholder of the Parent) for the purpose of paying taxes and operating expenses incurred in the ordinary course of business by such Subsidiary or such Affiliate but only to the extent such Subsidiary or such Affiliate has insufficient liquidity or insufficient cash flow to pay such taxes or operating expenses; providedthat in no event shall any Loan Party make loans to any Person other than any other Loan Party pursuant to this clause (i) in an aggregate amount exceeding $25,000,000 at any time outstanding unless the Pro Forma Availability Condition has been satisfied at the time such loans are made;

(j)    Provided no Enumerated Default or breach of SECTION 6.10 then exists or would arise therefrom, (i) loans made by any Loan Party to any other Loan Party or any Subsidiary or Affiliate of any Loan Party (other than to the Sponsors, Sponsor Related Parties or any other stockholder of the Parent) solely for the purpose of paying scheduled interest payments (including at maturity) due and payable by such Loan Party, Subsidiary or any such Affiliate, or (ii) loans made by any Loan Party to any other Loan Party or to the Parent solely for the purpose of paying taxes and operating expenses incurred in the ordinary course of business by such Loan Party or the Parent;

(k)    Guarantees constituting Permitted Indebtedness;

(l)    Guarantees of Indebtedness of Subsidiaries that are not Loan Parties not in excess of $100,000,000 in the aggregate at any time outstanding; providedthat in no event shall any Loan Party issue Guarantees of Indebtedness of Subsidiaries that are not Loan Parties pursuant to this clause (l) in an aggregate amount exceeding $25,000,000 at any time outstanding unless the Pro Forma Availability Condition has been satisfied at the time such Guarantees are issued;

(m)    Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case in the ordinary course of business;

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(n)    Loans or advances to employees for the purpose of travel, entertainment or relocation in the ordinary course of business; providedthat all such loans and advances to employees shall not exceed $20,000,000 in the aggregate at any time, and determined without regard to any write-downs or write-offs thereof;

(o)    Investments received from purchasers of assets pursuant to dispositions permitted pursuant to SECTION 6.05;

(p)    Investments consisting of ownership interests in Special Purpose Entities;

(q)    Permitted Acquisitions and existing Investments of the Persons acquired in connection with Permitted Acquisitions so long as such Investment was not made in contemplation of such Permitted Acquisition;

(r)    Hedge Agreements entered into in the ordinary course of business for non-speculative purposes;

(s)    To the extent permitted by Applicable Law, notes from officers and employees in exchange for equity interests of the Parent purchased by such officers or employees pursuant to a stock ownership or purchase plan or compensation plan;

(t)    Earnest money required in connection with Permitted Acquisitions;

(u)    Subject to SECTION 2.18, Investments in deposit accounts opened in the ordinary course of business;

(v)    (i) Capitalization or forgiveness of any Indebtedness owed to any Loan Party by other Loan Parties (or owed to any Loan Party by an Affiliate of such Loan Party, to the extent simultaneously netted against any payable owed by such Loan Party to such Affiliate) or (ii) capitalization or forgiveness of any Indebtedness owed to any Loan Party by Persons other than Loan Parties, providedthat the Payment Conditions are satisfied after giving effect thereto, and (iii) forgiveness of any Indebtedness owed to a Loan Party which was obtained through a transfer or sale of Real Estate permitted pursuant to clause (e) of the definition of Permitted Dispositions;

(w)    Investments in Foreign Subsidiaries; providedthat such Investments shall not exceed $25,000,000 in the aggregate outstanding at any time (plus the amount of any Net Cash Proceeds of any equity issuance actually used for such purpose);

(x)    Investments to secure obligations of TRU (Vermont), Inc. not to exceed $250,000,000;

(y)    Creation and capitalization of new Subsidiaries, subject to the provisions of SECTION 5.12;

(z)    Capital Expenditures;

(aa)    Investments consisting of loans and advances to the Parent and its Subsidiaries in connection with the reimbursement of expenses incurred on behalf of the Loan Parties in the ordinary course of business;

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(bb)    (i) Other Investments in an amount not to exceed $100,000,000 in the aggregate outstanding at any time, determined without regard to any write-downs or write-offs thereof, plus the amount of cash proceeds received by a Loan Party in the twelve months prior to the date of such Investment from a direct or indirect common equity contribution from the Parent and (ii) other Investments so long as the Payment Conditions are satisfied at the time any such Investment is made;

(cc)    Investments consisting of acquisition of inventory, equipment and other fixed assets in the ordinary course of business; and

(dd)    (i) Investments in SALTRU Associates JV existing as of the Effective Date and additional Investments (including capital contributions) required to be made from time to time pursuant to the organizational documents of SALTRU Associate JV as in effect on the Effective Date, and (ii) other loans, advances or other Investments in SALTRU Associate JV not to exceed, in the case of this clause (ii), $10,000,000;

provided, however, that, for purposes of calculation, the amount of any Investment outstanding at any time shall be the aggregate cash Investment, less all cash returns, cash dividends and cash distributions (or the fair market value of any non-cash returns, dividends and distributions) received by such Person, and lessall liabilities expressly assumed by another Person in connection with the sale of such Investment.

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” means (a) any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Lead Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA or (b) in respect of the Canadian Loan Parties, any pension benefit or retirement savings plan maintained by any of the Canadian Loan Parties for its employees or its former employees to which any of the Canadian Loan Parties contribute or are required to contribute with respect to which any of the Canadian Loan Parties have incurred or may incur liability, including contingent liability.

“PPSA” means the Personal Property Security Act of Ontario (or any successor statute) or similar legislation of any other Canadian jurisdiction, including, without limitation, the Civil Code of Quebec, the laws of which are required by such legislation to be applied in connection with the issue, perfection, enforcement, opposability, validity or effect of security interests.

“Prepayment Event” means the occurrence of any of the following events:

(a)    Any sale, transfer or other disposition (including pursuant to a sale and leaseback transaction, other than such a transaction pursuant to which such asset was initially obtained or constructed in anticipation of such transaction) of any Collateral; or

(b)    Any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation, expropriation or similar proceeding of, any Collateral of a Loan Party, unless (i) the proceeds therefrom are required to be paid to the holder of a Lien on such property or asset having priority over the Lien of the Administrative Agent or the Canadian Agent, as applicable, or (ii) the proceeds therefrom are utilized for purposes of replacing or repairing the

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assets in respect of which such proceeds, awards or payments were received or reinvesting in assets used in any of the Loan Parties’ business within twelve (12) months of the receipt of such proceeds.

“Prime Rate” means, for any day, the highest of: (a) the variable annual rate of interest then most recently announced by Bank of America, N.A. at its head office in Charlotte, North Carolina as its “prime rate”; (b) the Federal Funds Effective Rate in effect on such day plus one-half of one percent (0.50%) per annum; or (c) the Adjusted LIBO Rate (calculated utilizing the LIBO Rate for a one-month Interest Period) plus one percent (1.00%) per annum. The “prime rate” is a reference rate and does not necessarily represent the lowest or best rate being charged by Bank of America, N.A. to any customer. If for any reason the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate or the LIBO Rate for any reason, including the inability or failure of the Administrative Agent to obtain sufficient quotations thereof in accordance with the terms hereof, the Prime Rate shall be determined without regard to clause (b) of the first sentence of this definition or clause (a)(i) of the definition of Adjusted LIBO Rate, as applicable, until the circumstances giving rise to such inability no longer exist. Any change in the Prime Rate due to a change in Bank of America’s “prime rate”, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective on the effective date of such change in Bank of America’s Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.

“Prime Rate Loan” means any Revolving Credit Loan bearing interest at a rate determined by reference to the Prime Rate or the Canadian Prime Rate, as the case may be, in accordance with the provisions of Article II.

“Pro Forma Availability” means, for any date of calculation with respect to any transaction or payment, the projected Monthly Excess Availability as of the last day of each Fiscal Month.

“Pro Forma Availability Condition” means, for any date of calculation with respect to any transaction or payment, the projected Monthly Excess Availability as of the last day of each Fiscal Month for the six (6) Fiscal Months following, and after giving effect to, such transaction or payment, will be greater than $200,000,000.

“Propco” shall mean each direct or indirect subsidiary of the Parent, including, without limitation, those designated as such on Schedule 3.12, the primary assets (other than cash or cash equivalents) of which consist of rights, title and interest (including any leasehold, mineral or other estate) in and to parcels of or interests in Real Estate, whether by lease, license or other means, in each case which has no other Indebtedness other than pursuant to the CMBS Facilities or the Supplemental Real Estate Facilities.

“Pro Rata Percentage” means with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of the sum of the Commitments and Tranche A-1 Loans represented by such Lender’s Commitment and Tranche A-1 Loans at such time (or if the Commitments have been terminated, the percentage of the Total Outstandings).

“Qualified ECP Guarantor” means, at any time, each Loan Party with total assets exceeding $10,000,000 or that qualifies at such time as an “eligible contract participant” under the Commodity Exchange Act and can cause another Person to qualify as an “eligible contract participant” at such time under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

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“Qualifying IPO” means an equity issuance by the Parent consisting of an underwritten primary public offering (other than a public offering pursuant to a registration statement on Form S-8) of its common stock (i) pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act of 1933 as amended (whether alone or in connection with a secondary public offering) and (ii) resulting in gross proceeds to the Parent of at least $100,000,000.

“Real Estate” means all Leases and all land, together with the buildings, structures, parking areas, and other improvements thereon, now or hereafter owned by any Loan Party, including all easements, rights-of-way, and similar rights relating thereto and all leases, tenancies, and occupancies thereof.

“Register” has the meaning provided in SECTION 9.04(c).

“Regulation U” means Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Regulation X” means Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.

“Release” has the meaning provided in Section 101(22) of CERCLA.

“Reports” has the meaning provided in SECTION 8.14.

“Required Availability Amount” means $125,000,000 (which is the initial amount required pursuant to SECTION 6.10) or such greater or lesser amounts as the Borrowers and the Required Lenders may agree.

“Required Lenders” means, at any time, Lenders (other than Defaulting Lenders) having Commitments aggregating more than 50% of the sum of the Total Commitmentsand the Tranche A-1 Loans outstanding, or if the Commitments have been terminated, Lenders (other than Defaulting Lenders) whose percentage of the Total Outstandings (calculated assuming settlement and repayment of all Swingline Loans by the Lenders) aggregate more than 50% of all Total Outstandings.

“Reserves” means all (if any) Inventory Reserves (including, without limitation, Shrink Reserves) and Availability Reserves (including, without limitation, Cash Management Reserves, Canadian Realty Reserves, Customer Credit Liabilities Reserves, Canadian Sales Reserves, the Tranche A-1 Push-Down Reserve, and other Reserves of the type described in SECTION 2.03 hereof).

“Responsible Officer” of any Person shall mean any executive officer or financial officer of such Person and any other officer or similar official thereof with responsibility for the administration of the obligations of such Person in respect of this Agreement.

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any class of Capital Stock of a Person, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Capital Stock of a Person or any option, warrant

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or other right to acquire any Capital Stock of a Person; providedthat “Restricted Payments” shall not include any dividends payable solely in Capital Stock of a Loan Party.

“Revolving Credit Ceiling” means $1,850,000,000, as such amount may be increased from time to time in accordance with SECTION 2.02 or reduced from time to time in accordance with SECTION 2.15 and SECTION 2.17 of this Agreement.

“Revolving Credit Loans” means all loans (other than Tranche A-1 Loans) at any time made by any Lender (including, without limitation, Domestic Loans and Canadian Loans) pursuant to Article II and, to the extent applicable, shall include Swingline Loans made by the Swingline Lender pursuant to SECTION 2.06.

“Revolving Credit Notes” means (a) the promissory notes of the Domestic Borrowers substantially in the form of Exhibit D, each payable to the order of a Domestic Lender, evidencing the Revolving Credit Loans made to the Domestic Borrowers, and (b) the promissory note of the Canadian Borrower substantially in the form of Exhibit E, payable to the order of a Canadian Lender, evidencing the Revolving Credit Loans made to the Canadian Borrower.

“S&P” means Standard & Poor’sFinancial Services LLC or any successor thereto.

“SEC” means the Securities and Exchange Commission.

“Secured Party” means (a) each Credit Party, (b) any Lender or any Affiliate of a Lender providing Cash Management Services or entering into or furnishing any Bank Products to or with any Loan Party, (c) the beneficiaries of each indemnification obligation undertaken by any Loan Party under any Loan Document, and (d) the successors and, subject to any limitations contained in this Agreement, assigns of each of the foregoing.

“Security Agreement” means the Security Agreement dated as of the Closing Date among the Loan Parties (other than the Canadian Borrower and its Subsidiaries) and the Administrative Agent, for its benefit and for the benefit of the other Secured Parties, as amended and in effect from time to time.

“Security Documents” means the Security Agreement, the Canadian Security Documents, the Mortgages, the Intellectual Property Rights Agreement, the Facility Guarantee, the Facility Guarantors’ Collateral Documents, the Blocked Account Agreements, and each other security agreement or other instrument or document executed and delivered pursuant to this Agreement or any other Loan Document to secure any of the Obligations, the Other Liabilities or the Canadian Liabilities, as applicable.

“Settlement Date” has the meaning provided in SECTION 2.22(b).

“Shrink” means Inventory identified by the Borrowers as lost, misplaced, or stolen.

“Shrink Reserve” means an amount reasonably estimated by the Co-Collateral Agents to be equal to that amount which is required in order that the Shrink reflected in Borrowers’ stock ledger would be reasonably equivalent to the Shrink calculated as part of the Borrowers’ most recent physical inventory.

“SNDA” means (a) that certain Subordination, Non-Disturbance and Attornment Agreement, dated as of July 21, 2005, between German American Capital Corporation and the Lead Borrower, as agreed and consented to by MPO Properties, LLC, and (b) that certain Subordination, Non-Disturbance and Attornment Agreement (MPO Properties, LLC), dated as of July 21, 2005, between German American Capital

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Corporation and the Lead Borrower, as agreed and consented to by Giraffe Properties, LLC (n/k/a Toys “R” Us Property Company II, LLC).

“Solvent” means, with respect to any Person on a particular date, that on such date (a) at fair valuation on a going concern basis, all of the properties and assets of such Person are greater than the sum of the debts, including contingent liabilities, of such Person, (b) the present fair saleable value of the properties and assets of such Person on a going concern basis is not less than the amount that would be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person is able to realize upon its properties and assets and generally pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, (d) such Person does not intend to, and does not believe that it will, incur debts beyond such Person’s ability to generally pay as such debts mature, and (e) such Person is not engaged in a business or a transaction, and is not about to engage in a business or transaction, for which such Person’s properties and assets would constitute unreasonably small capital after giving due consideration to the prevailing practices in the industry in which such Person is engaged.

“Special Purpose Entity” means a Person (other than any Loan Party) that (a) is a domestic subsidiary of the Parent and (b) has no operations and whose primary assets (other than cash and cash equivalents) are, directly or indirectly, the stock or other equity interests of a subsidiary that is a Propco and the Real Estate that is the subject of the CMBS Facilities or any Supplemental Real Estate Facilities.

“Special Refinancing Indebtedness” has the meaning assigned to such term in clause (ee) of the definition of “Permitted Indebtedness”.

“Special Refinancing Indebtedness Amount” means an amount equal to the aggregate principal amount of Term B-2 Loans, Term B-3 Loans and the Tranche A-1 Loans outstanding on the First Amendment Effective Date.

“Special Refinancing Subsidiary” means a direct or indirect Subsidiary of the Lead Borrower that incurs Special Refinancing Indebtedness.

“Specified Default” means the occurrence of any Enumerated Default or the failure of any Loan Party to comply with the terms of SECTION 6.10 or the occurrence of any Event of Default specified in SECTION 7.01(g) or SECTION 7.01(j).

“Sponsors” means, collectively, Bain Capital (TRU) VIII, L.P., a Delaware limited partnership; Bain Capital (TRU) VIII-E, L.P., a Delaware limited partnership; Bain Capital (TRU) VIII Coinvestment, L.P., a Delaware limited partnership; Bain Capital Integral Investors, LLC, a Delaware limited liability company; BCIP TCV, LLC, a Delaware limited liability company; Kohlberg Kravis Roberts & Co.; Toybox Holdings, LLC; Vornado Truck, LLC; and Vornado Realty Trust; and each of their respective Affiliates.

“Sponsor Group” means the Sponsors and the Sponsor Related Parties.

“Sponsor Lender Limitations” means, with respect to the Sponsor Group or any of their respective Affiliates which becomes an assignee of any portion of the Obligations, such Person(s) shall have executed a waiver in form and substance reasonably satisfactory to the Administrative Agent pursuant to which such Person(s) acknowledges and agrees that (a) it shall only have the right to vote up to 10% of the sum of the then outstanding Commitments and Tranche A-1 Loans (or if the Commitments have been terminated, the Total Outstandings) and, to the extent that the Sponsor Group or any of their respective Affiliates hold in

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the aggregate more than 10% of the sum of the then outstanding Commitments and Tranche A-1 Loans (or if the Commitments have been terminated, the Total Outstandings), Lenders other than the Sponsor Group or any of their respective Affiliates shall be permitted to vote the outstanding Commitments and Tranche A-1 Loans (or if the Commitments have been terminated, the Total Outstandings) held by the Sponsor Group and/or any of their respective Affiliates in excess of such amount (the “Excess Sponsor Amount”) on a pro rata basis, based on their respective percentage of the then outstanding Commitments and Tranche A-1 Loans (or if the Commitments have been terminated, the Total Outstandings), (b) if the Lead Borrower or the Canadian Borrower requests that this Agreement or any other Loan Document be modified, amended or waived in a manner which would require the consent of the Required Lenders or the Supermajority Lenders, as applicable, no such consent shall be deemed given unless such consent is obtained without giving effect to the Excess Sponsor Amount, and (c) it shall have no right (i) to require the Agents or any Lender to undertake any action (or refrain from taking any action) with respect to any Loan Document, (ii) to attend any meeting with the Agents or any Lender or receive any information from the Agents or any Lender, (iii) to the benefit of any advice provided by counsel to the Agents or the other Lenders or to challenge the attorney-client privilege of the communications between the Agents, such other Lenders and such counsel, or (iv) to make or bring any claim, in its capacity as Lender, against any Agent with respect to the fiduciary duties of such Agent or Lender and the other duties and obligations of the Agents hereunder; except, that, no amendment, modification or waiver to any Loan Document shall, without the consent of the Sponsor Group or any of their respective Affiliates, deprive any such Person, as assignee, of its pro rata share of any payments to which the Lenders as a group are otherwise entitled hereunder.

“Sponsor Related Parties” means, with respect to any Person, (a) any Controlling stockholder or partner (including, in the case of an individual Person who possesses Control, the spouse or immediate family member of such Person, providedthat such Person retains Control of the voting rights, by stockholders agreement, trust agreement or otherwise of the Capital Stock owned by such spouse or immediate family member) or 80% (or more) owned Subsidiary, or (b) any trust, corporation, partnership or other entity, the beneficiaries, stockholders, partners, owners or Persons beneficially holding a 51% or more Controlling interest of which consist of such Person and/or such Persons referred to in the immediately preceding clause (a), or (c) the limited partners of the Sponsors.

“Standby Letter of Credit” means any Letter of Credit other than a Commercial Letter of Credit.

“Stated Amount” means at any time the maximum amount for which a Letter of Credit may be honored.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent or the Canadian Agent, as applicable, is subject with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed pursuant to such Regulation D. LIBO Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

“Store” means any retail store (which includes any real property, fixtures, equipment, inventory and other property related thereto) operated, or to be operated, by any Loan Party.

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“Subordinated Indebtedness” means Indebtedness which is expressly subordinated in right of payment to the prior payment in full of the Obligations on terms materially consistent with Exhibit L hereto or as otherwise reasonably acceptable to the Co-Collateral Agents.

“Subsidiary” means, with respect to any Person (the “parent”), at any date, any corporation, limited liability company, partnership, association or other entity (a) of which Capital Stock representing more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, Controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent. For purposes hereof, a Special Purpose Entity and its subsidiaries and any holding company which has as its primary asset the stock of such Special Purpose Entity shall not be deemed a Subsidiary.

“Substantial Liquidation” means either (a) the Liquidation of substantially all of the Collateral, or (b) the sale or other disposition of substantially all of the Collateral by the Loan Parties.

“Supermajority Lenders” means, at any time, Lenders (other than Defaulting Lenders) having Commitments aggregating more than 66 2/3% of the sum of the Total Commitmentsand the Tranche A-1 Loans outstanding, or if the Commitments have been terminated, Lenders (other than Defaulting Lenders) whose percentage of the Total Outstandings (calculated assuming settlement and repayment of all Swingline Loans by the Lenders) aggregate more than 66 2/3% of all Total Outstandings.

“Supplemental Real Estate Facilities” mean any financing arrangements in favor of certain Special Purpose Entities, which are direct or indirect subsidiaries of the Lead Borrower, and any refinancing, extension or replacement thereof.

“Swap Obligations” means with respect to any Loan Party any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Swingline Lender” means Bank of America, N.A., in its capacity as lender of Swingline Loans hereunder to the Domestic Borrowers hereunder, and Bank of America-Canada Branch, in its capacity as lender of Swingline Loans to the Canadian Borrower hereunder.

“Swingline Loan” means a Loan made by the Swingline Lender to a Domestic Borrower or the Canadian Borrower, as applicable, pursuant to SECTION 2.06.

“Swingline Note” means (a) the promissory note of the Domestic Borrowers substantially in the form of Exhibit F, payable to the order of the applicable Swingline Lender, evidencing the Swingline Loans made by the Swingline Lender to the Domestic Borrowers, and (b) the promissory note of the Canadian Borrower substantially in the form of Exhibit G, payable to the order of the applicable Swingline Lender, evidencing the Swingline Loans made by the Swingline Lender to the Canadian Borrower.

“Synthetic Lease” means any lease or other agreement for the use or possession of property creating obligations which do not appear as Indebtedness on the balance sheet of the lessee thereunder but which, upon the insolvency or bankruptcy of such Person, may be characterized as Indebtedness of such lessee without regard to the accounting treatment.

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“Taxes” means any and all current or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority.

“Term B-2 Loans” has the meaning assigned to such term in the Term Loan Agreement.

“Term B-3 Loans” has the meaning assigned to such term in the Term Loan Agreement.

“Term B-4 Loans” has the meaning assigned to such term in the Term Loan Agreement

“Term Loan Agreement” meansthat certain Amended and Restated Credit Agreement dated as of August 24, 2010 among the Lead Borrower, the lenders party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the other parties thereto, as amended and in effect from time to time in accordance with the terms of the Intercreditor Agreement and any refinancing or replacement thereof in whole or in part (in accordance with the terms of the Intercreditor Agreement).

“Term Loans” means the term loan facilities in favor of the Lead Borrower established under that certain Amended and Restated Credit Agreement dated as of August 24, 2010 among the Lead Borrower, the lenders party thereto, Bank of America, N.A., as administrative agent and collateral agent, and the other parties theretothe Term Loan Agreement, as amended and in effect from time to time in accordance with the terms of the Intercreditor Agreement and any refinancing or replacement thereof in whole or in part (in accordance with the terms of the Intercreditor Agreement), whether in the form of new credit facilities, debt securities or otherwise, so long as the secured parties (or the agent acting on their behalf) under any such refinancing or replacement become party to the Intercreditor Agreement. As of the First Amendment Effective Date, the outstanding principal balances of the Term LoanB-12 Loans due 20162018, the Term LoanB-23 Loans due 2018 and the Term LoanB-34 Loans due 2018 are $649,226,000.00, $373,870,795.00, and $212,465,705.002020 are $135,058,075.29, $68,153,424.71, and $1,025,726,000.00, respectively.

“Termination Date” means the earliest to occur of (a) the Maturity Date, (b) the date on which the maturity of the Obligations is accelerated (or deemed accelerated) and the Commitments are irrevocably terminated (or deemed terminated) in accordance with ARTICLE VII or (c) the date the Commitments are permanently terminated in full in accordance with the provisions of SECTION 2.15 hereof.

“Total Canadian Outstandings” means as of any day, shall be equal to the sum of (a) the principal balance of all Loans made to the Canadian Borrower then outstanding (including Revolving Credit Loans and Tranche A-1 Loans), and (b) the then amount of Canadian Letter of Credit Outstandings.

“Total CanadianRevolverOutstandings” means, as of any day, shall be equal to the sum of (a) the principal balance of all Revolving Credit Loans and Swingline Loans made to the Canadian Borrower then outstanding, and (b) the then amount of Canadian Letter of Credit Outstandings.

“Total Domestic Outstandings” means as of any day, shall be equal to the sum of (a) the principal balance of all Loans made to the Domestic Borrowers then outstanding (including Revolving Credit Loans and Tranche A-1 Loans), and (b) the then amount of Domestic Letter of Credit Outstandings.

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“Total DomesticRevolverOutstandings” means, as of any day, shall be equal to the sum of (a) the principal balance of all Revolving Credit Loans and Swingline Loans made to the Domestic Borrower then outstanding, and (b) the then amount of Domestic Letter of Credit Outstandings.

“Total Commitments” means, at any time, the sum of the Domestic Total Commitments and the Canadian Total Commitments at such time.

“Total Outstandings” means, as of any day, shall be equal to the sum of (a) the Total Canadian Outstandings, and (b) the Total Domestic Outstandings.

“Total Revolver Outstandings” means, as of any day, the sum of the Total Canadian Revolver Outstandings and the Total Domestic Revolver Outstandings.

“Tranche A Borrowing Base” means, at any time of calculation, an amount equal to:

(a)    the face amount of Eligible Credit Card Receivables of the Domestic Borrowers multiplied by ninety percent (90%);

plus

(b)    the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Domestic Borrowers consisting of TRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for TRU Inventory, multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Domestic Borrowers consisting of TRU Inventory;

plus

(c)    the Cost of Eligible Inventory (other than Eligible In-Transit Inventory) of the Domestic Borrowers consisting of BRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for BRU Inventory, multiplied by the Appraised Value of Eligible Inventory (other than Eligible In-Transit Inventory) of the Domestic Borrowers consisting of BRU Inventory;

plus

(d)    the Cost of Eligible In-Transit Inventory of the Domestic Borrowers consisting of TRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for TRU Inventory, multiplied by the Appraised Value of Eligible In-Transit Inventory of the Domestic Borrowers consisting of TRU Inventory; providedthat in no event shall the amounts available to be borrowed pursuant to this clause (d), together with amounts available to be advanced under clause (e) of this definition and clauses (d) and (e) of the definition of “Canadian Borrowing Base”, exceed 12.5% of the Combined Borrowing Base in the aggregate;

plus

(e)    the Cost of Eligible In-Transit Inventory of the Domestic Borrowers consisting of BRU Inventory, net of Inventory Reserves, multiplied by the Inventory Advance Rate for BRU Inventory, multiplied by the Appraised Value of Eligible In-Transit Inventory of the Domestic Borrowers consisting of BRU Inventory; providedthat in no event shall the amounts available to be borrowed pursuant to this clause (e), together with amounts available to be advanced under clause

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(d) of this definition and clauses (d) and (e) of the definition of “Canadian Borrowing Base”, exceed 12.5% of the Combined Borrowing Base in the aggregate;

minus

(f)    the then amount of all Availability Reserves.

“Tranche A-1 Applicable Margin” means, (a) with respect to Tranche A-1 Loans which are LIBO Loans, 7.25% per annum, and (b) with respect to Tranche A-1 Loans which are Prime Rate Loans, 6.25% per annum.

“Tranche A-1 Commitment Increase” has the meaning set forth in SECTION 2.02(e).

“Tranche A-1 Lenders” means, collectively, the Domestic Tranche A-1 Lenders and the Canadian Tranche A-1 Lenders.

“Tranche A-1 Loans” means collectively, all Domestic Tranche A-1 Loans and all Canadian Tranche A-1 Loans.

“Tranche A-1 Notes” means collectively, the Canadian Tranche A-1 Notes and the Domestic Tranche A-1 Notes.

“Tranche A-1 Percentage” means with respect to each Tranche A-1 Lender, that percentage of the Tranche A-1 Loans of all Tranche A-1 Lenders hereunder, in the amount set forth opposite such Tranche A-1 Lender’s name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement.

“Tranche A-1 Push-Down Reserve” means the amount, as of any date of determination, equal to (a) the difference, if a positive number, between the outstanding Domestic Tranche A-1 Loans and Domestic Incremental Availability, and/or (b) the difference, if a positive number, between the outstanding Canadian Tranche A-1 Loans and Canadian Incremental Availability.

“Tri-Party Agreement” means an agreement substantially in the form of Exhibit N among a Loan Party, any Person providing freight, warehousing and consolidation services to such Loan Party and the Administrative Agent or Canadian Agent, as applicable, in which such Person acknowledges that (a) the Administrative Agent holds a first priority Lien on the Inventory of the Loan Parties, (b) such Person has furnished written acknowledgment to such Loan Party that such Person holds Inventory in its possession as bailee for such Loan Party and that such Loan Party has title to such Inventory, (c) any Inventory delivered to a carrier for shipment will reflect a Loan Party as consignor and consignee, (d) it will promptly notify the Administrative Agent of its receipt of notice from the seller of such Inventory of the seller’s stoppage of delivery of such Inventory to the Loan Party, and (e) agrees, upon notice from the Administrative Agent or the Canadian Agent, as applicable, to hold and dispose of the subject Inventory solely as directed by the Administrative Agent or the Canadian Agent, as applicable.

“TRU Inventory” means all Inventory of the Loan Parties which is offered for sale (or is designated for sale) at any “Toys “R” Us” Store, including, but not limited to, any such Inventory held for sale in internet and other direct sales and all Inventory of the Loan Parties specifically designated as “Toys “R” Us” Inventory at any distribution center or warehouse maintained by the Loan Parties.

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“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate, BA Equivalent Rate, Canadian Prime Rate or Prime Rate, as applicable.

“UCC” means the Uniform Commercial Code as in effect from time to time in the State of New York.

“UCP” means, with respect to any Letter of Credit, the Uniform Customs and Practice for Documentary Credits 2007 Revision, International Chamber of Commerce Publication No. 600 and any subsequent revision thereof adopted by the International Chamber of Commerce on the date such Letter of Credit is issued.

“Unanimous Consent” means the consent of Lenders (other than Defaulting Lenders) holding 100% of the Commitments (other than Commitments held by a Defaulting Lender).

“Unused Canadian Commitment” means, on any day, (a) the then Canadian Total Commitments, minus (b) the sum of (i) the principal amount of Loans to the Canadian Borrower then outstanding, and (ii) the then Canadian Letter of Credit Outstandings.

“Unused Domestic Commitment” shall mean, on any day, (a) the lesser of (i) the then Domestic Total Commitments, or (ii) the difference between the then Domestic Total Commitments and the then Canadian Total Commitments, minus (b) the sum of (i) the principal amount of Loans of the Domestic Borrowers then outstanding, and (ii) the then Domestic Letter of Credit Outstandings.

“Unused Fee” has the meaning provided in SECTION 2.19(b).

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

SECTION 1.02    Terms Generally.

The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s permitted successors and assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (e) all Schedules to this Agreement shall relate solely to the Domestic Loan Parties and the Canadian Loan Parties, (f) the term “security interest” shall include a hypothec, (g) the term “solidary” as used herein shall be read and interpreted in accordance with the Civil Code of Québec, (h) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible, moveable and immoveable, and intangible assets and properties, including cash, securities, accounts and

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contract rights, (i) all financial statements and other financial information provided by the Domestic Borrowers to the Administrative Agent or any Lender shall be provided with reference to dollars, (j) all references to "$" or "dollars" or to amounts of money and all calculations of Canadian Availability, Incremental Availability, Domestic Availability, permitted “baskets” and other similar matters shall, unless otherwise expressly provided to be CD$, be deemed to be references to the lawful currency of the United States of America at the Equivalent Amount, and (k) this Agreement and the other Loan Documents are the result of negotiation among, and have been reviewed by counsel to, among others, the Borrowers and the Agents and are the product of discussions and negotiations among all parties. Accordingly, this Agreement and the other Loan Documents are not intended to be construed against the Agents or any of the Lenders merely on account of the Agents’ or any Lender’s involvement in the preparation of such documents.

SECTION 1.03    Accounting Terms; GAAP.

Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Lead Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Lead Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); providedthat, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Lead Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

SECTION 1.04    Times of Day.

Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

ARTICLE II

Amount and Terms of Credit

SECTION 2.01    Commitment of the Lenders.

(a)    Each Domestic Lender, severally and not jointly with any other Domestic Lender, agrees, upon the terms and subject to the conditions herein set forth, to make Credit Extensions to or for the benefit of the Domestic Borrowers, and each Canadian Lender severally and not jointly with any other Canadian Lender, agrees upon the terms and subject to the conditions herein set forth, to make Credit Extensions to the Canadian Borrower, on a revolving basis, subject in each case to the following limitations:

(i)    The Total Domestic Revolver Outstandings shall not at any time exceed Domestic Availability;

(ii)    The Total Canadian Revolver Outstandings shall not at any time exceed Canadian Availability;

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(iii)    Letters of Credit shall be available from the Issuing Banks to the Borrowers, subject to the ratable participation of the Domestic Lenders or Canadian Lenders, as applicable, as set forth in SECTION 2.13. The Domestic Borrowers shall not at any time permit the aggregate Domestic Letter of Credit Outstandings at any time to exceed the Domestic Letter of Credit Sublimit and the Canadian Borrower shall not at any time permit the aggregate Canadian Letter of Credit Outstandings to exceed the Canadian Letter of Credit Sublimit;

(iv)    The Loans made to, and the Letters of Credit issued on behalf of, the Canadian Borrower by the Canadian Lenders may be either in $ or CD$, at the option of the Canadian Borrower, as herein set forth;

(v)    The Revolving Credit Loans (other than Swingline Loans) made to the Canadian Borrower shall be Prime Rate Loans or BA Equivalent Loans, or if made in dollars, shall be LIBO Loans or dollar denominated Prime Rate Loans;

(vi)    No Lender shall be obligated to make any Credit Extension (A) to the Domestic Borrowers in excess of such Lender’s Domestic Commitment, or (B) to the Canadian Borrower in excess of such Lender’s Canadian Commitment; and

(vii)    Subject to all of the other provisions of this Agreement, Revolving Credit Loans to the Borrowers that are repaid may be reborrowed prior to the Termination Date.

(b)    Each Borrowing of Revolving Credit Loans (other than Swingline Loans) by the Domestic Borrowers shall be made by the Domestic Lenders prorata in accordance with their respective Domestic Commitment Percentages, and each Borrowing of Revolving Credit Loans (other than Swingline Loans) by the Canadian Borrower shall be made by the Canadian Lenders prorata in accordance with their respective Canadian Commitment Percentages. The failure of any Domestic Lender or Canadian Lender, as applicable, to make any Loan to the Domestic Borrowers or the Canadian Borrower, as applicable, shall neither relieve any other Domestic Lender or Canadian Lender, as applicable, of its obligation to fund its Loan to the Domestic Borrowers or the Canadian Borrower, as applicable, in accordance with the provisions of this Agreement nor increase the obligation of any such other Domestic Lender or Canadian Lender, as applicable.

(c)On the First Amendment Effective Date, each Tranche A-1 Lender shall make a Tranche A-1 Loan to the Domestic Borrower and the Canadian Borrower in the amount set forth opposite such Lender’s name on Schedule 1.1.

SECTION 2.02    Increase in Total Commitments.

(a)    At any time and from time to time on or after the Effective Date, so long as no Default or Event of Default then exists or would arise therefrom, (i) the Lead Borrower shall have the right to request an increase of the then outstanding Domestic Commitments (which Commitment Increase may take the form of a term loan tranche) by such amount as would cause the Domestic Total Commitments not to exceed in the aggregate (A) $3,000,000,000 minus (B) the then outstanding Canadian Commitments (after taking into effect the amount of any increases in the Canadian Commitments requested pursuant to this SECTION 2.02(a) on or after the Effective Date), minus (C) all outstanding Tranche A-1 Loans, and (ii) the Canadian Borrower shall have the right to request an increase of the then outstanding Canadian Commitments to an amount not to exceed the Canadian Total Commitment Increase Amount(which Commitment Increase may take the form of a term

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loan tranche). The Lead Borrower may approach any Lender or any other Person (other than a natural person) to provide all or a portion of any such requested Commitment Increase; provided that, to the extent existing Lenders and Persons approached by the Lead Borrower have declined to provide the requested Commitment Increase, the Administrative Agent, in consultation with the Lead Borrower, will use its reasonable best efforts to arrange for other Persons to become a Domestic Lender or Canadian Lender, as applicable, hereunder and to issue commitments in an amount equal to the amount of the Commitment Increase requested by the Lead Borrower and/or the Canadian Borrower (each such increase by either means, a “Commitment Increase,” and each Person issuing, or Lender increasing, its Commitment, an “Additional Commitment Lender”); provided, however, that (i) no Lender shall be obligated to provide a Commitment Increase as a result of any such request by the Lead Borrower or the Canadian Borrower, as applicable, (ii) any Additional Commitment Lender which is not an existing Lender shall be subject to the approval of the Administrative Agent, the Issuing Banks and the Lead Borrower (which approval shall not be unreasonably withheld), and (iii) each Additional Commitment Lender which is a Canadian Lender shall be in compliance with the provisions of SECTION 2.23(j). Each Commitment Increase (other than any such Commitment Increase made on the Effective Date) shall be in a minimum aggregate amount of at least $25,000,000 and in integral multiples of $5,000,000 in excess thereof. Each Additional Commitment Lender agreeing to provide a Commitment Increase pursuant to this SECTION 2.02(a) shall be entitled to receive interest, letter of credit fees and unused fees at the rates provided for Lenders. Moreover, that portion of the Commitment of each Additional Commitment Lender constituting a Commitment Increase made pursuant to this SECTION 2.02(a) (i) shall terminate on the Termination Date, and (ii) shall otherwise be on the same terms as set forth in, and be entitled to the benefits of, this Agreement and the other Loan Documents.

(b)    Conditions to Effectiveness of each Commitment Increase. No Commitment Increase shall become effective unless and until each of the following conditions has been satisfied:

(i)    The Borrowers, the Administrative Agent, and each Additional Commitment Lender shall have executed and delivered a joinder to the Loan Documents in substantially the form of Exhibit H hereto;

(ii)    The Borrowers shall have paid such fees and other compensation to the Additional Commitment Lenders and to the Administrative Agent and MLPFS as the Lead Borrower, the Administrative Agent, MLPFS and such Additional Commitment Lenders shall agree;

(iii)    If requested by the Administrative Agent or the Canadian Agent, as applicable, the Borrowers shall deliver to the Administrative Agent or the Canadian Agent, as applicable, and the Lenders an opinion or opinions, in form and substance reasonably satisfactory to the Administrative Agent or the Canadian Agent, as applicable, from counsel to the Borrowers reasonably satisfactory to the Administrative Agent or the Canadian Agent, as applicable, and dated such date;

(iv)    A Revolving Credit Note (to the extent requested), to be in conformity with the requirements of SECTION 2.07 (with appropriate modification), will be issued, at the Borrowers’ expense, to each Additional Commitment Lender to the extent necessary to reflect the new Commitment of each Additional Commitment Lender; and

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(v)to the extent that the Commitment Increase shall take the form of a term loan, this Agreement shall be amended, in form and substance reasonably satisfactory to the Administrative Agent, to include such terms as are customary for a term loan commitment, including that the term loan advances shall (A) have a maturity date no earlier than the Latest Maturity Date, (B) if subject to amortization, shall have an average weighted life extending beyond the Latest Maturity Date, (C) shall bear interest at the rate agreed between the Borrowers and such Lender or Additional Commitment Lender and (D) not be voluntarily prepaid unless contemporaneously therewith, the Commitments are ratably permanently reduced and prepaid; and

(vvi)    The Borrowers and each Additional Commitment Lender shall have delivered such other instruments, documents and agreements as the Administrative Agent or the Canadian Agent, as applicable, may reasonably have requested in order to effectuate the documentation of the foregoing.

(c)    Notification by Administrative Agent. The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Commitment Increase (with each date of such effectiveness being referred to herein as a “Commitment Increase Date”), and, at such time, (i) the Domestic Commitments or Canadian Commitments, as applicable, under, and for all purposes of, this Agreement shall be increased by the aggregate amount of such Commitment Increases, (ii) Schedule 1.1 shall be deemed modified, without further action, to reflect the revised Domestic Commitments and Domestic Commitment Percentages of the Domestic Lenders or the revised Canadian Commitments and Canadian Commitment Percentages of the Canadian Lenders and (iii) this Agreement shall be deemed amended, without further action, to the extent necessary to reflect such increased Commitments.

(d)    Other Provisions. In connection with Commitment Increases hereunder, the Lenders and the Borrowers agree that, notwithstanding anything to the contrary in this Agreement, (i) the Borrowers shall, in coordination with the Administrative Agent, (A) repay outstanding Revolving Credit Loans of certain Lenders, and obtain Revolving Credit Loans from certain other Lenders (including the Additional Commitment Lenders), or (B) take such other actions as reasonably may be required by the Administrative Agent, in each case to the extent necessary so that all of the Lenders effectively participate in each of the outstanding Revolving Credit Loans pro rata on the basis of their Domestic Commitment Percentages or Canadian Commitment Percentages, as applicable (determined after giving effect to any increase in the Commitments pursuant to this SECTION 2.02), and (ii) the Borrowers shall pay to the Lenders any costs of the type referred to in SECTION 2.16(b) in connection with any repayment and/or Revolving Credit Loans required pursuant to preceding clause (i). Without limiting the obligations of the Borrowers provided for in this SECTION 2.02, the Administrative Agent and the Lenders agree that they will use their best efforts to attempt to minimize the costs of the type referred to in SECTION 2.16(b) which the Borrowers would otherwise incur in connection with the implementation of an increase in the Domestic Commitments or the Canadian Commitments.

(e)    Reinstatement of Tranche A-1 Commitments. At any time, so long as no Default or Event of Default then exists or would arise therefrom, subject to the prior written consent of the Required Lenders, if the then outstanding Total Commitments are less than $3,000,000,000, without duplication of the provisions of SECTION 2.02(a), the Lead Borrower shall have the right on a one-time basis to request an increase of the then outstanding DomesticCommitments by an aggregate amount not to exceed $150,000,000280,000,000 (the “Tranche A-1 Commitment Increase”); provided, however, that after giving effect to the Tranche A-1 Commitment Increase and any other

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Commitment Increases pursuant to this SECTION 2.02, the sum of the Total Commitments plus the outstanding Tranche A-1 Loans shall not exceed $3,000,000,000 at any time. The Tranche A-1 Commitment Increase shall be structured on substantially the same terms as apply to the Tranche A-1 Commitments under, and as defined in, the Original Credit Agreement(i.e. as a first-in, last out facility); providedthat the Tranche A-1 Commitment Increase shall be subject to such pricing, fees and other terms as the Lead Borrower, MLPFS and the Persons participating in the Tranche A-1 Commitment Increase shall agree; providedfurther that (i) no DomesticLender shall be obligated to increase its DomesticCommitment as a result of any such request by the Lead Borrower and (ii) any Person participating in the Tranche A-1 Commitment Increase which is not then an existing DomesticLender shall be subject to the approval of the Administrative Agent, the Issuing Banks and the Lead Borrower (which approval shall not be unreasonably withheld).The parties acknowledge that the Tranche A-1 Commitments (as defined in the Original Credit Agreement) have been reinstated as of the First Amendment Effective Date and that the amount of the Tranche A-1 Loans may not be increased pursuant to SECTION 2.02(a) or otherwise.

SECTION 2.03    Reserves; Changes to Reserves.

(a)    The Inventory Reserves and Availability Reserves as of the First Amendment Effective Date are those set forth in the Borrowing Base Certificate delivered to the Administrative Agent on the First Amendment Effective Date.

(b)The Administrative Agent shall establish an Availability Reserve applicable to the Tranche A Borrowing Base in the amount of the Tranche A-1 Push-Down Reserve at any time that outstanding Domestic Tranche A-1 Loans exceeds Domestic Incremental Availability. The Administrative Agent shall establish an Availability Reserve applicable to the Canadian Borrowing Base in the amount of the Tranche A-1 Push-Down Reserve at any time that outstanding Canadian Tranche A-1 Loans exceeds Canadian Incremental Availability.

(bc)    Any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) may hereafter establish additional Reserves or change any of the Reserves in effect on the Effective Date, in the exercise of its reasonable business judgment acting in accordance with industry standards for asset based lending in the retail industry; providedthat such Reserves shall not be established or changed except upon not less than five (5) Business Days notice to the Borrowers (during which period the Co-Collateral Agents shall be available to discuss any such proposed Reserve with the Borrowers); providedfurther that no such prior notice shall be required for (1) changes to any Reserves resulting solely by virtue of mathematical calculations of the amount of the Reserve in accordance with the methodology of calculation previously utilized (such as, but not limited to, Customer Credit Liabilities), or (2) changes to Reserves or the establishment of additional Reserves if a Material Adverse Effect under clause (b) of the definition thereof has occurred or it would be reasonably likely that a Material Adverse Effect under clause (b) of the definition thereof would occur were such Reserves not changed or established prior to the expiration of such five (5) Business Day period, or (3) the establishment of the Tranche A-1 Push-Down Reserve.

SECTION 2.04    Making of Loans.

(a)    Except as set forth in SECTION 2.09, SECTION 2.10 and SECTION 2.11, Revolving Credit Loans (other than Swingline Loans) shall be either Prime Rate Loans, LIBO Loans or BA Equivalent Loans as the Lead Borrower, on behalf of the Domestic Borrowers, or the Canadian

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Borrower, may request (which request shall, in the case of the Domestic Borrowers, be made in the form attached hereto as Exhibit C-1 and, in the case of the Canadian Borrower, be made in the form attached hereto as Exhibit C-2, and in the case of Loans to the Canadian Borrower, indicate whether CD$ or $ advances are requested) subject to and in accordance with this SECTION 2.04. All Swingline Loans shall be only Prime Rate Loans. All Revolving Credit Loans made pursuant to the same Borrowing shall, unless otherwise specifically provided herein, be Revolving Credit Loans of the same Type. Each Lender may fulfill its Commitment with respect to any Revolving Credit Loan by causing any lending office of such Lender to make such Revolving Credit Loan; provided, however, that any such use of a lending office shall not affect the obligation of the Borrowers to repay such Revolving Credit Loan in accordance with the terms of the applicable Revolving Credit Note. Each Lender shall, subject to its overall policy considerations, use reasonable efforts to select a lending office which will not result in the payment of increased costs by the Borrowers. Subject to the other provisions of this SECTION 2.04 and the provisions of SECTION 2.11, Borrowings of Revolving Credit Loans of more than one Type may be incurred at the same time, but in any event no more than fifteen (15) Borrowings of LIBO Loans may be outstanding at any time and no more than eight (8) Borrowings of BA Equivalent Loans may be outstanding at any time.

(b)    The Lead Borrower shall give the Administrative Agent (i) two (2) Business Days’ prior telephonic notice (thereafter confirmed in writing) of each Borrowing of LIBO Loans, and (ii) notice of each Borrowing of Prime Rate Loans by the Domestic Borrowers on the proposed day of each Borrowing. The Canadian Borrower shall give the Canadian Agent (i) two (2) Business Days’ prior telephonic notice (thereafter confirmed in writing) of each Borrowing of BA Equivalent Loans or LIBO Loans and (ii) one (1) Business Day’s prior telephonic notice (thereafter confirmed in writing) of each Borrowing of Prime Rate Loans by the Canadian Borrower. Any such notice, to be effective, must be received by the Administrative Agent or the Canadian Agent, as applicable, (i) not later than 11:00 a.m. on the second Business Day, in the case of LIBO Loans or BA Equivalent Loans, and on the first Business Day, in the case of Prime Rate Loans to the Canadian Borrower, prior to the date on which such Borrowing is to be made and, and (ii) no later than 12:00 noon on the same Business Day in the case of Prime Rate Loans to the Domestic Borrowers on which such Borrowing is to be made. Such notice shall be irrevocable, shall contain disbursement instructions and shall specify: (i) whether the Borrowing then being requested is to be a Borrowing of Prime Rate Loans (and, in the case of the Canadian Borrower, whether the Borrowing is in CD$ or $), BA Equivalent Loans, or LIBO Loans and, if BA Equivalent Loans or LIBO Loans, the Interest Period with respect thereto; (ii) the amount of the proposed Borrowing (which shall be in an integral multiple of $1,000,000, but not less than $5,000,000, in the case of LIBO Loans, and be in an integral multiple of CD$1,000,000, but not less than CD$1,000,000, in the case of BA Equivalent Loans); and (iii) the date of the proposed Borrowing (which shall be a Business Day). If no election of Interest Period is specified in any such notice for a Borrowing of LIBO Loans or BA Equivalent Loans, such notice shall be deemed a request for an Interest Period of one (1) month. If no election is made as to the Type of Revolving Credit Loan, such notice shall be deemed a request for Borrowing of Prime Rate Loans. The Administrative Agent or the Canadian Agent, as applicable, shall promptly notify each Lender of its proportionate share of such Borrowing, the date of such Borrowing, the Type of Borrowing being requested and the Interest Period or Interest Periods applicable thereto, as appropriate. On the borrowing date specified in such notice, each Domestic Lender shall make its share of the Borrowing available at the office of the Administrative Agent at 100 Federal Street, Boston, Massachusetts 02110, and each Canadian Lender shall make its share of the Borrowing available at the office of the Canadian Agent at 181 Bay Street, 4^th Floor, Toronto, Ontario, Canada

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M5J 2V8, in each case no later than 3:00 p.m., in immediately available funds. Unless the Administrative Agent or the Canadian Agent, as applicable, shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent or the Canadian Agent, as applicable, such Lender’s share of such Borrowing, the Administrative Agent and the Canadian Agent may assume that such Lender has made such share available on such date in accordance with this SECTION 2.04 and may, in reliance upon such assumption, make available to the Borrowers a corresponding amount. In the event a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent or the Canadian Agent, as applicable, then the applicable Lender and the Borrowers severally agree to pay to the Administrative Agent or the Canadian Agent, as applicable, forthwith on demand such corresponding amount, with interest thereon for each day from and including the date such amount is made available to the Borrowers to but excluding the date of payment to the Administrative Agent or the Canadian Agent, at (i) in the case of a Domestic Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, (ii) in the case of a Canadian Lender, the greater of the Bank of Canada Overnight Rate and a rate determined by the Canadian Agent in accordance with banking industry rules on interbank compensation, or (iii) in the case of the Borrowers, the interest rate applicable to Prime Rate Loans. If such Lender pays such amount to the Administrative Agent or the Canadian Agent, as applicable, then such amount shall constitute such Lender’s Revolving Credit Loan included in such Borrowing. Upon receipt of the funds made available by the Lenders to fund any borrowing hereunder, the Administrative Agent or the Canadian Agent, as applicable, shall disburse such funds in the manner specified in the notice of borrowing delivered by the Lead Borrower or Canadian Borrower and shall use reasonable efforts to make the funds so received from the Lenders available to the Borrowers no later than 5:00 p.m.

(c)    To the extent not paid by the Borrowers when due (after taking into consideration any applicable grace period), the Administrative Agent and the Canadian Agent, as applicable, without the request of the Lead Borrower or the Canadian Borrower, as applicable, may advance any interest, fee payable pursuant to SECTION 2.19 or other payment to which any Credit Party is entitled from the Loan Parties pursuant hereto or any other Loan Document and may charge the same to the Loan Account notwithstanding that a Domestic Overadvance or Canadian Overadvance, as applicable, may result thereby; providedthat no such Overadvance may be made if after giving effect thereto, the aggregate Domestic Commitments or the aggregate Canadian Commitments would be exceeded. The Administrative Agent or the Canadian Agent, as applicable, shall advise the Lead Borrower or the Canadian Borrower, as applicable, of any such advance or charge promptly after the making thereof. Such action on the part of the Administrative Agent or the Canadian Agent, as applicable, shall not constitute a waiver of the Administrative Agent’s or the Canadian Agent’s rights and the Borrowers’ obligations under SECTION 2.17(a) and SECTION 2.17(b). Any amount which is added to the principal balance of the Loan Account as provided in this SECTION 2.04(c) shall bear interest at the interest rate then and thereafter applicable to Prime Rate Loans.

(d)    Notwithstanding anything to the contrary herein contained, with respect to the Canadian Borrower, (i) all references to “the Lead Borrower” and “the Administrative Agent” in SECTIONS 2.04(b), 2.04(c), 2.17, and 2.18 shall mean and refer to the Canadian Borrower and the Canadian Agent (except to the extent such provisions already make reference to the Canadian Borrower and the Canadian Agent), respectively, (ii) the address of the Canadian Agent to which each Lender must make its share of Borrowings to the Canadian Borrower available is 181 Bay

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Street, 4^th Floor, Toronto, Ontario, Canada M5J 2V8, and (iii) the Canadian Agent shall promptly notify the Administrative Agent of each Borrowing by the Canadian Borrower, the date of such Borrowing, the Type of Borrowing being requested and the Interest Period or Periods applicable thereto.

SECTION 2.05    Overadvances.

(a)    The Agents, the Canadian Agent and the Lenders shall have no obligation to make any Revolving Credit Loan (including, without limitation, any Swingline Loan) or to provide any Letter of Credit if a Domestic Overadvance or Canadian Overadvance would result.

(b)    The Administrative Agent may, in its discretion, and shall, at the direction of any Co-Collateral Agent, make Permitted Domestic Overadvances to the Domestic Borrowers without the consent of the Lenders and each Lender shall be bound thereby. The Canadian Agent may, in its discretion, and shall, at the direction of any Co-Collateral Agent, make Permitted Canadian Overadvances to the Canadian Borrower without the consent of the Lenders and each Lender shall be bound thereby. Any Permitted Domestic Overadvances or Permitted Canadian Overadvances may constitute Swingline Loans. The making of a Permitted Domestic Overadvance is for the benefit of the Domestic Borrowers and shall constitute a Revolving Credit Loan and an Obligation. The making of a Permitted Canadian Overadvance is for the benefit of the Canadian Borrower and shall constitute a Revolving Credit Loan and an Obligation. The making of any such Permitted Domestic Overadvance or Permitted Canadian Overadvance on any one occasion shall not obligate the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, or any Lender to make or permit any Permitted Domestic Overadvance or Permitted Canadian Overadvance on any other occasion or to permit such Permitted Domestic Overadvances or Permitted Canadian Overadvances to remain outstanding.

(c)    The making by the Administrative Agent of a Permitted Domestic Overadvance or by the Canadian Agent of a Permitted Canadian Overadvance shall not modify or abrogate any of the provisions of SECTION 2.13(g) regarding the Lenders’ obligations to purchase participations with respect to Letter of Credit Disbursements.

SECTION 2.06    Swingline Loans

(a)    Each Swingline Lender is authorized by the Domestic Lenders and the Canadian Lenders, as applicable, to, and shall, make Swingline Loans at any time (subject to SECTION 2.06(b)) (i) to the Domestic Borrowers up to the amount of the sum of the Domestic Swingline Loan Ceiling, plus any Permitted Domestic Overadvances, and (ii) to the Canadian Borrower up to the amount of the sum of the Canadian Swingline Loan Ceiling, plus any Permitted Canadian Overadvances, in each case upon a notice of Borrowing from Lead Borrower received by the Administrative Agent or the Canadian Agent, as applicable, and the applicable Swingline Lender (which notice, at the Swingline Lender’s discretion, may be submitted prior to 3:00 p.m. for the Domestic Borrowers and 12:00 noon for the Canadian Borrower, on the Business Day on which such Swingline Loan is requested); providedthat the Swingline Lender shall not be obligated to make any Swingline Loan in its reasonable discretion if it shall determine (which determination shall be conclusive and binding absent manifest error) that it has, or by the making of such Swingline Loan may have, Fronting Exposure. Swingline Loans shall be Prime Rate Loans and shall be subject to periodic settlement with the Domestic Lenders and Canadian Lenders, as applicable, (other than Tranche A-1 Lenders) under SECTION 2.22 below. Immediately upon the making of a Swingline

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Loan, each Domestic Lender or Canadian Lender, as applicable, (other than Tranche A-1 Lenders) shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the applicable Swingline Lender a risk participation in such Swingline Loan in an amount equal to the product of such Lender’s Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, times the amount of such Swingline Loan. Each Swingline Lender shall have all of the benefits and immunities (A) provided to the Agents in Article VIII with respect to any acts taken or omissions suffered by the Swingline Lender in connection with Swingline Loans made by it or proposed to be made by it as if the term “Agents” as used in Article VIII included each Swingline Lender with respect to such acts or omissions, and (B) as additionally provided herein with respect to each Swingline Lender.

(b)    The Lead Borrower’s request for a Swingline Loan shall be deemed a representation that the applicable conditions for borrowing under SECTION 4.02 are satisfied. If the conditions for borrowing under SECTION 4.02 cannot in fact be fulfilled, (i) the Lead Borrower or the Canadian Borrower, as applicable, shall give immediate notice (a “Noncompliance Notice”) thereof to the Administrative Agent, the Canadian Agent, and the applicable Swingline Lender, and the Administrative Agent and the Canadian Agent, as applicable, shall promptly provide each Lender with a copy of the Noncompliance Notice, and (ii) the Required Lenders may direct the applicable Swingline Lender to, and such Swingline Lender thereupon shall, cease making Swingline Loans (other than Permitted Domestic Overadvances and Permitted Canadian Overadvances) until such conditions can be satisfied or are waived in accordance with SECTION 9.02. Unless the Required Lenders so direct the applicable Swingline Lender, such Swingline Lender may, but is not obligated to, continue to make Swingline Loans commencing one (1) Business Day after the Non-Compliance Notice is furnished to the Domestic Lenders. Notwithstanding the foregoing, no Swingline Loans (other than Permitted Domestic Overadvances and Permitted Canadian Overadvances) shall be made pursuant to this SECTION 2.06(b) if the Total Domestic Revolver Outstandings or the Total Canadian Revolver Outstandings, as applicable, would exceed the limitations set forth in SECTION 2.01.

SECTION 2.07    Notes.

(a)    Upon the request of any Domestic Lender, the Revolving CreditLoans made by such Domestic Lender shall be evidenced by a Revolving Credit Noteor Tranche A-1 Note, as applicable, duly executed on behalf of the Domestic Borrowers, dated the Effective Date or the First Amendment Effective Date, as applicable, payable to the order of such Domestic Lender in an aggregate principal amount equal to such Domestic Lender’s Commitment.

(b)    Upon the request of any Swingline Lender, the Revolving Credit Loans made by such Swingline Lender with respect to Swingline Loans shall be evidenced by a Swingline Note, duly executed on behalf of the Borrowers, dated the Effective Date, payable to the order of such Swingline Lender, in an aggregate principal amount equal to the Domestic Swingline Loan Ceiling or Canadian Swingline Loan Ceiling, as applicable.

(c)    Upon the request of any Canadian Lender, the Revolving CreditLoans made by such Canadian Lender shall be evidenced by a Revolving Credit Noteor Tranche A-1 Note, as applicable, duly executed on behalf of the Canadian Borrower, dated the Effective Dateor the First Amendment Effective Date, as applicable, payable to the order of such Canadian Lender in an aggregate principal amount equal to such Canadian Lender’s Commitment.

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(d)    Each Lender is hereby authorized by the applicable Borrowers to endorse on a schedule attached to each Note delivered to such Lender (or on a continuation of such schedule attached to such Note and made a part thereof), or otherwise to record in such Lender’s internal records, an appropriate notation evidencing the date and amount of each Loan from such Lender, each payment and prepayment of principal of any such Loan, each payment of interest on any such Loan and the other information provided for on such schedule; provided, however, that the failure of any Lender to make such a notation or any error therein shall not affect the obligation of any Borrower to repay the Loans made by such Lender in accordance with the terms of this Agreement and the applicable Notes.

(e)    Upon receipt of an affidavit and indemnity of a Lender as to the loss, theft, destruction or mutilation of such Lender’s Note and upon cancellation of such Note, the Borrowers will issue, in lieu thereof, a replacement Note in favor of such Lender, in the same principal amount thereof and otherwise of like tenor at such Lender’s expense.

SECTION 2.08    Interest onRevolving CreditLoans.

(a)    Interest on Revolving Credit Loans.

(i)    Subject to SECTION 2.12, each Prime Rate Loan made by a Lender shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable) at a rate per annum that shall be equal to the then Prime Rate or Canadian Prime Rate, as applicable, plus the Applicable Margin for Prime Rate Loans.

(ii)    Subject to SECTION 2.09 through SECTION 2.12, each LIBO Loan made by a Lender shall bear interest (computed on the basis of the actual number of days elapsed over a year of 360 days) at a rate per annum equal, during each Interest Period applicable thereto, to the Adjusted LIBO Rate for such Interest Period, plus the Applicable Margin for LIBO Loans (or with respect to Loans to the Canadian Borrower made in dollars, the Applicable Margin for LIBO Loans made in dollars or Prime Rate Loans, as applicable).

(iii)    Subject to SECTION 2.12, each BA Equivalent Loan made by a Lender shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable) at a rate per annum that shall be equal to the then BA Rate, plus the Applicable Margin for BA Equivalent Loans.

(b)Interest on Tranche A-1 Loans.

(i)Subject to SECTION 2.12, each Tranche A-1 Loan which is a Prime Rate Loan made by a Tranche A-1 Lender shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable) at a rate per annum that shall be equal to the then Prime Rate or Canadian Prime Rate, as applicable, plus the Tranche A-1 Applicable Margin for Prime Rate Loans.

(ii)Subject to SECTION 2.09 through SECTION 2.12, each Tranche A-1 Loan which is a LIBO Loan made by a Tranche A-1 Lender shall bear interest (computed on the basis of the actual number of days elapsed over a year of 360 days) at a rate per annum equal, during each Interest Period applicable thereto, to the Adjusted LIBO Rate for such Interest Period, plus the Tranche A-1 Applicable Margin for LIBO Loans.

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(bc)    Accrued interest on all Loans shall be payable in arrears on each Interest Payment Date applicable thereto, at maturity (whether by acceleration or otherwise) and after such maturity on demand.

(cd)    For the purposes of the Interest Act (Canada) and disclosure thereunder, whenever interest to be paid hereunder is to be calculated on the basis of a year of 360 days or any other period of time that is less than a calendar year, the yearly rate of interest to which the rate determined pursuant to such calculation is equivalent is the rate so determined multiplied by the actual number of days in the calendar year in which the same is to be ascertained and divided by either 360 or such other period of time, as the case may be. Calculations of interest shall be made using the nominal rate method of calculation, and will not be calculated using the effective rate method of calculation or any other basis that gives effect to the principle of deemed reinvestment of interest.

SECTION 2.09    Conversion and Continuation ofRevolving CreditLoans.

(a)    The Lead Borrower or the Canadian Borrower, as applicable, shall have the right at any time, on two (2) Business Days’ prior notice to the Administrative Agent or the Canadian Agent, as applicable (which notice, to be effective, must be received by the Administrative Agent not later than 11:00 a.m. on the second Business Day preceding the date of any conversion), (i) to convert any outstanding Borrowings of Prime Rate Loans to Borrowings of LIBO Loans, in the case of the Domestic Borrowers, Dollar denominated Prime Rate Loans to Borrowings of LIBO Loans or CD$ denominated Prime Rate Loans to Borrowings (other than Canadian Tranche A-1 Loans) of BA Equivalent Loans, in the case of the Canadian Borrower, or (ii) to continue an outstanding Borrowing of LIBO Loans or BA Equivalent Loans for an additional Interest Period, or (iii) to convert any outstanding Borrowings of LIBO Loans to a Borrowing of dollar denominated Prime Rate Loans, and to convert any outstanding Borrowings of BA Equivalent Loans to a Borrowing of CD$ denominated Prime Rate Loans subject in each case to the following:

(i)    No Borrowing of Revolving CreditLoans may be converted into, or continued as, LIBO Loans or BA Equivalent Loans at any time when any Specified Default has occurred and is continuing (nothing contained herein being deemed to obligate the Borrowers to incur Breakage Costs upon the occurrence of an Event of Default unless the Obligations are accelerated);

(ii)    If less than a full Borrowing of Revolving CreditLoans is converted, such conversion shall be made prorata among the Domestic Lenders or Canadian Lenders, as applicable, based upon their Domestic Commitment Percentagesor, Canadian Commitment Percentages, or Tranche A-1 Percentages, as applicable, in accordance with the respective principal amounts of the Revolving CreditLoans comprising such Borrowing held by such Lenders immediately prior to such conversion;

(iii)    The aggregate principal amount of Prime Rate Loans being converted into, or continued as, LIBO Loans shall be in an integral of $1,000,000 and at least $5,000,000, and the aggregate principal amount of Prime Rate Loans being converted into, or continued as, BA Equivalent Loans shall be in an integral of CD$1,000,000 and at least CD$1,000,000;

(iv)    Each Lender shall effect each conversion by applying the proceeds of its new LIBO Loan or dollar denominated Prime Rate Loan, as the case may be, to its Revolving Credit

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Loan being so converted and also, in the case of each Canadian Lender, shall effect each conversion by applying the proceeds of its new BA Equivalent Loan or CD$ denominated Prime Rate Loan, as the case may be, to its Revolving CreditLoan being so converted;

(v)    The Interest Period with respect to a Borrowing of LIBO Loans or BA Equivalent Loans effected by a conversion or in respect to the Borrowing of LIBO Loans or BA Equivalent Loans being continued as LIBO Loans or BA Equivalent Loans, respectively, shall commence on the date of conversion or the expiration of the current Interest Period applicable to such continuing Borrowing, as the case may be;

(vi)    A Borrowing of LIBO Loans or BA Equivalent Loans may be converted only on the last day of an Interest Period applicable thereto, unless the applicable Borrower pays all Breakage Costs incurred in connection with such conversion;

(vii)    In no event shall more than fifteen (15) Borrowings of LIBO Loans be outstanding at any time or more than eight (8) Borrowings of BA Equivalent Loans be outstanding at any time and

(viii)    Each request for a conversion or continuation of a Borrowing of LIBO Loans or BA Equivalent Loans which fails to state an applicable Interest Period shall be deemed to be a request for an Interest Period of one (1) month.

(b)    If the Lead Borrower or the Canadian Borrower, as applicable, does not give notice to convert any Borrowing of LIBO Loans or BA Equivalent Loans, or does not give notice to continue, or does not have the right to continue, any Borrowing as LIBO Loans or BA Equivalent Loans, in each case as provided in SECTION 2.09(a) above, such Borrowing shall automatically be converted to, or continued as, as applicable, a Borrowing of dollar denominated Prime Rate Loans or a Borrowing of CD$ denominated Prime Rate Loans, at the expiration of the then-current Interest Period. The Administrative Agent or Canadian Agent, as applicable, shall, after it receives notice from the Lead Borrower or the Canadian Borrower, promptly give each Domestic Lender or Canadian Lender, as applicable, notice of any conversion, in whole or part, of any Revolving Credit Loan made by such Lender.

SECTION 2.10    Alternate Rate of Interest forRevolving CreditLoans.

If prior to the commencement of any Interest Period for a LIBO Borrowing or BA Equivalent Loan Borrowing, the Administrative Agent or the Canadian Agent, as applicable:

(a)    Reasonably determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the BA Rate (in accordance with the terms of the definitions thereof) for such Interest Period; or

(b)    Is advised by the Required Lenders that the Adjusted LIBO Rate or BA Rate for such Interest Period will not adequately and fairly reflect the cost to such Required Lenders of making or maintaining their Revolving CreditLoans included in such Borrowing for such Interest Period;

then the Administrative Agent or the Canadian Agent, as applicable, shall give notice thereof to the Lead Borrower or the Canadian Borrower, as applicable, and the Lenders, in the case of a requested LIBO

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Borrowing, and the Canadian Lenders, in the case of a requested BA Equivalent Loan Borrowing, by telephone or telecopy as promptly as practicable thereafter and, until the Administrative Agent or the Canadian Agent notifies the Lead Borrower or the Canadian Borrower, as applicable, and the applicable Lenders that the circumstances giving rise to such notice no longer exist (which notice the Administrative Agent or the Canadian Agent, as applicable, shall deliver promptly upon obtaining knowledge of the same), (i) any Borrowing Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a LIBO Borrowing or a BA Equivalent Loan Borrowing shall be ineffective and (ii) if any Borrowing Request requests a LIBO Borrowing or a BA Equivalent Loan Borrowing, such Borrowing shall be made as a Borrowing of Prime Rate Loans unless withdrawn by the Lead Borrower or Canadian Borrower, as the case may be.

SECTION 2.11    Change in Legality.

(a)    Notwithstanding anything to the contrary contained elsewhere in this Agreement, if any Change in Law occurring after the Effective Date shall make it unlawful for a Lender to make or maintain a LIBO Loan or to give effect to its obligations as contemplated hereby with respect to a LIBO Loan, then, by written notice to the Lead Borrower or to the Canadian Borrower, as applicable, such Lender may (i) declare that LIBO Loans will not thereafter be made by such Lender hereunder, whereupon any request by the Lead Borrower or the Canadian Borrower, as applicable, for a LIBO Borrowing shall, unless withdrawn, as to such Lender only, be deemed a request for a Dollar denominated Prime Rate Loan unless such declaration shall be subsequently withdrawn; and (ii) require that all outstanding LIBO Loans made by such Lender be converted to Dollar denominated Prime Rate Loans, in which event all such LIBO Loans shall be automatically converted to Dollar denominated Prime Rate Loans as of the effective date of such notice as provided in SECTION 2.09(b). In the event any Lender shall exercise its rights hereunder, all payments and prepayments of principal which would otherwise have been applied to repay the LIBO Loans that would have been made by such Lender or the converted LIBO Loans of such Lender, shall instead be applied to repay the Prime Rate Loans made by such Lender in lieu of, or resulting from the conversion of, such LIBO Loans.

(b)    For purposes of this SECTION 2.11, a notice to the Lead Borrower or to the Canadian Borrower, as applicable, pursuant to SECTION 2.11(a) above shall be effective, if lawful, and if any LIBO Loans shall then be outstanding, on the last day of the then-current Interest Period; and, otherwise, such notice shall be effective on the date of receipt by the Lead Borrower or the Canadian Borrower, as applicable.

SECTION 2.12    Default Interest.

Effective upon written notice from the Administrative Agent or the Canadian Agent, as applicable, after the occurrence of any Specified Default and at all times thereafter while such Specified Default is continuing, interest shall accrue on all overdue amounts owing by the Borrowers (after as well as before judgment, as and to the extent permitted by law) at a rate per annum (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days as applicable) (the “Default Rate”) equal to the rate (including the Applicable Margin) in effect from time to time plus two percent (2.00%) per annum and such interest shall be payable on each Interest Payment Date (or any earlier maturity of the Loans).

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SECTION 2.13    Letters of Credit.

(a)    Upon the terms and subject to the conditions herein set forth, at any time and from time to time after the Effective Date and prior to the Termination Date, the Lead Borrower on behalf of the Domestic Borrowers, and the Canadian Borrower for itself and its Subsidiaries, may request an Issuing Bank (which in the case of the Canadian Borrower shall be the Canadian Agent or a Canadian Lender) to issue, and subject to the terms and conditions contained herein, such Issuing Bank shall issue, for the account of the relevant Borrower, one or more Letters of Credit; provided, however, that no Letter of Credit shall be issued if, after giving effect to such issuance, (i) the aggregate Domestic Letter of Credit Outstandings shall exceed the Domestic Letter of Credit Sublimit, (ii) the aggregate Canadian Letter of Credit Outstandings shall exceed the Canadian Letter of Credit Sublimit, or (iii) the Total Domestic Revolver Outstandings or the Total Canadian Revolver Outstandings, as applicable, would exceed the limitations set forth in SECTION 2.01(a); providedfurther that no Letter of Credit shall be issued unless an Issuing Bank shall have received notice from the Administrative Agent or the Canadian Agent that the conditions to such issuance have been met (such notice shall be deemed given (x) if the Issuing Bank has not received notice that the conditions have not been met, within two (2) Business Days of the initial request to the Issuing Bank and the Administrative Agent or Canadian Agent, as applicable, pursuant to SECTION 2.13(h), or (y) if the aggregate undrawn amount under Letters of Credit issued by such Issuing Bank then outstanding does not exceed the amount theretofore agreed to by the Lead Borrower, the Administrative Agent and such Issuing Bank, on the same Business Day as the receipt by the Issuing Bank of the request for issuance of a Letter of Credit if the request is received prior to 12:00 noon or on the next Business Day if the request is received after 12:00 noon); and providedfurther that an Issuing Bank shall not be required to issue any such Letter of Credit in its reasonable discretion if: (A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such Issuing Bank from issuing such Letter of Credit, or any Applicable Law relating to such Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuing Bank shall prohibit, or request that such Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuing Bank with respect to such Letter of Credit any restriction, reserve or capital requirement (for which such Issuing Bank is not otherwise compensated hereunder) not in effect on the Effective Date, or shall impose upon such Issuing Bank any unreimbursed loss, cost or expense which was not applicable on the Effective Date and which such Issuing Bank in good faith deems material to it, (B) the issuance of such Letter of Credit would violate one or more policies of such Issuing Bank applicable to letters of credit generally, (C) any Lender is at that time a Defaulting Lender, unless such Issuing Bank has entered into arrangements, including the delivery of cash collateral, satisfactory to such Issuing Bank (in its sole discretion) with the Borrowers or such Lender to eliminate such Issuing Bank’s actual or potential Fronting Exposure (after giving effect to SECTION 2.27(a)(iv)) with respect to the Defaulting Lender arising from either (x) the Letter of Credit then proposed to be issued or (y) that Letter of Credit and all other Letter of Credit Outstandings as to which such Issuing Bank has actual or potential Fronting Exposure, as it may elect in its sole discretion, (D) such Letter of Credit contains any provisions for automatic reinstatement of the Stated Amount after any drawing thereunder, or (E) such Letter of Credit is not in compliance with SECTIONS 2.13(b) or 2.13(c), as applicable. A permanent reduction of the Domestic Commitments or Canadian Commitments shall not require a corresponding pro rata reduction in the Domestic Letter of Credit Sublimit or the Canadian Letter of Credit Sublimit, as applicable; provided, however, that if the Domestic Total Commitments or Canadian Total Commitments are reduced to an amount less than the Domestic Letter of Credit

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Sublimit or the Canadian Letter of Credit Sublimit, as applicable, then the Domestic Letter of Credit Sublimit or the Canadian Letter of Credit Sublimit, as applicable shall be reduced to an amount equal to (or, at Lead Borrower’s or the Canadian Borrower’s option, less than) the Domestic Total Commitments or Canadian Total Commitments. Any Issuing Bank (other than Bank of America or any of its Affiliates) shall notify the Administrative Agent in writing on each Business Day of all Letters of Credit issued on the prior Business Day by such Issuing Bank; providedthat (A) until the Administrative Agent advises any such Issuing Bank that Excess Availability is less than $250,000,000, or (B) the aggregate amount of the Letters of Credit issued in any such week exceeds such amount as shall be agreed by the Administrative Agent and the Issuing Bank, such Issuing Bank shall be required to so notify the Administrative Agent in writing only once each week of the Letters of Credit issued by such Issuing Bank during the immediately preceding week as well as the daily amounts outstanding for the prior week, such notice to be furnished on such day of the week as the Administrative Agent and such Issuing Bank may agree. No Issuing Bank shall amend any Letter of Credit if such Issuing Bank would not be permitted at such time to issue such Letter of Credit in its amended form under the terms hereof or if the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

(b)    Each Standby Letter of Credit shall expire at or prior to the close of business on the earlier of the date which is (i) one (1) year after the date of the issuance of such Letter of Credit (or such other longer period of time as the Administrative Agent and the applicable Issuing Bank may agree) (or, in the case of any renewal or extension thereof, one (1) year after such renewal or extension) and (ii) unless Cash Collateralized or otherwise credit supported to the reasonable satisfaction of the Administrative Agent and the applicable Issuing Bank, five (5) Business Days prior to the Maturity Date; provided, however, that each Standby Letter of Credit may, upon the request of the Lead Borrower or the Canadian Borrower, as applicable, include a provision whereby such Letter of Credit shall be renewed automatically for additional consecutive periods of twelve (12) months or less (but not beyond the date that is five (5) Business Days prior to the Maturity Date unless Cash Collateralized or otherwise credit supported to the reasonable satisfaction of the Administrative Agent and the applicable Issuing Bank) unless the applicable Issuing Bank notifies the beneficiary thereof at least thirty (30) days prior to the then-applicable expiration date that such Letter of Credit will not be renewed.

(c)    Each Commercial Letter of Credit shall expire at or prior to the close of business on the earlier of the date which is (i) one year after the date of the issuance of such Commercial Letter of Credit (or such other period as may be acceptable to the Administrative Agent and the applicable Issuing Bank) and (ii) unless Cash Collateralized or otherwise credit supported to the reasonable satisfaction of the Administrative Agent and the applicable Issuing Bank, five (5) Business Days prior to the Maturity Date.

(d)    Drafts drawn under each Letter of Credit shall be reimbursed by the Domestic Borrowers, in the case of any Letter of Credit issued for them, and by the Canadian Borrower, in the case of a Canadian Letter of Credit, in the currency in which the Letter of Credit is issued by paying to the Administrative Agent or the Canadian Agent, as applicable, an amount equal to such drawing not later than 12:00 noon on the Business Day immediately following the day that the Lead Borrower or the Canadian Borrower receives notice of such drawing and demand for payment by the applicable Issuing Bank, providedthat (i) in the absence of written notice to the contrary from the Lead Borrower or the Canadian Borrower, as applicable, and subject to the other provisions of this Agreement, such payments shall be financed when due with a Prime Rate Loan or Swingline

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Loan to the applicable Borrower in an eEquivalent aAmount and the same currency and, to the extent so financed, the respective Borrower’s obligation to make such payment shall be discharged and replaced by the resulting Prime Rate Loan or Swingline Loan, and (ii) in the event that the Lead Borrower or the Canadian Borrower, as applicable, has notified the Administrative Agent or the Canadian Agent, as applicable, that it will not so finance any such payments, the applicable Borrowers will make payment directly to the applicable Issuing Bank when due. Such payments shall be due on the date specified in the demand for payment by the Issuing Bank. The Administrative Agent or the Canadian Agent, as applicable, shall promptly remit the payments received by it from any Borrower in reimbursement of a draw under a Letter of Credit to the applicable Issuing Bank or the proceeds of a Prime Rate Loan or Swingline Loan, as the case may be, used to finance such payment. The Issuing Banks shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit. The Issuing Banks shall promptly notify the Administrative Agent or the Canadian Agent, as applicable, and the Lead Borrower or the Canadian Borrower, as applicable, by telephone (confirmed by telecopy) of such demand for payment and whether the applicable Issuing Bank has made or will make payment thereunder; provided, however, that any failure to give or delay in giving such notice shall not relieve the Borrowers of their obligation to reimburse the applicable Issuing Bank and the Lenders with respect to any such payment.

(e)    If an Issuing Bank shall make any Letter of Credit Disbursement, then, unless the applicable Borrowers shall reimburse such Issuing Bank in full on the date provided in SECTION 2.13(d), above, the unpaid amount thereof shall bear interest at the rate per annum then applicable to Prime Rate Loans for Domestic Borrowers or the Canadian Borrower, as applicable, for each day from and including the date such payment is made to, but excluding, the date that such Borrowers reimburse such Issuing Bank therefor; provided, however, that, if such Borrowers fail to reimburse such Issuing Bank when due pursuant to this SECTION 2.13(e), then interest shall accrue at the rate set forth in SECTION 2.12. Interest accrued pursuant to this paragraph shall be for the account of, and promptly remitted by the Administrative Agent or the Canadian Agent, as applicable, upon receipt to, the applicable Issuing Bank, except that interest accrued on and after the date of payment by any Lender pursuant to SECTION 2.13(g) to reimburse such Issuing Bank shall be for the account of such Lender to the extent of such payment.

(f)    Immediately upon the issuance of any Letter of Credit by an Issuing Bank (or the amendment of a Letter of Credit increasing the amount thereof), and without any further action on the part of such Issuing Bank, such Issuing Bank shall be deemed to have sold to each Domestic Lender or Canadian Lender, as applicable, (other than a Tranche A-1 Lender) and each such Lender shall be deemed unconditionally and irrevocably to have purchased from such Issuing Bank, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, in such Letter of Credit, each drawing thereunder and the obligations of the Borrowers under this Agreement and the other Loan Documents with respect thereto. Upon any change in the Domestic Commitments or Canadian Commitments pursuant to SECTION 2.02 (other than pursuant to SECTION 2.02(e)), SECTION 2.15, SECTION 2.17 or SECTION 9.04 of this Agreement, it is hereby agreed that with respect to all Letter of Credit Outstandings, there shall be an automatic adjustment to the participations hereby created to reflect the new Domestic Commitment Percentages or new Canadian Commitment Percentages, as applicable, of the assigning and assignee Lenders and the Additional Commitment Lenders, if applicable. Any action taken or omitted by an Issuing Bank under or in

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connection with a Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not create for such Issuing Bank any resulting liability to any Lender.

(g)    In the event that an Issuing Bank makes any Letter of Credit Disbursement and the Borrowers shall not have reimbursed such amount in full to such Issuing Bank pursuant to this SECTION 2.13, such Issuing Bank shall promptly notify the Administrative Agent or the Canadian Agent, as applicable, which shall promptly notify each Domestic Lender or Canadian Lender, as applicable, of such failure, and each Domestic Lender or Canadian Lender, as applicable, (other than a Tranche A-1 Lender) shall promptly and unconditionally pay to the Administrative Agent or the Canadian Agent, as applicable, for the account of such Issuing Bank the amount of such Lender’s Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, of such unreimbursed payment in dollars and in same day funds. If an Issuing Bank so notifies the Administrative Agent or the Canadian Agent, as applicable, and the Administrative Agent or the Canadian Agent so notifies the applicable Lenders prior to 11:00 a.m. on any Business Day, each such Domestic Lender or Canadian Lender, as applicable, shall make available to such Issuing Bank such Lender’s Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, of the amount of such payment on such Business Day in same day funds (or if such notice is received by the Domestic Lenders or Canadian Lenders, as applicable, after 11:00 a.m. on the day of receipt, payment shall be made on the immediately following Business Day in same day funds). If and to the extent such Domestic Lender or Canadian Lender, as applicable, shall not have so made its Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, of the amount of such payment available to the applicable Issuing Bank, such Domestic Lender or Canadian Lender, as applicable, agrees to pay to such Issuing Bank forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to the Administrative Agent or the Canadian Agent, as applicable, for the account of such Issuing Bank at the Federal Funds Effective Rate, in the case of payments by a Domestic Lender, and the Bank of Canada Overnight Rate, in the case of payments by a Canadian Lender. Each Lender agrees to fund its Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, of such unreimbursed payment notwithstanding a failure to satisfy any applicable lending conditions or the provisions of SECTION 2.01 or SECTION 2.06, or the occurrence of the Termination Date. The failure of any Domestic Lender or Canadian Lender to make available to the applicable Issuing Bank its Domestic Commitment Percentage or Canadian Commitment Percentage of any payment under any Letter of Credit shall neither relieve any Domestic Lender or any Canadian Lender, as applicable, of its obligation hereunder to make available to such Issuing Bank its Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, of any payment under any Letter of Credit on the date required, as specified above, nor increase the obligation of such other Domestic Lender or Canadian Lender. Whenever any Domestic Lender or Canadian Lender, as applicable, has made payments to an Issuing Bank in respect of any reimbursement obligation for any Letter of Credit, such Domestic Lender or Canadian Lender shall be entitled to share ratably, based on its Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, in all payments and collections thereafter received on account of such reimbursement obligation. All participations in Letters of Credit by the Lenders shall be made in such currency as the Letter of Credit is denominated or in the dollar equivalent thereof.

(h)    Whenever the Lead Borrower or the Canadian Borrower, as applicable, desires that an Issuing Bank issue a Letter of Credit (or the amendment, renewal or extension (other than

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automatic renewal or extensions) of an outstanding Letter of Credit), the Lead Borrower or the Canadian Borrower, as applicable, shall give to the applicable Issuing Bank and the Administrative Agent or the Canadian Agent, as applicable, at least two (2) Business Days’ prior written (including, without limitation, by telegraphic, telex, facsimile or cable communication) notice (or such shorter period as may be agreed upon in writing by the applicable Issuing Bank and the Lead Borrower) specifying the date on which the proposed Letter of Credit is to be issued, amended, renewed or extended (which shall be a Business Day), the Stated Amount of the Letter of Credit so requested (and, if for the Canadian Borrower, whether such Letter of Credit is to be denominated in dollars or CD$), the expiration date of such Letter of Credit, the name and address of the beneficiary thereof, and the provisions thereof. If requested by an Issuing Bank, the Lead Borrower or the Canadian Borrower, as applicable, shall also submit documentation on such Issuing Bank’s standard form in connection with any request for the issuance, amendment, renewal or extension of a Letter of Credit; providedthat, in the event of a conflict or inconsistency between the terms of such documentation and this Agreement, the terms of this Agreement shall supersede any inconsistent or contrary terms in such documentation and this Agreement shall control.

(i)    Subject to the limitations set forth below, the obligations of the Borrowers to reimburse the Issuing Banks for any Letter of Credit Disbursement shall be unconditional and irrevocable and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including, without limitation (it being understood that any such payment by the Borrowers shall be without prejudice to, and shall not constitute a waiver of, any rights the Borrowers might have or might acquire as a result of the payment by an Issuing Bank of any draft or the reimbursement by the Borrowers thereof): (i) any lack of validity or enforceability of a Letter of Credit; (ii) the existence of any claim, setoff, defense or other right which a Borrower may have at any time against a beneficiary of any Letter of Credit or against any Issuing Bank or any of the Credit Parties, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction; (iii) any draft, demand, certificate or other document presented under any Letter of Credit proving to be forged or fraudulent in any respect or any statement therein being untrue or inaccurate in any respect, or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit; (iv) payment by an Issuing Bank of any Letter of Credit against presentation of a demand, draft or certificate or other document which does not strictly comply with the terms of such Letter of Credit; (v) waiver by an Issuing Bank of any requirement that exists for such Issuing Bank’s protection and not the protection of any Borrower or any waiver by an Issuing Bank which does not in fact materially prejudice any Borrower; (vi) any honor of a demand for payment presented electronically even if a Letter of Credit requires that demand be in the form of a draft; (vii) any payment made by any Issuing Bank in respect of an otherwise complying item presented after the date specified as the expiration date of, or the date by which documents must be received under, a Letter of Credit if presentation after such date is authorized by the UCC, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice (or such later version thereof as may be in effect at the time of issuance), or the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce Publication No. 600 (or such later version thereof as may be in effect at the time of issuance), as applicable; (viii) any payment by an Issuing Bank under a Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by an Issuing Bank under a Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver, interim receiver, monitor or other representative of or successor to any

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beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under the Bankruptcy Code or any state, federal or provincial bankruptcy, insolvency, receivership or similar law; (ix) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SECTION 2.13, constitute a legal or equitable discharge of, or provide a right of setoff against, any Loan Party’s obligations hereunder; or (x) the fact that any Event of Default shall have occurred and be continuing; providedthat the Borrowers shall have no obligation to reimburse the Issuing Bank to the extent that such payment was made in error due to the gross negligence or willful misconduct of the Issuing Bank (as determined by a court of competent jurisdiction or another independent tribunal having jurisdiction). No Credit Party shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Banks; providedthat the foregoing shall not be construed to excuse the Issuing Banks from liability to the Borrowers to the extent of any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by the Borrowers to the extent permitted by applicable law) suffered by the Borrowers that are caused by the applicable Issuing Bank’s gross negligence or willful misconduct when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented that appear on their face to be in compliance with the terms of a Letter of Credit, an Issuing Bank may, in its reasonable discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.

(j)    If any Enumerated Default shall occur and be continuing, on the Business Day that the Lead Borrower or the Canadian Borrower, as applicable, receives notice from the Administrative Agent or the Canadian Agent, as applicable, or the Required Lenders demanding the deposit of cash collateral pursuant to this paragraph, the applicable Loan Parties shall immediately Cash Collateralize the Letter of Credit Outstandings owing by such Loan Parties as of such date. For purposes of this Agreement, “Cash Collateralize” means to deposit in the applicable Cash Collateral Account an amount in cash equal to 103% of the Letter of Credit Outstandings owing by such Loan Parties as of such date, plus any accrued and unpaid interest thereon. Each such deposit shall be held by the Administrative Agent or the Canadian Agent for the payment and performance of the Obligations and the Other Liabilities. The Administrative Agent or the Canadian Agent, as applicable, shall have exclusive dominion and control, including the exclusive right of withdrawal, over such Cash Collateral Account. Other than any interest earned on the investment of such deposits, which investments shall be made at the option and in the sole discretion of the Administrative Agent or the Canadian Agent, as applicable (at the request of the Lead Borrower and at the Borrowers’ risk and expense), such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such Cash Collateral Account shall be applied by the Administrative Agent or the Canadian Agent to reimburse the Issuing Banks for payments on account of drawings under Letters of Credit for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrowers for the Letter of Credit Outstandings at such time or, if the maturity of the Loans

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has been accelerated, shall be applied to satisfy the other respective Obligations and the Other Liabilities of the applicable Borrower. If at any time the total amount of funds held as cash collateral are subject to any right or claim of any Person other than the Administrative Agent or that the total amount of such funds is less than 103% of the Letter of Credit Outstandings owing by the Loan Parties as of such date, the Borrowers will, forthwith upon demand by the Administrative Agent, pay to the Administrative Agent, as additional funds to be deposited as cash collateral, an amount equal to such deficiency. If the applicable Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Enumerated Default, such amount (to the extent not applied as aforesaid) shall be returned promptly to the respective Borrower but in no event later than two (2) Business Days after all Enumerated Defaults have been cured or waived.

(k)    Notwithstanding anything to the contrary contained herein, with respect to the Canadian Borrower only, if an Issuing Bank for any Canadian Letter of Credit is not the Canadian Agent or a Canadian Lender: (i) the Canadian Borrower authorizes the Canadian Agent to arrange for the issuance of Canadian Letters of Credit from such Issuing Bank and to pay and indemnify (the “L/C Credit Support”) such Issuing Bank from and against all reasonable charges in connection with the issuance, negotiation, settlement, amendment and processing of each such Canadian Letter of Credit, and the Canadian Borrower agrees to pay and indemnify the Canadian Agent for and in respect of the L/C Credit Support and agrees that such obligation to pay and indemnify shall be deemed Canadian Liabilities; (ii) any notices, requests or applications under this SECTION 2.13 shall contemporaneously be delivered to both such Issuing Bank and the Canadian Agent; (iii) drafts drawn under any Letters of Credit as provided in and L/C Disbursements as provided in SECTION 2.13(d) shall immediately and on the same Business Day be reimbursed by the Canadian Agent, and all interest accruing or payable pursuant to SECTION 2.13(d) or SECTION 2.13(f) shall be for the account of the Canadian Agent and not the Issuing Banks; and (iv) the Canadian Borrower’s reimbursement obligation under SECTION 2.13(d) and/or SECTION 2.13(g) shall be due to the Canadian Agent and the Lenders shall make available to the Canadian Agent (for its own account) the amount of its payment provided for in SECTION 2.13(g).

(l)    Each Issuing Bank shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and each Issuing Bank shall have all of the benefits and immunities (A) provided to the Agents in Article VIII with respect to any acts taken or omissions suffered by such Issuing Bank in connection with Letters of Credit issued by it or proposed to be issued by it and letter of credit applications and other documents, instruments or agreements relating to such Letters of Credit as fully as if the term “Agents” as used in Article VIII included such Issuing Bank with respect to such acts or omissions, and (B) as additionally provided herein with respect to such Issuing Bank.

(m)    Unless otherwise expressly agreed by the Issuing Bank and the Lead Borrower when a Letter of Credit is issued, (i) the rules of the ISP shall apply to each Standby Letter of Credit, and (ii) the rules of the UCP shall apply to each Commercial Letter of Credit. Notwithstanding the foregoing, the Issuing Banks shall not be responsible to the Borrowers for, and the Issuing Banks’ rights and remedies against the Borrowers shall not be impaired by, any action or inaction of the Issuing Banks required or permitted under any law, order, or practice that is required or permitted to be applied to any Letter of Credit or this Agreement, including the Law or any order of a jurisdiction where the Issuing Bank or the beneficiary is located, the practice stated in the ISP or UCP, as applicable, or in the decisions, opinions, practice statements, or official commentary of the ICC

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Banking Commission, the Bankers Association for Finance and Trade - International Financial Services Association (BAFT-IFSA), or the Institute of International Banking Law & Practice, whether or not any Letter of Credit chooses such law or practice.

SECTION 2.14    Increased Costs.

(a)    If any Change in Law shall:

(i)    impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender or any holding company of any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate) or the Issuing Banks; or

(ii)    impose on any Lender or any Issuing Bank or the London interbank market any other condition, cost or expense affecting this Agreement or LIBO Loans made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any LIBO Loan (or of maintaining its obligation to make any such Revolving CreditLoan) or to increase the cost to such Lender or such Issuing Bank of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit) or to reduce the amount of any sum received or receivable by such Lender or such Issuing Bank hereunder (whether of principal, interest or otherwise), then, upon the request of such Lender or such Issuing Bank, the Domestic Borrowers or the Canadian Borrower, as applicable, will pay to such Lender or such Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or such Issuing Bank, as the case may be, for such additional costs incurred or reduction suffered.

(b)    If any Lender or any Issuing Bank determines that any Change in Law regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s or such Issuing Bank’s capital or liquidity or on the capital or liquidity of such Lender’s or such Issuing Bank’s holding company, if any, as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that which such Lender or such Issuing Bank or such Lender’s or such Issuing Bank’s holding company would have achieved but for such Change in Law (taking into consideration such Lender’s or such Issuing Bank’s policies and the policies of such Lender’s or such Issuing Bank’s holding company with respect to capital adequacy), then from time to time the Borrowers will pay to such Lender or such Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or such Issuing Bank or such Lender’s or such Issuing Bank’s holding company for any such reduction suffered.

(c)    A certificate of a Lender or an Issuing Bank setting forth the amount or amounts necessary to compensate such Lender or such Issuing Bank or its holding company, as the case may be, as specified in paragraphs (a) or (b) of this SECTION 2.14 and setting forth in reasonable detail the manner in which such amount or amounts were determined shall be delivered to the Lead Borrower or the Canadian Borrower, as applicable, and shall be conclusive absent manifest error. The Domestic Borrowers or the Canadian Borrower, as applicable, shall pay such Lender or such

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Issuing Bank, as the case may be, the amount shown as due on any such certificate within fifteen (15) Business Days after receipt thereof.

(d)    Failure or delay on the part of any Lender or any Issuing Bank to demand compensation pursuant to this SECTION 2.14 shall not constitute a waiver of such Lender’s or such Issuing Bank’s right to demand such compensation; providedthat the Borrowers shall not be required to compensate a Lender or an Issuing Bank pursuant to this SECTION 2.14 for any increased costs or reductions incurred more than 90 days prior to the date that such Lender or such Issuing Bank, as the case may be, notifies the Borrowers of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or such Issuing Bank’s intention to claim compensation therefor; providedfurther that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 90 day period referred to above shall be extended to include the period of retroactive effect thereof.

SECTION 2.15    Termination or Reduction of Commitments.

(a)    Upon at least two (2) Business Days’ prior written notice to the Administrative Agent, the Lead Borrower may, at any time, in whole permanently terminate, or from time to time in part permanently reduce, the Domestic Commitments. Each such reduction shall be in the principal amount of $5,000,000 or any integral multiple thereof. Each such reduction or termination shall (i) be applied ratably to the Domestic Commitments of each Lender and (ii) be irrevocable at the effective time of any such termination or reduction. The Domestic Borrowers shall pay to the Administrative Agent, for application as provided in clause (i) of this SECTION 2.15(a), (A) at the effective time of any such termination (but not any partial reduction), all earned and unpaid Unused Fees accrued on the Domestic Commitments so terminated and (B) at the effective time of any such reduction or termination, any amount by which the Total Domestic Revolver Outstandings on such date exceed the amount to which the Domestic Commitments are to be reduced effective on such date.

(b)    Upon at least two (2) Business Days’ prior written notice to the Canadian Agent, the Canadian Borrower may, at any time, in whole permanently terminate, or from time to time in part permanently reduce, the Canadian Commitments. Each such reduction shall be in the principal amount of $5,000,000 or any integral multiple thereof. Each such reduction or termination shall (i) be applied ratably to the Canadian Commitments of each Canadian Lender and (ii) be irrevocable at the effective time of any such termination or reduction. The Canadian Borrower shall pay to the Canadian Agent, for application as provided in clause (i) of this SECTION 2.15(b), (A) at the effective time of each such termination (but not any partial reduction), all earned and unpaid Canadian Unused Fees accrued on the Canadian Commitments so terminated and (B) at the effective time of each such reduction or termination, any amount by which the Total Canadian Revolver Outstandings on such date exceed the amount to which the Canadian Commitments are to be reduced effective on such date.

(c)    In the event that the Lead Borrower terminates the Domestic Commitments, the Canadian Commitments shall be deemed to have also been terminated, without any further action by the Lead Borrower, the Canadian Borrower or any Credit Party.

SECTION 2.16    Optional Prepayment of Loans; Reimbursement of Lenders.

(a)    The Borrowers shall have the right, at any time and from time to time, to prepay (without a commitment reduction) outstanding Revolving Credit Loans and Tranche A-1 Loans, in

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whole or in part, (x) with respect to LIBO Loans or BA Equivalent Loans, upon at least two (2) Business Days’ prior written, telex or facsimile notice to the Administrative Agent or the Canadian Agent, as applicable, prior to 12:00 noon, and (y) with respect to Prime Rate Loans, on the same Business Day if written, telex or facsimile notice is received by the Administrative Agent or the Canadian Agent, as applicable, prior to 12:00 noon (or 11:00 a.m. in the case of CD$ Prime Rate Loans or Dollar denominated Prime Rate Loans of the Canadian Borrower), subject in each case to the following limitations:Notwithstanding the foregoing, Tranche A-1 Loans may not be voluntarily prepaid (except with respect to any refinancing, replacement, extension or renewal of the Tranche A-1 Loans including the payment of any fees and expenses in connection therewith (other than with proceeds of Revolving Credit Loans)) unless and until either (i) all other Obligations or Canadian Liabilities, as applicable (other than, in each case, Tranche A-1 Loans) have been paid in full and all Letters of Credit have been Cash Collateralized, or (ii)(A) no Default or Event of Default then exists or would arise therefrom, and (B) after giving effect to such prepayment, the Pro Forma Availability Condition shall have been satisfied.

(i)    Subject to SECTION 2.17, all prepayments of Revolving Credit Loans shall be paid to the Administrative Agent or the Canadian Agent, as applicable, for application (except as otherwise directed by the applicable Borrower), first, to the prepayment of outstanding Swingline Loans, second, to the prepayment of other outstanding Revolving Credit Loans ratably in accordance with each Lender’s Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, and, third, if an Enumerated Default then exists, to Cash Collateralize the Letter of Credit Outstandings; All prepayments of Tranche A-1 Loans shall be paid tothe Administrative Agent or the Canadian Agent, as applicable, for application to the prepayment of outstanding Tranche A-1 Loans.

(ii)    Subject to the foregoing, outstanding Prime Rate Loans of the Domestic Borrowers shall be prepaid before outstanding LIBO Loans are prepaid, and outstanding Prime Rate Loans of the Canadian Borrower shall be prepaid before outstanding BA Equivalent Loans or LIBO Loans are prepaid (except as otherwise directed by the applicable Borrower). Each partial prepayment of LIBO Loans shall be in an integral multiple of $1,000,000 (but in no event less than $10,000,000), and each partial prepayment of BA Equivalent Loans shall be in an integral multiple of CD$1,000,000 (but in no event less than CD$5,000,000). No prepayment of LIBO Loans or BA Equivalent Loans shall be permitted pursuant to this SECTION 2.16 other than on the last day of an Interest Period applicable thereto, unless the applicable Borrowers reimburse the Lenders for all Breakage Costs associated therewith within five (5) Business Days of receiving a written demand for such reimbursement which sets forth the calculation of such Breakage Costs in reasonable detail. No partial prepayment of a Borrowing of LIBO Loans shall result in the aggregate principal amount of the LIBO Loans remaining outstanding pursuant to such Borrowing being less than $10,000,000 (unless all such outstanding LIBO Loans are being prepaid in full). No partial prepayment of a Borrowing of BA Equivalent Loans shall result in the aggregate principal amount of the BA Equivalent Loans remaining outstanding pursuant to such Borrowing being less than CD$5,000,000 (unless all such outstanding BA Equivalent Loans are being prepaid in full); and

(iii)    Each notice of prepayment shall specify the prepayment date, the principal amount and Type of the Loans to be prepaid and, in the case of LIBO Loans or BA Equivalent Loans, the Borrowing or Borrowings pursuant to which such Revolving Credit Loans were made. Each notice of prepayment shall be revocable; providedthat, within five (5) Business Days of

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receiving a written demand for such reimbursement which sets forth the calculation of such Breakage Costs in reasonable detail, the applicable Borrower shall reimburse the Lenders for all Breakage Costs associated with the revocation of any notice of prepayment. The Administrative Agent or the Canadian Agent, as applicable, shall, promptly after receiving notice from the Lead Borrower hereunder, notify each applicable Lender of the principal amount and Type of the Loans held by such Lender which are to be prepaid, the prepayment date and the manner of application of the prepayment.

(b)    The Domestic Borrowers shall reimburse each Domestic Lender and the Canadian Borrower shall reimburse each Canadian Lender as set forth below for any loss incurred or to be incurred by the Domestic Lenders or the Canadian Lenders, as applicable, in the reemployment of the funds (i) resulting from any prepayment (for any reason whatsoever, including, without limitation, conversion to Prime Rate Loans or acceleration by virtue of, and after, the occurrence of an Event of Default) of any LIBO Loan or BA Equivalent Loan required or permitted under this Agreement, if such Revolving Credit Loan is prepaid other than on the last day of the Interest Period for such Revolving Credit Loan or (ii) in the event that after the Lead Borrower or the Canadian Borrower, as applicable, delivers a notice of borrowing under SECTION 2.04 in respect of LIBO Loans or BA Equivalent Loans, such Revolving Credit Loans are not made on the first day of the Interest Period specified in such notice of borrowing for any reason (including, without limitation, revocation by a Borrower of a notice of Borrowing) other than a breach by such Lender of its obligations hereunder or the delivery of any notice pursuant to SECTION 2.09, SECTION 2.10 or SECTION 2.11, or (iii) in the event that after a Borrower delivers a notice of commitment reduction under SECTION 2.15 or a notice of prepayment under this SECTION 2.16 in respect of LIBO Loans or BA Equivalent Loans, such commitment reductions or such prepayments are not made on the day specified in such notice of reduction or prepayment. Such loss shall be the amount (herein, collectively, “Breakage Costs”) as reasonably determined by such Lender as the excess, if any, of (A) the amount of interest which would have accrued to such Lender on the amount so paid, not prepaid or not borrowed at a rate of interest equal to the Adjusted LIBO Rate or BA Equivalent Rate, as applicable, for such Revolving Credit Loan (but specifically excluding any Applicable Margin), for the period from the date of such payment or failure to borrow or failure to prepay to the last day (x) in the case of a payment or refinancing of a LIBO Loan or BA Equivalent Loan with Prime Rate Loans other than on the last day of the Interest Period for such Revolving Credit Loan or the failure to prepay a LIBO Loan of BA Equivalent Loan, of the then current Interest Period for such Revolving Credit Loan or (y) in the case of such failure to borrow, of the Interest Period for such LIBO Loan or BA Equivalent Loan which would have commenced on the date of such failure to borrow, over (B) in the case of a LIBO Loan, the amount of interest which would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the London interbank market or, in the case of a BA Equivalent Loan, the amount of interest which would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with The Toronto-Dominion Bank. Any Lender demanding reimbursement for such loss shall deliver to the Lead Borrower or the Canadian Borrower, as applicable, from time to time one or more certificates setting forth the amount of such loss as determined by such Lender and setting forth in reasonable detail the manner in which such amount was determined and such amounts shall be due within ten (10) Business Days after the receipt of such notice.

(c)    In the event the Domestic Borrowers or the Canadian Borrower, as applicable, fail to prepay any Revolving Credit Loan on the date specified in any prepayment notice delivered

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pursuant to SECTION 2.16(a) (whether or not such prepayment notice is revoked), the Domestic Borrowers or the Canadian Borrower, as applicable, within ten (10) Business Days after the receipt of the notice described below from any Lender, shall pay to the Administrative Agent or the Canadian Agent, as applicable, for the account of such Lender, any amounts required to compensate such Lender for any loss incurred by such Lender as a result of such failure to prepay, including, without limitation, any loss, cost or expenses (other than loss of profits) incurred by reason of the acquisition of deposits or other funds by such Lender to fulfill deposit obligations incurred in anticipation of such prepayment. Any Lender demanding such payment shall deliver to the Lead Borrower or the Canadian Borrower, as applicable, from time to time one or more certificates setting forth the amount of such loss as determined by such Lender and setting forth in reasonable detail the manner in which such amount was determined and such amounts shall be due within ten (10) Business Days after the receipt of such notice.

(d)    Whenever any partial prepayment of Revolving Credit Loans is to be applied to LIBO Loans or BA Equivalent Loans, such LIBO Loans or BA Equivalent Loans shall be prepaid in the chronological order of their Interest Payment Dates or as the Lead Borrower or the Canadian Borrower, as applicable, may otherwise designate in writing.

SECTION 2.17    Mandatory Prepayment of Loans; Mandatory Reduction or Termination of Commitments; Cash Collateral.

The outstanding Obligations shall be subject to prepayment as follows:

(a)    If, at any time, the Total Domestic Revolver Outstandings exceeds Domestic Availability, including, without limitation, as a result of one or more fluctuations in the exchange rate of the CD$ against the dollar, the Domestic Borrowers will, immediately upon notice from the Administrative Agent: (i) prepay the Revolving Credit Loans in an amount necessary to eliminate such excess; and (ii) if, after giving effect to the prepayment in full of all outstanding Revolving Credit Loans such excess has not been eliminated, Cash Collateralize the Domestic Letters of Credit Outstanding.

(b)    If, at any time, the Total Canadian Revolver Outstandings exceeds Canadian Availability, in each case calculated in dollars at the Equivalent Amount, including, without limitation, as a result of one or more fluctuations in the exchange rate of the CD$ against the dollar, the Canadian Borrowers will immediately upon notice from the Canadian Agent (or within five (5) Business Days after notice from the Canadian Agent if such excess is solely the result of one or more fluctuations in the exchange rate of the CD$ against the dollar and the Canadian Loan Ceiling has not been exceeded) (i) prepay the Revolving Credit Loans to the Canadian Borrower in an amount necessary to eliminate such excess, and (ii) if, after giving effect to the prepayment in full of all such outstanding Revolving Credit Loans such excess has not been eliminated, Cash Collateralize the Canadian Letters of Credit Outstanding.

(c)If at any time, the calculation of Canadian Loan to Value is less than zero (0), the Canadian Borrower will, upon notice from the Canadian Agent, promptly prepay the Revolving Credit Loans that were made to the Canadian Borrower in such amount as may be necessary so that, after giving effect to such prepayment, the Canadian Loan to Value is not less than zero.

(cd)    The Revolving Credit Loans shall be repaid daily in accordance with (and to the extent required under) the provisions of SECTION 2.18, to the extent then applicable.

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(de)    Any Net Proceeds received from a Prepayment Event arising from Collateral included in the Tranche A Borrowing Base or the Canadian Borrowing Base (other than from sales of Inventory in the ordinary course of business), whether or not a Cash Dominion Event then exists, shall be paid over to the Administrative Agent on receipt by the Loan Parties and shall be utilized to prepay the Loans in the order of priority set forth in SECTION 7.03; providedthat the provisions of this clause (d) shall not apply if a Cash Dominion Event does not exist or arise from such prepayment Event and the Net Proceeds from such Prepayment Event are not in excess of $50,000,000. The Agents shall not be obligated to release their Liens on any Collateral included in such Prepayment Event until such Net Proceeds have been so received (to the extent required in this clause (d)). The application of such Net Proceeds to the Loans shall not reduce the Commitments. If all Obligations or Canadian Liabilities, as applicable, and Other Liabilities then due, are paid, any excess Net Proceeds shall be remitted to the operating account of the Domestic Borrowers or the Canadian Borrower maintained with the Administrative Agent or the Canadian Agent, respectively.

(ef)    Except during the continuance of a Cash Dominion Event, and provided that the Determination Date shall not have occurred, any Net Proceeds, Cash Receipts and other payments received by the Administrative Agent shall be applied as the Lead Borrower or the Canadian Borrower, as applicable, shall direct the Administrative Agent in writing.

(fg)    Subject to the foregoing, outstanding Prime Rate Loans of the Domestic Borrowers shall be prepaid before outstanding LIBO Loans of the Domestic Borrowers are prepaid and outstanding Prime Rate Loans of the Canadian Borrower shall be prepaid before outstanding BA Equivalent Loans or LIBO Loans of the Canadian Borrower are prepaid. No prepayment of LIBO Loans or BA Equivalent Loans shall be permitted pursuant to this SECTION 2.17 other than on the last day of an Interest Period applicable thereto, unless the applicable Borrowers reimburse the Domestic Lenders or Canadian Lenders, as applicable, for all Breakage Costs associated therewith within five (5) Business Days of receiving a written demand for such reimbursement which sets forth the calculation of such Breakage Costs in reasonable detail. In order to avoid such Breakage Costs, as long as no Specified Default has occurred and is continuing, at the request of the Lead Borrower, the Administrative Agent or the Canadian Agent, as applicable, shall hold all amounts required to be applied to LIBO Loans or BA Equivalent Loans in the Cash Collateral Account and will apply such funds to the applicable LIBO Loans and BA Equivalent Loans at the end of the then pending Interest Period therefor (providedthat the foregoing shall in no way limit or restrict the Agents’ or the Canadian Agent’s rights upon the subsequent occurrence of an Event of Default). No partial prepayment of a Borrowing of LIBO Loans or BA Equivalent Loans shall result in the aggregate principal amount of the LIBO Loans or BA Equivalent Loans remaining outstanding pursuant to such Borrowing being less than $10,000,000 or CD$5,000,000, as applicable. A prepayment of the Revolving Credit Loans pursuant to SECTION 2.16 or this SECTION 2.17 shall not permanently reduce the Commitments.A prepayment of the Tranche A-1 Loans shall permanently reduce the Tranche A-1 Loans and may not be reborrowed.

(gh)    All amounts required to be applied to all Revolving Credit Loans hereunder (other than Swingline Loans) shall be applied ratably in accordance with each Domestic Lender’s Domestic Commitment Percentage or each Canadian Lender’s Canadian Commitment Percentage, as applicable. All credits against the Obligations or the Canadian Liabilities shall be conditioned upon final payment to the Administrative Agent or the Canadian Agent, as applicable, of the items giving rise to such credits. If any item credited to the Loan Account is dishonored or returned unpaid for

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any reason, whether or not such return is rightful or timely, the Administrative Agent or the Canadian Agent, as applicable, shall have the right to reverse such credit and charge the amount of such item to the Loan Account and the Borrowers shall indemnify the Secured Parties against all claims and losses resulting from such dishonor or return.

(hi)    Without in any way limiting the provisions of SECTION 2.17(a) or SECTION 2.17(b), the Administrative Agent shall, monthly (or more frequently in the Administrative Agent’s reasonable discretion in the event of a material change in the foreign exchange rates), make the necessary exchange rate calculations to determine whether any such excess described in such Sections exists on such date.

(ij)    Upon the Termination Date, the Commitments of the Lenders and the credit facility provided hereunder shall be terminated in full, and the Domestic Borrowers shall pay, in full and in cash, all outstanding Loans and all other outstanding Obligations and Other Liabilities then owing by them to the Lenders, and the Canadian Borrower shall pay in full and in cash, all outstanding Loans to it and all other Canadian Liabilities owing by it to the Lenders.

(jk)    All Obligations, Canadian Liabilities and Other Liabilities shall be payable to the Administrative Agent or the Canadian Agent, as applicable, in the currency in which they are denominated.

(kl)    In the event of a direct conflict between the priority provisions of this SECTION 2.17 and other provisions contained in any other Loan Document, it is the intention of the parties hereto that such priority provisions in such documents shall be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this SECTION 2.17 shall control and govern.

(lm)    If:

(i)    thirty (30) days prior to the maturity date of each of the Term Loans, the Term Loans so maturing have not been refinanced, extended or otherwise replaced or repaid pursuant to transactions permitted hereunder (unless, on or prior to the date that is thirty (30) days prior to the maturity of the applicable Term Loans, the Administrative Agent has received reasonably satisfactory evidence that (A) commitments in respect of such refinancing, extension or replacement in an amount sufficient to repay in full the applicable Term Loans prior to their maturity have been obtained, subject only to customary closing conditions for transactions of this type and (B) the closing of such refinancing, extension or replacement will occur at least five (5) days prior to the maturity date of each of the Term Loans), or

(ii)    five (5) days prior to the maturity date of each of the Term Loans, the Term Loans so maturing have not been refinanced, extended or otherwise replaced or repaid pursuant to transactions permitted hereunder, or

(iii)    thirty (30) days prior to the maturity date of the 2016 Notes, the 2016 Notes have not been refinanced, extended or otherwise replaced or repaid pursuant to transactions permitted hereunder (unless, on or prior to the date that is thirty (30) days prior to the maturity of the 2016 Notes, the Administrative Agent has received reasonably satisfactory evidence that (A) commitments in respect of such refinancing, extension or replacement in an amount sufficient to

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repay in full the 2016 Notes prior to their maturity have been obtained, subject only to customary closing conditions for transactions of this type and (B) the closing of such refinancing, extension or replacement will occur at least five (5) days prior to the maturity date of the 2016 Notes), or

(iv)    five (5) days prior to the maturity date of the 2016 Notes, the 2016 Notes have not been refinanced, extended or otherwise replaced or repaid pursuant to transactions permitted hereunder,

then, in any such case, the Commitments shall automatically terminate without any further action by the Agents or the Lenders, the Domestic Borrowers shall pay, in full and in cash, all outstanding Loans and all other outstanding Obligations and Other Liabilities then owing by them to the Lenders, and the Canadian Borrower shall pay in full and in cash, all outstanding Loans to it and all other Canadian Liabilities owing by it to the Lenders.

SECTION 2.18    Cash Management.

(a)    Immediately upon the occurrence of a Cash Dominion Event, the Loan Parties, upon the request of any Co-Collateral Agent, shall deliver to the Co-Collateral Agents a schedule of all DDAs, that to the knowledge of the Responsible Officers of the Loan Parties, are maintained by the Loan Parties, which Schedule includes, with respect to each depository, (i) the name and address of such depository, (ii) the account number(s) maintained with such depository, and (iii) a contact person at such depository.

(b)    [Reserved.]

(c)    Each Loan Party has or shall have:

(i)    delivered to the Administrative Agent and the Canadian Agent, as applicable, notifications (each, a “Credit Card Notification”) substantially in the form attached hereto as Exhibit I which have been executed on behalf of such Loan Party and addressed to such Loan Party’s credit card clearinghouses and processors. Except as otherwise amended or supplemented by the Lead Borrower in writing to the Administrative Agent on or prior to the Effective Date, Schedule 2.18(b) to the Existing Credit Agreement sets forth all credit card processing agreements as of the First Amendment Effective Date;

(ii)    entered into a blocked account agreement (each, a “Blocked Account Agreement”) in form and substance reasonably satisfactory to the Co-Collateral Agents or the Canadian Agent, as applicable, with any bank with which such Loan Party maintains deposit account(s) into which the DDA’s are swept (collectively, the “Blocked Accounts”). Except as otherwise amended or supplemented by the Lead Borrower in writing to the Administrative Agent on or prior to the Effective Date, Schedule 2.18(c)(ii) to the Existing Credit Agreement sets forth all Blocked Accounts as of the First Amendment Effective Date.

(d)    Each Credit Card Notification and Blocked Account Agreement shall require, during the continuance of a Cash Dominion Event (and delivery of notice thereof from the Administrative Agent), the ACH or wire transfer on each Business Day (and whether or not there is then an outstanding balance in the Loan Account) of all available cash receipts (the “Cash Receipts”) (other than amounts not to exceed $25,000,000 in the aggregate which may be deposited into a segregated DDA (not to be located in the Province of Quebec, Canada) which the Lead Borrower designates

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in writing to the Administrative Agent as being the “uncontrolled cash account” (the “Designated Account”)) to the concentration account maintained by the Administrative Agent at Bank of America (the “Domestic Concentration Account”) or maintained by the Canadian Agent (the “Canadian Concentration Account”), from:

(i)    the sale of Inventory and other Collateral;

(ii)    all proceeds of collections of Accounts;

(iii)    all Net Proceeds on account of any Prepayment Event;

(iv)    each Blocked Account (including all cash deposited therein from each DDA (other than the Designated Account); and

(v)    the cash proceeds of all credit card charges;

providedthat Cash Receipts of the Canadian Loan Parties shall be delivered only to a Blocked Account established by the Canadian Borrower or as the Canadian Agent may otherwise direct.

(e)     If, at any time during the continuance of a Cash Dominion Event, any cash or cash equivalents owned by any Loan Party (other than (i) an amount of up to $25,000,000 that is on deposit in the Designated Account, which funds shall not be funded from, or when withdrawn from the Designated Account, shall not be replenished by, funds constituting proceeds of Collateral so long as such Cash Dominion Event continues, (ii) de minimus cash or cash equivalents inadvertently misapplied by the Loan Parties and (iii) payroll, trust and tax withholding accounts funded in the ordinary course of business and required by Applicable Law) are deposited to any account, or held or invested in any manner, otherwise than in a Blocked Account that is subject to a Blocked Account Agreement (or a DDA which is swept daily to a Blocked Account), any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) or the Canadian Agent may require the applicable Loan Party to close such account and have all funds therein transferred to a Blocked Account, and all future deposits made to a Blocked Account which is subject to a Blocked Account Agreement.

(f)    The Loan Parties may close DDAs or Blocked Accounts and/or open new DDAs or Blocked Accounts, subject to the execution and delivery to the Administrative Agent or the Canadian Agent, as applicable, of appropriate Blocked Account Agreements (unless expressly waived by the Co-Collateral Agents or the Canadian Agent) consistent with the provisions of this SECTION 2.18 and otherwise reasonably satisfactory to the Co-Collateral Agents and, if applicable, the Canadian Agent. The Loan Parties shall furnish the Co-Collateral Agents with prior written notice of their intention to open or close a Blocked Account and the Co-Collateral Agents shall promptly notify the Lead Borrower as to whether the Co-Collateral Agents shall require a Blocked Account Agreement with the Person with whom such account will be maintained. Unless consented to in writing by the Co-Collateral Agents and, if applicable, the Canadian Agent, the Loan Parties shall not enter into any agreements with credit card processors other than the ones expressly contemplated herein unless, contemporaneously therewith, a Credit Card Notification, is executed and delivered to the Administrative Agent or the Canadian Agent, as applicable.

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(g)    The Loan Parties may also maintain one or more disbursement accounts (the “Disbursement Accounts”) to be used by the Loan Parties for disbursements and payments (including payroll) in the ordinary course of business or as otherwise permitted hereunder.

(h)    The Domestic Concentration Account and the Canadian Concentration Account shall at all times be under the sole dominion and control of the Administrative Agent or the Canadian Agent, as applicable. Each Loan Party hereby acknowledges and agrees that (i) such Loan Party has no right of withdrawal from such Concentration Accounts, (ii) the funds on deposit in such Concentration Accounts shall at all times continue to be collateral security for all of the Obligations and the Other Liabilities, providedthat funds in the Canadian Concentration Account shall be applied only to the Canadian Liabilities, and (iii) the funds on deposit in each such Concentration Account shall be applied as provided in this Agreement. In the event that, notwithstanding the provisions of this SECTION 2.18, any Loan Party receives or otherwise has dominion and control of any such proceeds or collections, such proceeds and collections shall be held in trust by such Loan Party for the Administrative Agent or the Canadian Agent, as applicable, shall not be commingled with any of such Loan Party’s other funds or deposited in any account of such Loan Party and shall promptly be deposited into the applicable Concentration Account or dealt with in such other fashion as such Loan Party may be instructed by the Co-Collateral Agents or the Canadian Agent, as applicable.

(i)    Any amounts received in the Domestic Concentration Account or the Canadian Concentration Account at any time when all of the Obligations or the Canadian Liabilities, as applicable, and Other Liabilities then due have been and remain fully repaid shall be remitted to the operating account of the Domestic Borrowers or the Canadian Borrower maintained with the Administrative Agent or the Canadian Agent, respectively.

(j)    The Administrative Agent or the Canadian Agent, as applicable, shall promptly (but in any event within one (1) Business Day) furnish written notice to each Person with whom a Blocked Account is maintained of any termination of a Cash Dominion Event.

(k)    The following shall apply to deposits and payments under and pursuant to this Agreement:

(i)    Funds shall be deemed to have been deposited to the applicable Concentration Account on the Business Day on which deposited, providedthat such deposit is available to the Administrative Agent or the Canadian Agent, as applicable, by 4:00 p.m. on that Business Day (except that, if the Obligations or Canadian Liabilities are being paid in full, by 2:00 p.m. on that Business Day);

(ii)    Funds paid to the Administrative Agent or the Canadian Agent, as applicable, other than by deposit to the Concentration Account, shall be deemed to have been received on the Business Day when they are good and collected funds, providedthat such payment is available to the Administrative Agent or the Canadian Agent, as applicable, by 4:00 p.m. on that Business Day (except that, if the Obligations or Canadian Liabilities are being paid in full, by 2:00 p.m. on that Business Day);

(iii)    If a deposit to a Concentration Account or payment is not available to the Administrative Agent until after 4:00 p.m. (or, to the Canadian Agent, until after 2:00 p.m.) on a Business Day, such deposit or payment shall be deemed to have been made at 9:00 a.m. on the then next Business Day;

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(iv)    If any item deposited to a Concentration Account and credited to the Loan Account is dishonored or returned unpaid for any reason, whether or not such return is rightful or timely, the Administrative Agent or the Canadian Agent, as applicable, shall have the right to reverse such credit and charge the amount of such item to the applicable Loan Account and the applicable Loan Parties shall indemnify the Secured Parties against all out-of-pocket claims and losses resulting from such dishonor or return.

SECTION 2.19    Fees.

(a)    The Borrowers agree to pay to the Agents the fees in the amounts and on the dates as set forth in any fee letters or fee agreements with the Agents and to perform any other obligations contained therein.

(b)    The Domestic Borrowers shall pay the Administrative Agent, for the account of the Lenders having Domestic Commitments, an aggregate fee (the “Unused Fee”) equal to one quarter of one percent (0.25%) per annum (on the basis of actual days elapsed in a year of 365 or 366 days, as applicable) of the average daily balance of the Unused Domestic Commitment, during the calendar quarter just ended (or relevant period with respect to the payment being made for the first calendar quarter ending after the Effective Date or on the Termination Date). The Unused Fee shall be paid in arrears, on the tenth day of each October, January, April and July after the execution of this Agreement and on the Termination Date. The Administrative Agent shall pay the Unused Fee to the Lenders having Domestic Commitments upon the Administrative Agent’s receipt of the Unused Fee based upon their pro rata share of an amount equal to the aggregate Unused Fee to all Lenders having Domestic Commitments.

(c)    The Canadian Borrower shall pay the Canadian Agent, for the account of the Lenders having Canadian Commitments, an aggregate fee (the “Canadian Unused Fee”) equal to one quarter of one percent (0.25%) per annum (on the basis of actual days elapsed in a year of 365 or 366 days, as applicable) of the average daily balance of the Unused Canadian Commitment, during the calendar quarter just ended (or relevant period with respect to the payment being made for the first calendar quarter ending after the Effective Date or on the Termination Date). The Canadian Unused Fee shall be paid in arrears, on the tenth day of each October, January, April and July after the execution of this Agreement and on the Termination Date. The Canadian Agent shall pay the Canadian Unused Fee to the Lenders having Canadian Commitments upon the Canadian Agent’s receipt of the Canadian Unused Fee based upon their pro rata share of an amount equal to the aggregate Canadian Unused Fee to all Lenders having Canadian Commitments.

(d)    The Domestic Borrowers shall pay the Administrative Agent and the Canadian Borrower shall pay to the Canadian Agent, for the account of the Domestic Lenders or the Canadian Lenders, as applicable, (other than Tranche A-1 Lenders) on the first day of each September, December, March and June, in arrears, a fee calculated on the basis of a 365 or 366 day year, as applicable and actual days elapsed (each, a “Letter of Credit Fee”), equal to the following per annum percentages of the average face amount of the following categories of Letters of Credit outstanding during the three month period then ended:

(i)    Standby Letters of Credit for the Domestic Borrowers: for the account of each Lender in accordance with its Domestic Commitment Percentage, at a per annum rate equal to the then Applicable Margin for LIBO Loans;

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(ii)    Commercial Letters of Credit for the Domestic Borrowers: for the account of each Lender in accordance with its Domestic Commitment Percentage, at a rate per annum equal to fifty percent (50%) of the then Applicable Margin for LIBO Loans;

(iii)    Standby Letters of Credit for the Canadian Borrower: for the account of each Lender in accordance with its Canadian Commitment Percentage, at a per annum rate equal to the then Applicable Margin for BA Equivalent Loans;

(iv)    Commercial Letters of Credit for the Canadian Borrower: for the account of each Lender in accordance with its Canadian Commitment Percentage, at a per annum rate equal to fifty percent (50%) of the then Applicable Margin for BA Equivalent Loans; and

(v)    After the occurrence and during the continuance of an Enumerated Default and acceleration of the Obligations or the Canadian Liabilities, as applicable, if the Domestic Letter of Credit Outstandings or of the Canadian Letter of Credit Outstandings, as applicable, as of such date, plus accrued and unpaid interest thereon, have not been Cash Collateralized, effective upon written notice from the Administrative Agent or the Canadian Agent, as applicable, the Letter of Credit Fee shall be increased, at the option of the Administrative Agent or the Canadian Agent, as applicable, by an amount equal to two percent (2%) per annum.

(e)    The Domestic Borrowers or the Canadian Borrower, as applicable, shall pay to the applicable Issuing Bank, in addition to all Letter of Credit Fees otherwise provided for hereunder, the reasonable and customary fees and charges of such Issuing Bank in connection with the issuance, negotiation, settlement, amendment and processing of each Letter of Credit issued by such Issuing Bank.

(f)In the event that, prior to the 12 month anniversary of the First Amendment Effective Date, all or any portion of the Tranche A-1 Loans is (i) repaid, prepaid, refinanced or replaced with any term loan financing, or (ii) repriced or effectively refinanced through any waiver, consent, amendment or amendment and restatement, and in the case of each of (i) and (ii), above, the effect thereof is to lower the All-in Yield of the Tranche A-1 Loans (or portion thereof) or new term loan financing, as applicable, from the All-in Yield of the Tranche A-1 Loans (or portion thereof) so repaid, prepaid, refinanced, replaced or repriced (a “Repricing Event”), the Borrowers shall pay to Administrative Agent for the account of Tranche A-1 Lenders (A) in the case of clause (i), a prepayment premium equal to 1.00% of the aggregate principal amount of the Tranche A-1 Loans so repaid, prepaid, refinanced, replaced or repriced and (B) in the case of clause (ii), a fee equal to 1.00% of the aggregate principal amount of the Tranche A-1 Loans repriced or effectively refinanced through such waiver,consent, amendment or amendment and restatement; provided, that, no such fee shall be payable, in the case of clause (i) or (ii), if the Repricing Event is due to, or in connection with, a Change in Control. If all or any portion of the Tranche A-1 Loans held by any Tranche A-1 Lender is subject to mandatory assignment pursuant to Section 9.02(c) as a result of, or in connection with, such Tranche A-1 Lender’s not agreeing or otherwise consenting to any waiver, consent or amendment referred to in clause (ii) above (or otherwise in connection with a Repricing Event) on or prior to the 12 month anniversary of the First Amendment Date, the Borrowers shall pay to such Tranche A-1 Lender (and not any Person replacing such Tranche A-1 Lender pursuant to SECTION 9.02(c), its pro rata portion (as determined immediately prior to it being so replaced) of the a prepayment premium under clause (ii) of the immediately preceding sentence. Such amounts shall be due and payable on the date of effectiveness of such Repricing Event.

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(fg)    Notwithstanding anything to the contrary herein contained, the Borrowers shall not be obligated to pay any Unused Fees or Canadian Unused Fees to or the for the account of any Lender to the extent and during the period such Lender is a Defaulting Lender.

(gh)    All fees shall be paid on the dates due, in immediately available funds, to the Administrative Agent or the Canadian Agent, as applicable, for the respective accounts of the Administrative Agent or the Canadian Agent, as applicable, and other Credit Parties as provided herein. Once due, all fees shall be fully earned and shall not be refundable under any circumstances. For greater certainty, the Canadian Borrower shall not be liable for any fees which form part of the Obligations unless they are Canadian Liabilities (including as provided in SECTION 2.19(a), SECTION 2.19(c) or SECTION 9.03).

SECTION 2.20    Maintenance of Loan Account; Statements of Account.

(a)    The Administrative Agent or the Canadian Agent, as applicable, shall maintain an account on its books in the name of the Domestic Borrowers and the Canadian Borrower (each, the “Loan Account”) which will reflect (i) all Loans and other advances made by the Lenders to such Borrowers or for such Borrowers’ account, (ii) all Letter of Credit Disbursements, fees and interest that have become payable as herein set forth, and (iii) any and all other monetary Obligations or Canadian Liabilities, as applicable, that have become payable.

(b)    The Loan Account will be credited with all amounts received by the Administrative Agent or by the Canadian Agent from the applicable Borrower or from others for the Borrowers’ account, including all amounts received in the Concentration Account from the Blocked Account Banks, and the amounts so credited shall be applied as set forth in and to the extent required by SECTION 2.17(e) or SECTION 7.03, as applicable. After the end of each month, the Administrative Agent or the Canadian Agent, as applicable, shall send to the Domestic Borrowers and the Canadian Borrower, as applicable, a statement accounting for the charges (including interest), loans, advances and other transactions occurring among and between the Administrative Agent, or the Canadian Agent, as applicable, the Lenders and the applicable Borrowers during that month. The monthly statements shall, absent manifest error, shall be deemed presumptively correct.

SECTION 2.21    Payments; Sharing of Setoff.

(a)    The Borrowers shall make each payment required to be made hereunder or under any other Loan Document (whether of principal, interest, fees or reimbursement of drawings under Letters of Credit, of amounts payable under SECTIONS 2.14, 2.16(b) or 2.23, or otherwise) prior to 2:00 p.m. on the date when due, in immediately available funds, without setoff or counterclaim, in the same currency in which the Credit Extension was made. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made, as applicable, to the Administrative Agent at its offices at 100 Federal Street, Boston, Massachusetts, or to the Canadian Agent at its offices at 181 Bay Street, 4^th Floor, Toronto, Ontario, Canada M5J 2V8, except payments to be made directly to an Issuing Bank or Swingline Lender as expressly provided herein and payments pursuant to SECTIONS 2.14, 2.16(b), 2.23 and 9.03 shall be made directly to the Persons entitled thereto and payments pursuant to other Loan Documents shall be made to the Persons specified therein. TheSubject to SECTION 2.22, the Administrative Agent or the Canadian Agent, as applicable, shall distribute any such payments to the appropriate

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recipient promptly following receipt thereof. If any payment under any Loan Document shall be due on a day that is not a Business Day, except with respect to LIBO Borrowings or BA Equivalent Loan Borrowings, the date for payment shall be extended to the next succeeding Business Day, and, if any payment due with respect to LIBO Borrowings or BA Equivalent Loan Borrowings shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, unless that succeeding Business Day is in the next calendar month, in which event, the date of such payment shall be on the last Business Day of subject calendar month, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments in respect of any Loan or Letter of Credit shall be repaid in the currency in which such Loan or Letter of Credit was originally disbursed or issued.

(b)    All funds received by and available to the Administrative Agent to pay principal, unreimbursed drawings under Letters of Credit, interest and fees then due hereunder, shall be applied in accordance with the provisions of SECTION 2.17 or SECTION 7.03 ratably among the parties entitled thereto in accordance with the amounts of principal, unreimbursed drawings under Letters of Credit, interest, and fees then due to such respective parties. For purposes of calculating interest due to a Lender, that Lender shall be entitled to receive interest on the actual amount contributed by that Lender towards the principal balance of the Revolving Credit Loans outstanding during the applicable period covered by the interest payment made by the Borrowers. Any net principal reductions to the Revolving Credit Loans received by the Administrative Agent or the Canadian Agent in accordance with the Loan Documents during such period shall not reduce such actual amount so contributed, for purposes of calculation of interest due to that Lender, until the Administrative Agent or the Canadian Agent, as applicable, has distributed to the applicable Lender its Commitment Percentage thereof.

(c)    Unless the Administrative Agent or the Canadian Agent, as applicable, shall have received notice from the Lead Borrower prior to the date on which any payment is due to the Administrative Agent or the Canadian Agent, as applicable, for the account of the Domestic Lenders or the Canadian Lenders or the Issuing Banks hereunder that the Borrowers will not make such payment, the Administrative Agent or the Canadian Agent as applicable, may assume that the Borrowers have made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Domestic Lenders or the Canadian Lenders, as applicable, or the Issuing Banks, as the case may be, the amount due. In such event, if the Borrowers have not in fact made such payment, then each of the Lenders or the Issuing Banks, as the case may be, severally agrees to repay to the Administrative Agent or the Canadian Agent, as applicable, forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the Federal Funds Effective Rate in the case of amounts to be paid by the Domestic Lenders and at the Bank of Canada Overnight Rate in the case of payments to be made by the Canadian Lenders.

SECTION 2.22    Settlement Amongst Lenders

(a)    The Swingline Lender may, at any time (but, in any event shall weekly, as provided in SECTION 2.22(b)), on behalf of the Domestic Borrowers or the Canadian Borrower, as applicable (which hereby authorize the Swingline Lender to act on their behalf in that regard) request the Administrative Agent or the Canadian Agent, as applicable, to cause the Domestic Lenders and the Canadian Lenders, as applicable, (other than Tranche A-1 Lenders) to make a Revolving Credit Loan (which shall be a Prime Rate Loan) in an amount equal to such Lender’s Domestic Commitment

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Percentage or Canadian Commitment Percentage, as applicable, of the outstanding amount of Swingline Loans made in accordance with SECTION 2.06, which request may be made regardless of whether the conditions set forth in ARTICLE IV have been satisfied. Upon such request, each Domestic Lender or Canadian Lender, as applicable, (other than Tranche A-1 Lenders) shall make available to the Administrative Agent or the Canadian Agent, as applicable, the proceeds of such Revolving Credit Loan for the account of the Swingline Lender. If the Swingline Lender requires a Revolving Credit Loan to be made by the Domestic Lenders or the Canadian Lenders and the request therefor is received prior to 12:00 Noon (or 11:00 a.m. with respect to the Canadian Lenders) on a Business Day, such transfers shall be made in immediately available funds no later than 3:00 p.m. that day; and, if the request therefor is received after 12:00 Noon (or 11:00 a.m. with respect to the Canadian Lenders), then no later than 3:00 p.m. on the next Business Day. The obligation of each such Lender to transfer such funds is irrevocable, unconditional and without recourse to, or warranty by, the Administrative Agent, the Canadian Agent, or the Swingline Lender. If and to the extent any Domestic Lender or Canadian Lender, as applicable, (other than Tranche A-1 Lenders) shall not have so made its transfer to the Administrative Agent or the Canadian Agent, such Domestic Lender or Canadian Lender agrees to pay to the Administrative Agent or the Canadian Agent, as applicable, forthwith on demand, such amount, together with interest thereon, for each day from such date until the date such amount is paid to the Administrative Agent or the Canadian Agent, as applicable, at the Federal Funds Effective Rate, in the case of amounts to be paid by the Domestic Lenders, and at the Bank of Canada Overnight Rate, in the case of payments to be made by the Canadian Lenders.

(b)    The amount of each Lender’s Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, of outstanding Revolving Credit Loans (including outstanding Swingline Loans, except that settlements of Swingline Loans during the months of November and December of each year shall be required to be made by the Swingline Lender only with respect to those Swingline Loans in excess of $25,000,000 in the aggregate (the “Excess Swingline Loans”)) shall be computed weekly (or more frequently in the Administrative Agent’s or the Canadian Agent’s, as applicable, discretion) and shall be adjusted upward or downward based on all Revolving Credit Loans (including Swingline Loans, other than Excess Swingline Loans) and repayments of Revolving Credit Loans (including Swingline Loans, other than Excess Swingline Loans) received by the Administrative Agent or Canadian Agent, as applicable, as of 3:00 p.m. on the first Business Day (such date, the “Settlement Date”) following the end of the period specified by the Administrative Agent or the Canadian Agent, as applicable.

(c)    The Administrative Agent or the Canadian Agent, as applicable, shall deliver to each of the Domestic Lenders or Canadian Lenders, as applicable, promptly after a Settlement Date a summary statement of the amount of outstanding Revolving Credit Loans (including Swingline Loans, other than Excess Swingline Loans) for the period and the amount of repayments received for the period. As reflected on the summary statement, (i) the Administrative Agent or the Canadian Agent, as applicable, shall transfer to each Domestic Lender and Canadian Lender its applicable Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, of repayments, and (ii) each Domestic Lender and Canadian Lender, as applicable, (other than Tranche A-1 Lenders) shall transfer to the Administrative Agent or the Canadian Agent, as applicable (as provided below), or the Administrative Agent or the Canadian Agent, as applicable, shall transfer to each Domestic Lender or Canadian Lender, as applicable, (other than Tranche A-1 Lenders) such

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amounts as are necessary to insure that, after giving effect to all such transfers, the amount of Revolving Credit Loans made by each Domestic Lender and Canadian Lender with respect to Revolving Credit Loans to the Domestic Borrowers and the Canadian Borrowers, respectively (including Swingline Loans, other than Excess Swingline Loans), shall be equal to such Lender’s Domestic Commitment Percentage or Canadian Commitment Percentage, as applicable, of Revolving Credit Loans (including Swingline Loans which are not Excess Swingline Loans) outstanding as of such Settlement Date. If the summary statement requires transfers to be made to the Administrative Agent or the Canadian Agent, as applicable, by the Domestic Lenders or the Canadian Lenders and is received prior to 12:00 Noon (or 11:00 a.m. with respect to the Canadian Lenders) on a Business Day, such transfers shall be made in immediately available funds no later than 3:00 p.m. that day; and, if received after 12:00 Noon (or 11:00 a.m. with respect to the Canadian Lenders), then no later than 3:00 p.m. on the next Business Day. The obligation of each Domestic Lender and Canadian Lender to transfer such funds is irrevocable, unconditional and without recourse to or warranty by the Administrative Agent. If and to the extent any Domestic Lender shall not have so made its transfer to the Administrative Agent or the Canadian Agent, as applicable, such Domestic Lender or Canadian Lender (other than Tranche A-1 Lenders) agrees to pay to the Administrative Agent or the Canadian Agent, as applicable, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to the Administrative Agent or the Canadian Agent, as applicable, at the Federal Funds Effective Rate, in the case of amounts to be paid by the Domestic Lenders, and at the Bank of Canada Overnight Rate, in the case of payments to be made by the Canadian Lenders.

SECTION 2.23    Taxes.

(a)    Any and all payments by or on account of any obligation of the Loan Parties hereunder or under any other Loan Document shall be made free and clear of, and without deduction for, any Indemnified Taxes or Other Taxes; provided, however, that if a Loan Party or any Agent shall be required to deduct any Taxes from such payments, then (i) in the case of any Indemnified Taxes or Other Taxes, the sum payable shall be increased as necessary so that, after making all required deductions or remittances for such Taxes (including deductions applicable to additional sums payable under this SECTION 2.23), the applicable Credit Party receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Loan Party or the Agents, as applicable, shall make such deductions and (iii) the Loan Party or the Agents, as applicable, shall pay the full amount deducted to the relevant Governmental Authority in accordance with Applicable Law.

(b)    In addition, the Loan Parties shall pay any Other Taxes to the relevant Governmental Authority in accordance with Applicable Law.

(c)    (i)    The Domestic Borrowers shall indemnify each Credit Party, and the Canadian Borrower shall indemnify the Canadian Agent, each Canadian Lender and the Issuing Banks of any Letter of Credit on its behalf, within ten (10) days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by such Credit Party on or with respect to any payment by or on account of any obligation of the Loan Parties hereunder or under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this SECTION 2.23) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto; providedthat, if any Borrower reasonably believes that such Taxes were not correctly or legally asserted, each Lender will use reasonable efforts to cooperate

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with such Borrower to obtain a refund of such taxes so long as such efforts would not, in the sole determination of such Lender result in any additional costs, expenses or risks or be otherwise disadvantageous to it; providedfurther that the Borrowers shall not be required to compensate any Lender pursuant to this SECTION 2.23 for any amounts incurred in any Fiscal Year for which such Lender is claiming compensation if such Lender does not furnish notice of such claim within six (6) months from the end of such Fiscal Year; providedfurther that, if the circumstances giving rise to such claim have a retroactive effect, then the beginning of such six month period shall be extended to include such period of retroactive effect. A certificate as to the amount of such payment or liability delivered to the Lead Borrower by a Credit Party, or by the Administrative Agent on its own behalf or on behalf of any other Credit Party, setting forth in reasonable detail the manner in which such amount was determined, shall be conclusive absent manifest error.

(ii)    Each Lender shall, and does hereby, severally indemnify, and shall make payment in respect thereof within 10 days after demand therefor, (x) the Agents against any Indemnified Taxes and Other Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified the Agents for such Indemnified Taxes or Other Taxes, as applicable, and without limiting the obligation of the Loan Parties to do so), (y) the Agents and the Loan Parties, as applicable, against any Taxes attributable to such Lender’s failure to comply with the provisions of SECTION 9.04(e)(vii) relating to the maintenance of a Participant Register and (z) the Agents and the Loan Parties, as applicable, against any Excluded Taxes attributable to such Lender that are payable or paid by the Agents or a Loan Party in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to any Lender by any Agent shall be conclusive absent manifest error.  Each Lender hereby authorizes each Agent to set off and apply any and all amounts at any time owing to such Lender under this Agreement or any other Loan Document against any amount due to such Agent under this clause (ii).

(d)    As soon as practicable after any payment of Indemnified Taxes or Other Taxes by a Loan Party to a Governmental Authority, the Lead Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent or the Canadian Agent, as applicable.

(e)    Any Lender that is entitled to an exemption from, or reduction of, any applicable withholding Tax with respect to any payments under any Loan Document shall deliver to the Lead Borrower and the Administrative Agent, at the time or times reasonably requested by the Lead Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Lead Borrower or the Administrative Agent as will permit such payments to be made without, or at a reduced rate of, withholding. Any Domestic Lender that is not a Foreign Lender shall deliver to the Lead Borrower and the Administrative Agent on or before the date it becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of the Lead Borrower or the Administrative Agent), two (2) copies of a properly completed and duly executed United States Internal Revenue Service Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax. Any Foreign Lender that is a Domestic Lender that is entitled to an exemption from, or reduction in, withholding tax shall deliver to the Lead Borrower and the Administrative Agent two (2) copies of (i) either United States Internal Revenue

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Service Form W-8BEN, Form W-8ECI or Form W-8IMY (together with any applicable underlying forms), or any subsequent versions thereof or successors thereto, or, (ii) in the case of a Foreign Lender claiming exemption from or reduction in U.S. federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest”, (A) the applicable Form W-8BEN, or any subsequent versions thereof or successors thereto and (B) a certificate representing that such Foreign Lender (1) is not a bank for purposes of Section 881(c) of the Code, (2) is not a 10 percent shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of any Loan Party (other than the Canadian Borrower and its Subsidiaries), and (3) is not a controlled foreign corporation related to the Loan Parties (other than the Canadian Borrower and its Subsidiaries) (within the meaning of Section 864(d)(4) of the Code)), in all cases, properly completed and duly executed by such Foreign Lender claiming, as applicable, complete exemption from or reduced rate of, U.S. federal withholding tax on payments by the Loan Parties under this Agreement and the other Loan Documents, or in the case of a Foreign Lender claiming exemption for “portfolio interest” certifying that it is not a foreign corporation, partnership, estate or trust. Such forms shall be delivered by each Foreign Lender on or before the date it becomes a party to this Agreement (or, in the case of a transferee that is a participation holder, on or before the date such participation holder becomes a transferee hereunder) and on or before the date, if any, such Foreign Lender changes its applicable lending office by designating a different lending office (a “New Lending Office”). In addition, each Foreign Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Foreign Lender. Notwithstanding any other provision of this SECTION 2.23(e), a Lender shall not be required to deliver any form pursuant to this SECTION 2.23(e) that such Lender is not legally able to deliver. If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Lead Borrower and the Administrative Agent, at the time or times prescribed by law and at such time or times reasonably requested by the Lead Borrower or the Administrative Agent, such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Lead Borrower or the Administrative Agent as may be necessary for the Lead Borrower or the Administrative Agent to comply with its obligations under FATCA, to determine that such Lender has complied with such Lender's obligations under FATCA or to determine the amount to deduct and withhold from such payment. For purposes of this SECTION 2.23(e), FATCA shall include any amendments made to FATCA after the date of this Agreement.

(f)    The Borrowers shall not be required to indemnify any Foreign Lender or to pay any additional amounts to any Foreign Lender in respect of U.S. federal withholding tax pursuant to paragraph (a) or (c) above to the extent that the obligation to pay such additional amounts would not have arisen but for a failure by such Foreign Lender to comply with the provisions of paragraph (e) above. Should a Lender become subject to Taxes because of its failure to deliver a form required hereunder, the Loan Parties shall, at such Lender’s expense, take such steps as such Lender shall reasonably request to assist such Lender to recover such Taxes.

(g)    If any Loan Party shall be required pursuant to this SECTION 2.23 to pay any additional amount to, or to indemnify, any Credit Party to the extent that such Credit Party becomes subject to Taxes subsequent to the Effective Date (or, if applicable, subsequent to the date such Person becomes a party to this Agreement) as a result of any change in the circumstances of such

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Credit Party (other than a change in Applicable Law), including, without limitation, a change in the residence, place of incorporation, principal place of business of such Credit Party or a change in the branch or lending office of such Credit Party, as the case may be, such Credit Party shall use reasonable efforts to avoid or minimize any amounts which might otherwise be payable pursuant to this SECTION 2.23(g); provided, however, that such efforts shall not include the taking of any actions by such Credit Party that would result in any tax, costs or other expense to such Credit Party (other than a tax, cost or other expense for which such Credit Party shall have been reimbursed or indemnified by the Loan Parties pursuant to this Agreement or otherwise) or any action which would or might in the reasonable opinion of such Credit Party have an adverse effect upon its business, operations or financial condition or otherwise be disadvantageous to such Credit Party.

(h)    If any Lender is entitled to a reduction in (and not complete exemption from) the applicable withholding tax, the Borrowers may withhold from any interest payment to such Lender an amount equivalent to the applicable withholding tax after taking into account such reduction.

(i)    If any Credit Party reasonably determines that it has actually and finally realized, by reason of a refund, deduction or credit of any Taxes paid or reimbursed by the Loan Parties pursuant to subsection (a) or (c) above in respect of payments under the Loan Documents, a current monetary benefit that it would otherwise not have obtained and that would result in the total payments under this SECTION 2.23 exceeding the amount needed to make such Credit Party whole, such Credit Party shall pay to the Lead Borrower, with reasonable promptness following the date upon which it actually realizes such benefit, an amount equal to the lesser of the amount of such benefit or the amount of such excess, in each case net of all out of pocket expenses incurred in securing such refund, deduction or credit.

(j)    Each Lender (other than a Person who becomes a lender to the Canadian Borrower as a result of the provisions of SECTION 8.17) which has a Canadian Commitment hereby certifies that it is a Canadian Lender. Each Person that becomes a Lender to the Canadian Borrower hereafter (other than as a result of the provisions of SECTION 8.17 or otherwise following the occurrence of a Determination Date) shall promptly deliver to the Canadian Borrower and the Canadian Agent a certificate confirming that such Person is a Canadian Lender or is otherwise exempt from withholding taxes. If any such Lender (other than a Lender that becomes a Canadian Lender as a result of the provisions of SECTION 8.17) is not a Canadian Lender or otherwise is not exempt from the payment of withholding taxes on interest payments to it, prior to the Determination Date only, such Lender shall not be entitled to payments hereunder with respect to taxes imposed under Part XIII of the Income Tax Act (Canada) and such interest payments will be net of any applicable withholding taxes required to be withheld and remitted by the payor.

SECTION 2.24    Mitigation Obligations; Replacement of Lenders.

(a)    If any Lender requests compensation under SECTION 2.14 or cannot make Loans under SECTION 2.11, or if the Borrowers are required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to SECTION 2.23, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the reasonable judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to SECTION 2.14 or SECTION 2.23, as the case

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may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense. The Borrowers (in the case of the Canadian Borrower, only in respect of any Canadian Lender) hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment; provided, however, that the Borrowers shall not be liable for such costs and expenses of a Lender requesting compensation if (i) such Lender becomes a party to this Agreement on a date after the Effective Date and (ii) the relevant Change in Law occurs on a date prior to the date such Lender becomes a party hereto.

(b)    If any Lender requests compensation under SECTION 2.14 or cannot make Loans under SECTION 2.11 for thirty (30) consecutive days, or if any Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to SECTION 2.23, or if any Lender is a Defaulting Lender or otherwise defaults in its obligation to fund Loans hereunder, then the Borrowers may, at their sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in SECTION 9.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided, however, that (i) the Lead Borrower shall have received the prior written consent of the Administrative Agent, the Issuing Banks and the Swingline Lender (and the Canadian Agent only in the case of a Canadian Lender), which consent shall not be unreasonably withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in unreimbursed drawings under Letters of Credit and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrowers (in the case of all other amounts), (iii) in the case of any such assignment resulting from a claim for compensation under SECTION 2.14 or payments required to be made pursuant to SECTION 2.23, such assignment will result in a reduction in such compensation or payments, and (iv) in the case of an assignment resulting from a Lender becoming a Minority Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrowers to require such assignment and delegation cease to apply.

SECTION 2.25    Designation of Lead Borrower as Domestic Borrowers’ Agent.

(a)    Each Domestic Borrower hereby irrevocably designates and appoints the Lead Borrower as such Borrower’s agent to obtain Loans and Letters of Credit, the proceeds of which shall be available to each Domestic Borrower for such uses as are permitted under this Agreement. As the disclosed principal for its agent, each Domestic Borrower shall be obligated to the Administrative Agent and each Domestic Lender on account of Loans so made and Letters of Credit so issued as if made directly by the Domestic Lenders to such Domestic Borrower, notwithstanding the manner by which such Loans and Letters of Credit are recorded on the books and records of the Lead Borrower and of any other Domestic Borrower.

(b)    Each Borrower represents to the Credit Parties that it is an integral part of a consolidated enterprise, and that each Loan Party will receive direct and indirect benefits from the availability of the joint credit facility provided for herein, and from the ability to access the collective credit resources of the consolidated enterprise which the Loan Parties comprise. Each Borrower recognizes that credit available to it hereunder is in excess of and on better terms than it otherwise

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could obtain on and for its own account and that one of the reasons therefor is its joining in the credit facility contemplated herein with all other Borrowers. Consequently, each Borrower hereby assumes and agrees to discharge all Obligations, Other Liabilities and Canadian Liabilities of each of the other Borrowers as if the Borrower which is so assuming and agreeing were each of the other Borrowers; providedthat the Canadian Borrower and its Subsidiaries shall be liable only for the Canadian Liabilities.

(c)    The Lead Borrower shall act as a conduit for each Domestic Borrower (including itself, as a Domestic Borrower) on whose behalf the Lead Borrower has requested a Revolving Credit Loan. None of the Agents nor any other Credit Party shall have any obligation to see to the application of such proceeds.

(d)    The authority of the Lead Borrower to request Loans and Letters of Credit on behalf of, and to bind, the Domestic Borrowers, shall continue unless and until the Administrative Agent actually receives written notice of: (i) the termination of such authority; and (ii) the subsequent appointment of a successor Lead Borrower, which notice is signed by the respective Financial Officers of each Domestic Borrower; and (iii) written notice from such successive Lead Borrower accepting such appointment and acknowledging that from and after the date of such appointment, the newly appointed Lead Borrower shall be bound by the terms hereof, and that as used herein, the term “Lead Borrower” shall mean and include the newly appointed Lead Borrower.

SECTION 2.26    Security Interests in Collateral.

To secure their Obligations under this Agreement and the other Loan Documents and the Other Liabilities, the Domestic Borrowers have granted (or shall grant) to the Administrative Agent, for its own benefit and the benefit of the other Secured Parties, and the Canadian Borrower and each other Canadian Loan Party have granted (or shall grant) to the Canadian Agent, for its benefit and the benefit of the other Secured Parties, a first-priority security interest in, and hypothec of (subject to Permitted Encumbrances having priority by operation of Applicable Law), all of the Collateral pursuant hereto and to the Security Documents; providedthat the Collateral granted by the Canadian Borrower and each other Canadian Loan Party shall secure only the Canadian Liabilities.

SECTION 2.27    Defaulting Lenders.

(a)    Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by Applicable Law:

(i)    Waivers and Amendments. Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of “Required Lenders” and SECTION 9.02.

(ii)    Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VII or otherwise) or received by the Agent from a Defaulting Lender pursuant to SECTION 9.08 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing Banks or Swingline

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Lender hereunder; third, to cash collateralize the Issuing Banks’ Fronting Exposure with respect to such Defaulting Lender; fourth, as the Lead Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Lead Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement and (y) cash collateralize the Issuing Banks’ future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement; sixth, to the payment of any amounts owing to the Lenders, the Issuing Banks or Swingline Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, any Issuing Bank or the Swingline Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to any Borrower as a result of any judgment of a court of competent jurisdiction obtained by such Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans (including any Loans made pursuant to SECTION 2.13(e)) in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in SECTION 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and Letter of Credit Outstandings owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or Letter of Credit Outstandings owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in Letter of Credit Outstandings and Swingline Loans are held by the Lenders pro rata in accordance with the Commitments hereunder without giving effect to SECTION 2.27(a)(iv). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post cash collateral pursuant to this SECTION 2.27(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii)    Certain Fees.

(A)    No Defaulting Lender shall be entitled to receive any fee payable under SECTIONS 2.19(b) or 2.19(c) for any period during which that Lender is a Defaulting Lender (and no Borrower shall be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).

(B)    Each Defaulting Lender shall be entitled to receive Letter of Credit Fees for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Commitment Percentage of the stated amount of Letters of Credit for which it has provided cash collateral pursuant to SECTION 2.13(j).

(C)    With respect to any fee payable under SECTIONS 2.19(b) or 2.19(c) or any Letter of Credit Fee not required to be paid to any Defaulting Lender pursuant to clause (A) or (B) above, the Borrowers shall (x) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in Letter of Credit Outstandings or Swingline Loans that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay

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to the Issuing Banks and Swingline Lender, as applicable, the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to such Issuing Banks’ or Swingline Lender’s Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee.

(iv)    Reallocation of Applicable Percentages to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in Letter of Credit Outstandings and Swingline Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Commitment Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that (x) the conditions set forth in SECTION 4.02 are satisfied at the time of such reallocation (and, unless the Lead Borrower shall have otherwise notified the Administrative Agent at such time, the Borrowers shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause the portion of the Total Domestic Revolver Outstandings or Total Canadian Revolver Outstandings Outstandings owing to any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Domestic Commitmentor Canadian Commitment, as applicable. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

(v)    Cash Collateral, Repayment of Swing Line Loans. If the reallocation described in clause (a)(iv) above cannot, or can only partially, be effected, the Borrowers shall, without prejudice to any right or remedy available to them hereunder or under Applicable Law, (x) first, prepay Swingline Loans in an amount equal to the Swingline Lenders’ Fronting Exposure and (y) second, cash collateralize the Issuing Banks’ Fronting Exposure in accordance with the procedures set forth in SECTION 2.13(j).

(b)    Defaulting Lender Cure. If the Lead Borrower, the Administrative Agent, the Swingline Lender and the Issuing Banks agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any cash collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swingline Loans to be held on a pro rata basis by the Lenders in accordance with their Commitment Percentages (without giving effect to SECTION 2.27(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrowers while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

SECTION 2.28Extension of Commitments.

(a)The Lead Borrower, with the prior consent of the Administrative Agent, which consent shall not be unreasonably withheld or delayed, may at any time and from time to time request that all or a portion of the Commitments of a given Class (each, an “Existing Revolver Tranche”) be amended to extend the Maturity Date with respect to all or a portion of any principal

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amount of such Commitments (any such Commitments which have been so amended, “Extended Commitments”) and to provide for other terms consistent with this SECTION 2.28. In order to establish any Extended Commitments, the Lead Borrower, with the consent of the Administrative Agent, which consent shall not be unreasonably withheld or delayed, shall provide a notice to each of the Lenders under the applicable Existing Revolver Tranche (each, an “Extension Request”) setting forth the proposed terms (which shall be determined in consultation with and subject to the prior approval of the Administrative Agent, which approval shall not be unreasonably withheld or delayed) of the Extended Commitments to be established, which shall (x) be identical as offered to each Lender under such Existing Revolver Tranche and offered pro rata to each Lender under such Existing Revolver Tranche and (y) be identical to the Commitments under the Existing Revolver Tranche from which such Extended Commitments are to be amended, except that: (i) the maturity date of the Extended Commitments shall be later than the maturity date of the Commitments of such Existing Revolver Tranche, (ii) the Extension Amendment may provide for other covenants and terms that apply solely to any period after the Latest Maturity Date that is in effect on the effective date of the Extension Amendment (immediately prior to the establishment of such Extended Commitments); and (iii) all borrowings under the Commitments and repayments thereunder shall be made on a pro rata basis (except for (I) payments of interest and fees at different rates on Extended Commitments (and the outstanding Obligations thereunder), (II) repayments required upon the maturity date of the non-extending Commitments and (III) repayments, prepayments or payments of borrowings under the non-extending Commitments);provided,further, that (A) the conditions precedent to a Borrowing set forth in SECTION 4.02shall be satisfied as of the date of such Extension Amendment and at the time when any Loans are made in respect of any Extended Commitment, (B) in no event shall the final maturity date of any Extended Commitments of a given Extension Series at the time of establishment thereof be earlier than the then Latest Maturity Date of any other Commitments hereunder, (C) any such Extended Commitments (and the Liens securing the same) shall be permitted by the terms of the Intercreditor Agreement (to the extent the Intercreditor Agreement is then in effect) and (D) all documentation in respect of the such Extension Amendment shall be consistent with the foregoing in all material respects. Any Extended Commitments amended pursuant to any Extension Request shall be designated a series (each, an “Extension Series”) of Extended Commitments for all purposes of this Agreement; provided that any Extended Commitments amended from an Existing Revolver Tranche may, to the extent provided in the applicable Extension Amendment, be designated as an increase in any previously established Extension Series with respect to such Existing Revolver Tranche.

(b)The Lead Borrower shall provide the applicable Extension Request at least ten (10) Business Days (or such shorter period as may be agreed by the Administrative Agent) prior to the date on which Lenders under the Existing Revolver Tranche are requested to respond. The procedures to accomplish the purposes of this SECTION 2.28 shall be mutually agreed between the Lead Borrower and the Administrative Agent, in each case, acting reasonably. No Lender shall have any obligation to agree to provide any Extended Commitment pursuant to any Extension Request. Any Lender (each, an “Extending Revolving Credit Lender”) wishing to have all or a portion of its Commitments under the Existing Revolver Tranche subject to such Extension Request amended into Extended Commitments shall notify the Administrative Agent (each, an “Extension Election”) on or prior to the date specified in such Extension Request of the amount of its Commitment under the Existing Revolver Tranche which it has elected to request be amended into an Extended Commitment (subject to any minimum denomination requirements as mutually agreed by the Administrative Agent and the Lead Borrower). In the event that the aggregate principal amount of Commitments under the Existing Revolver Tranche in respect of which applicable

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Lenders shall have accepted the relevant Extension Request exceeds the amount of Extended Commitments requested to be extended pursuant to the Extension Request, Commitments subject to Extension Elections shall be amended to reflect allocations of the Extended Commitments, which Extended Commitments shall be allocated as agreed by Administrative Agent and the Lead Borrower.

(c)Following any Extension Request made by the Lead Borrower in accordance with this SECTION 2.28, if the Lenders shall have declined to agree during the period specified in SECTION 2.28(b) above to provide Extended Commitments in an aggregate principal amount equal to the amount requested by the Lead Borrower in such Extension Request, the Lead Borrower may request that banks, financial institutions or other institutional lenders or investors other than the Lenders or Extending Revolving Credit Lenders (the “New Revolving Commitment Lenders”), which New Revolving Commitment Lenders may elect to provide an Extended Commitment hereunder (a “New Extended Commitment”);providedthat such Extended Commitments of such New Revolving Commitment Lenders (i) shall be in an aggregate principal amount for all such New Revolving Commitment Lenders not to exceed the aggregate principal amount of Extended Commitments so declined to be provided by the existing Lenders and (ii) shall be on identical terms to the terms applicable to the terms specified in the applicable Extension Request (and any Extended Commitments provided by existing Lenders in respect thereof); provided further that, as a condition to the effectiveness of any Extended Commitment of any New Revolving Commitment Lender, the Administrative Agent, each Issuing Bank and the Swingline Lender shall have consented (such consent not to be unreasonably withheld or delayed) to each New Revolving Commitment Lender if such consent would be required under SECTION 9.04(b) for an assignment of Commitments to such Person. Notwithstanding anything herein to the contrary, any Extended Commitment provided by New Revolving Commitment Lenders shall be pro rata to each New Revolving Commitment Lender. Upon effectiveness of the Extension Amendment to which each such New Revolving Commitment Lender is a party, (a) the Commitments of all existing Lenders of each Class specified in the Extension Amendment in accordance with this SECTION 2.28 will be permanently reduced pro rata by an aggregate amount equal to the aggregate principal amount of the Extended Commitments of such New Revolving Commitment Lenders and (b) the Commitment of each such New Revolving Commitment Lender will become effective. The Extended Commitments of New Revolving Commitment Lenders will be incorporated as Commitments hereunder in the same manner in which Extended Commitments of existing Lenders are incorporated hereunder pursuant to this SECTION 2.28, and for the avoidance of doubt, all Borrowings and repayments of Revolving Credit Loans from and after the effectiveness of such Extension Amendment shall be made pro rata across all Classes of Commitments including such New Revolving Commitment Lenders (based on the outstanding principal amounts of the respective Classes of Commitments) except for (x) payments of interest and fees at different rates for each Class of Commitments (and related outstanding amounts), (y) repayments required on the Termination Date for any particular Class of Commitments and (z) payments, prepayments or repayments of the borrowings under any non-extending Commitments. Upon the effectiveness of each New Extended Commitment pursuant to this SECTION 2.28(c), (a) each Lender of all applicable existing Classes of Commitments immediately prior to such effectiveness will automatically and without further act be deemed to have assigned to each New Revolving Commitment Lender, and each such New Revolving Commitment Lender will automatically and without further act be deemed to have assumed, a portion of such Lender’s participations hereunder in outstanding Letters of Credit and Swingline Loans such that, after giving effect to each such deemed assignment and assumption of participations,

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the percentage of the outstanding (i) participations hereunder in Letters of Credit and (ii) participations hereunder in Swingline Loans held by each Lender of each Class of Commitments (including each such New Revolving Commitment Lender) will equal the percentage of the aggregate Commitments of all Classes of Lenders represented by such Lender’s Commitment and (b) if, on the date of such effectiveness, there are any Revolving Credit Loans outstanding, such Revolving Credit Loans shall on or prior to the effectiveness of such New Extended Commitment be prepaid from the proceeds of Revolving Credit Loans made hereunder under the New Extended Commitments, which prepayment shall be accompanied by accrued interest on the Revolving Credit Loans being prepaid and any Breakage Costs incurred by any Lender. Notwithstanding anything to the contrary contained herein, the Administrative Agent and the Lenders hereby agree that the minimum borrowing, pro rata borrowing and pro rata payment requirements contained elsewhere in this Agreement shall not apply to the transactions effected pursuant to the immediately preceding sentence.

(d)Extended Commitments and New Extended Commitments shall be established pursuant to an amendment (each, an “Extension Amendment”) to this Agreement among the Borrower, the Administrative Agent and each Extending Revolving Credit Lender and each New Revolving Commitment Lender, if any, providing an Extended Commitment or a New Extended Commitment, as applicable, thereunder, which shall be consistent with the provisions set forth in SECTIONS 2.28(a), (b) and (c) above (but which shall not require the consent of any other Lender). The effectiveness of any Extension Amendment shall be subject to the satisfaction on the date thereof of each of the conditions set forth in SECTION 4.02 and, to the extent reasonably requested by the Administrative Agent, receipt by the Administrative Agent of (i) legal opinions, board resolutions and officers’ certificates consistent with those delivered on the First Amendment Effective Date and (ii) reaffirmation agreements and/or such amendments to the Security Documents as may be reasonably requested by the Co-Collateral Agents in order to ensure that the Extended Commitments or the New Extended Commitments, as the case may be, are provided with the benefit of the applicable Loan Documents. The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Extension Amendment. Notwithstanding anything to the contrary contained herein, each of the parties hereto hereby agrees that this Agreement and the other Loan Documents may be amended pursuant to an Extension Amendment, without the consent of any other Lenders, to the extent (but only to the extent) necessary to (i) reflect the existence and terms of the Extended Commitments or the New Extended Commitments, as the case may be, incurred pursuant thereto, (ii) make such other changes to this Agreement and the other Loan Documents (without the consent of the Required Lenders) and (iii) effect such other amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Lead Borrower, to effect the provisions of this Section, and the Required Lenders hereby expressly authorize the Administrative Agent to enter into any such Extension Amendment.

(e)Notwithstanding anything to the contrary contained herein, no conversion of Loans pursuant to any Extension Request in accordance with this SECTION 2.28 shall constitute a voluntary or mandatory payment or prepayment for purposes of this Agreement.

SECTION 2.29Excess Cash Flow

If, for any Fiscal Year of the Lead Borrower and its Subsidiaries commencing with the Fiscal Year ending in January, 2016, there shall be Excess Cash Flow, the Borrowers shall prepay the Tranche A-1 Loans in an amount equal to (i) fifty percent (50%) of such Excess Cash Flow minus (ii) any

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mandatory prepayments of the Term Loans required to be made based on “Excess Cash Flow” (as defined in the Term Loan Agreement) for such Fiscal Year. Each such prepayment shall be made on a date no later than ten days after the date on which the financial statements of the Lead Borrower and its Subsidiaries referred to in SECTION 6.01(a) for such Fiscal Year are required to be delivered to the Administrative Agent. Concurrently with any prepayment of the Tranche A-1 Loans pursuant hereto, the Borrowers shall deliver to Administrative Agent a certificate of a Responsible Officer demonstrating the calculation of the amount of the Consolidated Excess Cash Flow. In the event that the Borrowers shall subsequently determine that the actual amount received exceeded the amount set forth in such certificate, the Borrowers shall promptly make an additional prepayment of the Tranche A-1 Loans in an amount equal to such excess, and the Borrowers shall concurrently therewith deliver to Administrative Agent a certificate of a Responsible Officer demonstrating the derivation of such excess. All payments under this SECTION 2.29 shall be applied ratably to the Canadian Tranche A-1 Loans and the Domestic Tranche A-1 Loans.

ARTICLE III

Representations and Warranties

To induce the Lenders to make the Loans and the Issuing Banks to issue Letters of Credit on and after the Effective Date, each Loan Party executing this Agreement or a Joinder hereto, jointly and severally, make the following representations and warranties to each Credit Party with respect to such Loan Party:

SECTION 3.01    Organization; Powers.

Each Loan Party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to own its property and assets and to carry on its business as now conducted, except, in each case, where the failure to do so, or so possess, individually or in the aggregate would not reasonably be expected to result in a Material Adverse Effect. Each Loan Party has all requisite organizational power and authority to execute and deliver and perform all its obligations under all Loan Documents to which such Loan Party is a party. Each Loan Party is qualified to do business in, and is in good standing (where such concept exists) in, every jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified or in good standing individually or in the aggregate would not reasonably be expected to result in a Material Adverse Effect. Schedule 3.01 to the Existing Credit Agreement sets forth, as of the First Amendment Effective Date, each Loan Party’s name as it appears in official filings in its state of incorporation or organization, its state of incorporation or organization, organization type, organization number, if any, issued by its state of incorporation or organization, and its federal employer identification number.

SECTION 3.02    Authorization; Enforceability.

The transactions contemplated hereby and by the other Loan Documents to be entered into by each Loan Party are within such Loan Party’s corporate powers and have been duly authorized by all necessary corporate, membership, partnership or other necessary action. This Agreement has been duly executed and delivered by each Loan Party that is a party hereto or thereto and constitutes, and each other Loan Document to which any Loan Party is a party, when executed and delivered by such Loan Party will constitute, a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

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SECTION 3.03    Governmental Approvals; No Conflicts.

The transactions to be entered into and contemplated by the Loan Documents (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except for (A) such as have been obtained or made and are in full force and effect, (B) filings and recordings necessary to perfect Liens created under the Loan Documents and enforce the rights of the Lenders and the Secured Parties under the Loan Documents or (C) the failure of which to obtain would not reasonably be expected to result in Material Adverse Effect, (b) will not violate any Applicable Law or the Charter Documents of any Loan Party, except to the extent that such violation would not reasonably be expected to result in a Material Adverse Effect, (c) will not violate or result in a default under any indenture or any other agreement, instrument or other evidence of Material Indebtedness, except to the extent that such default would not reasonably be expected to result in a Material Adverse Effect, and (d) will not result in the creation or imposition of any Lien on any asset of any Loan Party, except Liens created under the Loan Documents.

SECTION 3.04    Financial Condition; No Material Adverse Effect.

The Lead Borrower has heretofore furnished to the Administrative Agent the Consolidated balance sheet, and statements of income, stockholders’ equity, and cash flows for the Parent and its Subsidiaries as of and for the Fiscal Year ending on or about February 2, 2013 and as of and for the Fiscal Quarters ended May 4, 2013, August 3, 2013 and November 2, 2013, certified by a Financial Officer of the Parent. Such financial statements present fairly, in all material respects, the financial position, results of operations and cash flows of the Parent and its Subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year-end audit adjustments and the absence of footnotes. Since the date of the latest such financial statements, there has been no Material Adverse Effect.

SECTION 3.05    Properties.

(a)    Each Loan Party has title to, or valid leasehold interests in, all its real (immoveable) and personal (moveable) property material to its business, except for defects which would not reasonably be expected to have a Material Adverse Effect.

(b)    Each Loan Party owns or is licensed to use, all patents, trademarks, trade names, trade styles, brand names, service marks, logos, copyrights, and other intellectual property used in its business, except to the extent that the failure to so own or have the right to use would not reasonably be expected to have a Material Adverse Effect, and the use thereof by the Loan Parties does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

(c)    Except as would not reasonably be expected to result in a Material Adverse Effect, to the knowledge of the Responsible Officers of the Loan Parties, as of the Effective Date, each of the Leases with respect to Real Estate leased by the Loan Parties (other than any Real Estate comprising temporary locations such as “pop-up” stores that are not currently intended to be open for more than one year and are not currently included in the Borrower’s overall store count) is in full force and effect and the Loan Parties are not in default of the terms thereof.

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SECTION 3.06    Litigation and Environmental Matters.

(a)    Except as set forth on Schedule 3.06(a), there are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the actual knowledge of Responsible Officers of a Loan Party, threatened in writing against or affecting any Loan Party (i) as to which there is a reasonable possibility of an adverse determination which, if adversely determined, would reasonably be expected individually or in the aggregate to result in a Material Adverse Effect (other than Disclosed Matters) or (ii) that involve any of the Loan Documents and would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.

(b)    Except as set forth on Schedule 3.06(b), no Loan Party (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability, which, in each case, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.

SECTION 3.07    Compliance with Laws and Agreements.

Each Loan Party is in compliance with all Applicable Law and all Material Indebtedness (including, without limitation, the Indentures), and no event of default has occurred and is continuing thereunder, except in each case where the failure to comply or the existence of a default, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. Without limiting the generality of the foregoing, each Loan Party has obtained all permits, licenses and other authorizations which are required with respect to the ownership and operations of its business, except where the failure to obtain such permits, licenses or other authorizations, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. Each Loan Party is in material compliance with all terms and conditions of all such permits, licenses, orders and authorizations, except where the failure to comply with such terms or conditions, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

SECTION 3.08    Investment Company Status.

No Loan Party is an “investment company” as defined in, and subject to regulation under, the Investment Company Act of 1940.

SECTION 3.09    Taxes.

Since the Effective Date, each Loan Party has timely filed or caused to be filed all tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings, for which such Loan Party has set aside on its books adequate reserves, and as to which no Lien has arisen or (b) to the extent that the failure to do so would not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.10    ERISA; Canadian Defined Benefit Pension Plans.

(a)    Since the Effective Date, no ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably

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expected to occur, would reasonably be expected to result in a Material Adverse Effect. The present value of all accumulated benefit obligations under each Plan subject to ERISA (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed the fair market value of the assets of such Plan, and the present value of all accumulated benefit obligations of all underfunded Plans subject to ERISA (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed the fair market value of the assets of all such underfunded Plans, in each case, to the extent that any resulting liabilities would reasonably be expect to result in a Material Adverse Effect.

(b)    No Canadian Loan Party has any Canadian Defined Benefit Pension Plan.

SECTION 3.11    Disclosure.

None of the reports, financial statements, certificates or other information (other than any projections, pro formas, budgets and general market information) concerning the Loan Parties furnished by or on at the direction of any Loan Party to any Credit Party in connection with the negotiation of this Agreement or any other Loan Document or delivered hereunder or thereunder in connection therewith (as modified or supplemented by other information so furnished), when taken as a whole, contained, as of the date furnished, any material misstatement of fact or omitted to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not materially misleading in light of the circumstances under which such statements were made.

SECTION 3.12    Subsidiaries.

(a)    Schedule 3.12 sets forth the name of, and the ownership interest of each Loan Party in, each Subsidiary and Propco as of the First Amendment Effective Date and indicates, in the case of any Subsidiary, whether such Subsidiary is a Material Subsidiary as of the First Amendment Effective Date; there is no other Capital Stock of any class outstanding as of the First Amendment Effective Date. To the knowledge of the Responsible Officers of the Loan Parties, all such shares of Capital Stock are validly issued, fully paid, and, except as set forth on Schedule 3.12, non-assessable.

(b)    Except as set forth on Schedule 3.12, no Loan Party is party to any joint venture, general or limited partnership, or limited liability company agreements as of the First Amendment Effective Date.

SECTION 3.13    [Reserved.]

SECTION 3.14    Labor Matters.

As of the First Amendment Effective Date, there are no strikes, lockouts or slowdowns against any Loan Party pending or, to the actual knowledge of any Responsible Officer of any Loan Party, threatened, except to the extent that strikes, lockouts or slowdowns would not reasonably be expected to result in a Material Adverse AEffect. The hours worked by and payments made to employees of the Loan Parties have not been in violation of the Fair Labor Standards Act or any other applicable federal, state, local or foreign law dealing with such matters to the extent that any such violation could reasonably be expected to have a Material Adverse Effect. Except for Disclosed Matters and to the extent that such liability would not

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reasonably be expected to have a Material Adverse Effect, all payments due from any Loan Party, or for which any claim may be made against any Loan Party, on account of wages and employee health and welfare insurance and other benefits, have been paid or accrued in accordance with GAAP as a liability on the books of such Loan Party. As of the First Amendment Effective Date, there are no representation proceedings pending or, to the actual knowledge of any Responsible Officer of any Loan Party, threatened to be filed with the National Labor Relations Board or other applicable Governmental Authority, and no labor organization or group of employees of any Loan Party has made a pending demand for recognition. As of the First Amendment Effective Date, the consummation of the transactions contemplated by the Loan Documents will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which any Loan Party is bound to the extent that such would be reasonably expected to result in a Material Adverse Effect.

SECTION 3.15    Security Documents.

The Security Documents create in favor of the Administrative Agent or the Canadian Agent, as applicable, for the benefit of the Administrative Agent or the Canadian Agent, as applicable, and the other Secured Parties, a legal, valid and enforceable security or mortgage interests in the Collateral (subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law), and the Security Documents constitute, or will upon the filing of financing statements or other requisite registrations and/or the obtaining of “control”, in each case with respect to the relevant Collateral as required under the applicable Uniform Commercial Code or similar legislation of any jurisdiction, including, without limitation, the PPSA and the Civil Code of Quebec, to the extent security interests in such Collateral can be perfected by such filings or control, the creation of a fully perfected and opposable first priority Lien on, and security interest in, and hypothecation of, all right, title and interest of the Loan Parties thereunder in such Collateral (to the extent required under the Security Documents), in each case prior and superior in right to any other Person, except for Permitted Encumbrances having priority by operation of Applicable Law.

SECTION 3.16    Federal Reserve Regulations.

(a)    No Loan Party is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of buying or carrying Margin Stock.

(b)    No part of the proceeds of any Loan or any Letter of Credit will be used by any Loan Party or any of its Subsidiaries, whether directly or indirectly, and whether immediately, incidentally or ultimately, (i) to buy or carry Margin Stock or to extend credit to others for the purpose of buying or carrying Margin Stock or to refund indebtedness originally incurred for such purpose in violation of Regulation U or X or (ii) for any purpose that entails a violation of, or that is inconsistent with, the provisions of the Regulations of the Board, including Regulation U or Regulation X.

SECTION 3.17    Solvency.

As of the First Amendment Effective Date and after giving effect to the transactions contemplated to occur on the First Amendment Effective Date, the Loan Parties, on a Consolidated basis, are Solvent. No transfer of property is being made by any Loan Party and no obligation is being incurred by any Loan Party in connection with the transactions contemplated by this Agreement or the other Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of any Loan Party.

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ARTICLE IV

Conditions

SECTION 4.01    Effective Date.

The effectiveness of this Agreement is subject to the following conditions precedent:

(a)    The Administrative Agent (or its counsel) shall have received from each party either (i) a counterpart of this Agreement and all other Loan Documents signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement and all other Loan Documents.

(b)    The Administrative Agent shall have received a written opinion (addressed to each Agent, the Issuing Banks and the Lenders and dated the Effective Date) of (i) Simpson Thacher & Bartlett LLP, counsel for the Loan Parties, (ii) Borden Ladner Gervais LLP, counsel for the Canadian Borrower and its Subsidiaries, (iii) Hunton & Williams LLP, counsel for TRU-SVBC, LLC, and (iv) O’Neill & Borges, counsel for TRU of Puerto Rico, Inc., in each case covering such matters relating to the Loan Parties, the Loan Documents or the transactions contemplated thereby as the Administrative Agent shall reasonably request. The Loan Parties hereby request such counsel to deliver such opinions.

(c)    The Administrative Agent shall have received Charter Documents and such other documents and certificates as the Administrative Agent or its counsel may reasonably request relating to the organization and existence of each Loan Party, the authorization of the transactions contemplated by the Loan Documents and any other legal matters relating to the Loan Parties, the Loan Documents or the transactions contemplated thereby, all in form and substance reasonably satisfactory to the Administrative Agent and its counsel.

(d)    (i) The Administrative Agent shall have received a Borrowing Base Certificate dated the Effective Date, relating to the fiscal month ended on March 1, 2014, and executed by a Financial Officer of the Lead Borrower (and certified by such Financial Officer as being complete and correct in all material respects) evidencing that Excess Availability as of the Effective Date is not less than $500,000,000 and (ii) Excess Availability as of the Effective Date shall not be less than $500,000,000.

(e)    The Administrative Agent shall have received a certificate, reasonably satisfactory in form and substance to the Administrative Agent, certifying that, after giving effect to the consummation of the transactions contemplated under this Agreement and the other Loan Documents as of the Effective Date, no Default or Event of Default exists.

(f)    All necessary consents and approvals to the transactions contemplated hereby shall have been obtained and shall be reasonably satisfactory to the Administrative Agent other than those which, individually or in the aggregate, would not, and would not reasonably be expected to, have a Material Adverse Effect.

(g)    No Material Adverse Effect shall have occurred since February 2, 2013.

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(h)    The Administrative Agent shall have (i) received reasonably detailed financial projections for the Borrowers and their Subsidiaries on a quarterly basis for the Borrowers’ 2014 Fiscal Year and on an annual basis for the Borrowers’ 2015, 2016, 2017 and 2018 Fiscal Years, and (ii) received and be reasonably satisfied with a reasonably detailed projected Excess Availability calculation for the Domestic Borrower and the Canadian Borrower prepared on a monthly basis through the end of the Borrowers’ 2014 Fiscal Year.

(i)    The Administrative Agent shall have received and be reasonably satisfied with updated appraisals with respect to (i) TRU Inventory and BRU Inventory, and (ii) Eligible Real Estate of the Canadian Loan Parties.

(j)    The Administrative Agent shall have received results of searches or other evidence reasonably satisfactory to the Administrative Agent indicating the absence of Liens on the assets of the Loan Parties, except for Permitted Encumbrances and Liens for which termination statements and releases or subordination agreements are being tendered on the Effective Date.

(k)    The Administrative Agent shall have received, on or before the Effective Date, all documents and instruments, including Uniform Commercial Code and PPSA financing statements and certified statements issued by the Quebec Register of Personal and Movable Real Rights, required by law or reasonably requested by the Co-Collateral Agents to be filed, registered, published or recorded to create or perfect the first priority Liens (subject only to Permitted Encumbrances having priority by operation of Applicable Law) intended to be created under the Loan Documents and all such documents and instruments shall have been so filed, registered, published or recorded or other arrangements reasonably satisfactory to the Co-Collateral Agents for such filing, registration, publication or recordation shall have been made.

(l)    The Administrative Agent shall have received, and be reasonably satisfied with, evidence of the Loan Parties’ insurance, together with such endorsements as are required by the Loan Documents.

(m)    All fees due on or prior to the Effective Date, and all Credit Party Expenses incurred by in connection with the establishment of the credit facility contemplated hereby (including the reasonable fees and expenses of counsel to the Agents), shall have been paid in full.

(n)    There shall have been delivered to the Administrative Agent each of the instruments, agreements, opinions, certificates and other documents identified on the closing agenda attached hereto as Exhibit M.

SECTION 4.02    Conditions Precedent to Each Loan and Each Letter of Credit.

The obligation of the Lenders to make each Revolving Credit Loan and of the Issuing Banks to issue each Letter of Credit from and after the Effective Date is also subject to the following conditions precedent:

(a)    The Administrative Agent shall have received a notice with respect to such Borrowing or issuance, as the case may be, as required by ARTICLE II, and in the case of the issuance of a Letter of Credit, the applicable Issuing Bank shall have received notice with respect thereto in accordance with SECTION 2.13.

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(b)    All representations and warranties contained in this Agreement and the other Loan Documents or otherwise made in writing in connection herewith or therewith (including in any Borrowing Base Certificate) shall be true and correct in all material respects on and as of the date of each Borrowing or the issuance of each Letter of Credit hereunder with the same effect as if made on and as of such date, other than representations and warranties that relate solely to an earlier date which shall be true and correct in all material respects as of such earlier date (in each case, other than representations and warranties which are qualified by “materiality” or “Material Adverse Effect”, each of which shall be true and correct in all respects as of such date or as of such earlier date, as applicable).

(c)    On the date of each Borrowing hereunder and the issuance of each Letter of Credit and after giving effect thereto, no Default or Event of Default shall have occurred and be continuing.

(d)    On the date of each Borrowing hereunder and the issuance of each Letter of Credit and after giving effect thereto, to the extent the proceeds thereof will be used to fund a Restricted Payment, the Loan Parties, on a Consolidated basis, shall be Solvent.

The request by the Lead Borrower or the Canadian Borrower, as applicable, for, and the acceptance by any Borrower of, each extension of credit hereunder shall be deemed to be a representation and warranty by the Loan Parties that the conditions specified in this SECTION 4.02 have been satisfied at that time and that, after giving effect to such extension of credit, the DomesticBorrowers shall continue to be in compliance with the Tranche A Borrowing Base or the Canadian Borrowing Base. The conditions set forth in this SECTION 4.02 are for the sole benefit of the Administrative Agent and the Canadian Agent and each other Credit Party and may be waived by the Administrative Agent or the Canadian Agent, in whole or in part, without prejudice to the rights of the Administrative Agent, the Canadian Agent or any other Credit Party. Until the Required Lenders otherwise direct the Administrative Agent or the Canadian Agent to cease making Loans and issuing Letters of Credit, the Lenders will fund their Commitment Percentage of all Loans and participate in all Swing Line Loans and Letters of Credit whenever made or issued, which are requested by the Borrowers and which, notwithstanding the failure of the Loan Parties to comply with the provisions of this Article IV, agreed to by the Administrartive Agent or the Canadian Agent, provided, however, the making of any such Loans or the issuance of any Letters of Credit shall not be deemed a modification or waiver by any Credit Party of the provisions of this Article IV on any future occasion or a waiver of any rights or the Credit Parties as a result of any such failure to comply.

ARTICLE V

Affirmative Covenants

Until (i) the Commitments have expired or been terminated, (ii) the principal of and interest on each Loan and all fees and other Obligations (other than contingent indemnity obligations with respect to then unasserted claims and the Other Liabilities) shall have been paid in full, (iii) all Letters of Credit shall have expired or terminated (or been Cash Collateralized in a manner satisfactory to the applicable Issuing Banks) and (iv) all Letter of Credit Outstandings have been reduced to zero (or Cash Collateralized in a manner satisfactory to the applicable Issuing Banks), each Loan Party covenants and agrees with the Credit Parties (providedthat the Canadian Borrower covenants only for itself and its Subsidiaries) that:

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SECTION 5.01    Financial Statements and Other Information.

The Lead Borrower will furnish to the Administrative Agent:

(a)    Within one hundred twenty (120) days after the end of each Fiscal Year of the Parent, the Consolidated balance sheet and related statements of operations, and Consolidated statements of cash flows as of the end of and for such year for (x) the Parent and its Subsidiaries, and (y) the Lead Borrower and its Subsidiaries, setting forth in each case, in comparative form, the Consolidated figures for the previous Fiscal Year, all audited and reported on by independent public accountants of recognized national standing (without a “going concern” or like qualification or exception (other than solely with respect to, or resulting solely from, an upcoming maturity date under any Indebtedness occurring within 12 months of the end of such Fiscal Year) and without a qualification or exception as to the scope of such audit) to the effect that such Consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Parent and its Subsidiaries, or the Lead Borrower and its Subsidiaries, as applicable, in each case on a Consolidated basis in accordance with GAAP;

(b)    Within sixty (60) days after the end of the first three Fiscal Quarters of each Fiscal Year of the Lead Borrower, the unaudited Consolidated balance sheet and related statements of operations, and Consolidated statements of cash flows for (i) the Lead Borrower and its Subsidiaries, (ii) the Lead Borrower and its Subsidiaries (other than the Canadian Borrower and its Subsidiaries), and (iii) the Canadian Borrower and its Subsidiaries, as of the end of and for such Fiscal Quarter (other than in the case of statements of cash flows) and the elapsed portion of the Fiscal Year, setting forth in each case, in comparative form the Consolidated figures for the previous Fiscal Year, all certified by one of the Lead Borrower’s Financial Officers as presenting in all material respects the financial condition and results of operations of the Loan Parties and their Subsidiaries on a Consolidated basis in accordance with GAAP, subject to year-end audit adjustments and the absence of footnotes, and, in addition, separate financial statements for each business segment identified on, and as required by, Schedule 5.01(b) hereto;

(c)    Within thirty (30) days after the end of each Fiscal Month of the Lead Borrower and its Subsidiaries, such reports as are prepared by the Loan Parties’ management for their own use, including the Consolidated balance sheet and related statements of operations, and Consolidated statements of cash flows for (i) the Lead Borrower and its Subsidiaries, (ii) the Lead Borrower and its Subsidiaries (other than the Canadian Borrower and its Subsidiaries), and (iii) the Canadian Borrower and its Subsidiaries, with respect to (A) the balance sheet and statement of operations, as of the end of and for such Fiscal Month and the elapsed portion of the Fiscal Year, and (B) the statements of cash flow, for the elapsed portion of the Fiscal Year, setting forth in each case, in comparative form the Consolidated figures for the previous Fiscal Year, all certified by one of the Lead Borrower’s Financial Officers as agreeing to the Lead Borrower’s books and records and presenting in all material respects the financial condition and results of operations of the Loan Parties and their Subsidiaries on a Consolidated basis, and, in addition, separate financial statements for each business segment identified on, and as required by, Schedule 5.01(b) hereto;

(d)    Concurrently with any delivery of financial statements under clauses (a) or (b) above, a certificate of a Financial Officer of the Lead Borrower in the form of Exhibit J hereto (a “Compliance Certificate”) (i) certifying as to whether a Default or Event of Default has occurred and, if a Default or Event of Default has occurred, specifying the details thereof and any action

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taken or proposed to be taken with respect thereto, (ii) setting forth reasonably detailed calculations with respect to the Monthly Excess Availability for such period, (iii) without duplication of calculations described in clause (ii), setting forth reasonably detailed calculations with respect to compliance with the provisions of SECTION 6.10, to the extent then applicable,(iv) detailing all Store openings and Store closings during the immediately preceding fiscal period, and (v) stating whether any change in GAAP or in the application thereof has occurred since the date of the Lead Borrower’s most recent audited financial statements and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such Compliance Certificate;

(e)    Within ninety (90) days after the commencement of each Fiscal Year of the Loan Parties, a detailed, Consolidated budget by month for the applicable Fiscal Year for the Lead Borrower and its Subsidiaries and including a projected Consolidated income statement, balance sheet, statement of cash flow, Domestic Availabilityand, Canadian Availability and Incremental Availability, in each case by month, and promptly when available, any revisions to such budget resulting from any Permitted Acquisition, Permitted Disposition or other transaction, the effect of which would reasonably be expected to change the projected Consolidated EBITDA of the Loan Parties in any Fiscal Year by 20% or more;

(f)    The Lead Borrower will furnish to the Administrative Agent a certificate in the form of Exhibit K (a “Borrowing Base Certificate”) showing the Tranche A Borrowing Baseand, the Canadian Borrowing Base (reflected both in CD$ and the Equivalent Amount)and Incremental Availability, each Borrowing Base Certificate to be certified as complete and correct in all material respects on behalf of the Lead Borrower by a Financial Officer of the Lead Borrower, as follows:

(i)    On or prior to the 10^th Business Day of each fiscal month, the Lead Borrower shall furnish a Borrowing Base Certificate as of the last day of the immediately preceding fiscal month;

(ii)    Upon the occurrence and during the continuance of an Accelerated Borrowing Base Delivery Event, the Lead Borrower shall furnish a Borrowing Base Certificate (which shall roll forward the Loan Parties’ Inventory, credit card receivables and Credit Extensions) on Wednesday of each week (or, if Wednesday is not a Business Day, on the next succeeding Business Day), as of the close of business on the immediately preceding Saturday;

(iii)    If there are Loans then outstanding, the Lead Borrower shall also furnish a Borrowing Base Certificate within five (5) Business Days after December 15 of each year (which shall roll forward the Loan Parties’ Inventory, credit card receivables and Credit Extensions), as of the close of business on the immediately preceding Saturday;

(iv)    Upon the sale or other disposition of Collateral of any Loan Party included in the Tranche A Borrowing Baseor, the Canadian Borrowing Base or Incremental Availability outside of the ordinary course of business, (A) if the Loan Parties are not in compliance with the provisions of SECTION 6.10 hereof either before or after giving effect to such sale or disposition and the Net Proceeds therefrom are in excess of $25,000,000 or (B) if the Net Proceeds are in excess of $50,000,000, the Lead Borrower shall also furnish an updated Borrowing Base Certificate promptly upon the receipt of the Net Proceeds from such Prepayment Event; and

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(v)    The Borrowers may, at their option, elect to furnish the Administrative Agent with a Borrowing Base Certificate on a more frequent basis than is otherwise required pursuant to this SECTION 5.01(f); providedthat, if the Borrowers elect to deliver a Borrowing Base Certificate on a more frequent basis than is required by the other provisions of this SECTION 5.01(f), then the Lead Borrower shall continue to furnish a Borrowing Base Certificate on such basis from the date of such election through the remainder of the Fiscal Year in which such election was made.

(g)    Promptly after the same become publicly available, copies of (i) all material periodic and other reports, proxy statements and other materials filed by any Loan Party with the SEC or any Governmental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange, as the case may be, and (ii) SEC Forms 10K and 10Q for the Parent (for so long as the Parent is subject to the reporting requirements under the Securities Exchange Act of 1934, as amended); providedthat no such delivery shall be required hereunder with respect to each of the foregoing to the extent that such are publicly available via EDGAR or another publicly available reporting system and the Lead Borrower has advised the Administrative Agent of the filing thereof;

(h)    Promptly upon receipt thereof, copies of all material reports submitted to any Loan Party by independent certified public accountants in connection with each annual, interim or special audit of the books of the Loan Parties or any of their Subsidiaries made by such accountants, including any management letter commenting on the Loan Parties’ internal controls submitted by such accountants to management in connection with their annual audit(and, with respect to any event described in this clause (h), a calculation of the Excess Cash Flow for such period);

(i)    The financial and collateral reports described on Schedule 5.01(i) hereto, at the times set forth in such Schedule;

(j)    A detailed summary of the Net Proceeds received from any Prepayment Event resulting in Net Proceeds of $50,000,000 or more (or in respect of which prior notice was given or required to be given under clause (k) , below) within five (5) Business Days after receipt of such Net Proceeds (other than from sales of Inventory in the ordinary course of business); providedthat, prior to the occurrence and continuance of a Cash Dominion Event, such summary shall be required to be furnished only with respect to Prepayment Events arising from a Permitted Disposition of the type described in clauses (b), (r), and (s) of such definition;

(k)    Notice of any intended sale or other disposition of Collateral of any Loan Party included in the Tranche A Borrowing Baseor, the Canadian Borrowing Base or Incremental Availability outside of the ordinary course of business, (i) if a Cash Dominion Event then exists, (ii) if the Loan Parties are not in compliance with the provisions of SECTION 6.10 hereof either before or after giving effect to such sale or disposition and the Net Proceeds therefrom are in excess of $25,000,000 or (iii) if the Net Proceeds of which exceeds $50,000,000, in each case at least five (5) Business Days prior to the date of consummation such sale or disposition; and

(l)    Promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of any Loan Party as any Agent or any Lender may reasonably request (other than information which is subject to an attorney-client privilege or would result in a breach of a confidentiality obligation of the Loan Parties to any other Person).

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At the request of the Lead Borrower and with the consent of the Administrative Agent, not to be unreasonably withheld, any of the delivery requirements relating to written financial information set forth in this SECTION 5.01 may be satisfied by either (x) the Borrowers’ posting such information in electronic format readable by the Administrative Agent and the Lenders to a secure address on the world wide web (the “Informational Website”) which is accessible by the Administrative Agent and the Lenders or (y) the Borrowers’ delivering such financial information in electronic format to the Administrative Agent and the Administrative Agent’s posting such information to an Informational Website. The accommodation provided by the foregoing sentence shall not impair the right of the Administrative Agent, or any Lender through the Administrative Agent, to request and receive from the Borrowers physical delivery of specific financial information provided for in this SECTION 5.01. The Lead Borrower shall give the Administrative Agent and each Lender (or, if applicable, the Administrative Agent shall give each Lender) written or electronic notice each time any information is delivered by posting to the Informational Website. Except to the extent such Informational Website is established and maintained by the Administrative Agent, the Loan Parties shall be responsible for and shall bear all risk associated with establishing and maintaining the security and confidentiality of the Informational Website and the information posted thereto.

SECTION 5.02    Notices of Material Events.

The Lead Borrower will furnish to the Administrative Agent prompt written notice of the occurrence of any of the following after any Responsible Officer of the Lead Borrower or the Canadian Borrower obtains knowledge thereof:

(a)    A Default or Event of Default, specifying the nature and extent thereof and the action (if any) which is proposed to be taken with respect thereto;

(b)    The filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting any Loan Party or any Subsidiary of the Parent that would reasonably be expected to result in a Material Adverse Effect;

(c)    An ERISA Event that, alone or together with any other ERISA Events that have occurred, would reasonably be expected to result in a Material Adverse Effect;

(d)    Any other development that results in a Material Adverse Effect;

(e)    The discharge by any Loan Party of its present independent accountants or any withdrawal or resignation by such independent accountants;

(f)    Any casualty or other insured damage to any portion of the Collateral included in the Tranche A Borrowing Baseor, the Canadian Borrowing Base or Incremental Availability in excess of $50,000,000, or the commencement of any action or proceeding for the taking of any interest in a portion of the Collateral included in the Tranche A Borrowing Baseor, the Canadian Borrowing Base or Incremental Availability in excess of $50,000,000 or any part thereof or interest therein under power of eminent domain or by condemnation or similar proceeding; and

(g)    The occurrence of a Master Lease Liquidation Event.

Each notice delivered under this SECTION 5.02 shall be accompanied by a statement of a Financial Officer or other executive officer of the Lead Borrower setting forth the details of the event or development requiring

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such notice and, if applicable, any action taken or proposed to be taken with respect thereto.

SECTION 5.03    Information Regarding Collateral.

The Lead Borrower will furnish to the Administrative Agent prompt written notice of any change in: (a) any Loan Party’s name; (b) the location of any Loan Party’s chief executive office or its principal place of business; (c) any office in which a Canadian Loan Party maintains books or records relating to Collateral owned by it or any office or facility at which Collateral owned by it is located (including the establishment of any such new office or facility), to the extent that a filing would be required to perfect the Lien of the Canadian Agent in the Collateral at such location; (d) any Loan Party’s organizational structure or jurisdiction of incorporation or formation; or (e) any Loan Party’s Federal Taxpayer Identification Number or organizational identification number assigned to it by its state of organization. The Loan Parties agree not to effect or permit any change referred to in the preceding sentence unless all filings, publications and registrations, have been made under the Uniform Commercial Code, PPSA or other Applicable Law that are required in order for the Administrative Agent or the Canadian Agent, as applicable, to continue at all times following such change to have a valid, legal and perfected first priority security interest (subject only to Permitted Encumbrances having priority by operation of Applicable Law) in all the Collateral for its own benefit and the benefit of the other Secured Parties.

SECTION 5.04    Existence; Conduct of Business.

Each Loan Party will do all things necessary to comply with its Charter Documents in all material respects, and to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of its business, except to the extent that the failure to do so would not reasonably be expected to have a Material Adverse Effect; provided, however, that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under SECTION 6.03.

SECTION 5.05    Payment of Obligations.

Each Loan Party will pay its Tax liabilities before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) such Loan Party or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP, (c) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (d) the failure to make payment would not reasonably be expected to result in a Material Adverse Effect. The provisions of this paragraph shall not limit or restrict the ability of the Co-Collateral Agents to establish any Reserve for any unpaid Tax liabilities.

SECTION 5.06    Maintenance of Properties.

Each Loan Party will keep and maintain all property material to the conduct of its business in good working order and condition (ordinary wear and tear, casualty loss and condemnation excepted), except where the failure to do so would not reasonably be expected to result in a Material Adverse Effect and except for Permitted Dispositions.

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SECTION 5.07    Insurance.

(a)    Each Loan Party shall: (i) maintain insurance with financially sound and reputable insurers (or, to the extent consistent with business practices in effect on the Effective Date, a program of self-insurance) on such of its property and in at least such amounts and against at least such risks as is consistent with business practices in effect on the Effective Date or as otherwise determined by the Responsible Officers of the Loan Parties acting reasonably in their business judgment, including public liability insurance against claims for personal injury or death occurring upon, in or about or in connection with the use of any properties owned, occupied or controlled by it (including the insurance required pursuant to the Security Documents); (ii) maintain such other insurance as may be required by Applicable Law; and (iii) furnish to the Administrative Agent, upon written request, full information as to the insurance carried.

(b)    Fire and extended coverage policies maintained with respect to any Collateral shall be endorsed or otherwise amended to include: (i) a lenders’ loss payable clause (regarding personal property), in form and substance reasonably satisfactory to the Agents, which endorsements or amendments shall provide that the insurer shall pay all proceeds otherwise payable to the Loan Parties under the policies directly to the Administrative Agent or the Canadian Agent, as applicable; (ii) a provision to the effect that none of the Loan Parties, Credit Parties (in their capacity as such) or any other Affiliate of a Loan Party shall be a co-insurer (the foregoing not being deemed to limit the amount of self-insured retention or deductibles under such policies, which self-insured retention or deductibles shall be consistent with business practices in effect on the Effective Date or as otherwise determined by the Responsible Officers of the Loan Parties acting reasonably in their business judgment); and (iii) such other provisions as any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) or the Canadian Agent may reasonably require from time to time to protect the interests of the Credit Parties. Commercial general liability policies shall be endorsed to name the Administrative Agent or the Canadian Agent, as applicable, as an additional insured. Business interruption policies shall name the Administrative Agent or the Canadian Agent, as applicable, as a loss payee and shall be endorsed or amended to include: (i) a provision that, during the continuance of a Cash Dominion Event, the insurer shall pay all proceeds otherwise payable to the Loan Parties under the policies directly to the Administrative Agent or the Canadian Agent, as applicable; (ii) a provision to the effect that none of the Loan Parties, Credit Parties (in their capacity as such) or any other Affiliate of a Loan Party shall be a co-insurer; and (iii) such other provisions to the endorsement as any Co-Collateral Agent (after consultation with the other Co-Collateral Agent) or the Canadian Agent may reasonably require from time to time to protect the interests of the Credit Parties. Each such casualty or liability policy referred to in this SECTION 5.07(b) shall also provide that it shall not be canceled, modified in any manner that would cause this SECTION 5.07 to be violated, or not renewed (i) by reason of nonpayment of premium, except upon not less than thirty (30) days’ prior written notice thereof by the insurer to the Administrative Agent or the Canadian Agent, as applicable (giving the Administrative Agent or the Canadian Agent, as applicable, the right to cure defaults in the payment of premiums), or (ii) for any other reason, except upon not less than thirty (30) days’ prior written notice thereof by the insurer to the Administrative Agent or the Canadian Agent, as applicable. The Lead Borrower shall deliver to the Administrative Agent, and the Canadian Borrower shall deliver to the Canadian Agent, prior to the cancellation, modification or non-renewal of any such policy of insurance, a copy of a renewal or replacement policy (or other evidence of renewal of a policy previously delivered to the Administrative Agent or the Canadian Agent, as applicable, including an insurance binder) together

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with evidence satisfactory to the Administrative Agent or the Canadian Agent, as applicable, of payment of the premium therefor.

SECTION 5.08    Books and Records; Inspection and Audit Rights; Appraisals; Accountants.

(a)    Each Loan Party will keep proper books of record and account in accordance with GAAP and in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities. Each Loan Party will permit any representatives designated by the Administrative Agent or any Co-Collateral Agent, upon reasonable prior notice, to visit and inspect its properties, to discuss its affairs, finances and condition with its officers and independent accountants (so long as such Loan Party is afforded an opportunity to be present) and to examine and make extracts from its books and records, all at such reasonable times and as often as reasonably requested.

(b)    Each Loan Party will from time to time upon the request of the Administrative Agent or any Co-Collateral Agent, permit the Administrative Agent or any Co-Collateral Agent or professionals (including consultants, accountants, lawyers and appraisers) retained by the Co-Collateral Agents, on reasonable prior notice and during normal business hours, to conduct appraisals and commercial finance examinations, including, without limitation, of (i) the Domestic Borrowers’ and the Canadian Borrower’s practices in the computation of the Tranche A Borrowing Baseand, the Canadian Borrowing Baseand Incremental Availability, and (ii) the assets included in the Tranche A Borrowing Baseand, the Canadian Borrowing Base and Incremental Availability and related financial information such as, but not limited to, sales, gross margins, payables, accruals and reserves. Subject to the following, the Loan Parties shall pay the reasonable out-of-pocket fees and expenses of the Administrative Agent, the Co-Collateral Agents and such professionals with respect to such evaluations and appraisals:

(i)    The Co-Collateral Agents (acting in consultation with the Administrative Agent) may conduct one (1) commercial finance examination in each calendar year for each of the Domestic Loan Parties and Canadian Loan Parties, as applicable, each at the Loan Parties’ expense; providedthat, the Co-Collateral Agents (acting in consultation with the Administrative Agent) may conduct up to two (2) commercial finance examinations in a calendar year if Excess Availability falls below twenty-five percent (25%) of the Line Cap for twenty (20) consecutive calendar days at any time in such calendar year, in each case, for each of the Domestic Loan Parties and Canadian Loan Parties, as applicable, in each case, each at the Loan Parties’ expense. Notwithstanding anything to the contrary contained herein, the Co-Collateral Agents (acting in consultation with the Administrative Agent) may cause to be taken (A) up to one (1) additional commercial finance examination for each of the Domestic Loan Parties and Canadian Loan Parties, as applicable, at any time in each calendar year at the expense of the Lenders, and (B) after the occurrence and during the continuance of any Specified Default, such additional commercial finance examinations for each of the Domestic Loan Parties and Canadian Loan Parties, as applicable, as the Co-Collateral Agents, in their reasonable discretion, determine are necessary or appropriate (each, at the expense of the Loan Parties).

(ii)    The Co-Collateral Agents (acting in consultation with the Administrative Agent) may undertake one (1) appraisal in each calendar year of (A) the Domestic Loan Parties’ BRU Inventory, (B) the Domestic Loan Parties’ TRU Inventory, (C) the Canadian Loan Parties’ BRU Inventory, and (D) the Canadian Loan Parties’ TRU Inventory, each at the Loan Parties’ expense; providedthat, the Co-Collateral Agents (acting in consultation with the Administrative

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Agent) may undertake up to two (2) appraisals in a calendar year for each category of Inventory described in clauses (A) through (D) above if Excess Availability falls below twenty-five percent (25%) of the Line Cap for twenty (20) consecutive calendar days at any time in such calendar year, in each case, each at the Loan Parties’ expense. Notwithstanding anything to the contrary contained herein, the Co-Collateral Agents (acting in consultation with the Administrative Agent), may cause to be undertaken (x) up to one additional Inventory appraisal for each category of Inventory described in clauses (A) through (D) above, at any time in each calendar year at the expense of the Lenders, and (y) after the occurrence and during the continuance of any Specified Default, such additional Inventory appraisals as the Co-Collateral Agents, in their reasonable discretion, determine are necessary or appropriate (each, at the expense of the Loan Parties).

(iii)    The Co-Collateral Agents (acting in consultation with the Administrative Agent) may undertake one appraisal of other Collateral in each twelve calendar month period for each of the Domestic Loan Parties and Canadian Loan Parties, as applicable, each at the Loan Parties’ expense. Notwithstanding anything to the contrary contained herein, the Co-Collateral Agents (acting in consultation with the Administrative Agent), after the occurrence and during the continuance of any Specified Default, may cause such additional appraisals of other Collateral to be undertaken for each of the Domestic Loan Parties and Canadian Loan Parties, as applicable, as the Co-Collateral Agents, in their reasonable discretion, determine are necessary or appropriate (each, at the expense of the Loan Parties).

(c)    The Loan Parties shall at all times retain independent certified public accountants of national standing and shall instruct such accountants to cooperate with, and be available to, the Administrative Agent and the Co-Collateral Agents or their representatives to discuss the annual audited statements, the Loan Parties’ financial performance, financial condition, operating results, controls, and such other matters, within the scope of the retention of such accountants for such audited statements, as may be raised by the Administrative Agent or any Co-Collateral Agent; providedthat a representative of the Lead Borrower shall be given the opportunity to be present all such discussions.

SECTION 5.09    Physical Inventories.

The Loan Parties, at their own expense, shall cause not less than one (1) physical inventory to be undertaken in each twelve (12) month period (or alternatively, periodic cycle counts) in conjunction with the preparation of their annual audited financial statements, conducted following such methodology as is consistent with the methodology used in the immediately preceding inventory (or cycle count) or as otherwise may be reasonably satisfactory to the Co-Collateral Agents. Following the completion of such inventory, and in any event by the next date required for the delivery of a Borrowing Base Certificate hereunder, the Borrowers shall post such results to the Loan Parties’ stock ledgers and general ledgers, as applicable.

SECTION 5.10    Compliance with Laws.

Each Loan Party will comply with all Applicable Laws and the orders of any Governmental Authority except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

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SECTION 5.11    Use of Proceeds and Letters of Credit.

The proceeds of Loans made hereunder and of Letters of Credit issued hereunder will be used only (a) to finance the acquisition of assets of the Borrowers and their Subsidiaries, including the purchase of inventory, equipment, and other fixed assets, in each case in the ordinary course of business, (b) to finance Capital Expenditures of the Borrowers and their Subsidiaries, (c) to finance Permitted Acquisitions, and(d) with respect to the Tranche A-1 Loans, to repay the 2016 Notes and a portion of the Term Loan on the First Amendment Effective Date; and (e) for general corporate purposes, including, the repayment of Indebtedness (including, after the First Amendment Effective Date, the Term Loan and the Permanent Financing Facility), the making of Restricted Payments, and the making of Investments, all to the extent permitted in this Agreement. No part of the proceeds of any Loan will be used by any Loan Party or any of its Subsidiaries, whether directly or indirectly, for any purpose that entails a violation of any regulation of the Board, including Regulations U and X.

SECTION 5.12    Additional Subsidiaries.

(a)    If any Domestic Loan Party shall form or acquire a Material Subsidiary after the Effective Date, the Lead Borrower will notify the Administrative Agent thereof and if such Material Subsidiary is not a Foreign Subsidiary, the Lead Borrower will cause such Subsidiary to become a Loan Party hereunder and under each applicable Security Document in the manner provided therein within thirty (30) days after such Subsidiary is formed or acquired and promptly take such actions to create and perfect Liens on such Subsidiary’s assets to secure the Obligations and the Other Liabilities as the Administrative Agent or the Required Lenders shall request.

(b)    If the Canadian Borrower or any of its Subsidiaries shall form or acquire a Material Subsidiary after the Effective Date, the Canadian Borrower will notify the Administrative Agent thereof and (i) if such Material Subsidiary is organized under the laws of Canada or any province thereof, the Canadian Borrower will cause such Subsidiary to become a Canadian Loan Party hereunder and under each applicable Canadian Security Document in the manner provided therein within ten (10) Business Days after such Subsidiary is formed or acquired and promptly take such actions to create and perfect Liens on such Subsidiary’s assets to secure the Canadian Liabilities as the Canadian Agent or the Required Lenders shall reasonably request and (ii) if any shares of Capital Stock or Indebtedness of such Subsidiary are owned by or on behalf of the Canadian Borrower or any of its Subsidiaries, the Canadian Borrower will cause such shares and promissory notes evidencing such Indebtedness to be pledged to secure the Canadian Liabilities within three (3) Business Days after such Subsidiary is formed or acquired.

SECTION 5.13    Further Assurances.

(a)    Each Loan Party will execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements and other documents), that may be required under any Applicable Law, or which any Agent, the Canadian Agent or the Required Lenders may reasonably request, to effectuate the transactions contemplated by the Loan Documents or to grant, preserve, protect or perfect the Liens created or intended to be created by the Security Documents or the validity or priority of any such Lien, all at the expense of the Loan Parties (to the extent required under this Agreement). The Loan Parties also agree to provide to each Agent and the Canadian Agent, from time to time upon the reasonable request of the Administrative Agent, any Co-Collateral Agent or the Canadian Agent,

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as applicable, evidence reasonably satisfactory to the Administrative Agent, Co-Collateral Agents or Canadian Agent, as applicable, as to the perfection and priority of the Liens created or intended to be created by the Security Documents.

(b)    Upon the request of any Co-Collateral Agent or the Canadian Agent, as applicable, each Loan Party shall use commercially reasonable efforts to cause each of its customs brokers to deliver an agreement (including, without limitation, a Customs Broker Agreement) to the Administrative Agent or the Canadian Agent, as applicable, covering such matters and in such form as the Co-Collateral Agents or the Canadian Agent, as applicable, may reasonably require. In the event Inventory is in the possession or control of a customs broker that has not delivered an agreement as required by the preceding sentence, such Inventory shall not be considered Eligible In-Transit Inventory or Eligible Letter of Credit Inventory hereunder.

SECTION 5.14    Retention of Financial Consultant.

Upon the occurrence of a Specified Default, upon the request of any Co-Collateral Agent (after consultation with the other Co-Collateral Agent), the Loan Parties (at their sole cost and expense) shall retain a business and financial consultant mutually acceptable to the Lead Borrower and the Co-Collateral Agents (a “Financial Consultant”) on such terms, including the scope of work and term of engagement, as are reasonably acceptable to the Co-Collateral Agents.

ARTICLE VI

Negative Covenants

Until (i) the Commitments have expired or been terminated, (ii) the principal of and interest on each Loan and all fees and other Obligations (other than contingent indemnity obligations with respect to then unasserted claims and the Other Liabilities) shall have been paid in full, (iii) all Letters of Credit shall have expired or terminated (or been Cash Collateralized in a manner satisfactory to the applicable Issuing Banks) and (iv) all Letter of Credit Outstandings have been reduced to zero (or Cash Collateralized in a manner satisfactory to the Issuing Banks), each Loan Party covenants and agrees with the Credit Parties (providedthat the Canadian Borrower covenants only for itself and its Subsidiaries) that:

SECTION 6.01    Indebtedness and Other Obligations.

No Loan Party will create, incur, assume or permit to exist any Indebtedness, except Permitted Indebtedness.

SECTION 6.02    Liens.

No Loan Party will create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, except Permitted Encumbrances.

SECTION 6.03    Fundamental Changes

(a)    No Loan Party will merge or amalgamate into or consolidate with any other Person, or permit any other Person to merge or amalgamate into or consolidate with it, or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing or would arise therefrom: (i) any Subsidiary may liquidate, dissolve, consolidate, amalgamate or merge into a Loan Party in a transaction in which a Loan Party is the surviving corporation; (ii) any Subsidiary that is not a Loan

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Party may liquidate, dissolve, consolidate, amalgamate or merge into any Subsidiary that is not a Loan Party; (iii) any Loan Party may amalgamate or merge with or into any other Loan Party, providedthat no Domestic Loan Party shall merge or amalgamate with a Canadian Loan Party, if after giving effect thereto, a breach of SECTION 6.10 would exist; and (iv) Permitted Acquisitions and transactions permitted pursuant to SECTION 6.05 may be consummated in the form of a merger, amalgamation, or consolidation, as long as, in the event of a Permitted Acquisition, a Loan Party is the surviving Person, providedthat any such merger involving a Person that is not a wholly owned Subsidiary immediately prior to such merger or amalgamation shall not be permitted unless also permitted by SECTION 6.04.

(b)    No Loan Party will engage, to any material extent, in any business other than businesses of the type conducted by such Loan Party on the date of execution of this Agreement and businesses reasonably related thereto and those complementary or ancillary thereto.

SECTION 6.04    Investments, Loans, Advances, Guarantees and Acquisitions.

No Loan Party will make or permit to exist any Investment, except Permitted Investments.

SECTION 6.05    Asset Sales.

No Loan Party will sell, transfer, lease (as lessor) or otherwise voluntarily dispose of any asset, including any Capital Stock of another Person, except sales of Inventory and the use of cash in the ordinary course of business, transactions permitted by SECTION 6.03 and Permitted Dispositions.

SECTION 6.06    Restricted Payments; Certain Payments of Indebtedness.

(a)    No Loan Party will declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment, except that:

(i)    any Subsidiary of a Loan Party or the Canadian Borrower, as applicable, may declare and pay cash dividends or make other distributions of property to a Loan Party;

(ii)    as long as no Event of Default specified in SECTION 7.01(c) has occurred (and not been waived) as a result of a material misrepresentation in any Borrowing Base Certificate and no Specified Default then exists or would arise therefrom, the Loan Parties may make Restricted Payments as follows: (A) if the Payment Conditions are satisfied, (1) the Loan Parties may make dividends and distributions to their respective direct or indirect parents or holders of the Loan Parties’ Capital Stock solely for the purpose of paying scheduled principal payments (including at maturity) due and payable by such Person, (2) the Loan Parties may make Restricted Payments to the Parent solely for the purpose of paying taxes and operating expenses incurred in the ordinary course of business by a Subsidiary or Affiliate of a Loan Party but only to the extent such Subsidiary or Affiliate has insufficient liquidity or insufficient cash flow to pay such taxes or operating expenses, and (3) the Loan Parties may make payments in respect of Guarantees by the Parent of another Loan Party or any Subsidiary or Affiliate of the Parent that are due and payable by the Parent; providedthat no Restricted Payments may be made under this clause (A) to, or for the account of, the Sponsors, Sponsor Related Parties or any other stockholder of the Parent; and (B) the Loan Parties may make dividends and distributions to their respective direct or indirect parents or holders of Capital Stock if the Adjusted Payment Conditions are satisfied;

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(iii)    as long as no Enumerated Default or breach of SECTION 6.10 then exists or would arise therefrom, the Loan Parties may make Restricted Payments as follows: (A) the Loan Parties may make dividends and distributions to their respective direct or indirect parents or holders of the Loan Parties’ Capital Stock solely for the purpose of paying scheduled interest payments (including at maturity) due and payable by such Person, and (B) the Loan Parties may make Restricted Payments to the Parent solely for the purpose of paying taxes and operating expenses incurred in the ordinary course of business by the Parent;

(iv)    (A) the Loan Parties may make Restricted Payments for the purpose of making indemnity payments and reasonable expense reimbursements owing under the Advisory Agreement; and (B) to the extent permitted under SECTION 6.07, the Loan Parties may make Restricted Payments for the purpose of paying amounts (other than amounts described in clause (A) hereof) owing under the Advisory Agreement, as long as no Event of Default specified in SECTION 7.01(c) has occurred as a result of a material misrepresentation in any Borrowing Base Certificate and no Specified Default then exists or would arise therefrom;

(v)    the Loan Parties may make Permitted Dispositions of the type described, and subject to the limitations contained, in clauses (c), (e), (j), (p), and (t) of the definition thereof;

(vi)    the Loan Parties may make Restricted Payments from the Designated Account at the times and subject to the limitations set forth in SECTION 6.12;

(vii)    as long as no Event of Default specified in SECTION 7.01(c) has occurred as a result of a material misrepresentation in any Borrowing Base Certificate and no Specified Default then exists or would arise therefrom, the Loan Parties may make Restricted Payments to the Parent consisting of promissory notes or other instruments received by a Loan Party in connection with a Permitted Disposition described in clause (e)(i) of the definition thereof; and

(viii)    the Loan Parties may make Restricted Payments for the purpose of prepaying or repaying the 2017 Notes and the 2018 Notes so long as Excess Availability is at least $225,000,000 (A1) on a pro forma basis for the one month prior to the date of any such Restricted Payment and (B2) on a projected and pro forma basis for the six months following the date of such Restricted Payment.

(b)    No Loan Party will make or agree to pay or make any payment or other distribution (whether in cash, securities or other property) of or in respect of principal of or interest on any Indebtedness, or any payment or other distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Indebtedness, except:

(i)    Payments in Capital Stock (as long as no Change in Control would result therefrom), payments of interest in-kind or payments from proceeds of Subordinated Indebtedness of the Loan Parties;

(ii)    as long as the Pro Forma Availability Condition is then satisfied (except with respect to payments or prepayments of interest or scheduled amortization payments (which, for the avoidance of doubt, do not include mandatory prepayments, which shall be governed by clause (iii) below) of the Term Loans), (A) payments of principal and interest as and when due in respect of

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any Permitted Indebtedness (other than Indebtedness due to the Parent or any of its Affiliates), and (B) as long as no Specified Default then exists or would arise therefrom, prepayments of Permitted Indebtedness (other than Indebtedness due to the Parent or any Affiliates); provided that payments on account of Subordinated Indebtedness may be made only to the extent permitted under the subordination provisions relating thereto;

(iii)    as long as no Event of Default then exists or would arise therefrom, mandatory prepayments of the Term Loans as and when due;

(iv)    (x) as long as no Specified Default then exists or would arise therefrom, payments (including prepayments) on account of Permitted Indebtedness due to the Parent or any Affiliate (other than Indebtedness due to any of the Loan Parties or their Subsidiaries), and (y) payments (including prepayments) on account of Permitted Indebtedness due to any of the Loan Parties or their Subsidiaries;

(v)    prepayments in whole or in part of the Term Loan or Permanent Financing Facility from any refinancing of the Term Loan or Permanent Financing Facility not prohibited hereunder; and

(vi)    refinancings of Indebtedness to the extent permitted under this Agreement.

SECTION 6.07    Transactions with Affiliates.

No Loan Party will sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except:

(a) transactions that are at prices and on terms and conditions, taken as a whole, not less favorable to such Loan Party than could be obtained on an arm’s-length basis from unrelated third parties; or

(b) transactions between or among the Loan Parties or any Special Refinancing Subsidiary not otherwise prohibited hereunder; or

(c) payments due pursuant to the Advisory Agreement on account of Advisory Fees, consisting of: (i) payments (but not prepayments) on account of annual advisory fees, providedthat such advisory fees may not be paid if an Event of Default specified in SECTION 7.01(c) has occurred as a result of a material misrepresentation in any Borrowing Base Certificate or a Specified Default exists or would arise therefrom, providedfurther that such advisory fees not paid shall accrue and be paid when the applicable Event of Default or Specified Default has been cured or waived and no additional Specified Default has occurred and is continuing or would arise as a result of such payment; and (ii) transaction fees, providedthat such transaction fees may not be paid if an Event of Default specified in SECTION 7.01(c) has occurred as a result of a material misrepresentation in any Borrowing Base Certificate or a Specified Default exists or would arise therefrom, providedfurther that, notwithstanding the existence of a breach of the provisions of SECTION 6.10 hereof, such transactions fees may be paid if, as a result of the transaction to which they relate, Excess Availability would be greater than existed prior to such transaction, and providedfurther that such transaction fees not paid shall accrue and be paid when such Event of Default or Specified Default has been cured or waived and no additional Specified Default has occurred and is continuing or would arise as a result of such payment;

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(d) payments of indemnities and reasonable expense reimbursements under the Advisory Agreement;

(e) as set forth on Schedule 6.07;

(f) payment of reasonable compensation to officers and employees for services actually rendered to any such Loan Party or any of its Subsidiaries;

(g) payment of director’s fees, expenses and indemnities;

(h) stock option and compensation plans of the Loan Parties and their Subsidiaries;

(i) employment contracts with officers and management of the Loan Parties and their Subsidiaries;

(j) the repurchase of equity interests from officers, directors and employees to the extent specifically permitted under this Agreement;

(k) advances and loans to officers and employees of the Loan Parties and their Subsidiaries to the extent specifically permitted under this Agreement;

(l) Investments consisting of notes from officers, directors and employees to purchase equity interests to the extent specifically permitted under this Agreement;

(m) the payment and performance under any Master Lease to which the Lead Borrower is a party;

(n) other transactions specifically permitted under this Agreement (including, without limitation, sale/leaseback transactions, Permitted Dispositions, Restricted Payments, Permitted Investments and Indebtedness);

(o) that certain Amended and Restated Tax Allocation Agreement, dated as of June 28, 2006, by and among the Parent and certain of its Subsidiaries, including the capitalization, distribution or contribution of amounts payable or receivable thereunder and any amendments, modifications or replacements thereof which amendments, modifications or replacements would not have a Material Adverse Effect; and

(p) that certain Allocation Agreement, dated as of January 29, 2006, among Toys “R” Us International, LLC, Geoffrey and the Parent and any amendments, modifications or replacements thereof which amendments, modifications or replacements would not have a Material Adverse Effect.

SECTION 6.08    Restrictive Agreements.

No Loan Party will directly or indirectly enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon: (a) the ability of such Loan Party to create, incur or permit to exist any Lien upon any of its property or assets in favor of the Administrative Agent or the Canadian Agent, as applicable; or (b) the ability of any Subsidiary thereof to pay dividends or other distributions with respect to any shares of its Capital Stock to such Loan Party or to make or repay loans or advances to a Loan Party or to guarantee Indebtedness of the Loan Parties; providedthat (i) the foregoing shall not apply to restrictions and conditions imposed by Applicable Law, by any Loan Document, or under any documents relating to joint ventures of any Loan Party to the extent that such joint ventures

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are not prohibited hereunder, (ii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of assets or equity permitted hereunder by a Loan Party or a Subsidiary pending such sale, provided such restrictions and conditions apply only to the assets of the Loan Party or Subsidiary that are to be sold and such sale is permitted hereunder, (iii) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, (iv) clause (a) of the foregoing shall not apply to customary provisions in contracts or leases restricting the assignment or subleasing or sublicensing thereof, (v) the foregoing shall not apply to any agreement relating to Indebtedness under the Indentures, the Term Loan, the Permanent Financing Facility, the CMBS Facilities, the Supplemental Real Estate Facilities (or any facilities replacing or refinancing such facilities), or Indebtedness of Foreign Subsidiaries (other than the Canadian Loan Parties) permitted hereunder (solely to the extent such restrictions are limited to the such Foreign Subsidiaries, (vi) clause (a) of the foregoing shall not apply to licenses or contracts which, by the terms of such licenses and contracts, prohibit the granting of Liens on the rights contained therein, and (vii) the foregoing shall not apply to any restrictions in existence prior to the time any such Person became a Subsidiary and not created in contemplation of any such acquisition.

SECTION 6.09    Amendment of Material Documents.

No Loan Party will amend, modify or waive any of its rights under (a) its Charter Documents, (b) any Master Lease, (c) the nature of the obligations under any guaranty of recourse obligations or any environmental indemnity agreement executed and delivered in connection with the CMBS Facilities or any Supplemental Real Estate Facility, (d) the Advisory Agreement, or (e) any Material Indebtedness, in each case to the extent that such amendment, modification or waiver would reasonably likely have a Material Adverse Effect or would violate the provisions of the Intercreditor Agreement.

SECTION 6.10    Availability.

The Loan Parties shall maintain ExcessCombined Availability at all times of not less than $125,000,000(of which no more than $50,000,000 may be attributable to; provided that unless the Domestic Loan PartiesCmaintadian ExcessDomestic Availability)of at least $125,000,000, the Loan Parties shall not be in compliance with the provisions of this SECTION 6.10.

SECTION 6.11    Fiscal Year.

No Loan Party will change its Fiscal Year except upon written notice to the Agents; provided that any such change (a) which would affect the calculation of Consolidated Fixed Charge Coverage Ratio or the Consolidated Interest Coverage Ratio (and related definitions included therein), or (b) to another financial reporting convention must, in each case, be reasonably acceptable to the Agents.

SECTION 6.12    Designated Account.

After the occurrence and during the continuance of a Cash Dominion Event, the Loan Parties shall not use utilize the funds on deposit in the Designated Account for any purposes other than (a) the payment of operating expenses incurred by the Loan Parties in the ordinary course of business (including payments of interest when due on account of the Term Loan or the Permanent Financing Facility and any expenses incurred by the Parent attributable to the Loan Parties, such as taxes and Inventory acquisition costs), and (b) for such other purposes as the Loan Parties deem appropriate (including, without limitation, the making

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of other Restricted Payments, whether or not the conditions of SECTION 6.06(a) have then been satisfied).

SECTION 6.13    Canadian Defined Benefit Pension Plan.

No Loan Party shall, without the consent of the Administrative Agent (which consent shall not be unreasonably withheld or delayed), maintain, administer, contribute or have any liability in respect of any Canadian Defined Benefit Pension Plan or acquire an interest in any Person if such Person sponsors, maintains, administers or contributes to, or has any liability in respect of any Canadian Defined Benefit Pension Plan, except that a Loan Party may acquire an interest in such Person if (i) the Loan Party does not incur any liability in respect of the Canadian Defined Benefit Pension Plan of such Person and (ii) such Person is not required to become a Loan Party hereunder.

ARTICLE VII

Events of Default

SECTION 7.01    Events of Default.

If any of the following events (“Events of Default”) shall occur:

(a)    Any Loan Party shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any Letter of Credit Disbursement when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;

(b)    Any Loan Party shall fail to pay any interest on any Loan or any fee or any other amount (including, for avoidance of doubt, any amount referred to in SECTION 2.19(a) but excluding any amount referred to in SECTION 7.01(a) or any amount payable for Cash Management Services or Other Liabilities) payable under this Agreement or any other Loan Document and such failure continues for five (5) Business Days;

(c)    Any representation or warranty made or deemed made by or on behalf of any Loan Party in, or in connection with, any Loan Document or any amendment or modification thereof or waiver thereunder (including, without limitation, in any Borrowing Base Certificate or any certificate of a Financial Officer accompanying any financial statement) shall prove to have been incorrect in any material respect when made or deemed made;

(d)    Any Loan Party shall fail to observe or perform when due any covenant, condition or agreement contained (i) in ARTICLE VI or (ii) SECTION 5.01(f) (after a one Business Day grace period), or (iii) in any of SECTION 2.18, SECTION 5.01(g), SECTION 5.02(a), SECTION 5.07, SECTION 5.08(b), or SECTION 5.11 (providedthat, if (A) any such Default described in this clause (iii) is of a type that can be cured within 5 Business Days and (B) such Default could not materially adversely impact the Lenders’ Liens on the Collateral, such default shall not constitute an Event of Default for 5 Business Days after the occurrence of such Default so long as the Loan Parties are diligently pursuing the cure of such Default);

(e)    Any Loan Party shall fail to observe or perform when due any covenant, condition or agreement contained in any Loan Document (other than those specified in SECTION 7.01(a), SECTION 7.01(b), SECTION 7.01(c), or SECTION 7.01(d)), and such failure shall continue

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unremedied for a period of thirty (30) days after notice thereof from the Administrative Agent to the Lead Borrower;

(f)    Any Loan Party shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness when and as the same shall become due and payable (after giving effect to the expiration of any grace or cure period set forth therein) or any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any such Material Indebtedness or any trustee or agent on its or their behalf to cause any such Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity, which default, event or condition is not being contested in good faith;

(g)    a Change in Control shall occur;

(h)    An involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of any Loan Party or its debts, or of a substantial part of its assets, under the Bankruptcy Code or any other federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, interim receiver, monitor, trustee, custodian, sequestrator, conservator or similar official for any Loan Party or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall be entered;

(i)    Any Loan Party shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under the Bankruptcy Code or any other federal, state, provincial or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in SECTION 7.01(h), (iii) apply for or consent to the appointment of a receiver, interim receiver, monitor, trustee, custodian, sequestrator, conservator or similar official for any Loan Party or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

(j)    Except as permitted under SECTION 6.05, the determination of the Loan Parties, whether by vote of the Loan Parties’ board of directors or otherwise to: suspend the operation of the Loan Parties’ business in the ordinary course, liquidate all or substantially all of the Loan Parties’ assets or Store locations, or employ an agent or other third party to conduct any so-called store closing, store liquidation or “Going-Out-Of-Business” sales for all or substantially all of the Loan Parties’ Stores;

(k)    One or more final judgments for the payment of money in an aggregate amount in excess of (i) if Excess Availability is then greater than $250,000,000, $100,000,000, or (ii) if Excess Availability is then less than $250,000,000, $50,000,000 (or in each case, such lesser amount as would reasonably be expected to result in a Material Adverse Effect), in excess of insurance coverage (or indemnities from indemnitors reasonably satisfactory to the Agents), shall be rendered against any Loan Party or any combination of Loan Parties and the same shall remain undischarged for a period of forty-five (45) days during which execution shall not be effectively stayed, satisfied or

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bonded or any action shall be legally taken by a judgment creditor to attach or levy upon any material assets of any Loan Party to enforce any such judgment;

(l)    An ERISA Event shall have occurred that, when taken together with all other ERISA Events that have occurred, would reasonably be expected to result in a Material Adverse Effect and the same shall remain undischarged for a period of thirty (30) consecutive days during which period any action shall not be legally taken to attach or levy upon any material assets of any Loan Party to enforce any such liability;

(m)    Any challenge by or on behalf of any Loan Party to the validity of any Loan Document or the applicability or enforceability of any Loan Document strictly in accordance with the subject Loan Document’s terms or which seeks to void, avoid, limit, or otherwise adversely affect any security interest created by or in any Loan Document or any payment made pursuant thereto;

(n)    Any challenge by or on behalf of any other Person to the validity of any Loan Document or the applicability or enforceability of any Loan Document strictly in accordance with the subject Loan Document’s terms or which seeks to void, avoid, limit, or otherwise adversely affect any security interest created by or in any Loan Document or any payment made pursuant thereto, in each case, as to which an order or judgment has been entered materially adverse to the Agents and the Lenders;

(o)    Any Lien purported to be created under any Security Document in Collateral consisting of Inventory, Accounts, Deposit Accounts, and Eligible Real Estate and the proceeds thereof shall cease to be, or shall be asserted by any Loan Party not to be, a valid and perfected Lien on any such Collateral, with the priority required by the applicable Security Document except as a result of the sale, release or other disposition of the applicable Collateral in a transaction permitted under the Loan Documents or the failure of the Agents or the Canadian Agent, through their acts or omissions and through no fault of the Loan Parties, to maintain the perfection of their Liens in accordance with Applicable Law;

(p)    The indictment of any Loan Party, under any Applicable Law where the crime alleged would constitute a felony under Applicable Law and such indictment remains unquashed or such legal process remains undismissed for a period of 90 days or more, unless the Administrative Agent, in its reasonable discretion, determines that the indictment is not material; or

(q)    the imposition of any stay or other order, the effect of which restrains the conduct by the Loan Parties, taken as a whole, of their business in the ordinary course in a manner that has resulted in, or could reasonably be expected to have, a Material Adverse Effect;

then, and in every such event (other than an event with respect to any Loan Party described in SECTION 7.01(h) or SECTION 7.01(i)), and at any time thereafter during the continuance of such event, the Administrative Agent, at the request of the Required Lenders, shall, by notice to the Lead Borrower, take any or all of the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall irrevocably terminate immediately; (ii) declare the Obligations owing by such Borrowers then outstanding to be due and payable in whole, and thereupon the principal of the Loans and all other Obligations so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Loan Parties accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby

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waived by the Loan Parties; or (iii) require the applicable Loan Parties to Cash Collateralize its respective Letter of Credit Outstandings to be held and applied in accordance with SECTION 7.03. In case of any event with respect to any Loan Party described in SECTION 7.01(h) or SECTION 7.01(i), the Commitments shall automatically and irrevocably terminate and the principal of the Loans and other Obligations owing by such Borrower then outstanding, together with accrued interest thereon and all fees and other obligations of the Loan Parties accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Loan Parties.

Without limiting the foregoing, in every such event (other than an event with respect to any Borrower described in SECTION 7.01(h) or SECTION 7.01(i)), and at any time thereafter during the continuance of such event, the Canadian Agent, at the request of the Required Lenders, shall, by notice to the Canadian Borrower, take either or both of the following actions, at the same or different times: (i) terminate the Canadian Commitments, and thereupon the Canadian Commitments shall terminate immediately, and (ii) declare the Canadian Liabilities then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Canadian Liabilities so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Canadian Loan Parties accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrowers; and (iii) require the Canadian Borrower to Cash Collateralize the Letter of Credit Outstandings of the Canadian Borrower, and in case of any event with respect to any Canadian Loan Party described in SECTION 7.01(h) or SECTION 7.01(i), the Canadian Commitments shall automatically terminate and the principal of the Canadian Liabilities then outstanding, together with accrued interest thereon and all fees and other obligations of the Canadian Loan Parties accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrowers.

SECTION 7.02    Remedies on Default or Master Lease Liquidation Event.

(a)    In case any one or more of the Events of Default shall have occurred and be continuing, and whether or not the maturity of the Obligations shall have been accelerated pursuant hereto, the Administrative Agent and the Co-Collateral Agents may (and at the direction of the Required Lenders, shall) proceed to protect and enforce their rights and remedies under this Agreement or any of the other Loan Documents by suit in equity, action at law or other appropriate proceeding, whether for the specific performance of any covenant or agreement contained in this Agreement and the other Loan Documents or any instrument pursuant to which the Obligations and Other Liabilities are evidenced, and, if such amount shall have become due, by declaration or otherwise, proceed to enforce the payment thereof or any other legal or equitable right of the Secured Parties. No remedy herein is intended to be exclusive of any other remedy and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or any other provision of law and the Administrative Agent and the Co-Collateral Agents may proceed to protect and enforce their rights and remedies under this Agreement or any of the other Canadian Security Documents by suit in equity, action at law or other appropriate proceeding, whether for the specific performance of any covenant or agreement contained in this Agreement and the other Loan Documents or any instrument pursuant to which the Canadian Liabilities are evidenced, and, if such amount shall have become due, by declaration or otherwise, proceed to enforce the payment thereof or any other legal or

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equitable right of the Canadian Agent or the Canadian Lenders to whom any Canadian Liabilities are owing.

(b)    In case any one or more of Master Lease Liquidation Events shall have occurred and be continuing, and whether or not the maturity of the Obligations shall have been accelerated pursuant hereto, the Administrative Agent and the Co-Collateral Agents may (and, at the direction of the Required Lenders, shall) proceed to Liquidate the Collateral at any location which is the subject of such Master Lease Liquidation Event. Whether or not a Cash Dominion Event then exists, the proceeds of any such Liquidation shall be applied to the Obligations, the Other Liabilities or Canadian Liabilities, as applicable, in accordance with the provisions of SECTION 7.03 hereof, but the occurrence of any such Master Lease Liquidation Event, in and of itself, shall not constitute a Default or Event of Default hereunder or result in the acceleration of the Obligations or the termination of the Commitments.

SECTION 7.03    Application of Proceeds.

(a)    After the occurrence and during the continuance of (i) any Cash Dominion Event or (ii) any Event of Default and acceleration of the Obligations, except as provided in SECTION 7.03(b), all proceeds realized from any Domestic Loan Party or on account of any Collateral owned by a Domestic Loan Party or, without limiting the foregoing, on account of any Prepayment Event, any payments in respect of any Obligations or Other Liabilities and all proceeds of the Collateral, shall be applied in the following order:

(i)    FIRST, ratably to pay the Obligations in respect of any Credit Party Expenses, indemnities and other amounts then due to the Agents until paid in full;

(ii)    SECOND, ratably to pay any Credit Party Expenses and indemnities, and to pay any fees then due to the Domestic Lenders(other than fees to the Tranche A-1 Lenders), until paid in full;

(iii)    THIRD, ratably to pay interest accrued in respect of the Obligations (other than the Canadian Liabilitiesand the Tranche A-1 Loans) until paid in full;

(iv)    FOURTH, to pay principal due in respect of the Swingline Loans to the Domestic Borrowers until paid in full;

(v)    FIFTH, ratably to pay principal due in respect of the Revolving Credit Loans to the Domestic Borrowers (other than Tranche A-1 Loans) until paid in full;

(vi)    SIXTH, to the Administrative Agent, to be held by the Administrative Agent, for the ratable benefit of the Issuing Banks and the Domestic Lenders, to Cash Collateralize the then extant Stated Amount of Domestic Letters of Credit until paid in full;

(vii)SEVENTH, ratably to pay any fees then due to the Domestic Tranche A-1 Lenders on account of their Domestic Tranche A-1 Loans, until paid in full;

(viii)EIGHTH, ratably, to Domestic Tranche A-1 Lenders to pay interest accrued on account of their Domestic Tranche A-1 Loans, until paid in full;

(ix)NINTH, ratably, to Domestic Tranche A-1 Lenders to pay principal on account of their Domestic Tranche A-1 Loans, until paid in full;

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(viix)    SEVENTHTENTH, subject to the provisions of SECTION 7.03(c), to the Canadian Agent to be held by the Canadian Agent, for the ratable benefit of the Canadian Lenders as cash collateral to pay Credit Party Expenses, indemnities and other similar amounts then due in connection with Credit Extensions to the Canadian Borrower;

(viiixi)    EIGHTHELEVENTH, subject to the provisions of SECTION 7.03(c), to the Canadian Agent to be held by the Canadian Agent, for the ratable benefit of the Canadian Lenders as cash collateral to pay interest, indemnities, and fees (other than fees to the Canadian Tranche A-1 Lenders) due and payable on the Credit Extensions to the Canadian Borrower;

(ixxii)    NINTHTWELFTH, subject to the provisions of SECTION 7.03(c), to the Canadian Agent to be held by the Canadian Agent, for the ratable benefit of the Canadian Lenders as cash collateral to pay outstanding Swingline Loans of the Canadian Borrower;

(xxiii)    TENTHTHIRTEENTH, subject to the provisions of SECTION 7.03(c), to the Canadian Agent to be held by the Canadian Agent, for the ratable benefit of the Canadian Lenders as cash collateral to pay principal outstanding under other outstanding Revolving Credit Loans to the Canadian Borrower;

(xiv)    ELEVENTHFOURTEENTH, subject to the provisions of SECTION 7.03(c), to the Canadian Agent, to be held by the Canadian Agent, for the ratable benefit of the Issuing Banks and the Canadian Lenders, to Cash Collateralize the then extant Stated Amount of Canadian Letters of Credit until paid in full;

(xv)FIFTEENTH, subject to the provisions of SECTION 7.03(c), ratably to pay any fees then due to Canadian Tranche A-1 Lenders on account of their Canadian Tranche A-1 Loans, until paid in full;

(xvi)SIXTEENTH, subject to the provisions of SECTION 7.03(c), ratably, to Canadian Tranche A-1 Lenders to pay interest accrued on account of their Canadian Tranche A-1 Loans, until paid in full;

(xvii)SEVENTEENTH, subject to the provisions of SECTION 7.03(c), ratably, to Canadian Tranche A-1 Lenders to pay principal on account of their Canadian Tranche A-1 Loans, until paid in full;

(xiixviii)    TWELFTHEIGHTEENTH, to pay outstanding Obligations with respect to Cash Management Services furnished to any Loan Party;

(xiiixix)    THNIRNETEENTH, ratably to pay any other outstanding Obligations and Other Liabilities (including Bank Products) of the Domestic Borrowers;

(xiv)FOURTEENTHxx)TWENTIETH, to pay all other outstanding Canadian Liabilities; and

(xv)FIFTEENTHxxi)TWENTY-FIRST, to the Lead Borrower or such other Person entitled thereto under Applicable Law.

(b)    After the occurrence and during the continuance of (i) any Cash Dominion Event, or (ii) any Event of Default and acceleration of the Canadian Liabilities, all payments in respect of any Canadian Liabilities or Other Liabilities of the Canadian Borrower and its Subsidiaries which

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are Loan Parties and all proceeds of the Collateral from the Canadian Borrower and the other Canadian Loan Parties, shall be applied in the following order:

(i)    FIRST, ratably to pay the Obligations in respect of any Credit Party Expenses, indemnities and other amounts then due to the Canadian Agent until paid in full;

(ii)    SECOND, ratably to pay any Credit Party Expenses, indemnities and fees (other than fees to the Canadian Tranche A-1 Lenders) then due to the Canadian Lenders until paid in full;

(iii)    THIRD, ratably to pay interest accrued in respect of the Canadian Liabilities (other than Canadian Tranche A-1 Loans) until paid in full;

(iv)    FOURTH, to pay principal due in respect of the Swingline Loans to the Canadian Borrower until paid in full;

(v)    FIFTH, ratably to pay principal due in respect of the Revolving Credit Loans to the Canadian Borrower (other than Canadian Tranche A-1 Loans) until paid in full;

(vi)    SIXTH, to the Canadian Agent, to be held by the Canadian Agent, for the ratable benefit of the Issuing Banks and the Canadian Lenders, to Cash Collateralize the then extant Stated Amount of Canadian Letters of Credit until paid in full;

(vii)SEVENTH, ratably to pay any fees then due to Canadian Tranche A-1 Lenders on account of their Canadian Tranche A-1 Loans, until paid in full;

(viii)EIGHTH, ratably, to Canadian Tranche A-1 Lenders to pay interest accrued on account of their Canadian Tranche A-1 Loans, until paid in full;

(ix)NINTH, ratably, to Canadian Tranche A-1 Lenders to pay principal on account of their Canadian Tranche A-1 Loans, until paid in full;

(viix)    SEVENTHTENTH, to pay outstanding Canadian Liabilities with respect to Cash Management Services furnished to the Canadian Borrower and its Subsidiaries;

(viiixi)    EIGHTHELEVENTH, ratably to pay any other Canadian Liabilities and Other Liabilities (including Bank Products) of the Canadian Borrower; and

(ixxii)    NINTHTWELFTH, to the Canadian Borrower or such other Person entitled thereto under Applicable Law.

(c)    Any amounts received by the Canadian Agent pursuant to clauses SEVENTH, EIGHTH, NINTH, TENTH or ELEVENTHTENTH through and including SEVENTEENTH of SECTION 7.03(a) shall be held as cash collateral for the applicable Canadian Liabilities until the earlier of (i) the Substantial Liquidation of the Collateral granted by the Canadian Borrower and its Subsidiaries to secure the Canadian Liabilities, or (ii) such date that the Agents shall otherwise determine.

(d)    Excluded Swap Obligations with respect to any Facility Guarantor shall not be paid with amounts received from such Facility Guarantor, but appropriate adjustments shall be made

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with respect to payments from other Loan Parties to preserve the allocation to the Obligations otherwise set forth above in this Section.

ARTICLE VIII

The Agents

SECTION 8.01    Appointment and Administration by Administrative Agent.

Each Lender and each Issuing Bank hereby irrevocably designates Bank of America as Administrative Agent under this Agreement and the other Loan Documents. The general administration of the Loan Documents shall be by the Administrative Agent. The Lenders and each Issuing Bank each hereby (a) irrevocably authorizes the Administrative Agent (i) to enter into the Loan Documents to which it is a party, and (ii) at its discretion, to take or refrain from taking such actions as agent on its behalf and to exercise or refrain from exercising such powers under the Loan Documents as are delegated by the terms hereof or thereof, as appropriate, together with all powers reasonably incidental thereto, and (b) agrees and consents to all of the provisions of the Security Documents. All Collateral shall be held or administered by the Administrative Agent (or its duly-appointed agent) for its own benefit and for the ratable benefit of the other Secured Parties. Any proceeds received by the Administrative Agent from the foreclosure, sale, lease or other disposition of any of the Collateral and any other proceeds received pursuant to the terms of the Security Documents or the other Loan Documents shall be paid over to the Administrative Agent for application as provided in this Agreement and the other Loan Documents. The Administrative Agent shall have no duties or responsibilities except as set forth in this Agreement and the other Loan Documents, nor shall it have any fiduciary relationship with any other Credit Party, and no implied covenants, responsibilities, duties, obligations, or liabilities shall be read into the Loan Documents or otherwise exist against the Administrative Agent.

SECTION 8.02    Appointment of Co-Collateral Agents.

Each Lender and each Issuing Bank hereby irrevocably designates Bank of America and Wells Fargo Bank, National Association (or any Affiliates thereof succeeding to such position) as Co-Collateral Agents under this Agreement and the other Loan Documents. The Lenders and each Issuing Bank each hereby irrevocably authorizes the Co-Collateral Agents (a) to enter into the Loan Documents to which they are parties, and (b) at their discretion, to take or refrain from taking such actions as agent on its behalf and to exercise or refrain from exercising such powers under the Loan Documents as are delegated by the terms hereof or thereof, as appropriate, together with all powers reasonably incidental thereto. The Co-Collateral Agents shall have no duties or responsibilities except as set forth in this Agreement and the other Loan Documents, nor shall they have any fiduciary relationship with any other Secured Party, and no implied covenants, responsibilities, duties, obligations, or liabilities shall be read into the Loan Documents or otherwise exist against the Co-Collateral Agents. Any actions permitted to be taken by one or both of the Co-Collateral Agents under this Agreement and the other Loan Documents shall be taken by such Co-Collateral Agent or Co-Collateral Agents, as applicable, acting through Bank of America, as Co-Collateral Agent. Each Co-Collateral Agent shall notify Bank of America, as Co-Collateral Agent, in writing of any such action which any other Co-Collateral Agent desires to be undertaken in such capacity and Bank of America, as Collateral Agent, shall thereupon undertake such action on behalf of all Co-Collateral Agents, subject, in each case, to the other provisions and limitations of this Agreement and the other Loan Documents.

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SECTION 8.03    Appointment of Canadian Agent.

(a)    Each Lender, the Issuing Banks and each Secured Party that is owed any Canadian Liabilities hereby irrevocably designates Bank of America-Canada Branch as the Canadian Agent under this Agreement and the other Loan Documents. The general administration of the Loan Documents with respect to the Canadian Borrower shall be by the Canadian Agent. The Lenders, the Issuing Banks and each Secured Party that is owed any Canadian Liabilities each hereby (i) irrevocably authorizes the Canadian Agent (x) to enter into the Loan Documents to which it is a party and (y) at its discretion, to take or refrain from taking such actions as agent on its behalf and to exercise or refrain from exercising such powers under the Loan Documents as are delegated by the terms hereof or thereof, as appropriate, together with all powers reasonably incidental thereto, and (ii) agrees and consents to all of the provisions of the Canadian Security Documents. All Collateral from the Canadian Loan Parties shall be held or administered by the Canadian Agent (or its duly-appointed agent) for its own benefit and for the ratable benefit of the other Secured Parties holding Canadian Liabilities. Any proceeds received by the Canadian Agent from the foreclosure, sale, lease or other disposition of any of the Collateral from the Canadian Loan Parties and any other proceeds received pursuant to the terms of the Canadian Security Documents or the other Loan Documents shall be paid over to the Canadian Agent for application as provided in this Agreement and the other Loan Documents. The Canadian Agent shall have no duties or responsibilities except as set forth in this Agreement and the remaining Loan Documents, nor shall it have any fiduciary relationship with any other Secured Party, and no implied covenants, responsibilities, duties, obligations, or liabilities shall be read into the Loan Documents or otherwise exist against the Canadian Agent.

(b)    Without limiting the generality of the foregoing, for the purposes of creating a solidarité active in accordance with article 1541 of the Civil Code of Québec between each Secured Party that is owed any Canadian Liabilities, taken individually, on the one hand, and the Canadian Agent, on the other hand, each of the Canadian Borrower and each such Secured Party acknowledge and agree with the Canadian Agent that such Secured Party and the Canadian Agent are hereby conferred the legal status of solidary creditors of the Canadian Borrower in respect of all Canadian Liabilities, present and future, owed by the Canadian Borrower to each such Secured Party and the Canadian Agent (collectively, for the purposes of this paragraph, the “solidary claim”). Accordingly, but subject (for the avoidance of doubt) to article 1542 of the Civil Code of Québec, the Canadian Borrower is irrevocably bound towards the Canadian Agent and each such Secured Party in respect of the entire solidary claim of the Canadian Agent and such Secured Party. As a result of the foregoing, the Canadian Borrower confirms and agrees that subject to SECTION 8.03(a), above, the rights of the Canadian Agent and each of the Secured Parties who are owed Canadian Liabilities from time to time a party to this Agreement by way of assignment or otherwise are solidary and, as regards the Canadian Liabilities owing from time to time to each such Secured Party, each of the Canadian Agent and such Secured Party is entitled, when permitted pursuant to SECTION 7.01, to: (i) demand payment of all outstanding amounts from time to time in respect of the Canadian Liabilities; (ii) exact the whole performance of such Canadian Liabilities from the Canadian Loan Parties; (iii) benefit from the Canadian Agent’s Liens in the Collateral in respect of such Canadian Liabilities; (iv) give a full acquittance of such Canadian Liabilities (each Secured Party that is owed Canadian Liabilities hereby agreeing to be bound by any such acquittance); and (v) exercise all rights and recourses under the Loan Documents with respect to those Canadian Liabilities. The Canadian Liabilities of the Canadian Loan Parties will be secured by the Canadian Agent’s Liens

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in the Collateral and the Canadian Agent and the Secured Parties who are owed Canadian Liabilities will have a solidary interest therein.

SECTION 8.04    Sharing of Excess Payments.

If at any time or times any Secured Party shall receive (a) by payment, foreclosure, setoff, banker’s lien, counterclaim, or otherwise, or any payments with respect to the Obligations of the Domestic Borrowers or the Canadian Liabilities owing to such Secured Party arising under, or relating to, this Agreement or the other Loan Documents, or (b) payments from the Administrative Agent or the Canadian Agent, as applicable, in excess of such Secured Party's ratable portion of all such distributions by the Administrative Agent or the Canadian Agent, such Secured Party shall promptly (i) turn the same over to the Administrative Agent or the Canadian Agent, as applicable, in kind, and with such endorsements as may be required to negotiate the same to the Administrative Agent or the Canadian Agent, or in same day funds, as applicable, for the account of all of the Secured Parties and for application to the Obligations of the Domestic Borrowers or the Canadian Liabilities, as applicable, in accordance with the applicable provisions of this Agreement, or (ii) purchase, without recourse or warranty, an undivided interest and participation in the Obligations of the Domestic Borrowers or the Canadian Liabilities, as applicable, owed to the other Secured Parties so that such excess payment received shall be applied ratably as among the Secured Parties in accordance with the provisions of SECTION 2.17 or SECTION 7.03, as applicable, and with their Domestic Commitment Percentagesor,Canadian Commitment Percentages, or Tranche A-1 Percentage, as applicable; provided, however, that if all or part of such excess payment received by the purchasing party is thereafter recovered from it, those purchases of participations shall be rescinded in whole or in part, as applicable, and the applicable portion of the purchase price paid therefor shall be returned to such purchasing party, but without interest except to the extent that such purchasing party is required to pay interest in connection with the recovery of the excess payment. In no event shall the provisions of this SECTION 8.04 be construed to apply to any payment made by the Borrowers pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Domestic Lender or Canadian Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in drawings under Letters of Credit to any assignee or participant, other than to the Borrowers or any Affiliate(s) thereof (as to which the provisions of this SECTION 8.04 shall apply). Notwithstanding the foregoing, any amounts of the Canadian Borrower so offset shall be applied solely to, and shall be limited to, the Canadian Liabilities and any adjustments with respect thereto shall be made solely amongst Lenders having a Canadian Commitment.

SECTION 8.05    Agreement of Applicable Lenders.

Upon any occasion requiring or permitting an approval, consent, waiver, election or other action on the part of the Applicable Lenders, action shall be taken by each Agent or the Canadian Agent, as applicable, for and on behalf or for the benefit of all Credit Parties upon the direction of the Applicable Lenders, and any such action shall be binding on all Credit Parties. No amendment, modification, consent, or waiver shall be effective except in accordance with the provisions of SECTION 9.02.

SECTION 8.06    Liability of Agents.

(a)    Each of the Agents and the Canadian Agent, when acting on behalf of the Credit Parties, may execute any of its respective duties under this Agreement or any of the other Loan Documents by or through any of its officers, agents and employees, and no Agent or the Canadian Agent or any of its respective directors, officers, agents or employees shall be liable to any other Secured Party for any action taken or omitted to be taken in good faith, or be responsible to any

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other Secured Party for the consequences of any oversight or error of judgment, or for any loss, except to the extent of any liability imposed by law by reason of such Agent’s or Canadian Agent’s own gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision). No Agent or the Canadian Agent or any of its respective directors, officers, agents and employees shall in any event be liable to any other Secured Party for any action taken or omitted to be taken by it pursuant to instructions received by it from the Applicable Lenders, or in reliance upon the advice of counsel selected by it. Without limiting the foregoing, no Agent or the Canadian Agent or any of its respective directors, officers, employees, or agents shall be: (i) responsible to any other Secured Party for the due execution, validity, genuineness, effectiveness, sufficiency, or enforceability of, or for any recital, statement, warranty or representation in, this Agreement, any other Loan Document or any related agreement, document or order; (ii) required to ascertain or to make any inquiry concerning the performance or observance by any Loan Party of any of the terms, conditions, covenants, or agreements of this Agreement or any of the Loan Documents; (iii) responsible to any other Secured Party for the state or condition of any properties of the Loan Parties or any other obligor hereunder constituting Collateral for the Obligations, the Other Liabilities or Canadian Liabilities or any information contained in the books or records of the Loan Parties; (iv) responsible to any other Secured Party for the validity, enforceability, collectibility, effectiveness or genuineness of this Agreement or any other Loan Document or any other certificate, document or instrument furnished in connection therewith; or (v) responsible to any other Secured Party for the validity, priority or perfection of any Lien securing or purporting to secure the Obligations, the Other Liabilities or the Canadian Liabilities or for the value or sufficiency of any of the Collateral.

(b)    Each of the Agents and the Canadian Agent may execute any of its duties under this Agreement or any other Loan Document by or through its agents or attorneys-in-fact, and shall be entitled to the advice of counsel concerning all matters pertaining to its rights and duties hereunder or under the other Loan Documents. No Agent or the Canadian Agent shall be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

(c)    No Agent or the Canadian Agent or any of its respective directors, officers, employees, or agents shall have any responsibility to any Loan Party on account of the failure or delay in performance or breach by any other Secured Party (other than by each such Agent or Canadian Agent in its capacity as a Lender) of any of its respective obligations under this Agreement or any of the other Loan Documents or in connection herewith or therewith.

(d)    Each of the Agents and the Canadian Agent shall be entitled to rely, and shall be fully protected in relying, upon any notice, consent, certificate, affidavit, or other document or writing believed by it to be genuine and correct and to have been signed, sent or made by the proper person or persons, and upon the advice and statements of legal counsel (including, without, limitation, counsel to the Loan Parties), independent accountants and other experts selected by any Loan Party or any Secured Party. Each of the Agents and the Canadian Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Applicable Lenders as it deems appropriate or it shall first be indemnified to its satisfaction by the other Secured Parties against any and all liability and expense which may be incurred by it by reason of the taking or failing to take any such action.

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SECTION 8.07    Notice of Default.

No Agent or the Canadian Agent shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Default unless such Agent or Canadian Agent has actual knowledge of the same or has received notice from a Secured Party or Loan Party referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”. In the event that any Agent or the Canadian Agent obtains such actual knowledge or receives such a notice, such Agent or Canadian Agent shall give prompt notice thereof to each of the other Secured Parties. Upon the occurrence of an Event of Default, the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, shall (subject to the provisions of SECTION 9.02) take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders. Unless and until the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, shall have received such direction, the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to any such Default or Event of Default as it shall deem advisable in the best interest of the Secured Parties. In no event shall the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, be required to comply with any such directions to the extent that the Administrative Agent, the Co-Collateral Agents or the Canadian Agent, as applicable, believes that its compliance with such directions would be unlawful.

SECTION 8.08    Credit Decisions.

Each Secured Party (other than the Agents and the Canadian Agent) acknowledges that it has, independently and without reliance upon any Agent or the Canadian Agent or any other Secured Party, and based on the financial statements prepared by the Loan Parties and such other documents and information as it has deemed appropriate, made its own credit analysis and investigation into the business, assets, operations, property, and financial and other condition of the Loan Parties and has made its own decision to enter into this Agreement and the other Loan Documents. Each Credit Party (other than the Agents and the Canadian Agent) also acknowledges that it will, independently and without reliance upon any Agent, the Canadian Agent or any other Secured Party, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in determining whether or not conditions precedent to closing any Loan hereunder have been satisfied and in taking or not taking any action under this Agreement and the other Loan Documents.

SECTION 8.09    Reimbursement and Indemnification.

Each Secured Party (other than the Agents and the Canadian Agent) agrees to (a) reimburse each Agent and the Canadian Agent for such Secured PartyLender’s CommitmentPro Rata Percentage of (i) any expenses and fees incurred by any Agent or the Canadian Agent for the benefit of the Secured Parties under this Agreement and any of the other Loan Documents, including, without limitation, counsel fees and compensation of agents and employees paid for services rendered on behalf of the Secured Parties, and any other expense incurred in connection with the operations or enforcement thereof not reimbursed by the Loan Parties, and (ii) any expenses of any Agent or the Canadian Agent incurred for the benefit of the Secured Parties that the Loan Parties have agreed to reimburse pursuant to this Agreement or any other Loan Document and have failed to so reimburse, and (b) indemnify and hold harmless each Agent and the Canadian Agent and any of its respective directors, officers, employees, or agents, on demand, in the amount of such Secured PartyLender’s CommitmentPro Rata Percentage, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses, or disbursements of any kind or nature whatsoever which may be imposed on, incurred by, or asserted against it or any Secured Party in any way relating to or arising out of this Agreement or any of the other Loan Documents or any

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action taken or omitted by it or any of them under this Agreement or any of the other Loan Documents to the extent not reimbursed by the Loan Parties, including, without limitation, costs of any suit initiated by each Agent or the Canadian Agent against any Secured Party (except such as shall have been determined by a court of competent jurisdiction or another independent tribunal having jurisdiction by final and non-appealable judgment to have resulted from the gross negligence or willful misconduct of such Agent or Canadian Agent); providedthat the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against such Secured Party in its capacity as such. The provisions of this SECTION 8.09 shall survive the repayment of the Obligations, the Other Liabilities, the Canadian Liabilities and the termination of the Commitments.

SECTION 8.10    Rights of Agents.

It is understood and agreed that the Agents and the Canadian Agent shall have the same rights and powers hereunder (including the right to give such instructions) as the other Lenders and may exercise such rights and powers, as well as their rights and powers under other agreements and instruments to which they are or may be party, and engage in other transactions with the Loan Parties, as though they were not the Agents or the Canadian Agent. Each Agent, the Canadian Agent and its respective Affiliates may accept deposits from, lend money to, and generally engage in any kind of commercial or investment banking, trust, advisory or other business with the Loan Parties and their Affiliates as if it were not an Agent or Canadian Agent thereunder.

SECTION 8.11    Notice of Transfer.

The Administrative Agent or the Canadian Agent, as applicable, may deem and treat a Lender party to this Agreement as the owner of such Lender’s portion of the Obligations or Canadian Liabilities, as applicable, or the Other Liabilities for all purposes, unless and until, and except to the extent, an Assignment and Acceptance shall have become effective as set forth in SECTION 9.04.

SECTION 8.12    Successor Agents.

The Administrative Agent or the Canadian Agent may resign at any time by giving thirty (30) Business Days’ written notice thereof to the other Secured Parties and the Lead Borrower and the Canadian Borrower, as applicable. Any Co-Collateral Agent may resign at any time by giving prior written notice thereof to the other Agents and the Lead Borrower and the Canadian Borrower, as applicable. Upon any such resignation of the Administrative Agent or the Canadian Agent, the Required Lenders shall have the right to appoint a successor Administrative Agent or Canadian Agent, as applicable, which, so long as there is no Enumerated Default, shall be reasonably satisfactory to the Lead Borrower (whose consent in any event shall not be unreasonably withheld or delayed). If no successor Administrative Agent or Canadian Agent shall have been so appointed by the Required Lenders and/or none shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent’s or Canadian Agent’s giving of notice of resignation, the retiring Administrative Agent or Canadian Agent may, on behalf of the other Secured Parties, appoint a successor Administrative Agent or Canadian Agent which, (i) with respect to the Administrative Agent shall be a Person a commercial bank (or affiliate thereof) organized under the laws of the United States of America or of any State thereof and having a combined capital and surplus of aat least $1,000,000,000, or (ii) with respect to the Canadian Agent, a commercial bank or institutional lender (or branch or Affiliate thereof) resident in Canada (for purposes of the Income Tax Act (Canada) or otherwise not subject to withholding taxes on any interest paid by a resident of Canada) and having a combined capital and surplus of at least $1,000,000,000 or (iii) in either case, capable of complying with all of the duties of such Administrative Agent or Canadian Agent, as applicable, hereunder (in the opinion

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of the retiring Administrative Agent or Canadian Agent and as certified to the other Secured Parties in writing by such successor Administrative Agent or Canadian Agent) which, so long as there is no Enumerated Default, shall be reasonably satisfactory to the Lead Borrower (whose consent shall not in any event be unreasonably withheld or delayed). Upon the acceptance of any appointment as Administrative Agent or Canadian Agent by a successor Administrative Agent or Canadian Agent, as applicable, such successor Administrative Agent or Canadian Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent or Canadian Agent and the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement. After any retiring Administrative Agent’s, Co-Collateral Agent’s or Canadian Agent’s resignation hereunder as such Administrative Agent, Co-Collateral Agent or Canadian Agent, as applicable, the provisions of this ARTICLE VIII shall inure to its benefit as to any actions taken or omitted to be taken by it while it was such Administrative Agent, Co-Collateral Agent or Canadian Agent under this Agreement. Upon the resignation of any Co-Collateral Agent, no successor shall be appointed as long as there remains at least one Co-Collateral Agent which has not resigned; if all Co-Collateral Agents resign, then a successor shall be appointed in accordance with the procedures set forth above in this SECTION 8.12.

SECTION 8.13    Relation Among the Lenders.

The Lenders are not partners or co-venturers, and no Lender shall be liable for the acts or omissions of, or (except as otherwise set forth herein in case of any Agent or the Canadian Agent) authorized to act for, any other Lender.

SECTION 8.14    Reports and Financial Statements.

By signing this Agreement, each Lender:

(a)    agrees to furnish the Administrative Agent on the first day of each month with a summary of all Other Liabilities due or to become due to such Lender;

(b)    is deemed to have requested that the Administrative Agent or the Canadian Agent, as applicable, furnish such Lender, promptly after they become available, copies of all financial statements required to be delivered by the Lead Borrower hereunder and all commercial finance examinations and appraisals of the Collateral received by the Administrative Agent or the Co-Collateral Agents, as applicable (collectively, the “Reports”) (and the Administrative Agent and the Canadian Agent, as applicable, agree to furnish such Reports promptly to the Lenders, which may be furnished in accordance with the final paragraph of SECTION 5.01);

(c)    expressly agrees and acknowledges that no Agent or the Canadian Agent (i) makes any representation or warranty as to the accuracy of the Reports or (ii) shall be liable for any information contained in any Report;

(d)    expressly agrees and acknowledges that the Reports are not comprehensive audits or examinations, that the Agents, the Canadian Agent or any other party performing any audit or examination will inspect only specific information regarding the Loan Parties and will rely significantly upon the Loan Parties' books and records, as well as on representations of the Loan Parties' personnel;

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(e)    agrees to keep all Reports confidential in accordance with the provisions of SECTION 9.15 hereof, and not to use any Report in any other manner; and

(f)    without limiting the generality of any other indemnification provision contained in this Agreement, agrees: (i) to hold each Agent, the Canadian Agent and any such other Lender preparing a Report harmless from any action the indemnifying Lender may take or conclusion the indemnifying Lender may reach or draw from any Report in connection with any Credit Extensions that the indemnifying Lender has made or may make to the Borrowers, or the indemnifying Lender's participation in, or the indemnifying Lender's purchase of, a Loan or Loans of the Borrowers; and (ii) to pay and protect, and indemnify, defend, and hold each Agent, the Canadian Agent, and any such other Lender preparing a Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts (including attorney costs) incurred by the Agents, the Canadian Agent and any such other Lender preparing a Report as the direct or indirect result of any third parties who might obtain all or part of any Report through the indemnifying Lender in violation of the terms hereof.

SECTION 8.15    Agency for Perfection.

Each Lender hereby appoints each other Lender as agent for the purpose of perfecting Liens for the benefit of the Agents, the Canadian Agent and the Lenders, in assets which, in accordance with Article 9 of the UCC or any other Applicable Law of the United States of America or Canada can be perfected only by possession. Should any Lender (other than the Administrative Agent or the Canadian Agent) obtain possession of any such Collateral, such Lender shall notify the Administrative Agent or the Canadian Agent, as applicable, thereof, and, promptly upon the Administrative Agent's or Canadian Agent’s, as applicable, request therefor, shall deliver such Collateral to the Administrative Agent or Canadian Agent, as applicable, or otherwise deal with such Collateral in accordance with the Administrative Agent's or Canadian Agent’s (as applicable) instructions.

SECTION 8.16    [Reserved.]

SECTION 8.17    Risk Participation.

(a)    Upon the earlier of Substantial Liquidation or the Determination Date, if all Canadian Liabilities have not been repaid in full (other than the Other Liabilities and those relating to Tranche A-1 Loans of the Canadian Borrower and its Subsidiaries), then the Domestic Lenders (other than Domestic Tranche A-1 Lenders) shall purchase from the Canadian Lenders (other than Canadian Tranche A-1 Lenders) (on the date of Substantial Liquidation or the Determination Date, as applicable) such portion of the Canadian Liabilities (other than Other Liabilities and Tranche A-1 Loans relating to the Canadian Borrower and its Subsidiaries) so that each such Lender shall, after giving effect to any such purchases, hold its Liquidation Percentage of all outstanding Canadian Liabilities (other than those relating to Canadian Tranche A-1 Loans) and all other Obligations(other than those relating to Tranche A-1 Loans).

(b)    Upon the earlier of Substantial Liquidation or the Determination Date, if all Obligations of the Domestic Borrowers (other than those relating to the Canadian Liabilities, Tranche A-1 Loans, or the Other Liabilities of the Domestic Borrowers) have not been repaid in full, then the Canadian Lenders (other than Canadian Tranche A-1 Lenders) shall purchase from the Domestic Lenders (other than Domestic Tranche A-1 Lenders) (on the date of Substantial Liquidation or the Determination Date, as applicable) such portion of such Obligations (other than those relating to

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Tranche A-1 Loans) so that each such Lender shall, after giving effect to any such purchases, hold its Liquidation Percentage of all outstanding Obligations (other than those relating to Tranche A-1 Loans) of the Domestic Borrowers and the Canadian Liabilities(other than those relating to Tranche A-1 Loans).

(c)Upon the earlier of Substantial Liquidation or the Determination Date, if all Canadian Tranche A-1 Loans have not been repaid in full, then the Domestic Tranche A-1 Lenders shall purchase from the Canadian Tranche A-1 Lenders (on the date of Substantial Liquidation or the Determination Date, as applicable) such portion of the Canadian Tranche A-1 Loans so that each such Tranche A-1 Lender shall, after giving effect to any such purchases, hold its Liquidation Percentage of all outstanding Canadian Tranche A-1 Loans and all other Obligations relating to Tranche A-1 Loans.

(d)Upon the earlier of Substantial Liquidation or the Determination Date, if all Domestic Tranche A-1 Loans have not been repaid in full, then the Canadian Tranche A-1 Lenders shall purchase from the Domestic Tranche A-1 Lenders (on the date of Substantial Liquidation or the Determination Date, as applicable) such portion of such Domestic Tranche A-1 Loans so that each such Tranche A-1 Lender shall, after giving effect to any such purchases, hold its Liquidation Percentage of all outstanding Obligations relating to Tranche A-1 Loans and the Canadian Tranche A-1 Loans.

(ce)    All purchases of Obligations under this SECTION 8.17 shall be at par, for cash, with no premium, discount or reduction.

(df)    No Lender shall be responsible for any default of any other Lender in respect of any other Lender's obligations under this SECTION 8.17, nor shall the obligations of any Lender hereunder be increased as a result of such default of any other Lender. Each Lender shall be obligated to the extent provided herein regardless of the failure of any other Lender to fulfill its obligations hereunder.

(eg)    Each Lender shall execute such instruments, documents and agreements and do such other actions as may be necessary or proper in order to carry out more fully the provisions and purposes of this SECTION 8.17 and the purchase of Obligations or the Canadian Liabilities, as applicable, as provided herein.

(fh)    The obligations of each Lender under this SECTION 8.17 are irrevocable and unconditional and shall not be subject to any qualification or exception whatsoever including, without limitation, lack of validity or enforceability of this Agreement or any of the Loan Documents or the existence of any claim, setoff, defense or other right which any Loan Party may have at any time against any of the Lenders.

(gi)    No fees required to be paid on any assignment pursuant to SECTION 9.04 of this Agreement shall be payable in connection with any assignment under this SECTION 8.17.

SECTION 8.18    Collateral Matters.

(a)    The Lenders hereby irrevocably authorize the Administrative Agent and the Canadian Agent, as applicable, to take actions to evidence the release of any Lien upon any Collateral: (i) upon the termination of the Domestic Commitments and the Canadian Commitments, as applicable, and payment and satisfaction in full by the Domestic Borrowers of all Obligations and the Canadian Borrower of all Canadian Liabilities, as applicable and, if the Obligations have

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been accelerated and Liquidation has commenced, the Other Liabilities then due and payable (in any event other than contingent indemnity obligations with respect to then unasserted claims), all Letters of Credit shall have expired or terminated (or been collateralized in a manner satisfactory to the Issuing Banks) and all Letter of Credit Outstandings have been reduced to zero (or collateralized in a manner satisfactory to the Issuing Banks); (ii) constituting property being sold, transferred or disposed of in a Permitted Disposition or other transaction permitted hereunder upon receipt by the Administrative Agent or the Canadian Agent, as applicable, of the Net Proceeds thereof to the extent required by this Agreement (or, if no such Net Proceeds are required to be remitted to the Administrative Agent or the Canadian Agent, as applicable, upon consummation of such transaction); (iii) to the extent such Collateral is owned by a Loan Party, upon the release of such Loan Party from its obligations under the Loan Documents to the extent such release occurs as a result of a Permitted Disposition or other transaction permitted under SECTION 6.03, resulting in such Person ceasing to be a Loan Party; or (iv) upon request of the Lead Borrower, constituting Real Estate being transferred from a Domestic Loan Party to another Domestic Loan Party but only to the extent that after such transfer, no Event of Default exists. Except as provided above, the Administrative Agent or the Canadian Agent, as applicable, will not release any of the Agent’s or Canadian Agent’s Liens without the prior written authorization of the Applicable Lenders. Upon request by the Administrative Agent, the Canadian Agent or any Loan Party at any time, the Lenders will confirm in writing the Administrative Agent’s or the Canadian Agent’s authority to release any Liens upon particular types or items of Collateral pursuant to this SECTION 8.18.

(b)    The Lenders hereby authorize the Administrative Agent and the Canadian Agent, as applicable, to take such actions, including making filings and entering into agreements and any amendments or supplements to any Security Document or Intercreditor Agreement, as may be necessary or desirable to reflect the intent of this Agreement and the refinancing of any Indebtedness permitted hereunder. Upon request by the Administrative Agent, the Canadian Agent or any Loan Party at any time, the Lenders will confirm in writing the Administrative Agent’s or the Canadian Agent’s authority to enter into such agreements, amendments or supplements.

(c)    Upon at least two (2)Business Days’ prior written request by the Lead Borrower or the Canadian Borrower, as applicable, the Administrative Agent or the Canadian Agent shall (and is hereby irrevocably authorized by the Lenders to) execute such documents as may be necessary to evidence the release of the Liens upon any Collateral described in SECTION 8.18(a); provided, however, that (i) neither the Administrative Agent nor the Canadian Agent shall be required to execute any such document on terms which, in its reasonable opinion, would, under Applicable Law, expose the Administrative Agent or the Canadian Agent to liability or create any obligation or entail any adverse consequence other than the release of such Liens without recourse or warranty, and (ii) such release shall not in any manner discharge, affect or impair the Obligations, the Other Liabilities, the Canadian Liabilities, or any Liens (other than those expressly being released) upon (or obligations of any Loan Party in respect of) all interests retained by any Loan Party, including (without limitation) the proceeds of any sale, all of which shall continue to constitute part of the Collateral.

SECTION 8.19    Co-Syndication Agents, Co-Documentation Agents, Arrangers and Bookrunners.

Notwithstanding the provisions of this Agreement or any of the other Loan Documents, the Co-Syndication Agents, the Co-Documentation Agents, the Arrangers and the Bookrunners shall have no

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powers, rights, duties, responsibilities or liabilities with respect to this Agreement and the other Loan Documents.

ARTICLE IX

Miscellaneous

SECTION 9.01    Notices.

Except in the case of notices and other communications expressly permitted to be given by telephone or electronically, all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy or e-mail, as follows:

(a)    if to any Loan Party, to it at One Geoffrey Way, Wayne, New Jersey, Attention: Chief Financial Officer (Telecopy No. (973) 617-4006), with a copy to the attention of General Counsel (Telecopy No. (973) 617-4043), with a copy to Simpson Thacher & Bartlett, LLP, 425 Lexington Avenue, New York, New York 10017, Attention: James Cross, Esquire (Telecopy No. (212) 455-2502), (E-Mail jcross@stblaw.com);

(b)    if to the Administrative Agent, the Co-Collateral Agents or the Swingline Lender to Bank of America, N.A., 100 Federal Street, Boston, Massachusetts 02110, Attention Christine Hutchinson (Telecopy No. (617) 434-4131), (E-Mail christine.hutchinson@baml.com), with a copy to Riemer & Braunstein LLP, Three Center Plaza, Boston, Massachusetts 02108, Attention: David S. Berman, Esquire (Telecopy No. (617) 880-3456), (E-Mail dberman@riemerlaw.com);

(c)    if to the Canadian Agent, or the Swingline Lender of Swingline Loans to the Canadian Borrower, to the attention of the Administrative Agent; and

(d)    if to any other Credit Party, to it at its address (or telecopy number or electronic mail address) set forth on the signature pages hereto or on any Assignment and Acceptance.

Notwithstanding the foregoing, any notice hereunder sent by e-mail shall be solely for the distribution of (i) routine communications such as financial statements and (ii) documents and signature pages for execution by the parties hereto, and for no other purpose. Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt.

SECTION 9.02    Waivers; Amendments.

(a)    No failure or delay by any Credit Party in exercising any right or power hereunder or under any other Loan Document 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 a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Credit Parties hereunder and under the other Loan Documents are cumulative and are not exclusive of any other rights or remedies that they would otherwise have. No waiver of any provision of any Loan Document or consent to any departure by any Loan Party therefrom shall in any event be effective unless the same shall be permitted by SECTION 9.02(b), and then such waiver or consent shall be effective only in the specific instance and for the purpose

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for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default or Event of Default, regardless of whether any Credit Party may have had notice or knowledge of such Default or Event of Default at the time.

(b)    Except as otherwise specifically provided herein, neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except, in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Loan Parties and the Required Lenders or, in the case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by the Agent(s) or the Canadian Agent and the Loan Parties that are parties thereto, in each case with the consent of the Required Lenders; provided, however, that no such waiver, amendment, modification or other agreement shall:

(i)    Increase the Domestic Commitment or Canadian Commitment of any Lender without the prior written consent of such Lender

(ii)    Without:

(A)    the prior written consent of each Lender directly affected thereby, reduce the principal amount of any Obligation or reduce the rate of interest thereon (other than the waiver of the Default Rate), or reduce any fees payable under the Loan Documents;

(B)    the prior written consent of each Lender directly affected thereby, postpone the scheduled date of payment of the principal amount of any Obligation, or any interest thereon, or any fees payable under the Loan Documents, or reduce the amount of, waive or excuse any such payment, or postpone the expiration of the Commitments or postpone the Maturity Date;

(C)    the prior written Unanimous Consent of all Lenders, except for Permitted Dispositions or for Collateral releases as provided in SECTION 8.18, release all or substantially all of the Collateral from the Liens of the Security Documents;

(D)    the prior written Unanimous Consent of all Lenders, except as provided in SECTION 2.02, increase the Domestic Total DomesticCommitments or the Canadian Total CanadianCommitments;

(E)    the prior written Unanimous Consent of all Lenders, change the definition of the terms “Combined Availability”, “Domestic Availability”or, “Tranche A Borrowing Base”, or “Domestic Incremental Availability” or any component definition thereof if, as a result thereof, the amounts available to be borrowed by the Domestic Borrowers would be increased; providedthat the foregoing shall not limit the discretion of the Agents to change, establish or eliminate any Reserves or to add Inventory, Accounts and Real Estate acquired in a Permitted Acquisition to the Borrowing Base as provided herein; or

(F)    the prior written Unanimous Consent of all Lenders, change the definition of the terms “CanadianAvailability”, “Canadian IncrementalAvailability” or “Canadian Borrowing Base” or any component definition thereof if, as a result thereof, the

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amounts available to be borrowed by the Canadian Borrower would be increased; providedthat the foregoing shall not limit the discretion of the Agents to change, establish or eliminate any Reserves;

(G)    the prior written Unanimous Consent of all Lenders, except in connection with Permitted Dispositions or other transactions permitted under SECTION 6.03 resulting in such Loan Party ceasing to constitute a Loan Party, release any Loan Party (other than a Loan Party which is no longer a Material Subsidiary) from its obligations under any Loan Document, or limit its liability in respect of such Loan Document;

(H)    the prior written Unanimous Consent of all Lenders, modify the definition of Permitted Canadian Overadvance or Permitted Domestic Overadvance so as to increase the amount thereof, or to cause the aggregate Canadian Commitments or Domestic Commitments, as applicable (or the Canadian Commitment of any Canadian Lender or the Domestic Commitment of any Domestic Lender) to be exceeded as a result thereof, or, except as provided in such definition, the time period for a Permitted Canadian Overadvance or Permitted Domestic Overadvance;

(I)    the prior written Unanimous Consent of all Lenders, change SECTION 2.17, SECTION 7.03; SECTION 8.04 or SECTION 8.17;

(J)    the prior written consent of the Required Lenders and each Co-Collateral Agent, change SECTION 2.18;

(K)    the prior written Unanimous Consent of all Lenders, except as provided by operation of Applicable Law and otherwise expressly permitted hereunder, subordinate the Obligations or Other Liabilities hereunder or the Liens granted hereunder or under the other Loan Documents, to any other Indebtedness or Lien, as the case may be (including, without limitation, by virtue of the Obligations exceeding the “Cap Amount” (as defined in the Intercreditor Agreement));

(L)    the prior written Unanimous Consent of all Lenders, change any of the provisions of this SECTION 9.02(b) or the definitions of “Pro Rata Percentage”, “Canadian Commitment Percentage”, Domestic Commitment Percentage”, “Commitment Percentage”, “Required Lenders” or “Supermajority Lenders” or any other provision of any Loan Document specifying the number or percentage of Lenders required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder; or

(M)    the prior written Unanimous Consent of all Lenders, increase the amount of the Excess Swingline Loans.

(iii)    Without the prior written consent of the Supermajority Lenders, except for Permitted Dispositions or for Collateral releases as provided in SECTION 8.18, release any material portion of the Collateral from the Liens of the Security Documents.

(iv)Without the prior written consent of Lenders (other than Defaulting Lenders) having more than 50% of the Commitments, modify the provisions of SECTION 6.10 or any

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component definition thereof if, as a result thereof, the availability requirements of that Section would be reduced.

(viv)    Without the prior written consent of the Agents, the Canadian Agent or the Issuing Banks, as the case may be, affect the rights or duties of the Agents, the Canadian Agent or the Issuing Banks.

(c)    Notwithstanding anything to the contrary contained in this SECTION 9.02, in the event that the Lead Borrower or the Canadian Borrower shall request that this Agreement or any other Loan Document be modified, amended or waived in a manner which would require the consent of the Lenders pursuant to SECTION 9.02(b) and such amendment is approved by the Required Lenders, but not by the requisite percentage of all of the Lenders, the Lead Borrower and the Administrative Agent shall be permitted to amend this Agreement without the consent of the Lender or Lenders which did not agree to the modification or amendment requested by the Lead Borrower or the Canadian Borrower (such Lender or Lenders, collectively the “Minority Lenders”) subject to their providing for (i) the termination of the Commitment (including the Domestic Commitment and the Canadian Commitment) of each of the Minority Lenders, (ii) the addition to this Agreement of one or more other financial institutions which would qualify as an Eligible Assignee, subject to the reasonable approval of the Administrative Agent, or an increase in the Domestic Commitment or Canadian Commitment of one or more of the Required Lenders, so that the Domestic Total Commitments and the Canadian Total Commitments after giving effect to such amendment shall be in the same amount as the aggregate Commitments immediately before giving effect to such amendment, (iii) if any Loans are outstanding at the time of such amendment, the making of such additional Loans by such new or increasing Lender or Lenders, as the case may be, as may be necessary to repay in full the outstanding Loans (including principal, interest, and fees) of the Minority Lenders immediately before giving effect to such amendment and (iv) such other modifications to this Agreement or the Loan Documents as may be appropriate and incidental to the foregoing.

(d)    No notice to or demand on any Loan Party shall entitle any Loan Party to any other or further notice or demand in the same, similar or other circumstances. Each holder of a Note shall be bound by any amendment, modification, waiver or consent authorized as provided herein, whether or not a Note shall have been marked to indicate such amendment, modification, waiver or consent and any consent by a Lender, or any holder of a Note, shall bind any Person subsequently acquiring a Note, whether or not a Note is so marked. No amendment to this Agreement or any other Loan Document shall be effective against the Borrower unless signed by the Borrower or other applicable Loan Party.

SECTION 9.03    Expenses; Indemnity; Damage Waiver.

(a)    The Loan Parties shall jointly and severally (to the extent provided herein) pay on the Effective Date all Credit Party Expenses incurred as of the Effective Date, subject to any reimbursement limitations agreed to in writing prior to the Effective Date. Thereafter, the Loan Parties shall jointly and severally (to the extent provided herein) pay all Credit Party Expenses within fifteen (15) Business Days after receipt of an invoice therefor setting forth such expenses in reasonable detail; providedthat, in the event that the Borrowers have a bona fide dispute with any such expenses, payment of such disputed amounts shall not be required until the earlier of the date such dispute is resolved to the reasonable satisfaction of the Borrowers or thirty (30) days after receipt of any such invoice (and any such disputed amount which is so paid shall be subject to a reservation of the Borrowers’ rights with respect thereto).

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(b)    The Loan Parties shall, jointly and severally, indemnify the Secured Parties and each of their Subsidiaries and Affiliates, and each of the respective stockholders, directors, officers, employees, agents, attorneys, and advisors of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all damages, actual out-of-pocket losses, claims, actions, causes of action, settlement payments, obligations, liabilities and related expenses, including the reasonable fees, charges and disbursements of one counsel for Bank of America, one counsel for the Canadian Agent and one counsel for all other Indemnitees (other than the Agents and the Canadian Agent), incurred, suffered, sustained or required to be paid by, or asserted against, any Indemnitee arising out of, in any way connected with, or as a result of (i) the execution or delivery of any Loan Document or any other agreement or instrument contemplated hereby, the performance by the parties to the Loan Documents of their respective obligations thereunder or the consummation of the transactions contemplated by the Loan Documents or any other transactions contemplated hereby, (ii) any Credit Extension or the use of the proceeds therefrom (including any refusal by an Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property currently or formerly owned or operated by any Loan Party or any Subsidiary, or any Environmental Liability related in any way to any Loan Party or any Subsidiary, (iv) any actual or prospective claim, litigation, investigation or proceeding relating to or arising from any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto or (v) any documentary taxes, assessments or similar charges made by any Governmental Authority by reason of the execution and delivery of this Agreement or any other Loan Document; provided, however, that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (w) are determined in a final judgment by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from the gross negligence, bad faith or willful misconduct of such Indemnitee or any Affiliate of such Indemnitee (or any officer, director, employee, advisor or agent of such Indemnitee or any such Indemnitee’s Affiliates), (x) are relating to disputes among Indemnitees, other than any such claims arising out of any act or omission of the Loan Parties or any of their Affiliates or claims against an Indemnitee in its capacity as an Issuing Bank or other similar role, or (y) are determined in a final judgment by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from a material breach by such Indemnitee of its obligations to a Loan Party. In connection with any indemnified claim hereunder, the Indemnitee shall be entitled to select its own counsel and the Loan Parties shall promptly pay the reasonable fees and expenses of such counsel.

(c)    No party to this Agreement shall assert and, to the extent permitted by Applicable Law, each such party hereby waives, any claim against any other party to this Agreement or any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the transactions contemplated by the Loan Documents, any Credit Extension or the use of the proceeds thereof; provided that nothing contained in this clause (c) shall limit the Loan Parties’ indemnification obligations to the extent such special, indirect, consequential and punitive damages are included in any third party claim in connection with which such Indemnitee is entitled to indemnification hereunder.

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(d)    The provisions of SECTION 9.03(b) and SECTION 9.03(c) shall remain operative and in full force and effect regardless of the termination of this Agreement, the consummation of the transactions contemplated hereby, the repayment of any of the Obligations or the Other Liabilities, the invalidity or unenforceability of any term or provision of any Loan Document, or any investigation made by or on behalf of any Credit Party. All amounts due under this SECTION 9.03 shall be payable within fifteen (15) Business Days of written demand therefor, which written demand shall set forth such amounts in reasonable detail.

(e)    Notwithstanding anything to the contrary in SECTION 9.03(a) or SECTION 9.03(b), the Canadian Borrower's obligation to pay and indemnify shall be limited to matters, fees, expenses charges and disbursement, or losses, claims, damages and liabilities which the Administrative Agent or the Canadian Agent determines in their reasonable judgment to be properly attributable or allocable to the Canadian Borrower.

SECTION 9.04    Successors and Assigns.

(a)    The provisions of this Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of any Issuing Bank that issues any Letter of Credit), except that no Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and the Lenders (and any such attempted assignment or transfer without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of an Issuing Bank that issues any Letter of Credit) and, to the extent expressly contemplated hereby, Indemnitees, any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)    Any Lender may, with the consent of the Administrative Agent and, so long as no Enumerated Default has occurred and is continuing, the Lead Borrower (each of whose consents shall not be unreasonably withheld or delayedand, with respect to the Lead Borrower, shall be deemed given if the Lead Borrower has not responded to a request for such consent within ten (10) Business Days), assign to one or more Eligible Assignees (other than any Person in direct competition with a Loan Party’s business) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Domestic Commitment or Canadian Commitment and the Loans at the time owing to it); provided, however, that no such consent shall be required in connection with any assignment to another Lender; providedfurther that each assignment shall be subject to the following conditions: (i) except in the case of an assignment to a Lender or an Affiliate of a Lender, the amount of the Commitment or Loans of the assigning Lender subject to a partial assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $10,000,000 with respect to eitherthe Domestic Commitments or Canadian Commitmentsor $1,000,000 with respect to the Tranche A-1 Loans, as applicable; (ii) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations; without limitation, for clarity, any partial assignments of a Lender’s Tranche A-1 Loans shall include the same proportion of its Canadian Tranche A-1 Loans and its Domestic Tranche A-1 Loans (iii) any Person may be a Canadian Lender (other than a Canadian Tranche A-1 Lender) only if it or any of its Affiliates also has Domestic Commitments in an amount at least equal to its Canadian Commitment; and (iv) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance, together with (unless waived by the Administrative Agentor unless such assignment is to an Affiliate

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of a Lender) a processing and recordation fee of $3,500.00. Subject to acceptance and recording thereof pursuant to SECTION 9.04(d), from and after the effective date specified in each Assignment and Acceptance, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Acceptance, shall have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of SECTION 9.03; provided, that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this SECTION 9.04(b) shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with SECTION 9.04(e). The Loan Parties hereby acknowledge and agree that any effective assignment shall give rise to a direct obligation of the Loan Parties to the assignee and that the assignee shall be considered to be a “Credit Party” for all purposes under this Agreement and the other Loan Documents.

In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or sub-participations, or other compensating actions, including funding, with the consent of the Lead Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent, any Issuing Bank or any Lender hereunder (and interest accrued thereon) and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit and Swingline Loans in accordance with its Commitment Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under Applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

(c)    The Administrative Agent, acting for this purpose as an agent of the Loan Parties, shall maintain at one of its offices in Boston, Massachusetts,a copy of each Assignment and Acceptance delivered to it and a register (the “Register”) for the recordation of the names and addresses of the Lenders, and the Domestic Commitment and the Canadian Commitment of, and principal amount of the Loans and Letter of Credit Disbursements owing to, each Lender pursuant to the terms hereof from time to time. The entries in the Register shall be conclusive, absent manifest error, and the Loan Parties and Credit Parties may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Lead Borrower, the Canadian Borrower, the Issuing Banks and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

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(d)    Upon its receipt of a duly completed Assignment and Acceptance executed by an assigning Lender and an assignee, the processing and recordation fee referred to in SECTION 9.04(b) and any written consent to such assignment required by SECTION 9.04(a), the Administrative Agent shall accept such Assignment and Acceptance and record the information contained therein in the Register. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this SECTION 9.04(d).

(e)    Any Lender may, without the consent of the Loan Parties or any other Person, sell participations to one or more banks or other entities (other than any Person in direct competition with a Loan Party’s business) (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Domestic Commitment, Canadian Commitment and the Loans owing to it), subject to the following:

(i)    such Lender’s obligations under this Agreement and the other Loan Documents shall remain unchanged;

(ii)    such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations;

(iii)    the Loan Parties and other Credit Parties shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement;

(iv)    any agreement or instrument pursuant to which a Lender sells a participation in the Commitments, the Loans and the Letters of Credit Outstandings shall provide that such Lender shall retain the sole right to enforce the Loan Documents and to approve any amendment, modification or waiver of any provision of the Loan Documents; provided, however, that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the proviso to SECTION 9.02(b)(ii)(A) or SECTION 9.02(b)(ii)(B) that affects such Participant;

(v)    subject to clauses (viii) and (ix) of this SECTION 9.04(e), the Loan Parties agree that each Participant shall be entitled to the benefits (and subject to the requirements) of SECTION 2.14 and SECTION 2.23 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to SECTION 9.04(b);

(vi)    to the extent permitted by law, each Participant also shall be entitled to the benefits of SECTION 9.08 as though it were a Lender so long as such Participant agrees to be subject to SECTION 2.21(c) as though it were a Lender;

(vii)    each Lender, acting for this purpose as an agent of the Loan Parties, shall maintain at its offices a record of each agreement or instrument effecting any participation and a register (each a “Participant Register”) meeting the requirements of 26 CFR §5f.103 1(c) for the recordation of the names and addresses of its Participants and their rights with respect to principal amounts and other Obligations from time to time. The entries in each Participant Register shall be conclusive and the Loan Parties and the Credit Parties may treat each Person whose name is recorded in a Participant Register as a Participant for all purposes of this Agreement (including, for the avoidance of doubt, for purposes of entitlement to benefits under SECTION 2.14, SECTION 2.23, and SECTION 9.08). The Participant Register shall be available for inspection by the Lead Borrower and any Credit Party at any reasonable time and from time to time upon reasonable prior notice;

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(viii)    a Participant shall not be entitled to receive any greater payment under SECTION 2.14 or SECTION 2.23 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Lead Borrower’s prior written consent; and

(ix)    a Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of SECTION 2.23 unless the Lead Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Loan Parties, to comply with SECTION 2.23(e) as though it were a Lender and such Participant is eligible for exemption from, or reduction in, the withholding Tax referred to therein, following compliance with SECTION 2.23(e).

(f)    Any Credit Party may, without obtaining the consent of any Loan Party, at any time charge, pledge, assign or otherwise grant a security interest in, all or any portion of its rights under this Agreement to secure obligations of such Credit Party, including any pledge or assignment to secure obligations to a central bank or any of the twelve Federal Reserve Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341, and this SECTION 9.04 shall not apply to any such pledge or assignment of a security interest; provided, however, that no such pledge or assignment of a security interest shall release a Credit Party from any of its obligations hereunder or substitute any such pledgee or assignee for such Credit Party as a party hereto.

(g)    The Loan Parties authorize each Credit Party to disclose to any Participant or assignee and any prospective Participant or assignee, subject to the provisions of SECTION 9.15, any and all financial information in such Credit Party’s possession concerning the Loan Parties which has been delivered to such Credit Party by or on behalf of the Loan Parties pursuant to this Agreement or which has been delivered to such Credit Party by or on behalf of the Loan Parties in connection with such Credit Party’s credit evaluation of the Loan Parties prior to becoming a party to this Agreement.

SECTION 9.05    Survival.

All covenants, agreements, indemnities, representations and warranties made by the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that any Credit Party may have had notice or knowledge of any Default or Event of Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect until (a) the Commitments have expired or been terminated, (b) the principal of, and interest on, each Loan and all fees and other Obligations (other than contingent indemnity obligations with respect to then unasserted claims and, if no acceleration has occurred and no Liquidation has commenced, the Other Liabilities) shall have been paid in full, (c) all Letters of Credit shall have expired or terminated (or been Cash Collateralized in a manner satisfactory to the Issuing Bank) and (d) all Letter of Credit Outstandings have been reduced to zero (or Cash Collateralized in a manner satisfactory to the Issuing Bank). The provisions of SECTION 2.14, SECTION 2.23, SECTION 9.03 and ARTICLE VIII shall survive and remain in full force and effect regardless of the repayment of the Obligations, the expiration or termination of the Letters of Credit and the Commitments or the termination

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of this Agreement or any provision hereof. In connection with the termination of this Agreement and the release and termination of the security interests in the Collateral, the Administrative Agent or the Canadian Agent, on behalf of itself and the other Credit Parties, may require such indemnities as it shall reasonably deem necessary or appropriate to protect the Credit Parties against loss on account of such release and termination, including, without limitation, with respect to credits previously applied to the Obligations or Other Liabilities that may subsequently be reversed or revoked, and any Obligations that may thereafter arise, including without limitation under SECTION 9.03 and/or with respect to the Other Liabilities.

SECTION 9.06    Counterparts; Integration; Effectiveness.

This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents (and any fee letters or fee agreements referred to in SECTION 2.19(a)) constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all contemporaneous or previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in SECTION 4.01, this Agreement shall become effective when it shall have been executed by the applicable Credit Parties and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement by telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Agreement.

SECTION 9.07    Severability.

Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof, and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

SECTION 9.08    Right of Setoff.

If an Enumerated Default shall have occurred and be continuing, each Secured Party, each Participant and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, but excluding the Designated Account, and payroll, trust and tax withholding accounts) at any time held and other obligations at any time owing by such Secured Party, Participant or Affiliate to or for the credit or the account of the Loan Parties against any and all of the Obligations of the Loan Parties now or hereafter existing under this Agreement or other Loan Document to the extent such are then due and owing, although such Obligations may be otherwise fully secured; providedthat such Secured Party shall provide the Lead Borrower with written notice promptly after its exercise of such right of setoff. The rights of each Secured Party under this SECTION 9.08 are in addition to other rights and remedies (including other rights of setoff) that such Credit Party may have. No Credit Party will, or will permit its Participant to, exercise its rights under this SECTION 9.08 without the consent of the Administrative Agent or the Required Lenders. Notwithstanding the foregoing, any amounts of the Canadian Borrower so offset shall be applied solely to the Canadian Liabilities. ANY AND ALL RIGHTS TO REQUIRE ANY AGENT OR THE CANADIAN AGENT TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES ANY OF THE OBLIGATIONS, THE OTHER LIABILITIES

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OR THE CANADIAN LIABILITIES, AS APPLICABLE, PRIOR TO THE EXERCISE BY ANY SECURED PARTY, PARTICIPANT OR AFFILIATE OF ITS RIGHT OF SETOFF UNDER THIS SECTION ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

SECTION 9.09    Governing Law; Jurisdiction; Consent to Service of Process.

(a)    THIS AGREEMENT AND ALL ACTIONS ARISING UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

(b)    Each Loan Party agrees that any suit for the enforcement of this Agreement or any other Loan Document may be brought in the courts of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consents to the non-exclusive jurisdiction of such courts. Each party to this Agreement hereby waives any objection which it may now or hereafter have to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum and agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that any Credit Party may otherwise have to bring any action or proceeding relating to this Agreement against a Loan Party or its properties in the courts of any jurisdiction.

(c)    Each Loan Party agrees that any action commenced by any Loan Party asserting any claim or counterclaim arising under or in connection with this Agreement or any other Loan Document shall be brought solely in a court of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consents to the exclusive jurisdiction of such courts with respect to any such action.

(d)    Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in SECTION 9.01. Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

SECTION 9.10    WAIVER OF JURY TRIAL.

EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY); AND WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES THEREOF AS WELL AS NOTICE OF NONPAYMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS

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AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

SECTION 9.11    Press Releases and Related Matters.

Each Borrower consents to the publication by the Administrative Agent or the Canadian Agent of customary trade advertising material in tombstone format relating to the financing transactions contemplated by this Agreement using any Borrower’s name, and with the consent of the Lead Borrower, logo or trademark. The Administrative Agent or the Canadian Agent, as applicable, shall provide a draft reasonably in advance of any advertising material to the Lead Borrower for review and comment prior to the publication thereof. The Administrative Agent and the Canadian Agent reserve the right to provide to industry trade organizations information necessary and customary for inclusion in league table measurements.

SECTION 9.12    Headings.

Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

SECTION 9.13    Interest Rate Limitation.

Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Revolving Credit Loan, together with all fees, charges and other amounts that are treated as interest on such Revolving Credit Loan under Applicable Law (collectively, the “Charges”), shall be found by a court of competent jurisdiction in a final order to exceed the maximum lawful rate (the “Maximum Rate”) that may be contracted for, charged, taken, received or reserved by the Lender holding such Revolving Credit Loan in accordance with Applicable Law, the rate of interest payable in respect of such Revolving Credit Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Revolving Credit Loan but were not payable as a result of the operation of this SECTION 9.13 shall be cumulated and the interest and Charges payable to such Lender in respect of other Revolving Credit Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate, in the case of the Domestic Lenders, and at the Bank of Canada Overnight Rate, in the case of Canadian Lenders, to the date of repayment, shall have been received by such Lender.

SECTION 9.14    Additional Waivers.

(a)    The Obligations, the Other Liabilities and the Canadian Liabilities are the joint and several obligation of each Loan Party, providedthat the Canadian Borrower and the other Canadian Loan Parties shall be liable only for the Canadian Liabilities. To the fullest extent permitted by Applicable Law, the obligations of each Loan Party hereunder shall not be affected by (i) the failure of any Credit Party to assert any claim or demand or to enforce or exercise any right or remedy against any other Loan Party under the provisions of this Agreement, any other Loan Document or otherwise, (ii) any rescission, waiver, amendment or modification of, or any release of any Loan Party from, any of the terms or provisions of, this Agreement, any other Loan Document, or (iii) the failure to perfect any security interest in, or the release of, any of the Collateral or other security held by or on behalf of the Administrative Agent, the Canadian Agent, the Co-Collateral Agents or any other Credit Party.

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(b)    The obligations of each Loan Party to pay the Obligations, the Other Liabilities or the Canadian Liabilities, as applicable, in full hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason (other than the payment in full in cash of the Obligations, the Other Liabilities or the Canadian Liabilities, as applicable, after the termination of all Commitments to any Loan Party under any Loan Document), including any claim of waiver, release, surrender, alteration or compromise of any of the Obligations, the Other Liabilities or the Canadian Liabilities, as applicable, and shall not be subject to any defense or setoff, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or unenforceability of any of the Obligations, the Other Liabilities or Canadian Liabilities, as applicable, or otherwise. Without limiting the generality of the foregoing, the obligations of each Loan Party hereunder shall not be discharged or impaired or otherwise affected by the failure of any Agent or any other Credit Party to assert any claim or demand or to enforce any remedy under this Agreement, any other Loan Document or any other agreement, by any waiver or modification of any provision of any thereof, any default, failure or delay, willful or otherwise, in the performance of any of the Obligations or the Other Liabilities, or by any other act or omission that may or might in any manner or to any extent vary the risk of any Loan Party or that would otherwise operate as a discharge of any Loan Party as a matter of law or equity (other than the payment in full in cash of all of the Obligations and Other Liabilities after termination of all Commitments to any Loan Party under any Loan Document).

(c)    To the fullest extent permitted by Applicable Law, each Loan Party waives any defense based on or arising out of any defense of any other Loan Party or the unenforceability of the Obligations, the Other Liabilities or Canadian Liabilities or any part thereof from any cause, or the cessation from any cause of the liability of any other Loan Party, other than the payment in full in cash of all the Obligations, the Other Liabilities and the Canadian Liabilities after the termination of all Commitments to any Loan Party under any Loan Document. The Agents and the other Credit Parties may, at their election, foreclose on any security held by one or more of them by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or adjust any part of the Obligations, the Other Liabilities and the Canadian Liabilities, make any other accommodation with any other Loan Party, or exercise any other right or remedy available to them against any other Loan Party, without affecting or impairing in any way the liability of any Loan Party hereunder except to the extent that all the Obligations, the Other Liabilities and the Canadian Liabilities have been indefeasibly paid in full in cash and performed in full after the termination of Commitments to any Loan Party under any Loan Document. Pursuant to Applicable Law, each Loan Party waives any defense arising out of any such election even though such election operates, pursuant to Applicable Law, to impair or to extinguish any right of reimbursement or subrogation or other right or remedy of such Loan Party against any other Loan Party, as the case may be, or any security.

(d)    Except as otherwise specifically provided herein, each Domestic Borrower is obligated to repay the Obligations and the Other Liabilities as joint and several obligors under this Agreement. Upon payment by any Loan Party of any Obligations, Other Liabilities or the Canadian Liabilities, all rights of such Loan Party against any other Loan Party arising as a result thereof by way of right of subrogation, contribution, reimbursement, indemnity or otherwise shall in all respects be subordinate and junior in right of payment to the prior payment in full in cash of all the Obligations (other than contingent indemnity obligations for then unasserted claims), the Other Liabilities and the Canadian Liabilities (other than contingent indemnity obligations for then unasserted claims) and the termination of all Commitments to any Loan Party under any Loan Document. If any amount shall erroneously be paid to any Loan Party on account of (i) such subrogation, contribution,

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reimbursement, indemnity or similar right or (ii) any such indebtedness of any Loan Party, such amount shall be held in trust for the benefit of the Credit Parties and shall forthwith be paid to the Administrative Agent or the Canadian Agent, as applicable, to be credited against the payment of the Obligations, the Other Liabilities and the Canadian Liabilities, as applicable, whether matured or unmatured, in accordance with the terms of this Agreement and the other Loan Documents. Subject to the foregoing, to the extent that any Domestic Loan Party shall, under this Agreement as a joint and several obligor, repay any of the Obligations, the Other Liabilities or Canadian Liabilities constituting Revolving Credit Loans made to another Loan Party hereunder (an “Accommodation Payment”), then the Domestic Loan Party making such Accommodation Payment shall be entitled to contribution and indemnification from, and be reimbursed by, each of the other Domestic Loan Parties (or the Canadian Loan Parties, if applicable) in an amount, (x) for each of such other Domestic Loan Parties, equal to a fraction of such Accommodation Payment, the numerator of which fraction is such other Domestic Loan Party’s Allocable Amount and the denominator of which is the sum of the Allocable Amounts of all of the Domestic Loan Parties, or (y) for each Canadian Loan Party, in an amount equal to such Accommodation Payment. As of any date of determination, the “Allocable Amount” of each Domestic Loan Party shall be equal to the maximum amount of liability for Accommodation Payments which could be asserted against such Domestic Loan Party hereunder without (a) rendering such Domestic Loan Party “insolvent” within the meaning of Section 101 (31) of the Bankruptcy Code, Section 2 of the Uniform Fraudulent Transfer Act (“UFTA”) or Section 2 of the Uniform Fraudulent Conveyance Act (“UFCA”), (b) leaving such Domestic Loan Party with unreasonably small capital or assets, within the meaning of Section 548 of the Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the UFCA, or (c) leaving such Domestic Loan Party unable to pay its debts as they become due within the meaning of Section 548 of the Bankruptcy Code or Section 4 of the UFTA, or Section 5 of the UFCA.

(e)    Without limiting the generality of the foregoing, or of any other waiver or other provision set forth in this Agreement, each Loan Party waives all rights and defenses arising out of an election of remedies by any Credit Party, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for a guaranteed obligation, has destroyed such Credit Party’s rights of subrogation and reimbursement against such Loan Party by the operation of Section 580(d) of the California Code of Civil Procedure or otherwise. Each Loan Party waives all rights and defenses that such Loan Party may have because the Obligations and Other Liabilities are secured by Real Property which means, among other things: (i) a Credit Party may collect from any Loan Party without first foreclosing on any Real Property or personal property Collateral pledged by a Loan Party; (ii) if any Credit Party forecloses on any Real Property pledged by any Loan Party, the amount of the Obligations and Other Liabilities may be reduced only by the price for which that Real Property is sold at the foreclosure sale, even if the Real Property is worth more than the sale price; and (iii) the Credit Parties may collect Obligations and Other Liabilities from a Loan Party even if a Credit Party, by foreclosing on any such Real Property, has destroyed any right any Loan Party may have to collect from the other Loan Parties. This is an unconditional and irrevocable waiver of any rights and defenses any Loan Party may have because the Obligations and Other Liabilities are secured by Real Property. These rights and defenses include, but are not limited to, any rights or defenses based upon Section 580a, 580b, 580d or 726 of the California Code of Civil Procedure. Each Loan Party hereby absolutely, knowingly, unconditionally, and expressly waives any and all claim, defense or benefit arising directly or indirectly under any one or more of Sections 2787 to 2855 inclusive of the California Civil Code or any similar law of California.

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(f)    Each Loan Party hereby agrees to keep each other Loan Party fully apprised at all times as to the status of its business, affairs, finances, and financial condition, and its ability to perform its Obligations under the Loan Documents and the Other Liabilities, and in particular as to any adverse developments with respect thereto. Each Loan Party hereby agrees to undertake to keep itself apprised at all times as to the status of the business, affairs, finances, and financial condition of each other Loan Party, and of the ability of each other Loan Party to perform its Obligations under the Loan Documents and the Other Liabilities, and in particular as to any adverse developments with respect to any thereof. Each Loan Party hereby agrees, in light of the foregoing mutual covenants to inform each other, and to keep themselves and each other informed as to such matters, that the Credit Parties shall have no duty to inform any Loan Party of any information pertaining to the business, affairs, finances, or financial condition of any other Loan Party, or pertaining to the ability of any other Loan Party to perform its Obligations under the Loan Documents and the Other Liabilities, even if such information is adverse, and even if such information might influence the decision of one or more of the Loan Parties to continue to be jointly and severally liable for, or to provide Collateral for, Obligations or Other Liabilities of one or more of the other Loan Parties. To the fullest extent permitted by applicable law, each Loan Party hereby expressly waives any duty of the Credit Parties to inform any Loan Party of any such information.

SECTION 9.15    Confidentiality.

Each of the Credit Parties agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to their and their Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and agree to keep such Information confidential), (b) to the extent requested by any regulatory authority, (c) to the extent required by Applicable Law or by any subpoena or similar legal process (the Credit Parties’ agreeing to furnish the Lead Borrower with notice of such process and an opportunity to contest such disclosure as long as furnishing such notice and opportunity would not result in the Credit Parties’ violation of Applicable Law), (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this SECTION 9.15, to any assignee of, or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement and any actual or prospective counterparty or advisors to any swap or derivative transactions relating to the Loan Parties, the Canadian Liabilities, the Other Liabilities and the Obligations so long as such Person or any of their Affiliates is not a competitor of any Loan Party, (g) with the consent of the Loan Parties, or (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this SECTION 9.15, or to the knowledge of such Credit Party, the breach of any other Person’s obligation to keep the information confidential, or (ii) becomes available to any Credit Party on a non-confidential basis from a source other than the Loan Parties. For the purposes of this SECTION 9.15, the term “Information” means all information received from or on behalf of the Loan Parties or any of their Affiliates relating to their business. Any Person required to maintain the confidentiality of Information as provided in this SECTION 9.15 shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

Each Lender acknowledges that information furnished to it pursuant to this Agreement or the other Loan Documents, including conference calls or meetings with the Loan Parties to review their earnings

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and other information, may include material non-public information concerning the Loan Parties and their Subsidiaries and Affiliates and their related parties or their respective securities, and confirms that it has developed compliance procedures regarding the use of material non-public information and that it will handle such material non-public information in accordance with those procedures and applicable law, including federal and state securities laws.

All information, including requests for waivers and amendments, furnished by the Loan Parties or the Administrative Agent pursuant to, or in the course of administering, this Agreement or the other Loan Documents, including conference calls or meetings with the Loan Parties to review their earnings and other information, will be syndicate-level information, which may contain material non-public information about the Loan Parties and their Subsidiaries and Affiliates and their related parties or their respective securities. Accordingly, each Lender represents to the Loan Parties and the Administrative Agent that it has identified in its administrative questionnaire a credit contact who may receive information that may contain material non-public information in accordance with its compliance procedures and applicable law, including federal and state securities laws.

SECTION 9.16    Patriot Act; Proceeds of Crime Act.

Each Lender hereby notifies the Loan Parties that, pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “PatriotAct”) (including all applicable “know your customer” rules, regulations and procedures applicable to such Lender in Canada), it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name and address of each Loan Party and other information that will allow such Lender to identify such Loan Party in accordance with the Patriot Act. Each Loan Party is in compliance, in all material respects, with the Patriot Act and the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) (the “Proceeds of Crime Act”). No part of the proceeds of the Loans will be used by the Loan Parties, directly or indirectly, for any purpose which would contravene or breach the Proceeds of Crime Act or for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

SECTION 9.17    Foreign Asset Control Regulations.

Neither of the advance of the Revolving Credit Loans, nor the use of the proceeds of any thereof, will violate the Trading With the Enemy Act (50 U.S.C. § 1 et seq., as amended) (the “Trading With the Enemy Act”) or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) (the “Foreign Assets Control Regulations”) or any enabling legislation or executive order relating thereto (which for the avoidance of doubt shall include, but shall not be limited to (a) Executive Order 13224 of September 21, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)) (the “Executive Order”) and (b) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56)). Furthermore, none of the Borrowers or their Affiliates (a) is or will become a “blocked person” as described in the Executive Order, the Trading With the Enemy Act or the Foreign Assets Control Regulations or (b) knowingly engages or will engage in any dealings or transactions, or be otherwise associated, with any such “blocked person” or in any manner violative of any such order.

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SECTION 9.18    Limitation Of Canadian Loan Parties’ Liability.

Notwithstanding anything to the contrary herein contained, the liability of the Canadian Loan Parties hereunder and under any other Loan Documents shall be limited to the Canadian Liabilities, and the Canadian Loan Parties shall have no liability whatsoever under the Loan Documents with respect to any other Obligations or Other Liabilities of the Domestic Borrowers.

SECTION 9.19    Judgment Currency.

(a)    If, for the purpose of obtaining or enforcing judgment against the Canadian Borrower in any court in any jurisdiction, it becomes necessary to convert into any other currency (such other currency being hereinafter in this SECTION 9.19 referred to as the “Judgment Currency”) an amount due in CD$ or dollars under this Agreement, the conversion will be made at the rate of exchange prevailing on the Business Day immediately preceding:

(i)    the date of actual payment of the amount due, in the case of any proceeding in the courts of the Province of Ontario or in the courts of any other jurisdiction that will give effect to such conversion being made on such date; or

(ii)    the date on which the judgment is given, in the case of any proceeding in the courts of any other jurisdiction (the date as of which such conversion is made pursuant to this SECTION 9.19 being hereinafter in this SECTION 9.19 referred to as the “Judgment Conversion Date”).

(b)    If, in the case of any proceeding in the court of any jurisdiction referred to in SECTION 9.19(a)(ii), there is a change in the rate of exchange prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the Canadian Borrower will pay such additional amount (if any, but in any event not a lesser amount) as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the rate of exchange prevailing on the date of payment, will produce the amount of CD$ or dollars, as the case may be, which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial order at the rate of exchange prevailing on the Judgment Conversion Date.

(c)    Any amount due from the Canadian Borrower under the provisions of this SECTION 9.19 will be due as a separate debt and will not be affected by judgment being obtained for any other amounts due under or in respect of this Agreement.

(d)    The term “rate of exchange” in this SECTION 9.19 means:

(i)    for a conversion of CD$ to the Judgment Currency, the reciprocal of the official noon rate of exchange published by the Bank of Canada for the date in question for the conversion of the Judgment Currency to CD$;

(ii)    for a conversion of dollars to the Judgment Currency when the Judgment Currency is CD$, the official noon rate of exchange published by the Bank of Canada for the date in question for the conversion of dollars to CD$;

(iii)    for a conversion of dollars to the Judgment Currency when the Judgment Currency is not CD$, the effective rate obtained when a given amount of dollars is converted to CD$ at the rate determined pursuant to this SECTION 9.19 and the result thereof is then converted to the Judgment Currency pursuant to this SECTION 9.19; or

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(iv)    if a required rate is not so published by the Bank of Canada for any such date, the spot rate quoted by the Canadian Agent at Toronto, Canada at approximately noon (Toronto time) on that date in accordance with its normal practice for the applicable currency conversion in the wholesale market.

SECTION 9.20    Language.

The parties herein have expressly requested that this Agreement and all related documents be drawn up in the English language. A la demande expresse des parties aux présentes, cette convention et tout document y afférent ont été rédigés en langue anglaise.

SECTION 9.21    Existing Credit Agreement Amended and Restated. Upon satisfaction of the conditions precedent to the effectiveness of this Agreement, (a) this Agreement shall amend and restate the Existing Credit Agreement in its entirety (except to the extent that definitions from the Existing Credit Agreement are incorporated herein by reference) and (b) the rights and obligations of the parties under the Existing Credit Agreement shall be subsumed within, and be governed by, this Agreement; provided, however, that the Loan Parties hereby agree that (i) the Letter of Credit Outstandings under, and as defined in, the Existing Credit Agreement on the Effective Date shall be Letter of Credit Outstandings hereunder, and (ii) all Obligations and Other Liabilities of the Loan Parties under, and as defined in, the Existing Credit Agreement shall remain outstanding, shall constitute continuing Obligations and Other Liabilities secured by the Collateral, and this Agreement shall not be deemed to evidence or result in a novation or repayment and reborrowing of such obligations and other liabilities.

SECTION 9.22    Keepwell. Each Loan Party that, at the time the guarantee of (or grant of a security interest by, as applicable) another Loan Party becomes or would become effective as to any Swap Obligation of any Loan Party, is a Qualified ECP Guarantor intends that the Facility Guarantee constitute at such time, and such guarantee shall be deemed to constitute at such time, a guarantee for the benefit of each other Loan Party for purposes of Section 1a(18)(a)(v)(II) of the Commodity Exchange Act. For the avoidance of doubt, and for purposes of the foregoing sentence, such “effective” date with respect to any Loan Party shall be the date of the execution of a Hedge Agreement in respect of a Swap Obligation that constitutes a Bank Product if this Agreement is then in effect with respect to such Loan Party, and otherwise it shall be the date of execution and delivery of this Agreement by such Loan Party.

[SIGNATURE PAGES FOLLOW]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as a sealed instrument as of the day and year first above written.

TOYS “R” US-DELAWARE, INC., as Lead Borrower

By: _______________________________

Name:

Title:

Signature Page to Third Amended and Restated Credit Agreement

TOYS “R” US (CANADA) LTD.

TOYS “R” US (CANADA) LTEE, as a Canadian Borrower

By: _______________________________

Name:

Title:

Signature Page to Third Amended and Restated Credit Agreement

GEOFFREY HOLDINGS, LLC, as a Facility Guarantor

By: TOYS “R” US-DELAWARE, INC., its sole member

By: _______________________________

Name:

Title:

Signature Page to Third Amended and Restated Credit Agreement

TRU-SVC, LLC, as a Facility Guarantor

By: _______________________________

Name:

Title:

Signature Page to Third Amended and Restated Credit Agreement

TOYS ACQUISITION, LLC, as a Facility Guarantor

By: _______________________________

Name:

Title:

Signature Page to Third Amended and Restated Credit Agreement

TRU OF PUERTO RICO, INC., as a Facility Guarantor

By: _______________________________

Name:

Title:

Signature Page to Third Amended and Restated Credit Agreement

BANK OF AMERICA, N.A., as Administrative Agent, as Swingline Lender, and as a Domestic Lender

By: ___________________________________

Name:

Title:

Address:

100 Federal Street, 9th Floor

Boston, Massachusetts 02110

Attn: Christine Hutchinson

Telephone: (617) 434-2385

Telecopy: (617) 434-4131

Signature Page to Third Amended and Restated Credit Agreement

BANK OF AMERICA, N.A. (acting through its Canada branch),as Canadian Agent, as Swingline Lender and as a Canadian Lender

By: ___________________________________

Name:

Title:

Address:

181 Bay Street, 4^th Floor

Toronto, Ontario, Canada M5J 2V8

Attn: ___________

Telephone: ___________

Telecopy: ___________

Signature Page to Third Amended and Restated Credit Agreement

[other lender parties to be determined]

By: ___________________________________

Name:

Title:

Signature Page to Third Amended and Restated Credit Agreement

EXHIBIT A-2

FORM OF ASSIGNMENT AND ACCEPTANCE

This Assignment and Acceptance (this “Assignment and Acceptance”) is dated as of the Effective Date set forth below and is entered into by and between [the][each]¹ Assignor identified in item 1 below ([the][each, an] “Assignor”) and [the][each]²Assignee identified in item 2 below ([the][each, an] “Assignee”). [It is understood and agreed that the rights and obligations of [the Assignors][the Assignees]³hereunder are several and not joint.]⁴ Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by [each, the] Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Acceptance as if set forth herein in full.

For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and assumes from [the Assignor][the respective Assignors], subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’] rights and obligations in [its capacity as a [Domestic][Canadian] Tranche A-1 Lender][their respective capacities [Domestic][Canadian] Tranche A-1 Lenders] under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of [the Assignor][the respective Assignors] under the respective facilities identified below and (ii) to the extent permitted to be assigned under applicable Law, all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a [Domestic][Canadian] Tranche A-1 Lender)][the respective Assignors (in their respective capacities as [Domestic][Canadian] Tranche A-1 Lenders)] against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations

¹For bracketed language here and elsewhere in this form relating to the Assignor(s), if the assignment is from a single Assignor, choose the first bracketed language. If the assignment is from multiple Assignors, choose the second bracketed language.

² For bracketed language here and elsewhere in this form relating to the Assignee(s), if the assignment is to a single Assignee, choose the first bracketed language. If the assignment is to multiple Assignees, choose the second bracketed language.

³ Select as appropriate.

⁴ Include bracketed language if there are either multiple Assignors or multiple Assignees.

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sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as [the][an] “Assigned Interest”). Each such sale and assignment is without recourse to [the][any] Assignor and, except as expressly provided in this Assignment and Acceptance, without representation or warranty by [the][any] Assignor.

1.Assignor[s]:______________________________

______________________________

2.Assignee[s]:______________________________

______________________________

3. Borrowers:(i) Toys “R” Us-Delaware, Inc., for itself and as agent (in such capacity, the “Lead Borrower” for the other Domestic Borrowers party thereto from time to time, (ii) the other Domestic Borrowers party thereto from time to time, and (iii) Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee (the “Canadian Borrower”, and together with the Lead Borrower and the other Domestic Borrowers, individually, a “Borrower”, and collectively, the “Borrowers”)

4. Administrative Agent: Bank of America, N.A., as the Administrative Agent under the Credit Agreement.

5. Canadian Agent: Bank of America, N.A. (acting through its Canada branch), as the Canadian Agent under the Credit Agreement.

6. Credit Agreement:Third Amended and Restated Credit Agreement dated as of March 21, 2014 (as amended, restated, supplemented or otherwise modified, the “Credit Agreement”) by, among others, (i) the Borrowers, (ii) the Facility Guarantors party thereto from time to time, (iii) Bank of America, N.A., as Administrative Agent for its own benefit and the benefit of the other Secured Parties, (iv) Bank of America, N.A. (acting through its Canada branch), as Canadian Agent for its own benefit and the benefit of the other Secured Parties, and (v) the Lenders party thereto.

7. Assigned Interest[s]:

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Assignor[s]5	Assignee[s]6	Amount of Domestic Tranche A-1 Loans Assigned7	Amount of Canadian Tranche A-1 Loans Assigned	Percentage Assigned of Domestic Tranche A-1 Loans8	Percentage Assigned of Canadian Tranche A-1 Loans9
		$____________	$______	_________%	_________%
		$____________	$______	_________%	_________%

[8.Trade Date:__________________]¹⁰ 

Effective Date: __________________, 20__ [TO BE INSERTED BY AGENT AND WHICH SHALL BE THE DATE OF DELIVERY OF THIS ASSIGNMENT AND ACCEPTANCE FOR RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

⁵ List each Assignor, as appropriate.

⁶ List each Assignee, as appropriate.

⁷ Amounts in this column and in the column immediately to the right to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date. Subject to minimum amount requirements pursuant to Section 9.04(b) of the Credit Agreement and subject to proportionate amount requirements pursuant to Section 9.04(b) of the Credit Agreement

⁸ Set forth, to at least 9 decimals, as a percentage of the Domestic Tranche A-1 Loans of all Domestic Tranche A-1 Lenders thereunder.

⁹ Set forth, to at least 9 decimals, as a percentage of the Canadian Tranche A-1 Loans of all Canadian Tranche A-1 Lenders thereunder.

¹⁰ To be completed if the Assignor and the Assignee intend that the minimum assignment amount is to be determined as of the Trade Date.

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The terms set forth in this Assignment and Acceptance are hereby agreed to:

ASSIGNOR

[NAME OF ASSIGNOR]

By: _____________________________

Name:____________________________

Title:_____________________________

ASSIGNEE

[NAME OF ASSIGNEE]

By: _____________________________

Name:____________________________

Title:_____________________________

[Consented to and]¹¹Accepted:

BANK OF AMERICA, N.A., as

Agent

By: _____________________________

Name:_____________________________

Title:_____________________________

¹¹ To the extent that the Administrative Agent’s consent is required under Section 9.04 of the Credit Agreement.

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[Consented to:]¹² 

[TOYS “R” US-DELAWARE, INC., as Lead Borrower]

By: _____________________________

Name:_____________________________

Title:_____________________________

¹² To the extent required under Section 9.04 of the Credit Agreement.

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ANNEX 1 TO ASSIGNMENT AND ACCEPTANCE

Reference is made to the Third Amended and Restated Credit Agreement dated as of March 21, 2014 (as amended, restated, supplemented or otherwise modified, the “Credit Agreement”) by, among others, (i) Toys “R” Us-Delaware, Inc., for itself and as agent (in such capacity, the “Lead Borrower” for the other Domestic Borrowers party thereto from time to time, (ii) the other Domestic Borrowers party thereto from time to time, (iii) Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee (the “Canadian Borrower”, and together with the Lead Borrower and the other Domestic Borrowers, individually, a “Borrower”, and collectively, the “Borrowers”), (iv) the Facility Guarantors party thereto from time to time, (v) Bank of America, N.A., as Administrative Agent for its own benefit and the benefit of the other Secured Parties, (vi) Bank of America, N.A. (acting through its Canada branch), as Canadian Agent for its own benefit and the benefit of the other Secured Parties, and (vii) the Lenders party thereto. All capitalized terms used herein and not otherwise defined shall have the same meaning herein as in the Credit Agreement.

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ACCEPTANCE

1.Representations and Warranties.

1.1.Assignor. [The][Each] Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of [the][[the relevant] Assigned Interest, (ii) [the][such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Loan Parties or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Loan Parties or any other Person of any of their respective obligations under any Loan Document.

1.2.Assignee. [The][Each] Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby and to become a [Domestic][Canadian] Tranche A-1 Lender under the Credit Agreement, (ii) it meets all the requirements to be an Eligible Assignee under the Credit Agreement (subject to such consents, if any, as may be required by Section 9.04 of the Credit Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a [Domestic][Canadian] Tranche A-1 Lender thereunder and, to the extent of [the][the relevant] Assigned Interest, shall have the obligations of a [Domestic][Canadian] Tranche A-1 Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by [the][such] Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire [the][such] Assigned Interest, is experienced in acquiring assets of

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such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase [the][such] Assigned Interest, (vi) it has, independently and without reliance upon any Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase [the][such] Assigned Interest, and (vii) attached hereto is any documentation required to be delivered by it pursuant to the terms of Section 2.23 of the Credit Agreement, duly completed and executed by [the][such] Assignee; and (b) agrees that (i) it will, independently and without reliance upon any Agent, [the][any] Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a [Domestic][Canadian] Tranche A-1 Lender.

2.Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of [the][each] Assigned Interest (including payments of principal, interest, fees and other amounts) to [the][the relevant] Assignor for amounts which have accrued up to but excluding the Effective Date and to [the][the relevant] Assignee for amounts which have accrued from and after the Effective Date.

3.General Provisions. This Assignment and Acceptance shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Acceptance may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Acceptance by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Acceptance. This Assignment and Acceptance and all actions arising under this Assignment and Acceptance shall be governed by, and construed in accordance with, the laws of the State of New York.

4.Fees. Unless waived by the Administrative Agent in accordance with Section 9.04(b) of the Credit Agreement, this Assignment and Acceptance shall be delivered to the Administrative Agent with a processing and recordation fee of $3,500.

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Exhibit D-2

Form of Domestic Tranche A-1 Note

DOMESTIC TRANCHE A-1 NOTE

$_______________ ____________, 2014

FOR VALUE RECEIVED, the undersigned (singly, a “Domestic Borrower”, and collectively, the “Domestic Borrowers”) jointly and severally promise to pay to the order of __________________________________ (hereinafter, with any subsequent holders, the “Domestic Tranche A-1 Lender”), c/o Bank of America, N.A., 100 Federal Street, 9^th Floor, Boston, Massachusetts 02110, the principal sum of ______________________ DOLLARS ($______________), or, if less, the aggregate unpaid principal balance of Domestic Tranche A-1 Loans made by the Domestic Tranche A-1 Lender to or for the account of any Domestic Borrower pursuant to the Third Amended and Restated Credit Agreement dated as of March 21, 2014 (as amended, modified, supplemented or restated and in effect from time to time, the “Credit Agreement”) by and between, among others (i) Toys “R” Us-Delaware, Inc., as a Domestic Borrower and as agent (in such capacity, the “Lead Borrower”) for the other Domestic Borrowers, (ii) the Domestic Borrowers, (iii) the Facility Guarantors party thereto, (iv) Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee (the “Canadian Borrower” and, collectively with the Domestic Borrowers, the “Borrowers”), (v) Bank of America, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”) for its own benefit and the benefit of the other Secured Parties, (vi) Bank of America, N.A. (acting through its Canada branch), as Canadian Administrative Agent (in such capacity, the “Canadian Agent”) for its own benefit and the benefit of the other Secured Parties, (vii) Bank of America, N.A. and Wells Fargo Bank, National Association, as Co-Collateral Agents for their own benefit and the benefit of the other Secured Parties, and (viii) the Lenders party thereto (the “Lenders”), with interest at the rate and payable in the manner stated therein.

This is a “Domestic Tranche A-1 Note” to which reference is made in the Credit Agreement and is subject to all terms and provisions thereof. The principal of, and interest on, this Domestic Tranche A-1 Note shall be payable at the times, in the manner, and in the amounts as provided in the Credit Agreement and shall be subject to prepayment and acceleration as provided therein. Capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

The Administrative Agent’s books and records concerning the Domestic Tranche A-1 Loans, the accrual of interest thereon, and the repayment of such Domestic Tranche A-1 Loans, shall be prima facie evidence of the indebtedness hereunder, absent manifest error.

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No delay or omission by any Agent or the Domestic Tranche A-1 Lender in exercising or enforcing any of such Agent’s or the Domestic Tranche A-1 Lender’s powers, rights, privileges, remedies, or discretions hereunder shall operate as a waiver thereof on that occasion nor on any other occasion. No waiver of any Event of Default shall operate as a waiver of any other Event of Default, nor as a continuing waiver.

After the occurrence and during the continuance of an Event of Default, each Domestic Borrower, and each endorser and guarantor of this Domestic Tranche A-1 Note, waives presentment, demand, notice, and protest, and also waives any delay on the part of the holder hereof. Each Domestic Borrower assents to any extension or other indulgence (including, without limitation, the release or substitution of Collateral) permitted by any Agent and/or the Domestic Tranche A-1 Lender with respect to this Domestic Tranche A-1 Note and/or any Collateral or any extension or other indulgence with respect to any other liability or any collateral given to secure any other liability of any Domestic Borrower or any other Person obligated on account of this Domestic Tranche A-1 Note.

This Domestic Tranche A-1 Note shall be binding upon each Domestic Borrower, and each endorser and guarantor hereof, and upon their respective successors, assigns, and representatives, and shall inure to the benefit of the Domestic Tranche A-1 Lender and its successors, endorsees, and assigns.

The liabilities of each Domestic Borrower, and of any endorser or guarantor of this Domestic Tranche A-1 Note, are joint and several; provided, however, the release by any Agent or the Domestic Tranche A-1 Lender of any one or more such Persons shall not release any other Person obligated on account of this Domestic Tranche A-1 Note. Each reference in this Domestic Tranche A-1 Note to each Domestic Borrower, any endorser, and any guarantor, is to such Person individually and also to all such Persons jointly. No Person obligated on account of this Domestic Tranche A-1 Note may seek contribution from any other Person also obligated except in accordance with the terms of Section 9.14(d) of the Credit Agreement.

THIS Domestic Tranche A-1 NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

Each Domestic Borrower agrees that any suit for the enforcement of this Domestic Tranche A-1 Note or any other Loan Document may be brought in the courts of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consents to the non-exclusive jurisdiction of such courts. Each Domestic Borrower hereby waives any objection which it may now or hereafter have to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum and agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each Domestic Borrower agrees that any action commenced by any Domestic Borrower asserting any claim or counterclaim arising under or in connection with this Domestic Tranche A-1 Note or any other Loan Document shall be brought solely in a court of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as

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the Administrative Agent may elect in its sole discretion and consents to the exclusive jurisdiction of such courts with respect to any such action.

Each Domestic Borrower makes the following waiver knowingly, voluntarily, and intentionally, and understands that the Agents and the Domestic Tranche A-1 Lender, in the establishment and maintenance of their respective relationship with the Domestic Borrowers contemplated by this Domestic Tranche A-1 Note, is relying thereon. EACH DOMESTIC BORROWER, EACH GUARANTOR, ENDORSER AND SURETY, AND THE DOMESTIC tranche a-1 LENDER, BY ITS ACCEPTANCE HEREOF, HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS domestic tranche a-1 NOTE, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY); AND WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES THEREOF AS WELL AS NOTICE OF NONPAYMENT. EACH DOMESTIC BORROWER, EACH GUARANTOR, ENDORSER AND SURETY, AND THE DOMESTIC tranche a-1 LENDER, BY ITS ACCEPTANCE HEREOF, (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THE CREDIT AGREEMENT AND THIS domestic tranche a-1 NOTE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS HEREIN.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Domestic Borrowers have caused this Domestic Tranche A-1 Note to be duly executed as of the date set forth above.

DOMESTIC BORROWERS:

TOYS “R” US-DELAWARE, INC.

By: ____________________________

Name: __________________________

Title: ___________________________

Signature Page to Domestic Tranche A-1 Note

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Exhibit E-2

Form of Canadian Tranche A-1 Note

CANADIAN TRANCHE A-1 NOTE

$_______________ ____________, 2014

FOR VALUE RECEIVED, TOYS “R” US (CANADA) LTD./TOYS “R” US (CANADA) LTEE, a corporation organized and existing under the laws of the Province of Ontario (the “Canadian Borrower”), promises to pay to the order of __________________________________ (hereinafter, with any subsequent holders, the “Canadian Tranche A-1 Lender”), c/o Bank of America, N.A. (acting through its Canada branch), 181 Bay Street, 4^th Floor, Toronto, Ontario, Canada M5J 2V8, the principal sum of ______________________ DOLLARS (USD$______________), or, if less, the aggregate unpaid principal balance of Canadian Tranche A-1 Loans made by the Canadian Tranche A-1 Lender to or for the account of the Canadian Borrower pursuant to the Third Amended and Restated Credit Agreement dated as of March 21, 2014 (as amended, modified, supplemented or restated and in effect from time to time, the “Credit Agreement”) by and between, among others (i) Toys “R” Us-Delaware, Inc., as a Domestic Borrower and as agent (in such capacity, the “Lead Borrower”) for the other Domestic Borrowers party thereto (collectively, with the Lead Borrower, the “Domestic Borrowers”), (ii) the Domestic Borrowers, (iii) the Canadian Borrower (the Canadian Borrower, collectively with the Domestic Borrowers, the “Borrowers”), (iv) the Facility Guarantors party thereto, (v) Bank of America, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”) for its own benefit and the benefit of the other Secured Parties, (vi) Bank of America, N.A. (acting through its Canada branch), as Canadian Administrative Agent (in such capacity, the “Canadian Agent”) for its own benefit and the benefit of the other Secured Parties, (vii) Bank of America, N.A. and Wells Fargo Bank, National Association, as Co-Collateral Agents for their own benefit and the benefit of the other Secured Parties, and (viii) the Lenders party thereto (the “Lenders”), with interest at the rate and payable in the manner stated therein.

This is a “Canadian Tranche A-1 Note” to which reference is made in the Credit Agreement and is subject to all terms and provisions thereof. The principal of, and interest on, this Canadian Tranche A-1 Note shall be payable at the times, in the manner, and in the amounts as provided in the Credit Agreement and shall be subject to prepayment and acceleration as provided therein. Capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

1

The Canadian Agent’s books and records concerning the Canadian Tranche A-1 Loans, the accrual of interest thereon, and the repayment of such Canadian Tranche A-1 Loans, shall be prima facie evidence of the indebtedness hereunder, absent manifest error.

No delay or omission by the Canadian Agent, any other Agent or the Canadian Tranche A-1 Lender in exercising or enforcing any of the Canadian Agent’s, such other Agent’s or the Canadian Tranche A-1 Lender’s powers, rights, privileges, remedies, or discretions hereunder shall operate as a waiver thereof on that occasion nor on any other occasion. No waiver of any Event of Default shall operate as a waiver of any other Event of Default, nor as a continuing waiver.

After the occurrence and during the continuance of an Event of Default, the Canadian Borrower, and each endorser and guarantor of this Canadian Tranche A-1 Note, waives presentment, demand, notice, and protest, and also waives any delay on the part of the holder hereof. The Canadian Borrower assents to any extension or other indulgence (including, without limitation, the release or substitution of Collateral) permitted by the Canadian Agent, any other Agent and/or the Canadian Tranche A-1 Lender with respect to this Canadian Tranche A-1 Note and/or any Collateral or any extension or other indulgence with respect to any other liability or any collateral given to secure any other liability of the Canadian Borrower or any other Person obligated on account of this Canadian Tranche A-1 Note.

This Canadian Tranche A-1 Note shall be binding upon the Canadian Borrower, and each endorser and guarantor hereof, and upon their respective successors, assigns, and representatives, and shall inure to the benefit of the Canadian Tranche A-1 Lender and its successors, endorsees, and assigns.

The liabilities of the Canadian Borrower, and of any endorser or guarantor of this Canadian Tranche A-1 Note, are joint and several; provided, however, the release by the Canadian Agent, any other Agent or the Canadian Tranche A-1 Lender of any one or more such Persons shall not release any other Person obligated on account of this Canadian Tranche A-1 Note. Each reference in this Canadian Tranche A-1 Note to the Canadian Borrower, any endorser, and any guarantor, is to such Person individually and also to all such Persons jointly. No Person obligated on account of this Canadian Tranche A-1 Note may seek contribution from any other Person also obligated except in accordance with the terms of Section 9.14(d) of the Credit Agreement.

If, for the purpose of obtaining judgment in any court or for the purpose of determining, pursuant to the obligations of the Canadian Borrower, the amounts owing hereunder, it is necessary to convert an amount due hereunder in the currency in which it is due (the “Original Currency”) into another currency (the “Second Currency”), the rate of exchange applied shall be that at which, in accordance with normal banking procedures, the Canadian Agent could purchase, in the New York foreign exchange market, the Original Currency with the Second Currency on the date two (2) Business Days preceding that on which judgment is given or any other payment is due hereunder. The Canadian Borrower agrees that its obligation

2

in respect of any Original Currency due from it to the Canadian Tranche A-1 Lender hereunder shall, notwithstanding any judgment or payment in such other currency, be discharged only to the extent that, on the Business Day following the date the Canadian Tranche A-1 Lender receives payment of any sum so adjudged or owing to be due hereunder in the Second Currency the Canadian Agent may, in accordance with normal banking procedures, purchase, in the New York City foreign exchange market the Original Currency with the amount of the Second Currency so paid; and if the amount of the Original Currency so purchased or could have been so purchased is less than the amount originally due in the Original Currency, the Canadian Borrower agrees as a separate obligation and notwithstanding any such payment or judgment to indemnify the Canadian Tranche A-1 Lender against such loss. The term “rate of exchange” in this paragraph means the spot rate at which the Canadian Agent, in accordance with normal practices are able on the relevant date to purchase the Original Currency with the Second Currency and includes any premium and costs of exchange payable in connection with such purchase.

THIS CANADIAN TRANCHE A-1 NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE PROVINCE OF ONTARIO.

The Canadian Borrower agrees that any suit for the enforcement of this Canadian Tranche A-1 Note or any other Loan Document may be brought in the courts of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Canadian Agent may elect in its sole discretion and consents to the non-exclusive jurisdiction of such courts. The Canadian Borrower hereby waives any objection which it may now or hereafter have to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum and agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. The Canadian Borrower agrees that any action commenced by the Canadian Borrower asserting any claim or counterclaim arising under or in connection with this Canadian Tranche A-1 Note or any other Loan Document shall be brought solely in a court of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Canadian Agent may elect in its sole discretion and consents to the exclusive jurisdiction of such courts with respect to any such action.

The Canadian Borrower makes the following waiver knowingly, voluntarily, and intentionally, and understands that the Canadian Agent, the other Agents and the Canadian Tranche A-1 Lender, in the establishment and maintenance of their respective relationship with the Canadian Borrower contemplated by this Canadian Tranche A-1 Note, is relying thereon. THE CANADIAN BORROWER, EACH GUARANTOR, ENDORSER AND SURETY, AND THE CANADIAN TRANCHE A-1 LENDER, BY ITS ACCEPTANCE HEREOF, HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS CANADIAN TRANCHE A-1 NOTE, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY); AND WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY

3

NOTICES THEREOF AS WELL AS NOTICE OF NONPAYMENT. THE CANADIAN BORROWER, EACH GUARANTOR, ENDORSER AND SURETY, AND THE CANADIAN TRANCHE A-1 LENDER, BY ITS ACCEPTANCE HEREOF, (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THE CREDIT AGREEMENT AND THIS CANADIAN TRANCHE A-1 NOTE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS HEREIN.

[SIGNATURE PAGE FOLLOWS]

4

IN WITNESS WHEREOF, the Canadian Borrower has caused this Canadian Tranche A-1 Note to be duly executed as of the date set forth above.

CANADIAN BORROWER:

TOYS “R” US (CANADA) LTD.

TOYS “R” US (CANADA) LTEE

By: ____________________________

Name: __________________________

Title: ___________________________

Signature Page to Canadian Tranche A-1 Note

Exhibit J

Form of Compliance Certificate

COMPLIANCE CERTIFICATE

Date of Certificate: _______________

To:Bank of America, N.A., as Administrative Agent

100 Federal Street, 9^th Floor

Boston, Massachusetts 02110

Reference is made to the Third Amended and Restated Credit Agreement dated as of March 21, 2014 (as amended, modified, supplemented or restated and in effect from time to time, the “Credit Agreement”), by and between, among others (i) Toys “R” Us-Delaware, Inc., as a Domestic Borrower and as agent (in such capacity, the “Lead Borrower”) for itself and the other Domestic Borrowers party thereto (collectively, with the Lead Borrower, the “Domestic Borrowers”), (ii) the Domestic Borrowers, (iv) Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee (the “Canadian Borrower” and, collectively with the Domestic Borrowers, the “Borrowers”), (iv) the Facility Guarantors party thereto, (v) Bank of America, N.A., as Administrative Agent, for its own benefit and the benefit of the other Secured Parties, (vi) Bank of America, N.A. (acting through its Canada branch), as Canadian Administrative Agent for its own benefit and the benefit of the other Secured Parties, (vii) Bank of America, N.A. and Wells Fargo Bank, National Association, as Co-Collateral Agents for their own benefit and the benefit of the other Secured Parties, and (viii) the Lenders party thereto. Terms defined in the Credit Agreement are used herein as therein defined.

The undersigned, a duly authorized and acting Financial Officer of the Lead Borrower, hereby certifies to the Administrative Agent as follows:

1. Defaults/Events of Default.

(a) Since __________ (the date of the last similar certification), and except as set forth in Appendix I, no Default or Event of Default has occurred.

(b) If a Default or Event of Default has occurred since __________ (the date of the last similar certification), the Borrowers have taken or propose to take those actions with respect to such Default or Event of Default as described on said Appendix I.

(Note, if no Default or Event of Default has occurred, insert “Not Applicable”.)

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2. Monthly Excess Availability. The reasonably detailed calculations with respect to the Monthly Excess Availability for the [Fiscal Year/Fiscal Quarter] ending ______________ are attached hereto as Appendix II.

3. Availability.Without duplicating the calculations described in Section 2 herein, the reasonably detailed calculations setting forth compliance with the provisions of Section 6.10 of the Credit Agreement with respect to Combined Availability are attached hereto as Appendix III.

4. Store Openings/Store Closings. A list of Stores that were opened and/or closed, including, without limitation, the name and address of each such Store and date of the opening or closing, since __________ (the date of the last similar certification), is attached hereto as Appendix IV.

(Note, if no Store openings or closings have occurred, insert “Not Applicable”.)

5. GAAP.

(a) [For use with Fiscal Year-end financial statements only]The financial statements furnished to the Administrative Agent for the Fiscal Year ending _______ were prepared in accordance with GAAP and present fairly in all material respects the Consolidated financial condition and results of operations of (i) the Parent and its Subsidiaries, and (ii) the Lead Borrower and its Subsidiaries (other than the Canadian Borrower and its Subsidiaries), in each case, as of the end of, and the results of the Parent’s and its Subsidiaries’ or the Lead Borrower’ and its Subsidiaries’ as applicable, operations and cash flows for, the period(s) covered, subject to any changes as disclosed on Appendix V hereto.

(b) [For use with Fiscal Quarter-end financial statements only]The financial statements furnished to the Administrative Agent for the Fiscal Quarter ending _______ were prepared in accordance with GAAP and present fairly in all material respects the Consolidated financial condition and results of operations of (i) the Lead Borrower and its Subsidiaries, (ii) the Lead Borrower and its Subsidiaries (other than the Canadian Borrower and its Subsidiaries), and (iii) the Canadian Borrower and its Subsidiaries, as of the end of, and the results of the applicable Loan Parties and their Subsidiaries’ operations and cash flows for, the period(s) covered, subject to (a) normal year end audit adjustments and the absence of footnotes and (b) any changes as disclosed on Appendix V hereto.

(c) Except as set forth in Appendix V, there has been no change in GAAP or in the application thereof since ________________ (the date of the Parent’s or the Lead Borrower’s, as applicable, most recent audited

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financial statements), and if such a change has occurred, the effect of such change on the financial statements is detailed in Appendix V.

(Note, if no change has occurred, insert “Not Applicable”.)

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Lead Borrower, on behalf of itself and each of the other Loan Parties, has duly executed this Compliance Certificate as of __________________, 20__.

LEAD BORROWER:

TOYS “R” US-DELAWARE, INC.

By: ____________________________

Name: __________________________

Title: ___________________________

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Appendix I to Compliance Certificate

Except as set forth below, no Default or Event of Default has occurred. [If a Default or Event of Default has occurred, the following describes the nature of the Default or Event of Default in reasonable detail and the steps, if any, being taken or contemplated by the Loan Parties to be taken on account thereof.]

- 5-

Appendix II to Compliance Certificate

The following is a calculation of Monthly Excess Availability for the [Fiscal Year/Fiscal Quarter] ending on ___________________:

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Appendix III to Compliance Certificate

The following is a calculation of Combined Availability for the [Fiscal Year/Fiscal Quarter] ending on ___________________:

- 7-

Appendix IV to Compliance Certificate

The following Stores were opened since __________ (the date of the last similar certification):

Name Address Date

The following Stores were closed since __________ (the date of the last similar certification):

Name Address Date

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Appendix V to Compliance Certificate

Except as set forth below, no change in GAAP or in the application thereof has occurred since the date of the Parent’s or the Lead Borrower’s, as applicable, most recent audited financial statements referred to in Section 5.01 of the Credit Agreement. [If such changes have occurred, the following describes the nature of the changes in reasonable detail and the effect, if any, of each such change in GAAP or in the application thereof on the financial statements delivered in accordance with the Credit Agreement.]

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EXHIBIT K

FORM OF BORROWING BASE CERTIFICATE

[see attached]

Toys "R" Us-Delaware, Inc.		Date:		From:
Borrowing Base Certificate		Certificate #		To:
Tranche A Borrowing Base
U.S. Credit Card Receivables
Eligible Credit Card Receivables
Credit Card Advance Rate					90.00	%
Credit Card Receivables Availability					-
U.S. TRU Inventory
TRU Inventory
L/C Inventory					-
Less Ineligibles:
Reduction to .com inventory for unreported sales (1 day)					-
LCM Reserve
Shrink
Puerto Rico Inventory
Unbooked Adjust for Duplication of Imports and other					-
Total Ineligible TRU Inventory					-
			NRV
	Low Season (1st Day after 1st Sunday after 12/15 - 10/14)		77.10%
	High Season (10/15 - 1st Sunday after 12/15)		87.10%
Total Eligible TRU Inventory
Inventory Advance Rate (90%)					78.39	%
TRU Inventory Availability					-
TRU Intransit:
Imports Intransit (hard line)
Location 5001
Total Intransit
Inventory Advance Rate (90%)					78.39	%
TRU Intransit Availability					-
U.S. BRU Inventory
BRU Inventory
Less Ineligibles:
LCM Reserve
Shrink
Total Ineligible BRU Inventory					-
			NRV
	Low Season (11/1 - 1/31)		81.50%
	High Season (2/1 - 10/31)		82.70%
Total Eligible BRU Inventory					-
Inventory Advance Rate (90%)					74.43	%
BRU Inventory Availability					-

BRU Intransit:
Total Intransit
Inventory Advance Rate (90%)				74.43	%
BRU Intransit Availability				-
Total Intransit Availability (Capped at 12.5% of Combined Borrowing Base)				0
Total Tranche A Borrowing Base Availability Before U.S. Availability Reserves				0
Less: U.S. Availability Reserves
Landlord Lien Reserve (2 mos. Rent) (PA, WA, VA)
Customer Liabilities (45% of Gift Cards Outstanding less dormancy reserve)
GFS Liability (Guest Fulfillment Services - Pre sales/Special Orders)
Landed costs not yet paid
Domestic Tranche A-1 Pushdown Reserve
Total U.S. Availability Reserves				-
Total Tranche A Borrowing Base				0
Canadian Borrowing Base
		$CAN		$USD
Canadian Credit Card Receivables
Eligible Credit Card Receivables				-
Credit Card Advance Rate		90.00	%	90.00	%
Credit Card Receivables Availability		-		-
Canadian TRU Inventory
Canadian Inventory - Stock Ledger				-
Add: Toysrus.ca inventory		-		-
Canadian Inventory		-		-
Less Ineligibles:
Shrink (.8% of sales)				-
Prepaid Sales				-
RTV & RGD				-
Total Ineligible TRU Inventory		-		-
		NRV
	Low Season (1st Day after 1st Sunday after 12/15 - 10/14)	79.10%
	High Season (10/15 - 1st Sunday after 12/15)	88.20%
Eligible TRU Inventory		-		-
Inventory Advance Rate (90%)		79.38	%	79.38	%
Canadian TRU Inventory Availability		-		-
Canadian BRU Inventory
Canadian Inventory - Stock Ledger		-
Less: toysrus.ca inventory		-		-
Canadian Inventory		-		-

Less Ineligibles:
Shrink (.8% of sales)			-		-
RTV & RGD			-		-
Total Ineligible BRU Inventory			-		-
Eligible BRU Inventory			-		-
Inventory Advance Rate (90%)			0.00	%	0.00	%
Canadian BRU Inventory Availability			-		-
Canadian Real Estate Availability
FMV of Eligible Real Estate					-
Less: Canadian Realty Reserves					-
Total Eligible RE			-		-
Real Estate Advance Rate			50.00	%	50.00	%
Real Estate Availability (capped at 10% of Combined Borrowing Base)			-		0
Less: Canadian Availability Reserves
Realty Tax Reserve					-
Landlord Lien Reserve					-
Canadian Sales Reserve: 10% of FMV of Eligible RE Sold (capped at $10MM)			-		-
					-
Canadian Tranche A-1 Pushdown Reserve
Total Canadian Availability Reserves			-		-
Canadian Borrowing Base			-		0
Canadian Borrowing Base in $USD	Exchange Rate:	Date:			0
Combined Borrowing Base					0
Canadian Availability: lesser of (a) or (b) where:
			$CAN		$USD
(a) Canadian Credit Ceiling					200,000,000
less: Canadian Loans outstanding ($USD)					-
less: Canadian Loans outstanding ($CAN)			-		-
less: Canadian L/Cs outstanding ($USD)					-
less: Canadian L/Cs outstanding ($CAN)					-
Total (a):					200,000,000
(b) Canadian Borrowing Base					0
less: Canadian Loans outstanding ($USD)					-
less: Canadian Loans outstanding ($CAN)			-		-
less: Canadian L/Cs outstanding ($USD)			-		-
less: Canadian L/Cs outstanding ($CAN)			-		-
Total (b):					0
Canadian Availability {lesser of (a) or (b)}					0

Domestic Availability: lesser of (a) or (b) where:
(a) Revolving Credit Ceiling	1,850,000,000
less: Domestic Loans outstanding
less: Domestic L/Cs outstanding
less: Import L/Cs outstanding - Wells Fargo Bank, N.A. HK
less: Canadian Credit Extensions	-
Total (a):	1,850,000,000
(b) Tranche A Borrowing Base	0
less: Domestic Loans outstanding	-
less: Domestic L/Cs outstanding	-
less: Import L/Cs outstanding - Wells Fargo Bank, N.A. HK	-
Total (b):	0
Domestic Availability {lesser of (a) or (b)}	0
Excess Availability	0
The undersigned, a Financial Officer (as defined in Credit Agreement referenced below) of Toys "R" Us-Delaware, Inc. represents and warrants that as of the date hereof (A) the information set forth above and all supporting documentation delivered in connection herewith (i) is true and correct in all material respects, (ii) has been prepared in accordance with the requirements of that certain Third Amended and Restated Credit Agreement dated March 21, 2014 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by, among others, (1) Toys “R” Us – Delaware, Inc., (2) the other loan parties party thereto, (3) the Lenders party thereto, (4) Bank of America, N.A., as Administrative Agent (in such capacity, the “Agent”), (5) Bank of America, N.A.(acting through its Canada branch), as Canadian Agent and (6) Bank of America, N.A. and Wells Fargo Bank, National Association, as Co-Collateral Agents, and (iii) is based on supporting documentation that was used by the undersigned in connection with the preparation hereof and supports the calculations and conclusions evidenced hereby, which supporting documentation the undersigned acknowledges must be satisfactory to Agent and (B) no Default or Event of Default (as such terms are defined in the Credit Agreement) has occurred and is outstanding.
Financial Officer
Name:

Toys "R" Us-Delaware, Inc.		Date:		From:
FILO Borrowing Base Certificate		Certificate #		To:
Domestic Incremental Availability
U.S. Credit Card Receivables
Eligible Credit Card Receivables					-
Credit Card Advance Rate					10.00	%
Credit Card Receivables Availability					-
Total Eligible TRU Inventory			NRV		-
Inventory Advance Rate (10%)	Low Season (1st Day after 1st Sunday after 12/15 - 10/14)		77.10%
TRU Inventory Availability	High Season (10/15 - 1st Sunday after 12/15)		87.10%		-

Total Intransit				-
Inventory Advance Rate (10%)
TRU Intransit Availability				-
U.S. BRU Inventory
Total Eligible BRU Inventory		NRV		-
Inventory Advance Rate (10%)	Low Season (11/1 - 1/31)	81.50%
BRU Inventory Availability	High Season (2/1 - 10/31)	82.70%		-
BRU Intransit:
Total Intransit				-
Inventory Advance Rate (10%)
BRU Intransit Availability				-
Total Intransit Availability				-
36% of the Required Availability Amount ($125MM)
Domestic Incremental Availability (Uncapped)				-
Domestic Incremental Availability				-
Less: Domestic Tranche A-1 Loans
Domestic Incremental Excess Availability				-
Required Domestic Tranche A-1 Pushdown Reserve				-
Canadian Incremental Availability
		$CAN		$USD
Canadian Credit Card Receivables
Eligible Credit Card Receivables		-		-
Credit Card Advance Rate		10.00	%	10.00	%
Credit Card Receivables Availability		-		-
Canadian TRU Inventory
		NRV
	Low Season (1st Day after 1st Sunday after 12/15 - 10/14)	79.10%
	High Season (10/15 - 1st Sunday after 12/15)	88.20%
Eligible TRU Inventory		-		-
Inventory Advance Rate (10%)		0.00	%
Canadian TRU Inventory Availability		-		-
Canadian BRU Inventory
Eligible BRU Inventory		-		-
Inventory Advance Rate (10%)		0.00	%	0.00	%
Canadian BRU Inventory Availability		-		-
Canadian Real Estate Availability

FMV of Eligible Real Estate			-		-
Less: Canadian Realty Reserves			-		-
Total Eligible RE			-		-
Real Estate Advance Rate			15.00	%	15.00	%
Real Estate Availability			-		-
64% of the Required Availability Amount ($125MM)
Canadian Incremental Availability (Uncapped)					-
Canadian Incremental Availability in $USD	Exchange Rate:	Date:			-
Less: Canadian Tranche A-1 Loans
Canadian Incremental Excess Availability					-
Required Canadian Tranche A-1 Pushdown Reserve					-
The undersigned, a Financial Officer (as defined in Credit Agreement referenced below) of Toys "R" Us-Delaware, Inc. represents and warrants that as of the date hereof (A) the information set forth above and all supporting documentation delivered in connection herewith (i) is true and correct in all material respects, (ii) has been prepared in accordance with the requirements of that certain Third Amended and Restated Credit Agreement dated March 21, 2014 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by, among others, (1) Toys “R” Us – Delaware, Inc., (2) the other loan parties party thereto, (3) the Lenders party thereto, (4) Bank of America, N.A., as Administrative Agent (in such capacity, the “Agent”), (5) Bank of America, N.A.(acting through its Canada branch), as Canadian Agent and (6) Bank of America, N.A. and Wells Fargo Bank, National Association, as Co-Collateral Agents, and (iii) is based on supporting documentation that was used by the undersigned in connection with the preparation hereof and supports the calculations and conclusions evidenced hereby, which supporting documentation the undersigned acknowledges must be satisfactory to Agent and (B) no Default or Event of Default (as such terms are defined in the Credit Agreement) has occurred and is outstanding.
Financial Officer
Name:

Schedule 1.1

Lenders and Commitments

Lender	Domestic Commitment	Domestic Commitment Percentage	Canadian Commitment	Canadian Commitment Percentage	Total Commitment	Total Commitment Percentage	Pro Rata Percentage (including Tranche A-1 Loans)
Bank of America, N.A.	$335,000,0001	18.1081%	$0	0%	$335,000,0001	18.1081%	23.0047%
Bank of America, N.A. (acting through its Canada branch)	$0	0%	$62,000,000	31.000000%	See Note 1 below	See Note 1 below	5.8685%
Wells Fargo Bank, National Association	$385,000,0002	20.8108%	$0	0%	$385,000,0002	20.8108%	18.0751%
Wells Fargo Financial Corporation Canada	$0	0%	$60,000,000	30.000000%	See Note 2 below	See Note 2 below	See Note 2 below
Deutsche Bank AG New York Branch	$150,000,0003	8.1081%	$0	0%	$150,000,0003	8.1081%	7.0423%
Deutsche Bank AG Canada Branch	$0	0%	$35,000,000	17.500000%	See Note 3 below	See Note 3 below	See Note 3 below
JPMorgan Chase Bank, N.A.	$150,000,0004	8.1081%	$0	0%	$150,000,0004	8.1081%	7.0423%
JPMorgan Chase Bank, N.A. Toronto	$0	0%	$35,000,000	17.500000%	See Note 4 below	See Note 4 below	See Note 4 below
Goldman Sachs Bank USA	$150,000,000	8.1081%	$0	0%	$150,000,000	8.1081	7.0423%
Citibank N.A.	$110,000,000	5.9459%	$0	0%	$110,000,000	5.9459%	5.1643%
Bank of Montreal	$100,000,000	5.4054%	$0	0%	$100,000,000	5.4054%	4.6948%
General Electric Capital Corporation	$75,000,000	4.0541%	$0	0%	$75,000,000	4.0541%	3.5211%
U.S. Bank National Association	$75,000,000	4.0541%	$0	0%	$75,000,000	4.0541%	3.5211%
HSBC Bank USA, N.A.	$65,000,0005	3.5135%	$0	0%	$65,000,0005	3.5135%	3.0516%
HSBC Bank Canada	$0	0%	$8,000,000	4.000000%	See Note 5 below	See Note 5 below	See Note 5 below
Regions Bank	$50,000,000	2.7027%	$0	0%	$50,000,000	2.7027%	2.3474%
SunTrust Bank	$50,000,000	2.7027%	$0	0%	$50,000,000	2.7027%	2.3474%
PNC Bank, National Association	$35,000,000	1.8919%	$0	0%	$35,000,000	1.8919%	1.6432%
TD Bank, N.A.	$35,000,000	1.8919%	$0	0%	$35,000,000	1.8919%	1.6432%

Lender	Domestic Commitment	Domestic Commitment Percentage	Canadian Commitment	Canadian Commitment Percentage	Total Commitment	Total Commitment Percentage	Pro Rata Percentage (including Tranche A-1 Loans)
Capital One Business Credit Corp.	$25,000,000	1.3514%	$0	0%	$25,000,000	1.3514%	1.1737%
CIT Bank	$20,000,000	1.0811%	$0	0%	$50,000,000	1.0811%	0.9390%
Fifth Third Bank	$15,000,000	0.8108%	$0	0%	$15,000,000	0.8108%	0.7042%
UPS Capital Corporation	$15,000,000	0.8108%	$0	0%	$15,000,000	0.8108%	0.7042%
Credit Suisse AG, Cayman Islands Branch	$10,000,000	0.5405%	$0	0%	$10,000,000	0.5405%	0.4695%
TOTAL	$1,850,000,000	100%	$200,000,000	100%	$1,850,000,000	100%	100%

The Commitments of certain Lenders may be used by either the Canadian Borrowers or the Domestic Borrowers at any time but are not aggregated. Thus:

Note 1: The aggregate Commitments of Bank of America, N.A. and Bank of America, N.A. (acting through its Canada branch), other than with respect to Tranche A-1 Loans, total $335,000,000. Any usage by the Canadian Borrower of the Bank of America, N.A. (acting through its Canada branch) Canadian Commitment, other than with respect to Tranche A-1 Loans, will reduce dollar for dollar the amounts available to be borrowed under the Bank of America, N.A. Domestic Commitment, other than with respect to Tranche A-1 Loans. Similarly, any amounts borrowed by the Domestic Borrowers from Bank of America, N.A. in excess of $273,000,000, other than with respect to Tranche A-1 Loans, will reduce dollar for dollar the amounts available to be borrowed under the Bank of America, N.A. (acting through its Canada branch) Canadian Commitment, other than with respect to Tranche A-1 Loans.

Note 2: The aggregate Commitments of Wells Fargo Bank, National Association and Wells Fargo Financial Corporation Canada total $385,000,000. Any usage by the Canadian Borrower of the Wells Fargo Financial Corporation Canada Canadian Commitment will reduce dollar for dollar the amounts available to be borrowed under the Wells Fargo Bank, National Association Domestic Commitment. Similarly, any amounts borrowed by the Domestic Borrowers from Wells Fargo Bank, National Association in excess of $325,000,000 will reduce dollar for dollar the amounts available to be borrowed under the Wells Fargo Financial Corporation Canada Canadian Commitment.

Note 3: The aggregate Commitments of Deutsche Bank AG New York Branch and Deutsche Bank AG Canada Branch total $150,000,000. Any usage by the Canadian Borrower of Deutsche Bank AG Canada Branch Canadian Commitment will reduce dollar for dollar the amounts available to be borrowed under the Deutsche Bank AG New York Branch Domestic Commitment. Similarly, any amounts borrowed by the Domestic Borrowers from Deutsche Bank AG New York Branch in excess of $115,000,000 will reduce dollar for dollar the amounts available to be borrowed under the Deutsche Bank AG Canada Branch Canadian Commitment.

Note 4: The aggregate Commitments of JPMorgan Chase Bank, N.A. and JPMorgan Chase Bank, N.A. Toronto total $150,000,000. Any usage by the Canadian Borrower of JPMorgan Chase Bank, N.A. Toronto Canadian Commitment will reduce dollar for dollar the amounts available to be borrowed under the JPMorgan Chase Bank, N.A. Domestic Commitment. Similarly, any amounts borrowed by the Domestic Borrowers from JPMorgan Chase Bank, N.A. in excess of $115,000,000 will reduce dollar for dollar the amounts available to be borrowed under the JPMorgan Chase Bank, N.A. Toronto Canadian Commitment.

Note 5: The aggregate Commitments of HSBC Bank USA, N.A. and HSBC Bank Canada total $65,000,000. Any usage by the Canadian Borrower of HSBC Bank Canada Canadian Commitment will reduce dollar for dollar the amounts available to be borrowed under the HSBC Bank USA, N.A. Domestic Commitment. Similarly, any amounts borrowed by the Domestic Borrowers from HSBC Bank USA, N.A. in excess of $57,000,000 will reduce dollar for dollar the amounts available to be borrowed under the HSBC Bank Canada Canadian Commitment.

Tranche A-1 Lenders and Percentages

Lender	Domestic Tranche A- 1 Commitment	Domestic Tranche A-1 Percentage	Canadian Tranche A-1 Commitment	Canadian Tranche A-1 Percentage	Total Tranche A-1 Commitment	Total Revolver (Tranche A-1) Commitment Percentage	Pro Rata Percentage (including Tranche A-1 Loans)
Bank of America, N.A.	$155,000,0001	100.000000%	$0	0%	$155,000,000	55.357143%	See above
Bank of America, N.A. (acting through its Canada branch)	$0	0%	$125,000,000	100.000000%	$125,000,000	44.642857%	See above
TOTAL	$155,000,000	100%	$125,000,000	100%	$280,000,000	100%	See above

1748563.5

Schedule 3.01

Name	State of Incorporation	Organization Type	Organization Number	Federal EIN
Toys “R” Us-Delaware, Inc.	Delaware	Corporation
Toys “R” Us (Canada) Ltd./Toys “R” Us (Canada) Ltee	Ontario, Canada	Corporation
Geoffrey Holdings, LLC	Delaware	Limited liability company
Toys Acquisition, LLC	Delaware	Limited liability company
TRU-SVC, LLC	Virginia	Limited liability company
TRU of Puerto Rico, Inc.	Puerto Rico	Corporation

Schedule 3.12

[See Schedule 3.12 to the

Third Amended and Restated Credit Agreement, dated as of March 21, 2014]

Annex B

Amended and Restated Intercreditor Agreement

[See Attached]

Annex B

AMENDED AND RESTATED INTERCREDITOR AGREEMENT

by and between

BANK OF AMERICA, N.A.

as ABL Agent

and

BANK OF AMERICA, N.A.

as Term Agent

and

THE BANK OF NEW YORK MELLON

as Notes Agent

Dated as of August 24, 2010

TABLE OF CONTENTS

		Page No.
	ARTICLE 1
	DEFINITIONS
Section 1.1	UCC Definitions	32
Section 1.2	Other Definitions	32
Section 1.3	Rules of Construction	16
	ARTICLE 2
	LIEN PRIORITY
Section 2.1	Priority of Liens	16
Section 2.2	Waiver of Right to Contest Liens	17
Section 2.3	Remedies Standstill	18
Section 2.4	Exercise of Rights	19
Section 2.5	No New Liens	20
Section 2.6	Waiver of Marshalling	2021
Section 2.7	Refinancings	2021
Section 2.8	Junior Indebtedness	21
	ARTICLE 3
	ACTIONS OF THE PARTIES
Section 3.1	Certain Actions Permitted	21
Section 3.2	Agent for Perfection	2122
Section 3.3	[Reserved]	22
Section 3.4	Insurance	2223
Section 3.5	No Additional Rights for the Loan Parties Hereunder	2223
Section 3.6	Geoffrey Collateral	2223
Section 3.7	Access Rights	2324
	ARTICLE 4
	APPLICATION OF PROCEEDS
Section 4.1	Application of Proceeds	2425
Section 4.2	Application of Proceeds In Respect of the IntermediateCo Unsecured Guarantee	27
Section 4.24.3	Specific Performance	2527
	ARTICLE 5
	INTERCREDITOR ACKNOWLEDGEMENTS AND WAIVERS
Section 5.1	Notice of Acceptance and Other Waivers	2627
Section 5.2	Modifications to ABL Documents and Shared Collateral Documents	2728

-i-

Section 5.3	Reinstatement and Continuation of Agreement	2931
Section 5.4	Joinder of Authorized Representatives	3031
	ARTICLE 6
	INSOLVENCY PROCEEDINGS
Section 6.1	DIP Financing	3032
Section 6.2	Relief from Stay	3032
Section 6.3	No Contest; Adequate Protection	3133
Section 6.4	Asset Sales	3134
Section 6.5	Separate Grants of Security and Separate Classification	3134
Section 6.6	Enforceability	3234
Section 6.7	ABL Obligations Unconditional	3234
Section 6.8	Shared Collateral Obligations Unconditional	3234
	ARTICLE 7
	CANADIAN PLEDGE COLLATERAL
Section 7.1	Canadian Pledge Collateral	35
Section 7.2	Waiver of Right to Contest Liens	36
Section 7.3	Canadian Pledge Collateral Remedies Standstill; Release of Liens	37
Section 7.4	Application of Proceeds; Turnover Provisions	38
	ARTICLE 8
	MISCELLANEOUS
Section 7.18.1	Rights of Subrogation	3339
Section 7.28.2	Further Assurances	3339
Section 7.38.3	Representations	3339
Section 7.48.4	Amendments	3440
Section 7.58.5	Addresses for Notices	3440
Section 7.68.6	No Waiver, Remedies	3540
Section 7.78.7	Continuing Agreement, Transfer of Secured Obligations	3540
Section 7.88.8	Governing Law; Entire Agreement	3541
Section 7.98.9	Counterparts	3541
Section 7.108.10	No Third Party Beneficiaries	3541
Section 7.118.11	Headings	3641
Section 7.128.12	Severability	3641
Section 7.138.13	Attorneys Fees	3642
Section 7.148.14	VENUE; JURY TRIAL WAIVER	3642
Section 7.158.15	Intercreditor Agreement	3743
Section 7.168.16	No Warranties or Liability	3743
Section 7.178.17	Conflicts	3843
Section 7.188.18	Information Concerning Financial Condition of the Loan Parties	3843
Section 7.198.19	Amendment, Restatement, Extension, Renewal and Consolidation of Existing Intercreditor Agreement	3844
Section 7.208.20	Force Majeure	3844
Section 7.21	Authority of Notes Collateral Agent	38

-ii-

-iii-

AMENDED AND RESTATED INTERCREDITOR AGREEMENT

THIS AMENDED AND RESTATED INTERCREDITOR AGREEMENT (as amended, supplemented, restated or otherwise modified from time to time pursuant to the terms hereof, this “Agreement”) is entered into as of August 24, 2010 between BANK OF AMERICA, N.A. (“Bank of America”), in its capacities as administrative agent and collateral agent (together with its successors and assigns in such capacities, the “ABL Agent”) for the financial institutions party from time to time to the ABL Credit Agreement referred to below (such financial institutions, together with their successors, assigns and transferees, the “ABL Credit Agreement Lenders” and, together with affiliates thereof and certain other specified hedging parties, in their capacity as ABL Cash Management Affiliates or ABL Hedging Affiliates (in each case, as hereinafter defined), the “ABL Lenders”),and BANK OF AMERICA, N.A. (as successor to Banc of America Bridge LLC) in its capacity as administrative agent (together with its successors and assigns in such capacity, the “Term Agent”) for the financial institutions party from time to time to Term Credit Agreement (as defined herein)and THE BANK OF NEW YORK MELLON, in its capacity as trustee and collateral agent (together with its successors and assigns in such capacity, the “Notes Agent”) for the financial institutions party from time to time to Notes Documents (as defined herein)..

RECITALS

A.Pursuant to that certain Credit Agreement dated as of July 21, 2005 (as amended and restated as of June 24, 2009 and as further amended and restated as of August 10, 2010) by and among Toys “R” Us-Delaware, Inc. (the “ABL Lead Borrower”), Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltd.Ltee. (the “Canadian Borrower”) and certain other borrowers from time to time party thereto (collectively with the ABL Lead Borrower and the Canadian Borrower, the “ABL Borrowers”), the ABL Credit Agreement Lenders and the ABL Agent (as such agreement has been amended to date, and may hereafter be amended, supplemented, restated or otherwise modified from time to time in accordance with this Agreement, the “ABL Credit Agreement”), the ABL Credit Agreement Lenders made certain loans and other financial accommodations to or for the benefit of the ABL Borrowers on such date.

B.Pursuant to a certain guaranty dated as of July 21, 2005 (as such guaranty has been amended to date and may hereafterbe amended, supplemented, restated or otherwise modified from time to time, the “ABL Guaranty”) by the ABL Guarantors (as hereinafter defined) in favor of, among others, the ABL Agent, the ABL Guarantors guaranteed the payment and performance of the ABL Borrowers’ obligations under the ABL Documents (as hereinafter defined).

C.As a condition to the effectiveness of the ABL Credit Agreement and to secure the obligations of the ABL Borrowers and the ABL Guarantors (the ABL Borrowers, the ABL Guarantors and each other direct or indirect subsidiary or parent of the ABL Borrowers or any of their affiliates that was then or thereafter became a party to any ABL Document, collectively, the “ABL Loan Parties”) under and in connection with the ABL Documents, the ABL Loan Parties granted to the ABL Agent (for the benefit of the ABL Lenders) Liens on the ABL Collateral.

D.Pursuant to that certain Credit Agreement dated as of July 19, 2006 by and among, Toys “R” Us-Delaware, Inc. (the “Term Borrower”), the Term Lenders and the Term Agent (as amended, the “Existing Term Credit Agreement”), the Term Lenders made certain loans to the Term Borrower on such date.

E.Pursuant to a certain guaranty dated as of July 19, 2006 (the “Term Guaranty”) by the Term Guarantors (as hereinafter defined) in favor of the Term Agent, the Term Guarantors guaranteed the payment and performance of the Term Borrower’s obligations under the Term Documents (as hereinafter defined).

F.As a condition to the effectiveness of the Existing Term Credit Agreement and to secure the obligations of the Term Borrower and the Term Guarantors (the Term Borrower, the Term Guarantors and each other direct or indirect subsidiary or parent of the Term Borrower or any of its affiliates that was then or thereafter became a party to any Term Document, collectively, the “Term Loan Parties”) under and in connection with the Term Documents as of such date, the Term Loan Parties granted to the Term Agent (for the benefit of the Term Lenders) Liens on the ABL Collateraland, the Geoffrey Collateraland the Canadian Pledge Collateral.

G.Concurrently with the execution and delivery of this Agreement, the Term Loan Parties and the Term Lenders have agreed to amend and restate (i) the Existing Term Credit Agreement in its entirety (as such agreement may be amended, supplemented, restated or otherwise modified from time to time in accordance with this Agreement, the “Term Credit Agreement”) pursuant to which the Term Lenders have agreed to make certain loans and other financial accommodations to or for the benefit of the Term Borrowerand (ii) the Term Security Agreement in its entirety.

H.Concurrently with the execution and delivery of this Agreement, the Notes Parties (as defined below) and the Notes Agent, in its capacity as collateral agent for the Noteholders (as defined below), have entered into that certain Indenture dated as of the date hereof (as such agreement may be amended, supplemented, restated or otherwise modified from time to time in accordance with this Agreement, the “Indenture”) providing for the issuance of 7 ⅜% Senior Secured Notes due 2016 (the “Notes”) by the Notes Issuer (as defined below) and the Notes Guarantees (as defined below) by the Notes Guarantors (as defined below).

IH.     Each of the ABL Agent (on behalf of the ABL Lenders) and the Term Agent (on behalf of the Term Lenders) and, by their acknowledgment hereof, the ABL Loan Parties and the Term Loan Parties, desire to amend and restate in its entirety the intercreditor agreement dated as of July 19, 2006August 24, 2010 by and among the ABL Agent, the Term Agent, the Borrower and the Guarantors (the “Existing Intercreditor Agreement”) and each of the ABL Agent (on behalf of the ABL Lenders) and each Shared Collateral Agent (on behalf of the applicable Shared Collateral Secured Parties) and, by their acknowledgment hereof, the ABL Loan Parties and the Shared Collateral Secured Parties agree to the relative priority of Liens on the ABL Collateral and certain other rights, priorities and interests as provided herein.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

SECTION 1.1UCC Definitions. The following terms which are defined in the Uniform Commercial Code are used herein as so defined: Accounts, Chattel Paper, Deposit Accounts, Documents, Electronic Chattel Paper, Equipment, Financial Assets, Fixtures, Instruments, Inventory, Investment Property, Letter-of-Credit Rights, Money, Payment Intangibles, Records, Security, Securities Accounts, Security Entitlements, Supporting Obligations and Tangible Chattel Paper.

SECTION 1.2Other Definitions. Subject to Section 1.1 above, unless the context otherwise requires, all capitalized terms used but not defined herein shall have the meanings set forth in the ABL Credit Agreement,and the Term Credit Agreementand the Indenture, in each case as in effect on the date hereof. In addition, as used in this Agreement, the following terms shall have the meanings set forth below:

“ABL Agent” shall have the meaning assigned to that term in the introduction to this Agreement and shall include any successor thereto as well as any Person designated as the “Agent” or “Administrative Agent” under any ABL Credit Agreement.

“ABL Borrowers” shall have the meaning assigned to that term in the recitals to this Agreement.

“ABL Cash Management Affiliate” shall mean any ABL Credit Agreement Lender or any Affiliate of any ABL Credit Agreement Lender that provides Cash Management Services (as defined in the ABL Credit Agreement) to an ABL Loan Party with the obligations of such ABL Loan Party thereunder being secured by one or more ABL Collateral Documents.

“ABL Collateral” shall mean all of the following assets orand property of the ABLLoan Parties now owned or hereafter acquired, including the followingwith respect to which a Lien is granted or purported to be granted as security for any ABL Obligations and as security for any Term Obligations:

(1)all Accounts;

(2)all Chattel Paper (including Tangible Chattel Paper and Electronic Chattel Paper);

(3)(x) all Deposit Accounts and Money and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein, and (y) Securities Accounts, Security Entitlements and Securities, and, in each case, all cash, checks and other property held therein or credited thereto;

(4)all Inventory;

(5)all Documents, General Intangibles (including Payment Intangibles and Intellectual Property (but excluding any GeoffreyNon-Shared Collateral)), Instruments and Commercial Tort Claims;

(6)all Supporting Obligations and Letter-of-Credit Rights;

(7)all books, Records and information relating to the ABL Collateral (including all books, databases, customer lists, engineer drawings and Records, whether tangible or electronic);

(8)all Equipment and Investment Property;

(9)all Credit Card Receivables (as defined in the ABL Credit Agreement);

(10)any collateral received under Section 2.5 or Section 6.3;

(911)    all Real Property located in Canada; and

(1012)    all collateral security, liens, guarantees, rights, remedies and privileges with respect to any of the foregoing and all cash, Money, policies and certificates of insurance, deposits or other property, insurance proceeds, refunds and premium rebates, including without limitation, proceeds of fire and casualty insurance, instruments, securities, financial assets and deposit accounts received as proceeds of any of the foregoing (such proceeds, “ABL Proceeds”);

provided, that for the avoidance of doubt, “ABL Collateral” shall exclude the GeoffreyNon-Shared Collateral and, solely for the purposes of this Agreement, shall be deemed to not include the Canadian Pledge Collateral.

“ABL Collateral Documents” shall mean all “Security Documents” as defined in the ABL Credit Agreement, including the ABL Security Agreement and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with the ABL Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“ABL Credit Agreement” shall mean the ABL Credit Agreement and any other agreement extending the maturity of, consolidating, restructuring, refunding, replacing or refinancing all or any portion of the ABL Obligations, whether by the same or any other agent, lender or group of lenders and whether or not increasing the amount of any Indebtedness that may be incurred thereunder.

“ABL Credit Agreement Lenders” shall have the meaning assigned to that term in the introduction to this Agreement.

“ABL Documents” shall mean the ABL Credit Agreement, the ABL Guaranty, the ABL Collateral Documents, any agreements governing Cash Management Services between any ABL Loan Party and any ABL Cash Management Affiliate, any ABL Hedging Agreements between any ABL Loan Party and any ABL Hedging Affiliate, those other ancillary agreements as to which the ABL Agent or any ABL Lender is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any ABL Loan Party or any of its respective Subsidiaries or Affiliates, and delivered to the ABL Agent, in connection with any of the foregoing or any ABL Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“ABL Enforcement Date” means the date which is 180 days after the occurrence of (i) an Event of Default (under and as defined in the ABL Credit Agreement) and (ii) each Shared Collateral Agent’s receipt of an Enforcement Notice from the ABL Agent, provided that the ABL Enforcement Date shall be stayed and shall not occur (or be deemed to have occurred) (A) at any time any Shared Collateral Agent or the Shared Collateral Secured Parties have commenced and are diligently pursuing enforcement action against the Canadian Pledge Collateral, (B) at any time that any Loan Party is then a debtor under or with respect to (or otherwise subject to) any Insolvency Proceeding, or (C) if the Event of Default under the ABL Credit Agreement is waived in accordance with the terms of the ABL Credit Agreement.

“ABL Guarantors” shall mean the collective reference to Geoffrey Holdings, LLC, TRU Acquisition, LLC, TRU-SVC, LLC, TRU of Puerto Rico, Inc. and any other Person who becomes a guarantor under the ABL Guaranty.

“ABL Guaranty” shall have the meaning assigned to that term in the recitals to this Agreement.

“ABL Hedging Affiliate” shall mean any ABL Credit Agreement Lender or any Affiliate of any ABL Credit Agreement Lender that has entered into an ABL Hedging Agreement with an ABL Loan Party with the obligations of such ABL Loan Party thereunder being secured by one or more ABL Collateral Documents by an ABL Loan Party.

“ABL Hedging Agreement” shall mean any “Hedge Agreement” as defined in the ABL Credit Agreement.

“ABL Lenders” shall have the meaning assigned to that term in the introduction to this Agreement and shall include all ABL Cash Management Affiliates and ABL Hedging Affiliates and all successors, assigns, transferees and replacements thereof, as well as any Person designated as a “Lender” under any ABL Credit Agreement.

“ABL Loan Parties” shall have the meaning assigned to that term in the recitals to this Agreement.

“ABL Obligations” shall mean all obligations of every nature of each ABL Loan Party from time to time owed to the ABL Agent, the ABL Lenders, or any of them, under any ABL Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such ABL Loan Party, would have accrued on any ABL Obligation, whether or not a claim is allowed against such ABL Loan Party for such interest in the related bankruptcy proceeding), reimbursement of amounts drawn under letters of credit, payments for early termination of ABL Hedging Agreements, fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the ABL Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time; provided that if the aggregate principal amount of Revolving Credit Loans andTranche A-1Loans outstanding under the ABL Credit Agreement plus the aggregate Letter of Credit Outstandings under the ABL Credit Agreement exceeds the greater of (x) $2.53.0billion in the aggregate and (y) the Tranchesum of (A-1) the Combined Borrowing Base (and (B) the aggregate Incremental Availability (the greater of (x) and (y),the “Cap Amount”) (provided that when calculating

the amount of the Tranche A-1Borrowing BaseIncremental Availability for the purpose of the Cap Amount, the effect of any amendment, supplement or modification which expands or otherwise increases the scope of the assets that comprise the underlying borrowing base under the ABL Credit Agreementare included in the calculation of Incremental Availability to include assets other than current assets (e.g. real property (other than real property of any ABL Loan Party located in Canada)) shall be excluded from such calculation), then only (1) that portion of Revolving Credit Loans,Tranche A-1Loans and Letter of Credit Outstandings equal to the Cap Amount plus (2) interest on the Cap Amount, reimbursement obligations for Letter of Credit Outstandings included in the Cap Amount, payments for early termination of ABL Hedging Agreements, agreements governing Cash Management Services, fees, expenses, indemnification or other charges shall be included in the ABL Obligations for purposes of this Agreement until the Discharge of Term Obligations.

“ABL Recovery” shall have the meaning set forth in Section 5.3(a).

“ABL Secured Parties” shall mean “Secured Parties” as defined in the ABL Credit Agreement.

“ABL Security Agreement” shall mean the “Security Agreement” as defined in the ABL Credit Agreement.

“Access Period” means for each parcel of Real Property, the period, after the commencement of an Enforcement Period, which begins on the day that the ABL Agent provides the Shared Collateral Agents with an Enforcement Notice pursuant to Section 3.7(a) below and ends on the earliest of (i) the 120th day after the ABL Agent obtains the ability to take physical possession of, remove, or otherwise control physical access to, or actually uses, the ABL Collateral located on such Real Estate following the Enforcement Period plus such number of days, if any, after the ABL Agent obtains such access to such ABL Collateral that it is stayed or otherwise prohibited by law or court order from exercising remedies with respect to ABL Collateral located on such Real Property, (ii) the date on which all or substantially all of the ABL Collateral located on such Real Estate is sold, collected or liquidated, or (iii) the date on which the Discharge of ABL Obligations occurs; provided that in no event shall the Access Period extend later than 210 days following the date of delivery of an Enforcement Notice to the ABL Agent by the Authorized Shared Collateral Agent plus such number of days, if any, after the ABL Agent obtains such access to such ABL Collateral that it is stayed or otherwise prohibited by law or court order from exercising remedies with respect to ABL Collateral located on such Real Estate.

“Additional Pari Passu Agent” shall mean each duly authorized representative of any holders of Additional Pari Passu Obligations which agent has executed a joinder agreement to this Agreement substantially in the form of Exhibit A (appropriately completed) and which is a party to the Additional Pari Passu Documents. Upon the execution of such joinder agreement, the Additional Pari Passu Agent shall succeed to all rights, benefits and obligations of the Additional Pari Passu Agent hereunder.

“Additional Pari Passu Agreement” shall mean the agreements, documents, joinders and instruments providing for or evidencing Additional Pari Passu Obligations and which are identified in a joinder agreement to this Agreement substantially in the form of Exhibit A executed by the relevant Additional Pari Passu Agent, whether by the same or any other agent, lender or group of lenders and whether or not increasing the amount of any Indebtedness that may be incurred thereunder as permitted by the Term Documentsand Notes Documents.

“Additional Pari Passu Security Agreement” shall mean the security agreement governing any Additional Pari Passu Obligations.

“Additional Pari Passu Collateral Documents” shall mean all “Security Documents” as defined in the Additional Pari Passu Agreement, including the Additional Pari Passu Security Agreement and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with any Additional Pari Passu Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Additional Pari Passu Documents” shall mean the Additional Pari Passu Agreement, the Additional Pari Passu Guarantees, the Additional Pari Passu Collateral Documents and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any Loan Party or any of its respective Subsidiaries or Affiliates, and delivered to the Additional Pari Passu Agent, in connection with any of the foregoing or any Additional Pari Passu CreditAgreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Additional Pari Passu Guarantees” shall mean the agreements of the Additional Pari Passu Guarantors to guarantee the payment and performance of obligations of any issuer or borrower pursuant to any Additional Pari Passu Agreement under the Additional Pari Passu Documents.

“Additional Pari Passu Guarantors” shall mean any Person who becomes a guarantor under any Additional Pari Passu Document.

“Additional Pari Passu Obligations” shall mean, to the extent permitted to be incurred by the terms of the Term Credit Agreement and the IndentureABL Credit Agreement and permitted by the terms of the Term Credit Agreement and the ABL Credit Agreement to be secured by the ABL Collateral on a pari passu basis with the Liens securing the Term Loan Obligations and secured by the Canadian Pledge Collateral on a pari passu basis with the Liens securing the Term Loan Obligations (other than Term Loan Obligations in respect of any Term B-4 Loans, which will, to the extent provided herein, be senior in priority), all obligations of every nature of each NotesTerm Loan Party from time to time owed to the Additional Pari Passu Agent, the Additional Pari Passu Secured Parties or any of them, under any Additional Pari Passu Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Additional Pari Passu Secured Party, would have accrued on any Additional Pari Passu Obligation, whether or not a claim is allowed against such NotesTerm Loan Party for such interest in the related bankruptcy proceeding), payments of fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the Additional Pari Passu Documents, as amended, restated, modified, renewed, refunded, replaced or

refinanced in whole or in part from time to time; provided that no Additional Pari Passu Obligations shall be secured by any Secured Specified Real Property.

“Additional Pari Passu Parties” shall meanshall mean, collectively,each obligor in respect of any Additional Pari Passu Obligations, the Additional Pari PassuGuarantors and each other direct or indirect subsidiary or parent ofsuch obligor or any of its affiliates that is or becomes a party to any Additional Pari Passu Document.

“Additional Pari Passu Secured Parties” shall mean the “Secured Parties” (or similar term) as defined in the Additional Pari Passu Agreement.

“Affiliate” shall mean, with respect to a specified Person, any other Person that directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with the Person specified.

“Agent(s)” means individually the ABL Agent and each Shared Collateral Agent and collectively means the ABL Agent and the Shared Collateral Agents.

“Agreement” shall have the meaning assigned to that term in the introduction to this Agreement.

“Authorized Representative” shall have the meaning set forth in Section 2.7.

“Authorized Shared Collateral Agent” has the meaning assigned to the term “Authorized Collateral Agent” in the Shared Collateral Intercreditor Agreement.

“Bank of America” shall have the meaning assigned to that term in the introduction to this Agreement.

“Bankruptcy Code” shall mean Title 11 of the United States Code.

“Borrower” shall mean the ABL Borrowers,or the Term Borroweror the Notes Issuer.

“Canadian Borrower” shall have the meaning assigned to that term in the recitals to this Agreement.

“Canadian Pledge Collateral” shall mean all of the following assets and property of the Loan Parties now owned or hereafter acquired, with respect to which a Lien is granted or purported to be granted as security for any ABL Obligations and as security for any Term Obligations:

(1)65% of the voting Capital Stock and 100% of the non-voting Capital Stock of Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee; and

(2)all stock certificates, dividends, distributions, rights and proceeds of or relating to the foregoing.

“Capital Stock” shall mean, as to any Person that is a corporation, the authorized shares of such Person’s capital stock, including all classes of common, preferred, voting and nonvoting capital stock, and, as to any Person that is not a corporation or an individual, the membership or other ownership interests in such Person, including the right to share in profits and losses, the right to receive distributions of cash and other property, and the right to receive allocations of items of income, gain, loss, deduction and credit and similar items from such Person, whether or not such interests include voting or similar rights entitling the holder thereof to exercise Control over such Person, collectively with, in any such case, all warrants, options and other rights to purchase or otherwise acquire, and all other instruments convertible into or exchangeable for, any of the foregoing.

“Cash Management Services” shall have the meaning provided in the ABL Credit Agreement as in effect on the date hereof.

“CombinedBorrowing Base” shall mean the “CombinedBorrowing Base” as defined in the ABL Credit Agreement.

“Control” shall mean the possession, directly or indirectly, of the power (a) to vote 50% or more of the securities having ordinary voting power for the election of directors (or any similar governing body) of a Person, or (b) to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. The terms “Controlling” and “Controlled” have meanings correlative thereto.

“Control Collateral” shall mean any Shared Collateral consisting of any Certificated Security (as defined in Section 8-102 of the Uniform Commercial Code), Investment Property, Deposit Account, Instruments and any other Shared Collateral as to which a Lien may be perfected through possession or control by the secured party, or any agent therefor.

“Credit Documents” shall mean the ABL Documents, the Term Documents, the Notes Documents and the Additional Pari Passu Documents (if any).

“Debtor Relief Laws” shall mean the Bankruptcy Code and all other liquidation, conservatorship, bankruptcy, assignment for benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect affecting the rights of creditors generally.

“DIP Financing” shall have the meaning set forth in Section 6.1(a).

“Discharge of ABL Obligations” shall mean (a) the payment in full in cash of all outstanding ABL Obligations excluding contingent indemnity obligations with respect to then unasserted claims but including, with respect to amounts available to be drawn under outstanding letters of credit issued thereunder (or indemnities or other undertakings issued pursuant thereto in respect of outstanding letters of credit), the cancellation of such letters of credit or the delivery or provision of money or backstop letters of credit in respect thereof in compliance with the terms of any ABL Credit Agreement (which shall not exceed an amount equal to 105% of the aggregate undrawn amount of such letters of credit) and (b) the termination of all commitments to extend credit under the ABL Documents.

“Discharge of Additional Pari Passu Obligations” shall mean the payment in full in cash of all outstanding Additional Pari Passu Obligations (other than contingent indemnity obligations with respect to then unasserted claims).

“Discharge of Term Obligations” shall mean the payment in full in cash of all outstanding Term Obligations (other than contingent indemnity obligations with respect to then unasserted claims).

“Discharge of Notes Obligations” shall mean the payment in full in cash of all outstanding Notes Obligations (other than contingent indemnity obligations with respect to then unasserted claims).

“Discharge of Shared Collateral Obligations” shall mean, collectively, the Discharge of Term Obligations, Discharge of Notes Obligations and Discharge of Additional Pari Passu Obligations (if any).

“Enforcement Notice” shall mean a written notice delivered by the ABL Agent to the Shared Collateral Agents or from the Authorized Shared Collateral Agent to the ABL Agent, in either case, announcing that an Enforcement Period has commenced.

“Enforcement Period” shall mean the period of time following the receipt by either the ABL Agent or the Authorized Shared Collateral Agent of an Enforcement Notice from the other and continuing until the earliest of (a) in the case of an Enforcement Period commenced by the Authorized Shared Collateral Agent, the Discharge of Shared Collateral Obligations, (b) in the case of an Enforcement Period commenced by the ABL Agent, the Discharge of ABL Obligations, or (c) the date upon which the ABL Agent or the Authorized Shared Collateral Agent, terminate, or agree in writing to terminate, the Enforcement Period.

“Event of Default” shall mean an Event of Default under any ABL Credit Agreement, any Term Credit Agreement, any Indenture or any Additional Pari Passu Agreement (if any).

“Excluded Specified Real Property” shall have the meaning assigned to such term in the Term Credit Agreement as in effect on the date hereof.

“Exercise Any Secured Creditor Remedies” or “Exercise of Secured Creditor Remedies” shall mean, except as otherwise provided in the final sentence of this definition:

(a)the taking by any Secured Party of any action to enforce or realize upon any Lien on ABLShared Collateral, including the institution of any foreclosure proceedings or the noticing of any public or private sale pursuant to Article 9 of the Uniform Commercial Code;

(b)the exercise by any Secured Party of any right or remedy provided to a secured creditor on account of a Lien on ABLShared Collateral under any of the Credit Documents, under applicable law, in an Insolvency Proceeding or otherwise, including the election to retain any of the ABLShared Collateral in satisfaction of a Lien;

(c)the taking of any action by any Secured Party or the exercise of any right or remedy by any Secured Party in respect of the collection on, set off against, marshaling of, injunction respecting or foreclosure on the ABLShared Collateral or the Proceeds thereof;

(d)the appointment of, or the application of a Secured Party for, a receiver, receiver and manager or interim receiver of all or part of the ABLShared Collateral;

(e)the sale, lease, license, or other disposition of all or any portion of the ABLShared Collateral by private or public sale conducted by a Secured Party or any other means at the direction of a Secured Party permissible under applicable law;

(f)the exercise of any other right of a secured creditor under Part 6 of Article 9 of the Uniform Commercial Code; or

(g)the exercise by a Secured Party of any voting rights relating to any Capital Stock included in the ABLShared Collateral.

For the avoidance of doubt, none of the following shall be deemed to constitute an Exercise of Secured Creditor Remedies: (i) the filing a proof of claim in bankruptcy court or seeking adequate protection, (ii) the exercise of rights by the ABL Agent upon the occurrence of a Cash Dominion Event (as defined in the ABL Credit Agreement), including, without limitation, the notification of account debtors, depository institutions or any other Person to deliver proceeds of ABL Collateral to the ABL Agent (unless and until the ABL Lenders cease making Credit Extensions to the ABL Borrowers, in which event an Exercise of Secured Creditor Remedies shall be deemed to have occurred), (iii) the consent by a Secured Party to a sale or other disposition by any Loan Party of any of its assets or properties, (iv) the acceleration of all or a portion of the ABL Obligations or the Shared Collateral Obligations, (v) the reduction of advance rates or sub-limits by the ABL Agent and the ABL Lenders, or (vi) the imposition of reserves by the ABL Agent.

“Existing Intercreditor Agreement” shall have the meaning assigned to that term in the recitals to this Agreement.

“Foreign Subsidiary” shall have the meaning provided in the ABL Credit Agreement and the Term Credit Agreement as in effect on the date hereof.

“General Intangibles” shall have the meaning provided in the ABL Security Agreement and the Term Security Agreement as in effect on the date hereof.

“Geoffrey Collateral” means those certain assets and property of Geoffrey, LLC described in the Shared Collateralshall have the meaning provided in the Term Security Agreements as in effect on the date hereof.

“Governmental Authority” shall mean any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

“Guarantor” shall mean any of the ABL Guarantors,or Term Guarantorsor Notes Guarantors.

“Incremental Availability” shall mean the “Incremental Availability” as defined in the ABL Credit Agreement.

“Indebtedness” shall have the meaning provided in the ABL Credit Agreement,and the Term Credit Agreement and Indentureas in effect on the date hereof.

“Indenture” shall have the meaning assigned to that term in the recitals to this Agreement.

“Insolvency Proceeding” shall mean (a) any case, action or proceeding before any court or other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors or other similar arrangement in respect of its creditors generally or any substantial portion of its creditors; in each case covered by clauses (a) and (b) undertaken under United States Federal, State or foreign law, including the Bankruptcy Code.

“Intellectual Property Rights Agreement” shall mean the “Intellectual Property Rights Agreement” as defined in the ABL Credit Agreement as in effect on the date hereof.

“IntermediateCo Unsecured Guarantee” shall have the meaning provided in the Term Credit Agreement.

“Lender(s)” means individually the ABL Lenders or the Term Lenders and collectively means all of the ABL Lenders and the Term Lenders.

“Lien” shall have the meaning provided in the ABL Credit Agreement,and the Term Credit Agreement and the Indentureas in effect on the date hereof.

“Lien Priority” shall mean with respect to any Lien of the ABL Agent, the ABL Lenders, the Shared Collateral Agents or the Shared Collateral Secured Parties (i) in the ABL Collateral, the order of priority of such Lien as specified in Section 2.1and (ii) in the Canadian Pledge Collateral, the order of priority of such Lien as specified in Section 7.2.

“Loan Parties” shall mean the ABL Loan Parties and the Shared Collateral Secured Parties.

“Noteholder” means any Person in whose name a Note is registered.

“Notes” shall have the meaning assigned to that term in the recitals to this Agreement.

“Notes Agent” shall have the meaning assigned to that term in the introduction to this Agreement.

“Notes Collateral Documents” shall mean all “Security Documents” as defined in the Indenture, including the Notes Security Agreement and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with any Indenture, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Notes Documents” shall mean the Indenture, the Notes, the Notes Guarantees, the Notes Collateral Documents, those other ancillary agreements as to which the Notes Agent or any Noteholder is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any Noteholder or any of its respective Subsidiaries or Affiliates, and delivered to the Notes Agent in connection with any of the foregoing or the Indenture, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Notes Guarantors” shall mean the collective reference to Geoffrey Holdings, LLC, Toys Acquisition, LLC, TRU of Puerto Rico, Inc., TRU-SVC, LLC, Geoffrey, LLC, Geoffrey International, LLC and any other Person who becomes a guarantor under the Indenture.

“Notes Guarantee” shall mean the agreements of the Notes Guarantors to guarantee the payment and performance of the Notes Issuer’s obligations under the Notes Documents.

“Notes Issuer” shall mean Toys “R” Us-Delaware, Inc.

“Notes Parties” shall mean, collectively, the Notes Issuer, Notes Guarantors and each other direct or indirect subsidiary or parent of the Notes Issuer or any of its affiliates that is now or hereafter becomes a party to any Notes Document.

“Notes Obligations” shall mean all obligations of every nature of each Notes Party from time to time owed to the Notes Agent, the Noteholders or any of them, under any Notes Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Noteholder, would have accrued on any Notes Obligation, whether or not a claim is allowed against such Notes Party for such interest in the related bankruptcy proceeding), payments of fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the Notes Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.

“NotesNon-Shared Collateral” means, collectively, the Geoffrey Collateral and the Secured Parties” shall mean the “Secured Parties” as defined in the Notes Security AgreementSpecified Real Property.

“Notes Security Agreement” shall mean the “Security Agreement” as defined in the Indenture.

“Party” shall mean the ABL Agent, the Term Agent, the NotesAgent or the Additional Pari Passu Agent (if any) and “Parties” shall mean the ABL Agent, the Term Agent, the Notes Agent and the Additional Pari Passu Agent (if any).

“Person” shall mean an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

“Proceeds” shall mean (a) all “proceeds,” as defined in Article 9 of the Uniform Commercial Code, with respect to the ABL Collateral,and (b) whatever is recoverable or recovered when any ABLShared Collateral or Non-Shared Collateral is sold, exchanged, collected, or disposed of, whether voluntarily or involuntarily.

“Property” shall mean any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.

“Real Property” shall mean any right, title or interest in and to real property, including any fee interest, leasehold interest, easement, or license and any other right to use or occupy real property.

“Secured Parties” shall mean the ABL Secured Parties, the Term Secured Parties ,the Noteholders and the Additional Pari Passu Secured Parties (if any).

“Secured Specified Real Property” shall have the meaning set forth in Section 2.1(b).

“Shared Collateral” shall mean the ABL Collateral and the Canadian Pledge Collateral.

“Shared Collateral Agents” means the Notes Agent,the Term Agent and the Additional Pari Passu Agent (if any).

“Shared Collateral Documents” means, collectively, the Term Documents, the Notes Documents and the Additional Pari Passu Documents (if any).

“Shared Collateral Enforcement Date” means the date which is 180 days after the occurrence of (i) an Event of Default (under and as defined in either the Term Credit Agreement, the Indenture or any Additional Pari Passu Agreement) and (ii) the ABL Agent’s receipt of an Enforcement Notice from the applicable Authorized Shared Collateral Agent, provided that the Shared Collateral Enforcement Date shall be stayed and shall not occur (or be deemed to have occurred) (A) at any time the ABL Agent or the ABL Secured Parties have commenced and are diligently pursuing enforcement action against the ABL Collateral, (B) at any time that any Loan Party is then a debtor under or with respect to (or otherwise subject to) any Insolvency Proceeding, or (C) if the Event of Default under the applicable Shared Collateral Agreement is waived in accordance with the terms of such Shared Collateral Agreement.

“Shared Collateral Intercreditor Agreement” means that certain first lien intercreditor agreement dated as of the date hereofAugust 24, 2010 among the Notes Agent, the Term Agent, the Additional Pari Passu Agent (if any), the Borrower and the Guarantors.

“Shared Collateral Loan Parties” shall mean, collectively, the NotesAdditional Pari Passu Parties and the Term Loan Parties.

“Shared Collateral Obligations” means, collectively, the Term Loan Obligations, the NotesObligations and the Additional Pari Passu Obligations (if any).

“Shared Collateral Recovery” shall have the meaning set forth in Section 5.3(b).

“Shared Collateral Secured Parties” shall mean, collectively, the Term Secured Parties, the Notes Secured Parties and the Additional Pari Passu Secured Parties.

“Shared Collateral Security Agreements” means, collectively, the Notes Security Agreement, Term Security Agreement and Additional Pari Passu Security Agreement (if any).

“Special Refinancing Indebtedness” shall have the meaning assigned tosuch term in the ABL CreditAgreement.

“Specified Real Property” shall have the meaning assigned to such term in the Term Credit Agreement as in the effect on the date hereof and shall include any Proceeds thereof.

“Springing Covenant” shall have the meaning assigned to such term in the Term Credit Agreement.

“Springing Covenant Trigger Date” shall have the meaning assigned to such term in the Term Credit Agreement.

“Subsidiary” shall mean with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity (a) of which Capital Stock representing more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, Controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.

“Term Agent” shall have the meaning assigned to that term in the introduction to this Agreement.

“Term B-4 Lenders” shall have the meaning assigned to such term in the Term Credit Agreement.

“Term B-4 Loans” shall have the meaning assigned tosuch term in the Term CreditAgreement.

“Term Borrower” shall have the meaning assigned to that term in the introduction to this Agreement.

“Term Collateral Documents” shall mean all “Security Documents” as defined in the Term Credit Agreement, including the Term Security Agreement and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with any Term Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Term Credit Agreement” shall mean the Term Credit Agreement and any other agreement extending the maturity of, consolidating, restructuring, refunding, replacing or refinancing all or any portion of the Term Obligations, whether by the same or any other agent, lender or group of lenders and whether or not increasing the amount of any Indebtedness that may be incurred thereunder.

“Term Documents” shall mean the Term Credit Agreement, the Term Guaranties, the Term Collateral Documents, any Term Hedging Agreements between any Term Loan Party and any Term Hedging Affiliate, those other ancillary agreements as to which the Term Agent or any Term Lender is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any Term Loan Party or any of its respective Subsidiaries or Affiliates, and delivered to the Term Agent, in connection with any of the foregoing or any Term Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Term Guarantors” shall mean the collective reference to Geoffrey Holdings, LLC, Toys Acquisition, LLC, TRU of Puerto Rico, Inc., TRU-SVC, LLC, Geoffrey, LLC, Geoffrey International, LLC and any other Person who becomes a guarantor under the Term Guaranty.

“Term Guaranty” shall have the meaning assigned to that term in the recitals to this Agreement.

“Term Hedging Affiliate” shall mean any Term Lender or any Affiliate of any Term Lender that has entered into an Term Hedging Agreement with a Term Loan Party with the obligations of such Term Loan Party thereunder being secured by one or more Term Collateral Documents by an Term Loan Party.

“Term Hedging Agreement” shall mean any “Hedging Agreement” as defined in the Term Credit Agreement.

“Term Lenders” shall have the meaning assigned to the term “Lenders” (or any similar term) in any Term Credit Agreement.

“Term Loan Parties” shall have the meaning assigned to that term in the recitals to this Agreement.

“Term Obligations” shall mean all obligations of every nature of each Term Loan Party from time to time owed to the Term Agent, the Term Lenders or any of them, under any Term Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Term Loan Party, would have accrued on any Term Obligation, whether or not a claim is allowed against such Term Loan Party for such interest in the related bankruptcy proceeding), payments for early termination of Term Hedging Agreements, fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the Term Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.

“Term Secured Parties” shall mean the “Secured Parties” as defined in the Term Credit Agreement.

“Term Security Agreement” shall mean the “Security Agreement” as defined in the Term Credit Agreement.

“Tranche A Borrowing Base” shall mean the “Tranche A Borrowing Base” as defined in the ABL Credit Agreement.

“Tranche A-1 Borrowing Base” shall mean the “Tranche A-1 Borrowing Base” as defined in the ABL Credit Agreement.

“Uniform Commercial Code” shall mean the Uniform Commercial Code as the same may, from time to time, be in effect in the State of New York; provided that to the extent that the Uniform Commercial Code is used to define any term in any security document and such term is defined differently in differing Articles of the Uniform Commercial Code, the definition of such term contained in Article 9 shall govern; provided, further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, publication or priority of, or remedies with respect to, Liens of any Party is governed by the Uniform Commercial Code or foreign personal property security laws as enacted and in effect in a jurisdiction other than the State of New York, the term “Uniform Commercial Code” will mean the Uniform Commercial Code or such foreign personal property security laws as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions.

“Use Period” means the period, after the commencement of an Enforcement Period, which begins on the day that the ABL Agent provides the Term Agent with an Enforcement Notice and ends on the 210th day thereafter, plus such number of days, if any, during which any stay or other order that prohibits any of the ABL Agent or the other ABL Secured Parties (with the consent of the ABL Agent) from commencing and continuing to Exercise Any Secured Creditor Remedies or to liquidate and sell the ABL Collateral has been entered by a court of competent jurisdiction.

SECTION 1.3Rules of Construction. Unless the context of this Agreement clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the term “including” is not limiting and shall be deemed to be followed by the phrase “without limitation,” and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Article, section, subsection, clause, schedule and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement to any agreement, instrument, or document shall include all alterations, amendments, changes, restatements, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, restatements, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). Any reference herein to any Person shall be construed to include such Person’s successors and assigns. Any reference herein to the repayment in full of an obligation shall mean the payment in full in cash of such obligation, or in such other manner as may be approved in writing by the requisite holders or representatives in respect of such

obligation, or in such other manner as may be approved by the requisite holders or representatives in respect of such obligation.

ARTICLE 2
LIEN PRIORITY

SECTION 2.1 Priority of Liens.

(a)Subject to the proviso in subclause (b) of Section 4.1, notwithstanding (i) the date, time, method, manner, or order of grant, attachment, or perfection of any Liens granted to the ABL Agent or the ABL Lenders in respect of all or any portion of the ABL Collateral or of any Liens granted to the Shared Collateral Agents or the Shared Collateral Secured Parties in respect of all or any portion of the ABL Collateral and regardless of how any such Lien was acquired (whether by grant, statute, operation of law, subrogation or otherwise), (ii) the order or time of filing or recordation of any document or instrument for perfecting the Liens in favor of the ABL Agent or the Shared Collateral Agents (or ABL Lenders or the Shared Collateral Secured Parties) in any ABL Collateral, (iii) any provision of the Uniform Commercial Code, the Bankruptcy Code or any other applicable law, or of the ABL Documents or the Shared Collateral Documents, or (iv) whether the ABL Agent or the Shared Collateral Agents, in each case, either directly or through agents, hold possession of, or have control over, all or any part of the ABL Collateral, the ABL Agent, on behalf of itself and the ABL Lenders, and the Shared Collateral Agent, on behalf of the applicable Shared Collateral Secured Parties, hereby agrees that prior to the Discharge of ABL Obligations:

(1)any Lien in respect of all or any portion of the ABL Collateral now or hereafter held by or on behalf of the Shared Collateral Agents or any Shared Collateral Secured Party that secures all or any portion of the Shared Collateral Obligations shall in all respects be junior and subordinate to all Liens granted to the ABL Agent and the ABL Lenders on the ABL Collateral;and

(2)any Lien in respect of all or any portion of the ABL Collateral now or hereafter held by or on behalf of the ABL Agent or any ABL Lender that secures all or any portion of the ABL Obligations shall in all respects be senior and prior to all Liens granted to the Shared Collateral Agents or any Shared Collateral Secured Party on the ABL Collateral.; and

(b)The ABL Agent, for and on behalf of itself and the ABL Secured Parties, acknowledges and agrees that, (i) the Shared Collateral Agents, for the benefit of the Shared Collateral Secured Parties, have been granted Liens upon all of the ABLShared Collateral in which the ABL Agent has been granted Liens and the ABL Agent hereby consents theretoand, (ii) the Shared Collateral Agents, for and on behalf of themselves and the Shared Collateral Secured Parties, have been granted first priority Liens in the Geoffrey Collateral and neither the ABL Agent nor the ABL Secured Parties shall have a Lien on or a security interest in the Geoffrey Collateraland (iii) after the Springing Covenant Trigger Date, pursuant to the terms of the Springing Covenant, the Term Agent, for the benefit of the Term B-4 Lenders, will be granted a first priority Lien upon the Specified Real Property (other than any Excluded Specified Real Property) (after the Springing Covenant Trigger Date, such Specified

Real Property on which a Lien has been granted to the Term Agent for the benefit of the Term B-4 Lenders, the “Secured Specified Real Property”) and neither the ABL Agent, the ABL Secured Parties or any other Shared Collateral Secured Parties shall have a Lien on or a security interest in the Secured Specified Real Properties. The subordination of Liens by the Shared Collateral Agents in favor of the ABL Agent as set forth herein shall not be deemed to subordinate the Shared Collateral Agents’ respective Liens on the ABL Collateral to the Liens of any other Person.

(c)The relative rights and obligations of the ABL Agent and the Shared Collateral Agents (or the ABL Lenders and the Shared Collateral Secured Parties) under this Agreement with respect to the Liens on the Canadian Pledge Collateral shall be determined in accordance with Article 7 of this Agreement.

SECTION 2.2Waiver of Right to Contest Liens. Each of ABL Agent, on behalf of the ABL Secured Parties and the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agrees that it and they shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the ABL Agent and the ABL Secured Parties in respect of the ABL Collateral or Liens of the Shared Collateral Agents and the Shared Collateral Secured Parties in respect of the ABLShared Collateral or the provisions of this Agreement. Except to the extent expressly set forth in this Agreement, the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agrees that none of the Shared Collateral Agents or the Shared Collateral Secured Parties will take any action that would interfere with any Exercise of Secured Creditor Remedies undertaken by the ABL Agent or any ABL Secured Party under the ABL Documents with respect to the ABL Collateral. Except to the extent expressly set forth in this Agreement, the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, hereby waive any and all rights they or the Shared Collateral Secured Parties may have as a junior lien creditor or otherwise to contest, protest, object to, or interfere with the manner in which the ABL Agent or any ABL Secured Party seeks to enforce its Liens in any ABL Collateral. The foregoing shall not be construed to prohibit the Shared Collateral Agents from enforcing the provisions of this Agreement as to the relative priority of the parties hereto. In addition, for the avoidance of doubt, the ABL Agent, on behalf of the ABL Secured Parties, further agrees that it has no, and will not have, Liens on any of the GeoffreyNon-Shared Collateral and as such, it shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the Shared Collateral Agents and the Shared Collateral Secured Parties in respect of the GeoffreyNon-Shared Collateral.

SECTION 2.3 Remedies Standstill.

(a)The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree that, from the date hereof until the earlier of (i) the Shared Collateral Enforcement Date, or (ii) the date upon which the Discharge of ABL Obligations shall have occurred, neither the Shared Collateral Agents nor any Shared Collateral Secured Party will Exercise Any Secured Creditor Remedies with respect to any of the ABL Collateral without the written consent of the ABL Agent and the Required

Lenders (as defined in the ABL Credit Agreement), and will not take, receive or accept any Proceeds of the ABL Collateral. From and after the earlier of (i) the Shared Collateral Enforcement Date or (ii) the date upon which the Discharge of ABL Obligations shall have occurred, the Shared Collateral Agents or any Shared Collateral Secured Party may Exercise Any Secured Creditor Remedies under the Shared Collateral Documents or applicable law as to any ABL Collateral; provided, however, that any Exercise of Secured Creditor Remedies with respect to any ABL Collateral by the Shared Collateral Agents is at all times subject to the provisions of this Agreement, including Section 4.1 hereof.

(b)Notwithstanding the provisions of Sections 2.3(a) or any other provision of this Agreement, prior to the Discharge of ABL Obligations, nothing contained herein shall be construed to prevent (i) the Shared Collateral Agents or any Shared Collateral Secured Party from filing a claim or statement of interest with respect to the Shared Collateral Obligations owed to it in any Insolvency Proceeding commenced by or against any Loan Party, (ii) take any action (not adverse to the priority status of the Liens of the ABL Agent or ABL Secured Parties on the ABL Collateral in which the ABL Agent or ABL Secured Parties have a priority Lien or the rights of the ABL Agent or any of the ABL Secured Parties to exercise remedies in respect thereof) in order to create, perfect, preserve or protect (but not enforce) its Lien on any ABL Collateral, (iii) file any necessary or responsive pleadings in opposition to any motion, adversary proceeding or other pleading filed by any Person objecting to or otherwise seeking disallowance of the claim or Lien of the Shared Collateral Agents or Shared Collateral Secured Parties, (iv) file any pleadings, objections, motions, or agreements which assert rights available to unsecured creditors of the Loan Parties arising under any Insolvency Proceeding or applicable non-bankruptcy law, (v) vote on any plan of reorganization or file any proof of claim in any Insolvency Proceeding of any Loan Party, or (vi) object to the proposed retention of ABL Collateral by the ABL Agent or any ABL Secured Party in full or partial satisfaction of any ABL Obligations due to the ABL Agent or ABL Secured Parties, in each case (i) through (iv) and (vi) above to the extent not inconsistent with, or could not result in a resolution inconsistent with, the terms of this Agreement. Notwithstanding the foregoing, nothing in this Agreement shall prevent the Authorized Shared Collateral Agent, on behalf of the Shared Collateral Secured Parties, from the Exercise of Secured Creditor Remedies with respect to the GeoffreyNon-Shared Collateral, other thansubject to the provisions set forth in Sections 3.6and 3.7

SECTION 2.4Exercise of Rights.

(a)No Other Restrictions. Except as expressly set forth in this Agreement, each of the Shared Collateral Agents, each Shared Collateral Secured Party, the ABL Agent and each ABL Secured Party shall have any and all rights and remedies it may have as a creditor under applicable law, including the right to the Exercise of Secured Creditor Remedies; provided, however, that the Exercise of Secured Creditor Remedies with respect to the ABLShared Collateral shall be subject to the Lien Priority and to the provisions of this Agreement, including Sections 2.3and, 4.1, 7.3 and 7.4 hereof. The ABL Agent may enforce the provisions of the ABL Documents, the Shared Collateral Agents may enforce the provisions of the Shared Collateral Documents and each may Exercise Any Secured Creditor Remedies, all in such order and in such manner as each may determine in the exercise of its sole discretion, consistent with the terms of this Agreement and mandatory provisions of applicable law; provided, however, that (i) prior to the Discharge of ABL Obligationsand solely in the case of an

Exercise of Secured Creditor Remedies with respect to any ABL Collateral, the ABL Agent, and in the event of a Shared Collateral Enforcement Date, the Shared Collateral Agents, agree to provide to the other (x) an Enforcement Notice prior to the commencement of an Exercise Any Secured Creditor Remedies with respect to the ABL Collateral and (y) copies of any notices that it is required under applicable law to deliver to any Loan Party; provided, further, however, that the ABL Agent’s failure to provide any such copies to the Shared Collateral Agents (but not the Enforcement Notice) shall not impair any of the ABL Agent’s rights hereunder or under any of the ABL Documents and the Shared Collateral Agents’ failure to provide any such copies to the ABL Agent (but not the Enforcement Notice) shall not impair any of the Shared Collateral Agents’ rights hereunder or under any of the Shared Collateral Documents and (ii) prior to the Discharge of Shared Collateral Obligations and solely in the case of an Exercise of Secured Creditor Remedies with respect to any Canadian Pledge Collateral, the Shared Collateral Agents, and in the event of an ABL Enforcement Date, the ABL Agent, agree to provide to the other (x) an Enforcement Notice prior to the commencement of an Exercise Any Secured Creditor Remedies with respect to the Canadian Pledge Collateral and (y) copies of any notices that it is required under applicable law to deliver to any Loan Party; provided, further, however, that any Shared Collateral Agent’s failure to provide any such copies to the ABL Agent (but not the Enforcement Notice) shall not impair any of such Shared Collateral Agent’s rights hereunder or under any of the Shared Collateral Documents and the ABL Agent’s failure to provide any such copies to the Shared Collateral Agents (but not the Enforcement Notice) shall not impair any of the ABL Agent’s rights hereunder or under any of the ABL Documents. Each of the Shared Collateral Agents, each Shared Collateral Secured Party, the ABL Agent and each ABL Secured Party agrees (i) that it will not institute any suit or other proceeding or assert in any suit, Insolvency Proceeding or other proceeding, or any other claim, in the case of the Shared Collateral Agents and each Shared Collateral Secured Party, against either the ABL Agent or any other ABL Secured Party, and in the case of the ABL Agent and each other ABL Secured Party, against either the Shared Collateral Agents or any other Shared Collateral Secured Party, seeking damages from or other relief by way of specific performance, instructions or otherwise, with respect to, any action taken or omitted to be taken by such Person with respect to the ABLShared Collateral which is consistent with the terms of this Agreement, and none of such Parties shall be liable for any such action taken or omitted to be taken, or (ii) it will not be a petitioning creditor or otherwise assist in the filing of an involuntary Insolvency Proceeding.

(b)Release of Liens. In the event of any private or public sale of all or any portion of the ABL Collateral (other than in connection with a refinancing as described in Section 5.2(d)) permitted by the ABL Documents or consented to by the requisite ABL Lenders, the Shared Collateral Agents agree, on behalf of the Shared Collateral Secured Parties that such sale will be free and clear of the Liens on such ABL Collateral securing the Shared Collateral Obligations, and the Shared Collateral Agents’ and the Shared Collateral Secured Parties’ Liens with respect to the ABL Collateral so sold, transferred, disposed or released shall terminate and be automatically released without further action concurrently with, and to the same extent as, the release of the ABL Secured Parties’ Liens on such ABL Collateral; provided that in the case of a disposition in connection with an Exercise of Secured Creditor Remedieswith respect to ABL Collateral, any Proceeds thereof not applied to repay ABL Obligations shall be subject to the Liens securing the Shared Collateral Obligations and shall be applied pursuant to this Agreement and the Shared Collateral Intercreditor Agreement. In furtherance of, and subject to, the foregoing, the Shared Collateral Agents agree that they will promptly execute any and all Lien releases

or other documents reasonably requested by the ABL Agent in connection therewith. Each Shared Collateral Agent hereby appoints the ABL Agent and any officer or duly authorized person of the ABL Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power of attorney in the place and stead of such Shared Collateral Agent and in the name of such Shared Collateral Agent or in the ABL Agent’s own name, from time to time, in the ABL Agent’s sole discretion, for the purposes of carrying out the terms of this paragraph, to take any and all appropriate action and to execute and deliver any and all documents and instruments as may be necessary or desirable to accomplish the purposes of this paragraph, including any financing statements, endorsements, assignments, releases or other documents or instruments of transfer (which appointment, being coupled with an interest, is irrevocable).

SECTION 2.5No New Liens. Prior to the Discharge of ABL Obligations, the parties hereto agree that the Borrower shall not, and shall not permit any other Loan Party to grant or permit any additional Liens on any ABLProperty (other than Non-Shared Collateral) to secure the Shared CollateralTerm Obligations unless it has granted or concurrently grants a Lien on such ABLProperty (other than Non-Shared Collateral) to secure the ABL Obligations or grant or permit any additional Liens on any asset or pProperty to secure any ABL Obligations (other than assets or pProperty owned by any ABL Loan Party organized in Canada) unless it has granted or concurrently grants a Lien on such ABL CollateralProperty to secure the Shared CollateralTerm Obligations. If any Loan Party shall (nonetheless and in breach hereof) permit any Lien on any ABL Collateralsecuring any ABL ObligationProperty (other than assets or pProperty owned by any ABL Loan Party organized in Canada) securing any ABL Obligationwhich assets are not also subject to the Lien of the Shared Collateral Agents under the Shared Collateral Documents, subject to the Lien Priority set forth herein, then the ABL Agent (or the relevant ABL Secured Party) shall, without the need for any further consent of any other ABL Secured Party, any ABL Borrower or any ABL Guarantor, and notwithstanding anything to the contrary in any other ABL Document, be deemed to also hold and have held such Lien as agent or bailee for the benefit of the Shared Collateral Agents as security for the Shared Collateral Obligations (subject to the Lien Priority and other terms hereof) and shall promptly notify the Shared Collateral Agents in writing of the existence of such Lien.

SECTION 2.6Waiver of Marshalling. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree not to assert and hereby waive, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the ABL Collateral or any other similar rights a junior secured creditor may have under applicable law.with respect to the ABL Collateral. Prior to the Discharge of Term Obligations, the ABL Agent, on behalf of the ABL Secured Parties, agrees not to assert and hereby waive, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the Canadian Pledge Collateral or any other similar rights a junior secured creditor may have under applicable law with respect to the Canadian Pledge Collateral.

SECTION 2.7Refinancings. The ABL Obligations and any series of Shared Collateral Obligations may be refinanced, in whole or in part, in each case, in accordance with the terms of the ABL Documents and the Shared Collateral Documents, as applicable, including a refinancing with the incurrence of Special Refinancing Indebtedness, and without notice to, or the consent (except to the extent a consent is otherwise required to permit the refinancing transaction under any ABL Document or Shared Collateral Document) of the ABL Secured Parties or any Shared Collateral Secured Parties, all without affecting the priorities provided for herein or the other provisions hereof; provided that (i) the authorized representative of the holders of any such refinancing indebtedness (the “Authorized Representative”) shall have executed a joinder agreement on behalf of the holders of such refinancing indebtedness substantially in the form of Exhibit A heretoand (ii) such refinancing indebtedness may provide for a lien that is junior in priority to the Lien Priorities provided for herein.

Section 2.8Junior Indebtedness. The Parties hereto hereby agree that the Borrower may incur Indebtedness that is junior in priority to the Lien Priorities provided for herein (in accordance with the terms of the ABL Documents and the Shared Collateral Documents, as applicable), to the extent permitted in the ABL Credit Agreement, without notice to, or the consent of the ABL Agent, the ABL Lenders, the Shared Collateral Agents or the Shared Collateral Secured Parties, as the case may be, and upon any such incurrence, the Parties hereto hereby authorize the Agents to make technical amendments to this Agreement in order to effectuate the foregoing.

ARTICLE 3
ACTIONS OF THE PARTIES

SECTION 3.1Certain Actions Permitted. The Shared Collateral Agents and the ABL Agent may make such demands or file such claims in respect of the Shared Collateral Obligations or the ABL Obligations, as applicable, as are necessary to prevent the waiver or bar of such claims under applicable statutes of limitations or other statutes, court orders, or rules of procedure at any time. Except as provided in Section 5.2, nothing in this Agreement shall prohibit the receipt by the Shared Collateral Agents or any Shared Collateral Secured Party of the required payments of interest, principal and other amounts owed in respect of the Shared Collateral Obligations so long as such receipt is not the direct or indirect result of the exercise by the Shared Collateral Agents or any Shared Collateral Secured Party of rights or remedies as a secured creditor (including set-off with respect to the ABL Collateral) or enforcement, in each case with respect to ABL Collateral, in contravention of this Agreement of any Lien held by any of them.

SECTION 3.2Agent for Perfection. Prior to the Discharge of ABL Obligations, the ABL Agent, for and on behalf of itself and each ABL Secured Party, and the Shared Collateral Agents, for and on behalf of themselves and each Shared Collateral Secured Party, as applicable, each agree to hold all ABLControl Collateral in their respective possession, custody, or control (or in the possession, custody, or control of agents or bailees for either) as agent for the other solely for the purpose of perfecting the security interest granted to each in such ABLControl Collateral, subject to the terms and conditions of this Section 3.2. In addition, the ABL Agent expressly agrees to act as agent for the benefit of the Shared Collateral Agents and the Shared Collateral Secured Parties under each control agreement or blocked account agreement with respect to any Deposit Accounts and Securities Accounts of a Loan

Partyconstituting ABL Collateral. None of the ABL Agent, the ABL Secured Parties, the Shared Collaterals Agent, or the Shared Collateral Secured Parties, as applicable, shall have any obligation whatsoever to the others to assure that the ABLControl Collateral is genuine or owned by any Loan Party or any other Person or to preserve rights or benefits of any Person. The duties or responsibilities of the ABL Agent and the Shared Collateral Agents under this Section 3.2 are and shall be limited solely to holding or maintaining control of the ABLControl Collateral as agent for the other Party for purposes of perfecting the Lien held by the Shared Collateral Agents or the ABL Agent, as applicable. The ABL Agent is not and shall not be deemed to be a fiduciary of any kind for the Shared Collateral Agents, the Shared Collateral Secured Parties, or any other Person. The Shared Collateral Agents are not and shall not be deemed to be a fiduciary of any kind for the ABL Agent, the ABL Secured Parties, or any other Person. Prior to the Discharge of ABL Obligations, in the event that any Shared Collateral Agent or any Shared Collateral Secured Party receives any ABL Collateral or Proceeds of the ABL Collateral in violation of the terms of this Agreement, then such Shared Collateral Agent or such Shared Collateral Secured Party shall promptly pay over such Proceeds or ABL Collateral to the ABL Agent, in the same form as received with any necessary endorsements, for application in accordance with the provisions of Section 4.1 of this Agreement.Prior to the Discharge of Term Obligations, in the event that the ABL Agent or any ABL Secured Party or any Additional Pari Passu Agent or any Additional Pari Passu Secured Party receives any Canadian Pledge Collateral or Proceeds of the Canadian Pledge Collateral in violation of the terms of this Agreement, then the ABL Agent or such ABL Secured Party or the Additional Pari Passu Agent or such Additional Pari Passu Secured Party, as applicable, shall promptly pay over such Proceeds or Canadian Pledge Collateral to the Term Agent, in the same form as received with any necessary endorsements, for application in accordance with the provisions of Section 7.4 of this Agreement.

SECTION 3.3[Reserved]

SECTION 3.4Insurance. Proceeds of ABL Collateral include insurance proceeds of such ABL Collateral and, therefore, the Lien Priority shall govern the ultimate disposition of casualty insurance proceeds. The ABL Agent and the Shared Collateral Agents shall each be named as additional insured or loss payee, as applicable, with respect to all insurance policies relating to the ABLShared Collateral. Prior to the Discharge of ABL Obligationsand solely with respect to insurance proceeds of ABL Collateral, the ABL Agent shall have the sole and exclusive right, as against the Shared Collateral Agents, to adjust settlement of insurance claims in the event of any covered loss, theft or destruction of the ABL Collateral. Prior to the Discharge of ABL Obligations, all proceeds of such insurance shall be remitted for application in accordance with the provisions of Section 4.1 of this Agreement.Prior to the Discharge of Term Obligations and solely with respect to insurance proceeds of Canadian Pledge Collateral, the Term Agent shall have the sole and exclusive right, as against the ABL Agent and any Additional Pari Passu Agent, to adjust settlement of insurance claims in the event of any covered loss, theft or destruction of the Canadian Pledge Collateral. Prior to the Discharge of Term Obligations, all proceeds of such insurance shall be remitted for application in accordance with the provisions of Section 7.4 of this Agreement.

SECTION 3.5No Additional Rights for the Loan Parties Hereunder. Except as provided in Section 3.6, if any ABL Secured Party or Shared Collateral Secured Party shall enforce its rights or

remedies in violation of the terms of this Agreement, the Loan Parties shall not be entitled to use such violation as a defense to any action by any ABL Secured Party or Shared Collateral Secured Party, nor to assert such violation as a counterclaim or basis for set off or recoupment against any ABL Secured Party or Shared Collateral Secured Party.

SECTION 3.6Geoffrey Collateral.

(a)Without limiting any rights the ABL Agent or any other ABL Secured Party may otherwise have under applicable law or by agreement, in the event of any liquidation of the ABL Collateral (or any other Exercise of Secured Creditor Remedies by the ABL Agent) and whether or not the Shared Collateral Agents or any other Shared Collateral Secured Party has commenced and is continuing to Exercise Any Secured Creditor Remedies of the Shared Collateral Agents, the ABL Agent or any other Person (including any Loan Party) acting with the consent, or on behalf, of the ABL Agent, shall have the right to use the Geoffrey Collateral in order to complete a production run of Inventory involving, take possession of, move, prepare and advertise for sale, to sell (by public auction, private sale or a “store closing”, “going out of business” or similar sale, whether in bulk, in lots or to customers in the ordinary course of business or otherwise and which sale may include augmented Inventory of the same type sold in the Borrowers’ and Guarantors’ business), store or otherwise deal with the ABL Collateral, in each case without notice to, the involvement of or interference by any Shared Collateral Secured Party or liability to any Shared Collateral Secured Party for a period, (i) in the case of Geoffrey Collateral that is subject to a license agreement (including the Intellectual Property Rights Agreement), the period described in such license agreement and (ii) otherwise, the Use Period. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents agree not sell, assign or otherwise transfer the Geoffrey Collateral, (i) in the case of Geoffrey Collateral that is subject to a license agreement (including the Intellectual Property Rights Agreement), prior to the expiration of the period described in such license agreement and (ii) otherwise, prior to the expiration of the Use Period, unless the purchaser, assignee or transferee thereof agrees to be bound by the provisions of this Section 3.6. Subject only to the foregoing provisions of this Section 3.6, nothing in this Agreement shall impair the Shared Collateral Agents’ and the Shared Collateral Secured Parties’ rights and Liens on the Geoffrey Collateral.

(b)The ABL Agent and the ABL Secured Parties shall not be obligated to pay any amounts to the Shared Collateral Agents or the Shared Collateral Secured Parties (or any person claiming by, through or under the Shared Collateral Secured Parties, including any purchaser of the Geoffrey Collateral) or to the Loan Parties, for or in respect of the use by the ABL Agent and the ABL Secured Parties of the Geoffrey Collateral and none of the ABL Agent or the ABL Secured Parties shall be obligated to secure, protect, insure or repair any such Geoffrey Collateral (other than for damages caused by the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives). The ABL Agent and the ABL Secured Parties shall not have any liability to the Shared Collateral Agents or the Shared Collateral Secured Parties (or any person claiming by, through or under the Shared Collateral Agents or the Shared Collateral Secured Parties, including any purchaser of the Geoffrey Collateral) as a result of any condition on or with respect to the Geoffrey Collateral other than those arising from the gross negligence or willful misconduct of the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives, and the ABL Agent and the ABL Secured Parties shall have no duty or liability to maintain the Geoffrey Collateral in a condition or

manner better than that in which it was maintained prior to the use thereof by the ABL Agent and the ABL Secured Parties.

SECTION 3.7 Access Rights.

(a)Without limiting any rights the ABL Agent or any other ABL Secured Party may otherwise have under applicable law or by agreement, (i) in the event of any liquidation of the ABL Collateral (or any other Exercise Any Secured Creditor Remedies by the ABL Agent) and whether or not the Authorized Shared Collateral Agent or any other Shared Collateral Secured Party has commenced and is continuing to Exercise Any Secured Creditor Remedies of the Shared Collateral Agents, and (ii) if the Shared Collateral Agents have obtained a first priority Lien on or control of any Real Property where any ABL Collateral is located, then the ABL Agent or any other Person (including any Loan Party) acting with the consent, or on behalf, of the ABL Agent, shall have the right to access such Real Property in order to assemble, inspect, copy or download information stored on, take actions to perfect its Lien on, complete a production run of Inventory involving, take possession of, move, prepare and advertise for sale, sell (by public auction, private sale or a “store closing”, “going out of business” or similar sale, whether in bulk, in lots or to customers in the ordinary course of business or otherwise and which sale may include augmented Inventory of the same type sold in the Borrowers’ and Guarantors’ business), store or otherwise deal with the ABL Collateral, in each case without notice to, the involvement of or interference by any Shared Collateral Secured Party or liability to any Shared Collateral Secured Party for a period not to exceed the Access Period. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents agree not sell, assign or otherwise transfer such Real Property prior to the Access Period, unless the purchaser, assignee or transferee thereof agrees to be bound by the provisions of this Section 3.7. Subject only to the foregoing provisions of this Section 3.7, nothing in this Agreement shall impair the Shared Collateral Agents’ and the Shared Collateral Secured Parties’ rights and Liens on such Real Property.

(b)The ABL Agent and the ABL Secured Parties shall not be obligated to pay any amounts to the Shared Collateral Agent or the Shared Collateral Secured Parties (or any person claiming by, through or under the Shared Collateral Secured Parties, including any purchaser of such Real Property) or to the Loan Parties, for or in respect of the use by the ABL Agent and the ABL Secured Parties of the Real Property and none of the ABL Agent or the ABL Secured Parties shall be obligated to secure, protect, insure or repair any such Real Property (other than for damages caused by the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives). The ABL Agent and the ABL Secured Parties shall not have any liability to the Shared Collateral Agents or the Shared Collateral Secured Parties (or any person claiming by, through or under the Shared Collateral Agents or the Shared Collateral Secured Parties, including any purchaser of the Real Property) as a result of any condition on or with respect to such Real Property other than those arising from the gross negligence or willful misconduct of the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives, and the ABL Agent and the ABL Secured Parties shall have no duty or liability to maintain the Real Property in a condition or manner better than that in which it was maintained prior to the use thereof by the ABL Agent and the ABL Secured Parties.

ARTICLE 4
APPLICATION OF PROCEEDS

SECTION 4.1 Application of Proceeds.

(a)Revolving Nature of ABL Obligations. The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, expressly acknowledge and agree that (i) the ABL Credit Agreement includes a revolving commitment, that in the ordinary course of business the ABL Agent and the ABL Lenders will apply payments and make advances thereunder, and that no application of any ABL Collateral or the release of any Lien by the ABL Agent upon any portion of the ABL Collateral in connection with a permitted disposition by the ABL Loan Parties under any ABL Credit Agreement shall constitute the Exercise of Secured Creditor Remedies under this Agreement; (ii) the amount of the ABL Obligations that may be outstanding at any time or from time to time may be increased or reduced and subsequently reborrowed, and that the terms of the ABL Obligations may be modified, extended or amended from time to time, and that the aggregate amount of the ABL Obligations may be increased, replaced or refinanced, in each event, without notice to or consent by the Shared Collateral Secured Parties and without affecting the provisions hereof; and (iii) all ABL Collateral received by the ABL Agent may be applied, reversed, reapplied, credited, or reborrowed, in whole or in part, to the ABL Obligations at any time; provided, however, that from and after the date on which the ABL Agent (or any ABL Lender) commences the Exercise of Secured Creditor Remedies, all amounts received by the ABL Agent or any ABL Lender in respect of any ABL Collateral shall be applied as specified in this Section 4.1. The Lien Priority shall not be altered or otherwise affected by any such amendment, modification, supplement, extension, repayment, reborrowing, increase, replacement, renewal, restatement or refinancing of either the ABL Obligations or the Shared Collateral Obligations, or any portion thereof.

(b)Application of Proceeds of ABL Collateral. Prior to the Discharge of ABL Obligations, the ABL Agent and the Shared Collateral Agents hereby agree that all ABL Collateral and all Proceeds thereof, received by either of them in connection with any Exercise of Secured Creditor Remedies with respect to the ABL Collateral shall be applied,

first, to the payment of costs and expenses of the ABL Agent in connection with such Exercise of Secured Creditor Remedies,

second, to the payment of the ABL Obligations in accordance with the ABL Documents until the Discharge of ABL Obligations shall have occurred,

third, to the payment of the Shared CollateralTerm Obligations in accordance with the Shared CollateralTerm Documentsuntil the Discharge of Term Obligations shall have occurred, and

fourth, the balance, if any, to the Loan Parties or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct;

provided that in the event any Shared Collateral Agent receives, in connection with an Insolvency Proceeding, any Proceeds of any ABL Collateral and the Lien granted in favor of the ABL Agent or the ABL Secured Parties in respect of such ABL Collateral has been voided,

avoided, subordinated, or otherwise invalidated by a court of competent jurisdiction and the provisions of Section 5.3 would not be effective, the such proceeds received by such Shared Collateral Agent with respect to the ABL Collateral subject to avoidance, subordination or invalidation shall be applied, to the extent permitted under applicable law, to the payment of the Shared Collateral Obligations in accordance with the Shared Collateral Documents.

(c)Limited Obligation or Liability. In exercising remedies, whether as a secured creditor or otherwise, the ABL Agent shall have no obligation or liability to the Shared Collateral Agents or to any Shared Collateral Secured Party, regarding the adequacy of any Proceeds of ABL Collateral or for any action or omission, save and except solely for an action or omission that breaches the express obligations undertaken by each Party under the terms of this Agreement. Notwithstanding anything to the contrary herein contained, none of the Parties hereto waives any claim that it may have against a Secured Party on the grounds that and sale, transfer or other disposition by the Secured Party was not commercially reasonable in every respect as required by the Uniform Commercial Code.

(d)Turnover ofABLSharedCollateral After Discharge. Upon the Discharge of ABL Obligations, the ABL Agent shall deliver to the Shared Collateral Agents or shall execute such documents as the Shared Collateral Agents may reasonably request (at the expense of the Term Borrowerand Notes Issuer) to enable the Shared Collateral Agents to have control over any ABL Collateral still in the ABL Agent’s possession, custody, or control in the same form as received with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct. Upon the Discharge of Shared Collateral Obligations, the applicable Shared Collateral Agent shall deliver to the ABL Agent or shall execute such documents as the ABL Agent may reasonably request (at the expense of the Term Borrower) to enable the ABL Agent to have control over any Canadian Pledge Collateral still in such Shared Collateral Agent’s possession, custody, or control in the same form as received with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct.

SECTION 4.2Application of Proceeds In Respect of the IntermediateCo Unsecured Guarantee. Notwithstanding anything to the contrary in this Agreement, any Additional Pari Passu Document, any ABL Document or the Term Credit Agreement, the parties hereto hereby agree (other than clauses (ii) and (iii) solely with respect to the ABL Agent for which such clauses shall not apply) that any payments made by the Term Borrower to the Term Agent in respect of (i) the IntermediateCo Unsecured Guarantee, (ii) any mandatory prepayment events set forth in Section 2.03(j) of the Term Credit Agreement (including a sale of Secured Specified Real Property after the Springing Covenant Trigger Date), (iii) remedies pursuant to the proviso to Section 8.02 of the Term Credit Agreement, or (iv) remedy event interest payments set forth in the Term B-4 Joinder Agreement, in each case, shall be paid solely to the Term B-4 Lenders to repay the Term B-4 Loans and, for the avoidance of doubt, shall not be paid to any other Term Secured Parties or any ABL Secured Party or any Additional Pari Passu Secured Party.

Section 4.24.3Specific Performance. Each of the ABL Agent and each Shared Collateral Agent is hereby authorized to demand specific performance of this Agreement, whether or not any Loan Party shall have complied with any of the provisions of any of the Credit Documents, at any time when the other Party shall have failed to comply with any of the provisions of this Agreement applicable to it. Each of the ABL Agent, on behalf of the ABL Secured Parties, and the Shared Collateral Agents, on behalf of the applicable Shared Collateral Secured Parties, hereby irrevocably waives any defense based

on the adequacy of a remedy at law that might be asserted as a bar to such remedy of specific performance.

ARTICLE 5
INTERCREDITOR ACKNOWLEDGEMENTS AND WAIVERS

SECTION 5.1 Notice of Acceptance and Other Waivers.

(a)All ABL Obligations at any time made or incurred by any ABL Loan Party shall be deemed to have been made or incurred in reliance upon this Agreement, and the Term Agent, on behalf of the Term Secured Parties, hereby waives notice of acceptance, or proof of reliance by the ABL Agent or any ABL Secured Parties of this Agreement, and notice of the existence, increase, renewal, extension, accrual, creation, or non-payment of all or any part of the ABL Obligations. All Shared Collateral Obligations at any time made or incurred by any Shared Collateral Loan Party shall be deemed to have been made or incurred in reliance upon this Agreement, and the ABL Agent, on behalf of the ABL Secured Parties, hereby waives notice of acceptance, or proof of reliance, by the Shared Collateral Agents or any Shared Collateral Secured Party of this Agreement, and notice of the existence, increase, renewal, extension, accrual, creation, or non-payment of all or any part of the Shared Collateral Obligations.

(b)None of the ABL Agent, any ABL Secured Party, or any of their respective Affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, or realize upon any of the ABL Collateral or any Proceeds, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any ABL Collateral or Proceeds thereof or to take any other action whatsoever with regard to the ABL Collateral or any part or Proceeds thereof, except as specifically provided in this Agreement. If the ABL Agent or any ABL Secured Party honors (or fails to honor) a request by any ABL Borrower for an extension of credit pursuant to any ABL Credit Agreement or any of the other ABL Documents, whether or not the ABL Agent or any ABL Secured Party has knowledge that the honoring of (or failure to honor) any such request would constitute a default under the terms of any Shared Collateral Document (but not a default under this Agreement) or an act, condition, or event that, with the giving of notice or the passage of time, or both, would constitute such a default, or if the ABL Agent or any ABL Secured Party otherwise should exercise any of its contractual rights or remedies under any ABL Documents (subject to the express terms and conditions hereof), neither the ABL Agent nor any ABL Secured Party shall have any liability whatsoever to the Shared Collateral Agents or any Shared Collateral Secured Party as a result of such action, omission, or exercise (so long as any such exercise does not breach the express terms and provisions of this Agreement). The ABL Agent and the ABL Secured Party shall be entitled to manage and supervise their loans and extensions of credit under any ABL Credit Agreement and any of the other ABL Documents as they may, in their sole discretion, deem appropriate, and may manage their loans and extensions of credit without regard to any rights or interests that the Shared Collateral Agents or any of the Shared Collateral Secured Parties have in the ABL Collateral, except as otherwise expressly set forth in this Agreement. The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree that neither the

ABL Agent nor any ABL Secured Party shall incur any liability as a result of a sale, lease, license, application, or other disposition of all or any portion of the ABL Collateral or Proceeds thereof, pursuant to the ABL Documents, so long as such disposition is conducted in accordance with mandatory provisions of applicable law and does not breach the provisions of this Agreement.

(c)None of the Shared Collateral Agents, any Shared Collateral Secured Party, or any of their respective Affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, or realize upon any of the Canadian Pledge Collateral or any Proceeds, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any Canadian Pledge Collateral or Proceeds thereof or to take any other action whatsoever with regard to the Canadian Pledge Collateral or any part or Proceeds thereof, except as specifically provided in this Agreement. The Shared Collateral Agent and the Shared Collateral Secured Parties shall be entitled to manage and supervise their loans and extensions of credit under any Shared Collateral Documents as they may, in their sole discretion, deem appropriate, and may manage their loans and extensions of credit without regard to any rights or interests that the ABL Agent or any of the ABL Secured Parties have in the Canadian Pledge Collateral, except as otherwise expressly set forth in this Agreement. The ABL Agent, on behalf of the ABL Secured Parties, agrees that no Shared Collateral Agent nor any Shared Collateral Secured Party shall incur any liability as a result of a sale, lease, license, application, or other disposition of all or any portion of the Canadian Pledge Collateral or Proceeds thereof, pursuant to the Shared Collateral Documents, so long as such disposition is conducted in accordance with mandatory provisions of applicable law and does not breach the provisions of this Agreement.

SECTION 5.2 Modifications to ABL Documents and Shared Collateral Documents.

(a)The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, hereby agree that, without affecting the obligations of the Shared Collateral Agent and the Shared Collateral Secured Parties hereunder, the ABL Agent and the ABL Lenders may, at any time and from time to time, in their sole discretion without the consent of or notice to the Shared Collateral Agents or any Shared Collateral Secured Party (except to the extent such notice or consent is required pursuant to the express provisions of this Agreement), and without incurring any liability to the Shared Collateral Agent or any Shared Collateral Secured Party or impairing or releasing the subordination provided for herein, amend, restate, supplement, replace, refinance, extend, consolidate, restructure, or otherwise modify any of the ABL Documents in any manner whatsoever, including, without limitation, to:

(i)change the manner, place, time, or terms of payment or renew, alter or increase, all or any of the ABL Obligations or otherwise amend, restate, supplement, or otherwise modify in any manner, or grant any waiver or release with respect to, all or any part of the ABL Obligations or any of the ABL Documents;

(ii)subject to Section 2.5, retain or obtain a Lien on any Property of any Person to secure any of the ABL Obligations, and in connection therewith to enter into any additional ABL Documents;

(iii)amend, or grant any waiver, compromise, or release with respect to, or consent to any departure from, any guaranty or other obligations of any Person obligated in any manner under or in respect of the ABL Obligations;

(iv)release its Lien on any ABLShared Collateral or other Property;

(v)exercise or refrain from exercising any rights against any Loan Party or any other Person;

(vi)subject to Section 2.5, retain or obtain the primary or secondary obligation of any other Person with respect to any of the ABL Obligations; and

(vii)otherwise manage and supervise the ABL Obligations as the ABL Agent shall deem appropriate;

provided, however, that no such amendment, supplement or modification shall (x) in the case of the Tranche A Borrowing Base, result in increasing the “Inventory Advance Rate” thereunder to more than 95% and (y) in the case of the Tranche A-1 Borrowing BaseIncremental Availability, result in increasing the “Inventory Advance Rate” thereunder to more than 100%.

(b)The ABL Agent, on behalf of the ABL Secured Parties, hereby agrees that, without affecting the obligations of the ABL Agent and the ABL Secured Parties hereunder, the Shared Collateral Agents and the Shared Collateral Secured Parties may, at any time and from time to time, in their sole discretion without the consent of or notice to the ABL Agent or any ABL Secured Party (except to the extent such notice or consent is required pursuant to the express provisions of this Agreement), and without incurring any liability to the ABL Agent or any ABL Secured Party or impairing or releasing the subordination provided for herein, amend, restate, supplement, replace, refinance, extend, consolidate, restructure, or otherwise modify any of the Shared Collateral Documents in any manner whatsoever, including, without limitation, to:

(i)change the manner, place, time, or terms of payment or renew, alter or increase, all or any of the Shared Collateral Obligations or otherwise amend, restate, supplement, or otherwise modify in any manner, or grant any waiver or release with respect to, all or any part of the Shared Collateral Obligations or any of the Shared Collateral Documents;

(ii)subject to Section 2.5, retain or obtain a Lien on any Property of any Person to secure any of the Shared Collateral Obligations, and in connection therewith to enter into any additional Shared Collateral Documents;

(iii)amend, or grant any waiver, compromise, or release with respect to, or consent to any departure from, any guaranty or other obligations of any Person obligated in any manner under or in respect of the Shared Collateral Obligations;

(iv)exercise or refrain from exercising any rights against Loan Party or any other Person;

(v)subject to Section 2.5, retain or obtain the primary or secondary obligation of any other Person with respect to any of the Shared Collateral Obligations;

(vi)release its Lien on any ABLShared Collateral, Non-Shared Collateral or other Propertyand take any action in respect of any of the Non-Shared Collateral; and

(vii)otherwise manage and supervise the Shared Collateral Obligations as the Shared Collateral Agents shall deem appropriate.

(c)No consent furnished by the ABL Agent or the Shared Collateral Agents pursuant to Sections 5.2(a) or 5.2(b) hereof shall be deemed to constitute the modification or waiver of any provisions of the ABL Documents or the Shared Collateral Documents, each of which remain in full force and effect as written.

(d)The ABL Obligations and each of the Shared Collateral Obligations may be refinancedor replaced, in whole or in part, in each case, without notice to, or the consent (except to the extent a consent is required to permit the refinancing transaction under any ABL Document or any Shared Collateral Document) of the ABL Agent, the ABL Lenders, the Shared Collateral Agents or the Shared Collateral Secured Parties, as the case may be, all without affecting the Lien Priorities provided for herein or the other provisions hereofand the terms of this Agreement would apply to such refinancing Indebtedness and the holders thereof, mutatis mutandis, provided, however, that (i) the holders of such refinancing Indebtedness (or an authorized agent or trustee on their behalf) bind themselves in writing to the terms of this Agreement pursuant to such documents or agreements (including amendments or supplements to this Agreement) as the ABL Agent or the applicable Shared Collateral Agent, as the case may be, shall reasonably request and in form and substance reasonably acceptable to the ABL Agent or the applicable Shared Collateral Agent, as the case may be, and any such refinancing transaction shall be in accordance with any applicable provisions of both the ABL Documents and the Shared Collateral Documents, and(ii) no such refinancing shall have any effect prohibited by Section 5.2(a) or 5.2(b), as applicable.and (iii) such refinancing Indebtedness may provide for a lien that is junior in priority to the Lien Priorities provided for herein. The Parties hereto hereby authorize the Agents to make technical amendments to this Agreement in order to effectuate any of the foregoing.

SECTION 5.3 Reinstatement and Continuation of Agreement.

(a)If the ABL Agent or any ABL Lender is required in any Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate of any Loan Party or any other Person any payment made in satisfaction of all or any portion of the ABL Obligations (an “ABL Recovery”), then the ABL Obligations shall be reinstated to the extent of such ABL Recovery. If this Agreement shall have been terminated prior to such ABL Recovery, this Agreement shall be reinstated in full force and effect in the event of such ABL Recovery, and such prior termination shall not diminish, release, discharge, impair, or otherwise affect the obligations of the Parties from such date of reinstatement. All rights, interests, agreements, and obligations of the ABL Agent, the Shared Collateral Agents, the ABL Secured Parties, and the Shared Collateral Secured Parties under this Agreement shall remain in full force and effect and shall continue irrespective of the commencement of, or any discharge, confirmation, conversion, or dismissal of, any Insolvency Proceeding by or against any Loan Party or any other circumstance which otherwise might constitute a defense available to, or a discharge of any Loan Party in respect of the ABL Obligations or the Shared Collateral Obligations. No priority or right of the ABL Agent or any ABL Secured Party shall at any time be prejudiced or impaired in any way by any act or failure to act on the

part of any ABL Loan Party or by the noncompliance by any Person with the terms, provisions, or covenants of any of the ABL Documents, regardless of any knowledge thereof which the ABL Agent or any ABL Secured Party may have.

(b)If any Shared Collateral Agent or any Shared Collateral Secured Party is required in any Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate of any Shared Collateral Loan Party or any other Person any payment made in satisfaction of all or any portion of the Shared Collateral Obligations (a “Shared Collateral Recovery”), then the Shared Collateral Obligations shall be reinstated to the extent of such Shared Collateral Recovery. If this Agreement shall have been terminated prior to such Shared Collateral Recovery, this Agreement shall be reinstated in full force and effect in the event of such Shared Collateral Recovery, and such prior termination shall not diminish, release, discharge, impair, or otherwise affect the obligations of the Parties from such date of reinstatement. All rights, interests, agreements, and obligations of the ABL Agent, the Shared Collateral Agents, the ABL Secured Parties, and the Shared Collateral Secured Parties under this Agreement shall remain in full force and effect and shall continue irrespective of the commencement of, or any discharge, confirmation, conversion, or dismissal of, any Insolvency Proceeding by or against any Loan Party or any other circumstance which otherwise might constitute a defense available to, or a discharge of any Loan Party in respect of the ABL Obligations or the Shared Collateral Obligations. No priority or right of the Shared Collateral Agents or any Shared Collateral Secured Party shall at any time be prejudiced or impaired in any way by any act or failure to act on the part of any Loan Party or by the noncompliance by any Person with the terms, provisions, or covenants of any of the Shared Collateral Documents, regardless of any knowledge thereof which the Shared Collateral Agents or any Shared Collateral Secured Party may have.

SECTION 5.4Joinder of Authorized Representatives. Notwithstanding anything contained in this Agreement to the contrary, without the consent of any ABL Secured Party or any Shared Collateral Secured Party, any Authorized Representative may become a party to this Agreement by execution and delivery of a joinder agreement substantially in the form of Exhibit A hereto and upon such execution and delivery, such Authorized Representative and the Secured Parties for which such Authorized Representative is acting shall be subject to the terms of this Agreement as an Additional Pari Passu Agent and Additional Pari Passu Secured Parties, respectively.

ARTICLE 6
INSOLVENCY PROCEEDINGS

SECTION 6.1DIP Financing.

(a)If any Loan Party shall be subject to any Insolvency Proceeding in the United States at any time prior to the Discharge of ABL Obligations, and the ABL Agent or the ABL Secured Parties shall seek to provide any Loan Party with, or consent to a third party providing, any financing under Section 364 of the Bankruptcy Code or consent to any order for the use of cash collateral constituting ABL Collateral under Section 363 of the Bankruptcy Code (each, a “DIP Financing”), with such DIP Financing to be secured by all or any portion of the ABL Collateral (including assets that, but for the application of Section 552 of the Bankruptcy Code would be ABL Collateral), then the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree that they will raise no

objection and will not support any objection to such DIP Financing or use of cash collateral or to the Liens securing the same on the grounds of a failure to provide “adequate protection” for the Liens of the Shared Collateral Agents securing the Shared Collateral Obligations or on any other grounds (and will not request any adequate protection solely as a result of such DIP Financing or use of cash collateral that is ABL Collateral except as permitted by Section 6.3(b)), so long as (i) the Shared Collateral Agents retain their Lien on the ABL Collateral to secure the Shared Collateral Obligations (in each case, including Proceeds thereof arising after the commencement of the case under the Bankruptcy Code), (ii) the terms of the DIP Financing do not compel the applicable Loan Party to seek confirmation of a specific plan of reorganization for which all or substantially all of the material terms of such plan are set forth in the DIP Financing documentation or related document; (iii) all Liens on the ABL Collateral securing any such DIP Financing shall be senior to or on a parity with the Liens of the ABL Agent and the ABL Secured Parties securing the ABL Obligations on the ABL Collateral, and (iv) the amount of ABL Obligations as a result of such DIP Financing may be increased but in no event by no more than $50.0 million in excess of the maximum commitments under the ABL Credit Agreement prior to the commencement of the applicable Insolvency Proceeding.

(b)All Liens granted to the ABL Agent or the Shared Collateral Agents in any Insolvency Proceeding, whether as adequate protection or otherwise, are intended by the Parties to be and shall be deemed to be subject to the Lien Priority and the other terms and conditions of this Agreement.

SECTION 6.2Relief from Stay. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree not to seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of any portion of the ABL Collateral without the ABL Agent’s express written consent. Prior to the Discharge of Shared Collateral Obligations, the ABL Agent, on behalf of the ABL Secured Parties, agrees not to seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of any portion of the Canadian Pledge Collateral without each Shared Collateral Agent’s express written consent. In addition, the ABL Agent and Shared Collateral Agents shall not seek any relief from the automatic stay with respect to any ABLShared Collateral without providing 3 days’ prior written notice to the other, unless such period is agreed by each of the ABL Agent and the Shared Collateral Agents to be modified or unless (i) in the case of ABL Collateral, the ABL Agent makes a good faith determination that either (A) the ABL Collateral will decline speedily in value or (B) the failure to take any action will have a reasonable likelihood of endangering the ABL Agent’s or the Shared Collateral Agents’ ability to realize upon the ABL Collateral.and (ii) in the case of Canadian Pledge Collateral, the Term Agent (prior to the Discharge of Term Obligations in respect of Term B-4 Loans and thereafter the Authorized Shared Collateral Agent) makes a good faith determination that either (A) the Canadian Pledge Collateral will decline speedily in value or (B) the failure to take any action will have a reasonable likelihood of endangering the Term Agent’s, any other Shared Collateral Agent’s or the ABL Agent’s ability to realize upon the Canadian Pledge Collateral

SECTION 6.3No Contest; Adequate Protection.

(a)The Shared Collateral Agents’, on behalf of the Shared Collateral Secured Parties, agrees that, prior to the Discharge of ABL Obligations, none of them shall contest (or support any other Person contesting) (a) any request by the ABL Agent or any ABL Secured Party for adequate protection

of its interest in the ABL Collateral, (b) any proposed provision of DIP Financing by the ABL Agent and the ABL Secured Parties (or any other Person proposing to provide DIP Financing with the consent of the ABL Agent) or (c) any objection by the ABL Agent or any ABL Secured Party to any motion, relief, action, or proceeding based on a claim by the ABL Agent or any ABL Secured Party that its interests in the ABL Collateral are not adequately protected (or any other similar request under any law applicable to an Insolvency Proceeding), so long as any Liens granted to the ABL Agent as adequate protection of its interests are subject to this Agreement.The ABL Agent, on behalf of the ABL Secured Parties, agrees that, prior to the Discharge of Shared Collateral Obligations, none of them shall contest (or support any other Person contesting) (a) any request by a Shared Collateral Agent or any Shared Collateral Secured Party for adequate protection of its interest in the Canadian Pledge Collateral or (b) any objection by a Shared Collateral Agent or any Shared Collateral Secured Party to any motion, relief, action, or proceeding based on a claim by a Shared Collateral Agent or any Shared Collateral Secured Party that its interests in the Canadian Pledge Collateral are not adequately protected (or any other similar request under any law applicable to an Insolvency Proceeding), so long as any Liens granted to a Shared Collateral Agent as adequate protection of its interests are subject to this Agreement.

(b)Notwithstanding the foregoing provisions in this Section 6.3, in any Insolvency Proceeding if the ABL Secured Parties (or any subset thereof) are granted adequate protection with respect to the ABL Collateral in the form of additional collateral (even if such collateral is not of a type which would otherwise have constituted ABL Collateral), then the ABL Agent, on behalf of itself and the ABL Lenders, agrees that the Shared Collateral Agents, on behalf of itself or any of the Shared Collateral Secured Parties, may seek or request (and the ABL Secured Parties will not oppose such request) adequate protection with respect to its interests in such ABL Collateral in the form of a Lien on the same additional collateral, which Lien will be subordinated to the Liens securing the ABL Obligations on the same basis as the other Liens of the Shared Collateral Agents on the ABL Collateral.

SECTION 6.4Asset Sales. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents agree, on behalf of themselves and the Shared Collateral Secured Parties, that they will not oppose any sale consented to by the ABL Agent of any ABL Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any Insolvency Proceeding) so long as the proceeds of such sale are applied in accordance with this Agreement. Prior to the Discharge of Shared Collateral Obligations, the ABL Agent agrees, on behalf of itself and the ABL Secured Parties, that they will not oppose any sale consented to by the Shared Collateral Agents of any Canadian Pledge Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any Insolvency Proceeding) so long as the proceeds of such sale are applied in accordance with this Agreement.

SECTION 6.5Separate Grants of Security and Separate Classification. Each Shared Collateral Secured Party, the Shared Collateral Agents, each ABL Secured Party and the ABL Agent acknowledges and agrees that (i) the grants of Liens pursuant to the ABL Documents, the Term Documents, the Notes Documents and the Additional Pari Passu Documents constitute separate and distinct grants of Liens and (ii) because of, among other things, their differing rights in the ABLShared Collateral, each of the TermABL Obligations, the NotesTerm Obligations and the Additional Pari Passu

Obligations are fundamentally different from the ABL Obligationsone another and must be separately classified in any plan of reorganization proposed or adopted in an Insolvency Proceeding.

SECTION 6.6Enforceability. The provisions of this Agreement are intended to be and shall be enforceable under Section 510(a) of the Bankruptcy Code.

SECTION 6.7ABL Obligations Unconditional. All rights of the ABL Agent hereunder, and all agreements and obligations of the Shared Collateral Agents and the Loan Parties (to the extent applicable) hereunder, shall remain in full force and effect irrespective of:

(i)any lack of validity or enforceability of any ABL Document;

(ii)any change in the time, place or manner of payment of, or in any other term of, all or any portion of the ABL Obligations, or any amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of any ABL Document;

(iii)any exchange, release, voiding, avoidance or non perfection of any security interest in any ABLShared Collateral or any other collateral, or any release, amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding, restatement or increase of all or any portion of the ABL Obligations or any guarantee or guaranty thereof; or

(iv)any other circumstances that otherwise might constitute a defense available to, or a discharge of, any Loan Party in respect of the ABL Obligations, or of any of the Shared Collateral Agents or any Loan Party, to the extent applicable, in respect of this Agreement.

SECTION 6.8Shared Collateral Obligations Unconditional. All rights of the Shared Collateral Agents hereunder, all agreements and obligations of the ABL Agent and the Loan Parties (to the extent applicable) hereunder, shall remain in full force and effect irrespective of:

(i)any lack of validity or enforceability of any Shared Collateral Document;

(ii)any change in the time, place or manner of payment of, or in any other term of, all or any portion of the Shared Collateral Obligations, or any amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of any Shared Collateral Document;

(iii)any exchange, release, voiding, avoidance or non perfection of any security interest in any ABLShared Collateral, or any other collateral, or any release, amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding, restatement or increase of all or any portion of the Shared Collateral Obligations or any guarantee or guaranty thereof; or

(iv)any other circumstances that otherwise might constitute a defense available to, or a discharge of, any Loan Party in respect of the Shared Collateral Obligations, or of any of the ABL Agent or any Loan Party, to the extent applicable, in respect of this Agreement.

ARTICLE 7CANADIAN PLEDGE COLLATERAL

SECTION 7.1Canadian Pledge Collateral. Notwithstanding (i) the date, time, method, manner, or order of grant, attachment, or perfection of any Liens granted to any Shared Collateral Agent or the Shared Collateral Secured Parties in respect of all or any portion of the Canadian Pledge Collateral or of any Liens granted to the ABL Agent or the ABL Secured Parties in respect of all or any portion of the Canadian Pledge Collateral and regardless of how any such Lien was acquired (whether by grant, statute, operation of law, subrogation or otherwise), (ii) the order or time of filing or recordation of any document or instrument for perfecting the Liens in favor of the Shared Collateral Agents or the ABL Agent (or Shared Collateral Secured Parties or the ABL Secured Parties) in any Canadian Pledge Collateral, (iii) any provision of the Uniform Commercial Code, the Bankruptcy Code or any other applicable law, or of the Shared Collateral Documents or the ABL Documents, or (iv) whether any Shared Collateral Agent or the ABL Agent, in each case, either directly or through agents, hold possession of, or have control over, all or any part of the Canadian Pledge Collateral, the Term Agent, on behalf of itself and the Term Secured Parties, each Additional Pari Passu Agent, on behalf of itself and the Additional Pari Passu Secured Parties it represents, and the ABL Agent, on behalf of itself and the ABL Secured Parties, hereby agrees that prior to the Discharge of Shared Collateral Obligations:

(1)any Lien in respect of all or any portion of the Canadian Pledge Collateral now or hereafter held by or on behalf of the ABL Agent or any ABL Secured Party that secures all or any portion of the ABL Obligations shall in all respects be junior and subordinate to all Liens granted to the Shared Collateral Agents for the benefit of their respective Shared Collateral Secured Parties on the Canadian Pledge Collateral;

(2)any Lien in respect of all or any portion of the Canadian Pledge Collateral now or hereafter held by or on behalf of (a) the Term Agent or any Term Secured Party (other than a Term B-4 Lender) that secures all or any portion of the Term Obligations (other than Term Obligations in respect of Term B-4 Loans payable to the Term B-4 Lenders) or (b) any Additional Pari Passu Agent or any Additional Pari Passu Secured Parties represented by such Additional Pari Passu Agent that secures all or any portion of the Additional Pari Passu Obligations, in each case shall in all respect be junior and subordinate to all Liens granted to the Term Agent for the benefit of the Term B-4 Lenders on the Canadian Pledge Collateral;

(3)any Lien in respect of all or any portion of the Canadian Pledge Collateral now or hereafter held by or on behalf of the Term Agent (acting on behalf of any Term B-4 Lender) or any Term B-4 Lender that secures all or any portion of the Term Obligations in respect of Term B-4 Loans payable to the Term B-4 Lenders shall in all respects be senior and prior to all Liens granted to the ABL Agent or any ABL Secured Party, any Additional Par Passu Agent or any Additional Pari Passu Secured Party or the Term Agent (acting on behalf of any Term Secured

Party that is not a Term B-4 Lender) or any such Term Secured Party that is not a Term B-4 Lender on the ABL Collateral; and

The TermAgent, for and on behalf of itself and theTermSecured Parties, acknowledges and agrees that, the ABL Agent, for the benefit of the ABL Secured Parties, has been granted Liens upon all of the Canadian Pledge Collateral in which the Term Agent has been granted Liens and the Term Agent hereby consents thereto. The subordination of Liens by the ABL Agent, Additional Pari Passu Secured Parties and the Term Secured Parties (other than the Term B-4 Lenders) in favor of the Term Agent for the benefit of the Term B-4 Lenders or the Term Secured Parties, as applicable, as set forth herein shall not be deemed to subordinate the ABL Agent’s, Additional Pari Passu Agent’s or the Term Agent’s respective Liens on the Canadian Pledge Collateral to the Liens of any other Person. Notwithstanding any provision to the contrary contained herein, this Article 7 shall not apply to any of the ABL Collateral.

SECTION 7.2Waiver of Right to Contest Liens. Each of ABL Agent, on behalf of the ABL Secured Parties and the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties represented by such Shared Collateral Agent, agrees that it and they shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the Shared Collateral Agents and the Shared Collateral Secured Parties in respect of the Canadian Pledge Collateral or Liens of the ABL Agent and the ABL Secured Parties in respect of the Canadian Pledge Collateral or the provisions of this Agreement. Except to the extent expressly set forth in this Agreement, the ABL Agent, on behalf of the ABL Secured Parties, agrees that none of the ABL Agent or the ABL Secured Parties will take any action that would interfere with any Exercise of Secured Creditor Remedies undertaken by the Term Agent or any Term Secured Party under the Term Documents, or by any Additional Pari Passu Agent or Additional Par Passu Secured Party under any Additional Par Passu Document, with respect to the Canadian Pledge Collateral. Except to the extent expressly set forth in this Agreement, the ABL Agent, on behalf of the ABL Secured Parties, hereby waive any and all rights they or the ABL Secured Parties may have as a junior lien creditor or otherwise to contest, protest, object to, or interfere with the manner in which any Shared Collateral Agent or any Shared Collateral Secured Party seeks to enforce its Liens in any Canadian Pledge Collateral. Except to the extent expressly set forth in this Agreement, each Additional Pari Passu Agent, on behalf of the Additional Pari Passu Secured Parties represented by it, hereby waive any and all rights they or the Additional Pari Passu Secured Parties may have as a junior lien creditor or otherwise to contest, protest, object to, or interfere with the manner in which the Term Agent (acting on behalf of the Term B-4 Lenders) or any Term B-4 Lender seeks to enforce its Liens in any Canadian Pledge Collateral. The foregoing shall not be construed to prohibit the ABL Agent from enforcing the provisions of this Agreement as to the relative priority of the parties hereto.

SECTION 7.3Canadian Pledge Collateral Remedies Standstill; Release of Liens.

(b)The ABL Agent, on behalf of the ABL Secured Parties, agrees that, from the date hereof until the earlier of (i) the ABL Enforcement Date or (ii) the date upon which the Discharge of the

Shared Collateral Obligations shall have occurred, they will not Exercise Any Secured Creditor Remedies with respect to any of the Canadian Pledge Collateral without the written consent of (i) the Term Agent and, to the extent such consent is required under the Term Credit Agreement, the Required Lenders (as defined in the Term Credit Agreement) and/or the Term B-4 Required Lenders (as defined in the Term Credit Agreement) and (ii) each Additional Pari Passu Agent and, to the extent such consent is required under the Additional Pari Passu Documents with respect to such Additional Pari Passu Agent, the required holders of such Additional Pari Passu Obligations, and will not take, receive or accept any Proceeds of the Canadian Pledge Collateral. From and after the earlier of (i) the ABL Enforcement Date or (ii) the date upon which the Discharge of the Shared Collateral Obligations shall have occurred, the ABL Agent or any ABL Secured Party may Exercise Any Secured Creditor Remedies under the ABL Collateral Documents or applicable law as to any Canadian Pledge Collateral.

(c)Notwithstanding the provisions of Sections 7.3(a) or any other provision of this Agreement, prior to the Discharge of the Shared Collateral Obligations, nothing contained herein shall be construed to prevent (i) the ABL Agent or any ABL Secured Party from filing a claim or statement of interest with respect to the ABL Obligations owed to them in any Insolvency Proceeding commenced by or against any Loan Party, (ii) take any action (not adverse to the priority status of the Liens of the Shared Collateral Agents or Shared Collateral Secured Parties on the Canadian Pledge Collateral in which the Shared Collateral Agents or Shared Collateral Secured Parties have a priority Lien or the rights of the Shared Collateral Agents or any of the Shared Collateral Secured Parties to exercise remedies in respect thereof) in order to create, perfect, preserve or protect (but not enforce) its Lien on any Canadian Pledge Collateral, (iii) file any necessary or responsive pleadings in opposition to any motion, adversary proceeding or other pleading filed by any Person objecting to or otherwise seeking disallowance of the claim or Lien of the ABL Agent or ABL Secured Parties, (iv) file any pleadings, objections, motions, or agreements which assert rights available to unsecured creditors of the Loan Parties arising under any Insolvency Proceeding or applicable non-bankruptcy law, (v) vote on any plan of reorganization or file any proof of claim in any Insolvency Proceeding of any Loan Party, or (vi) object to the proposed retention of Canadian Pledge Collateral by any Shared Collateral Agent or any Shared Collateral Secured Party in full or partial satisfaction of any Shared Collateral Obligations due to such Shared Collateral Agent or Shared Collateral Secured Parties, in each case (i) through (iv) and (vi) above to the extent not inconsistent with, or could not result in a resolution inconsistent with, the terms of this Agreement.

(d)In the event of any private or public sale of all or any portion of the Canadian Pledge Collateral (other than in connection with a refinancing as described in Section 5.2(d)) permitted by the Term Documents or consented to by the Required Lenders (as defined in the Term Credit Agreement) or, to the extent required by the Term Credit Agreement, the Term B-4 Required Lenders (as defined in the Term Credit Agreement), the ABL Agent agrees, on behalf of the ABL Secured Parties, that such sale will be free and clear of the Liens on such Canadian Pledge Collateral securing the ABL Obligations, and the ABL Agent’s and the ABL Secured Parties’ Liens with respect to the Canadian Pledge Collateral so sold, transferred, disposed or released shall terminate and be automatically released without further action concurrently with, and to the same extent as, the release of the Term Secured

Parties’ Liens on such Canadian Pledge Collateral; provided that in the case of a disposition in connection with an Exercise of Secured Creditor Remedies with respect to any Canadian Pledge Collateral, any Proceeds thereof not applied to repay Shared Collateral Obligations shall be subject to the Liens securing the ABL Obligations and shall be applied pursuant to this Agreement. In furtherance of, and subject to, the foregoing, the ABL Agent agrees that it will promptly execute any and all Lien releases or other documents reasonably requested by the Term Agent in connection therewith. The ABL Agent hereby appoints the Term Agent and any officer or duly authorized person of the Term Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power of attorney in the place and stead of the ABL Agent and in the name of such ABL Agent or in the Term Agent’s own name, from time to time, in the Term Agent’s sole discretion, for the purposes of carrying out the terms of this paragraph, to take any and all appropriate action and to execute and deliver any and all documents and instruments as may be necessary or desirable to accomplish the purposes of this paragraph, including any financing statements, endorsements, assignments, releases or other documents or instruments of transfer (which appointment, being coupled with an interest, is irrevocable)..

SECTION 7.4Application of Proceeds; Turnover Provisions. Prior to the Discharge of Shared Collateral Obligations, the ABL Agent, each Additional Pari Passu Agent and the Term Agent hereby agree that all Canadian Pledge Collateral and all Proceeds thereof received by either of them or any ABL Secured Party, Additional Pari Passu Secured Party or Term Secured Party, respectively, in connection with any Exercise of Secured Creditor Remedies with respect to Canadian Pledge Collateral, whether or not pursuant to an Insolvency Proceeding, shall be distributed as follows: first, to the Term Agent on behalf of the Term B-4 Lenders for application to the Term Obligations with respect to the Term B-4 Loans in accordance with the terms of the Term Documents, until the Discharge of Term Obligations with respect to the Term B-4 Loans has occurred, second, ratably, to the Shared Collateral Agents on behalf of the Shared Collateral Secured Parties (other than the Term B-4 Lenders) for application to the Shared Collateral Obligations in accordance with the terms of the Shared Collateral Documents, until the Discharge of the Shared Collateral Obligations, third, to the ABL Agent on behalf of the ABL Secured Parties in accordance with the ABL Documents, until the Discharge of ABL Obligations has occurred and fourth the balance, if any, to the Loan Parties or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct; provided that in the event the ABL Agent receives, in connection with an Insolvency Proceeding, any Proceeds of any Canadian Pledge Collateral and the Lien granted in favor of each Shared Collateral Agent or the Shared Collateral Secured Parties in respect of such Canadian Pledge Collateral has been voided, avoided, subordinated, or otherwise invalidated by a court of competent jurisdiction and the provisions of Section 5.3 would not be effective, then such Proceeds received ABL Agent with respect to the Canadian Pledge Collateral subject to such avoidance, subordination or invalidation shall be applied, to the extent permitted under applicable law, to the payment of the ABL Obligations in accordance with the ABL Documents.

ARTICLE 8MISCELLANEOUS

Section 7.18.1Rights of Subrogation. The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree that no payment to the ABL Agent or any ABL Secured Parties

pursuant to the provisions of this Agreement in respect of ABL Collateral shall entitle the Shared Collateral Agents or any Shared Collateral Secured Party to exercise any rights of subrogation in respect thereof prior to the Discharge of ABL Obligations. Following the Discharge of ABL Obligations, the ABL Agent agrees to execute such documents, agreements, and instruments as the Shared Collateral Agents or any Shared Collateral Secured Party may reasonably request to evidence the transfer by subrogation to any such Person of an interest in the ABL Obligations resulting from payments to the ABL Agent by such Person, so long as all costs and expenses (including all reasonable legal fees and disbursements) incurred in connection therewith by the ABL Agent are paid by such Person upon request for payment thereof. The ABL Agent, on behalf of the ABL Secured Parties, agree that no payment to a Shared Collateral Agent or any Shared Collateral Secured Parties pursuant to the provisions of this Agreement in respect of Canadian Pledge Collateral shall entitle the ABL Agent or any ABL Secured Party to exercise any rights of subrogation in respect thereof prior to the Discharge of Shared Collateral Obligations

Section 7.28.2Further Assurances. The Parties will, at their own expense and at any time and from time to time, promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or desirable, or that any Party may reasonably request, in order to protect any right or interest granted or purported to be granted hereby or to enable the ABL Agent or the Shared Collateral Agents to exercise and enforce its rights and remedies hereunder; provided, however, that no Party shall be required to pay over any payment or distribution, execute any instruments or documents, or take any other action referred to in this Section 7.28.2, to the extent that such action would contravene any law, order or other legal requirement or any of the terms or provisions of this Agreement, and in the event of a controversy or dispute, such Party may interplead any payment or distribution in any court of competent jurisdiction, without further responsibility in respect of such payment or distribution under this Section 7.28.2.

Section 7.38.3Representations. The Term Agent represents and warrants to the ABL Agent and each other Shared Collateral Agent that it has the requisite power and authority under the Term Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the Term Secured Parties and that this Agreement shall be binding obligations of the Term Agent and the Term Secured Parties, enforceable against the Term Agent and the Term Secured Parties in accordance with its terms. The ABL Agent represents and warrants to the Shared Collateral Agents that it has the requisite power and authority under the ABL Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the ABL Secured Parties and that this Agreement shall be binding obligations of the ABL Agent and the ABL Secured Parties, enforceable against the ABL Agent and the ABL Secured Parties in accordance with its terms. The Notes Agent represents and warrants to the ABL Agent and each other Shared Collateral Agent that pursuant to authority granted in Article 11 of the Indenture it has the requisite power and authority under the Notes Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the Notes Secured Parties and that this Agreement shall be binding obligations of the Notes Agent and the Notes Secured Parties, enforceable against the Notes Agent and the Notes Secured Parties in accordance with its terms.By executing a joinder agreement in the form of Exhibit A hereto, the Additional Pari Passu Agent represents and warrants to the ABL Agent and each other Shared Collateral Agent that it has the requisite power and authority under the Additional Pari Passu Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the Additional Pari Passu Secured Parties and that this Agreement

shall be binding obligations of the Additional Pari Passu Agent and the Additional Pari Passu Secured Parties, enforceable against the Additional Pari Passu Agent and the Additional Pari Passu Secured Parties in accordance with its terms

Section 7.48.4Amendments. No amendment or waiver of any provision of this Agreement nor consent to any departure by any Party hereto shall be effective unless it is in a written agreement executed by each Shared Collateral Agent and the ABL Agent and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

Section 7.58.5Addresses for Notices. Unless otherwise specifically provided herein, any notice or other communication herein required or permitted to be given shall be in writing and may be personally served, faxed, or sent by overnight express courier service or United States mail and shall be deemed to have been given when delivered in person or by courier service, upon receipt of a telecopy or five (5) days after deposit in the United States mail (certified, with postage prepaid and properly addressed). For the purposes hereof, the addresses of the parties hereto (until notice of a change thereof is delivered as provided in this Section) shall be as set forth below or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties.

ABL Agent: Bank of America, N.A.
40 Broad Street
Boston, Massachusetts 02109
Attention: Betsy Ratto

Term Agent: Bank of America, N.A.
101 South Tryon Street
Charlotte, North Carolina 28255
Tel: (980) 387-5452
Fax: (704) 208-2871
Attn: Kelly T. Weaver

Notes Agent: The Bank of New York Mellonc/o The Bank of New York Mellon Trust Company, N.A.525 William Penn Place38th FloorPittsburgh, PA 15259Tel: (412) 236-1196Fax: (412) 234-7571Attn: Global Corporate Trust - Toys “R” US - Delaware

Section 7.68.6No Waiver, Remedies. No failure on the part of any Party to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.

Section 7.78.7Continuing Agreement, Transfer of Secured Obligations. This Agreement is a continuing agreement and shall (a) remain in full force and effect until the Discharge of ABL

Obligations and the Discharge of the Shared Collateral Obligations shall have occurred, (b) be binding upon the Parties and their successors and assigns, and (c) inure to the benefit of and be enforceable by the Parties and their respective successors, transferees and assigns. Nothing herein is intended, or shall be construed to give, any other Person any right, remedy or claim under, to or in respect of this Agreement or any ABLShared Collateral. All references to any Loan Party shall include any Loan Party as debtor-in-possession and any receiver or trustee for such Loan Party in any Insolvency Proceeding. Without limiting the generality of the foregoing clause (c), the ABL Agent, any ABL Lender, the Term Agent, or any Term Lender, the Notes Agent or any Notes Secured Party and theand any Additional Pari Passu Agent or any Additional Pari Passu Secured Party may assign or otherwise transfer all or any portion of the ABL Obligations, the Term Obligations, NotesObligations or the Additional Pari Passu Obligations, as applicable, to any other Person (other than any Loan Party or any Affiliate of a Loan Party and any Subsidiary of a Loan Party), and such other Person shall thereupon become vested with all the rights and obligations in respect thereof granted to the ABL Agent, the Term Agent, the Notes Agent, theAdditional Pari Passu Agent, any ABL Lender, any Term Lender, any Notes Secured Partyor any Additional Pari Passu Secured Party, as the case may be, herein or otherwise. The ABL Secured Parties, the Term Secured Parties, the Notes Secured Partyand the Additional Pari Passu Secured Parties (if any) may continue, at any time and without notice to the other parties hereto, to extend credit and other financial accommodations, lend monies and provide Indebtedness to, or for the benefit of, any Loan Party on the faith hereof.

Section 7.88.8Governing Law; Entire Agreement. The validity, performance, and enforcement of this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. This Agreement constitutes the entire agreement and understanding among the Parties with respect to the subject matter hereof and supersedes any prior agreements, written or oral, with respect thereto

Section 7.98.9CounterpartsThis Agreement may be executed in any number of counterparts, including by means of facsimile or “pdf”’ file thereof, and it is not necessary that the signatures of all Parties be contained on any one counterpart hereof, each counterpart will be deemed to be an original, and all together shall constitute one and the same document.

Section 7.108.10No Third Party Beneficiaries. This Agreement is solely for the benefit of the ABL Agent, ABL Secured Parties, the Term Agent, Term Secured Parties, the Notes Agent and the Notes Secured Partiesand the Additional Pari Passu Agent and the Additional Pari Passu Secured Parties (if any). No other Person (including any Loan Party or any Affiliate of a Loan Party, or any Subsidiary of a Loan Party) shall be deemed to be a third party beneficiary of this Agreement.

Section 7.118.11Headings. The headings of the articles and sections of this Agreement are inserted for purposes of convenience only and shall not be construed to affect the meaning or construction of any of the provisions hereof.

Section 7.128.12Severability. If any of the provisions in this Agreement shall, for any reason, be held invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Agreement and shall not invalidate the Lien Priority or the

application of Proceeds and other priorities set forth in this Agreement. The Parties hereto shall endeavor in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions, the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

Section 7.138.13Attorneys Fees. The Parties agree that if any dispute, arbitration, litigation, or other proceeding is brought with respect to the enforcement of this Agreement or any provision hereof, the prevailing party in such dispute, arbitration, litigation, or other proceeding shall be entitled to recover its reasonable attorneys’ fees and all other costs and expenses incurred in the enforcement of this Agreement, irrespective of whether suit is brought.

Section 7.148.14VENUE; JURY TRIAL WAIVER.

(a)EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

(b)EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF SUCH STATE, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OR ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY ABL SECURED PARTY OR ANY SHARED COLLATERAL SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, ANY

ABL DOCUMENTS OR ANY TERM DOCUMENTS AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c)EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OR ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT. EACH PARTY HERETO REPRESENTS THAT IT HAS REVIEWED THIS WAIVER AND IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

(d)EACH PARTY HERETO HEREBY IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 7.58.5. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

Section 7.158.15Intercreditor Agreement. This Agreement is the Intercreditor Agreement or the Shared Collateral Intercreditor Agreement, as the case may be, referred to in the ABL Credit Agreement, the Term Credit Agreement, the Indenture and the Additional Pari Passu Agreement (if any). Nothing in this Agreement shall be deemed to subordinate the obligations due to (i) any ABL Secured Party to the obligations due to any Shared Collateral Secured Party or (ii) any Shared Collateral Secured Party to the obligations due to any ABL Secured Party (in each case, whether before or after the occurrence of an Insolvency Proceeding), it being the intent of the Parties that this Agreement shall effectuate a subordination of Liens but not a subordination of Indebtedness.

Section 7.168.16No Warranties or Liability. The Term Agent, the NotesAgent, the Additional Pari Passu Agent (if any) and the ABL Agent acknowledge and agree that none of them have made any representation or warranty with respect to the execution, validity, legality, completeness, collectibility or enforceability of any other ABL Document, Term Document, Notes Documentor Additional Pari Passu Document. Except as otherwise provided in this Agreement, the Term Agent, the NotesAgent, the Additional Pari Passu Agent and the ABL Agent will be entitled to manage and supervise their respective extensions of credit to any Loan Party in accordance with law and their usual practices, modified from time to time as they deem appropriate.

Section 7.178.17Conflicts. In the event of any conflict between the provisions of this Agreement and the provisions of any ABL Document, any Term Document, any Notes Document or any Additional Pari Passu Document, the provisions of this Agreement shall govern.

Section 7.188.18Information Concerning Financial Condition of the Loan Parties. The Term Agent, the NotesAgent, Additional Pari Passu Agent (if any) and the ABL Agent hereby agree that no party shall have any duty to advise any other party of information known to it regarding such condition or any such circumstances. In the event the Term Agent, the NotesAgent, the Additional Pari Passu Agent (if any) or the ABL Agent, in its sole discretion, undertakes at any time or from time to time to provide any information to any other party to this Agreement, (a) it shall be under no obligation (i) to provide any such information to such other party or any other party on any subsequent occasion, (ii) to undertake any investigation not a part of its regular business routine, or (iii) to disclose any other information, or (b) it makes no representation as to the accuracy or completeness of any such information and shall not be liable for any information contained therein, and (c) the Party receiving such information hereby to hold the other Party harmless from any action the receiving Party may take or conclusion the receiving Party may reach or draw from any such information, as well as from and against any and all losses, claims, damages, liabilities, and expenses to which such receiving Party may become subject arising out of or in connection with the use of such information.

Section 7.198.19Amendment, Restatement, Extension, Renewal and Consolidation of Existing Intercreditor Agreement. This Agreement shall be deemed to amend and restate the Existing Intercreditor Agreement and all terms and provisions of this Agreement supersede in their entirety the terms and provisions of the Existing Intercreditor Agreement.

Section 7.208.20Force Majeure. In no event shall the Term Agent, NotesAgent, the Additional Pari Passu Agent (if any) and the ABL Agent be responsible or liable for any failure or delay in the performance of their obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services, it being understood that the Term Agent, Notes Agent,the Additional Pari Passu Agent (if any) and the ABL Agent shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

Section 7.21Authority of Notes Collateral Agent.The Bank of New York Mellon has been appointed by the Notes Agent for the Notes Secured Parties pursuant to Article 11 of the Indenture. It is expressly understood and agreed by the parties to this Agreement that any authority conferred upon the Notes Agent hereunder is subject to the terms of the delegation of authority made by the holders of the Notes Secured Party to the Notes Collateral Agent pursuant to the Indenture, and that the Notes Agent has agreed to act (and any successor Notes Agent shall act) as such hereunder only on the express conditions contained in such Article 11. Any successor Notes Agent appointed pursuant to Article 11 of the Indenture shall be entitled to all rights, interests and benefits of the Notes Agent hereunder.

Exhibit 10.2

[Signature pages follow]

IN WITNESS WHEREOF, the ABL Agent, for and on behalf of itself and the ABL Lenders, and the Term Agent, for and on behalf of itself and the Term Lendersand the NotesAgent, for and on behalf of itself and theNotesSecured Parties, have caused this Agreement to be duly executed and delivered as of the date first above written.

BANK OF AMERICA, N.A., in its capacity as the ABL Agent
By:
	Name:
	Title:

BANK OF AMERICA, NA.A., in its capacity as the Term Agent
By:
	Name:
	Title:

THE BANK OF NEW YORK MELLON, in its capacity as the Notes Agent
By:
	Name
	Title:

[Signature Page to Intercreditor Agreement]

ACKNOWLEDGMENT

Each ABL Loan Party and each Shared Collateral Loan Party hereby acknowledge that it has received a copy of this Agreement and consents thereto, agrees to recognize all rights granted thereby to the ABL Agent, the ABL Secured Parties, the Shared Collateral Agents, and the Shared Collateral Secured Parties and will not do any act or perform any obligation which is not in accordance with the agreements set forth in this Agreement. Each ABL Loan Party and each Shared Collateral Loan Party further acknowledge and agrees that it is not an intended beneficiary or third party beneficiary under this Agreement and (i) as between the ABL Secured Parties and the ABL Loan Parties, the ABL Documents remain in full force and effect as written and are in no way modified hereby, (ii) as between the Term Secured Parties and the Term Loan Parties, the Term Documents remain in full force and effect as written and are in no way modified hereby, and (iii) as between the Notes Secured Parties and the Notes Parties, the Notes Documents remain in full force and effect as written and are in no way modified hereby and (iv) as between the Additional Pari Passu Secured Parties and the NotesAdditional Pari Passu Parties, the Additional Pari Passu Documents remain in full force and effect as written and are in no way modified hereby.

[Signature Pages Follow]

TOYS “R” US-DELAWARE, INC., as the ABL Lead Borrower,and the Term Borrower and Notes Issuer
By:
	Name:
	Title:

GEOFFREY, LLC, as a Term Guarantor and a Notes Guarantor
By:
	Name:
	Title:

GEOFFREY HOLDINGS, LLC, as an ABL Guarantor,and a Term Guarantor and a Notes Guarantor
By:	TOYS “R” US-DELAWARE, INC., its sole member
By:
	Name:
	Title:

TOYS ACQUISITIONGEOFFREY, LLC,, as an ABL Guarantor,a Term Guarantor and a Notes Guarantor
By:
	Name:
	Title:

GEOFFREY INTERNATIONAL, LLC, as a Term Guarantor and a Notes Guarantor
By:	Geoffrey, LLC, its sole member
By:
	Name:
	Title:

TRU OF PUERTO RICO, INC.TRU-SVC, LLC, as an ABL Guarantor,and a Term Guarantor and a Notes Guarantor
By:
	Name:
	Title:

TRU-SVCTOYS ACQUISITION, LLC, as an ABL Guarantor,and a Term Guarantor and a Notes Guarantor
By:
	Name:
	Title:

TRU OF PUERTO RICO, INC., as an ABL Guarantor and a Term Guarantor
By:
	Name:
	Title:

EXHIBIT A

JOINDER

Reference is hereby made to the Intercreditor Agreement, dated as of August 24, 2010 (as amended, restated, supplemented or otherwise modified from time to time, the “Agreement”), among the agents referred to therein, to which this Joinder is attached. All capitalized terms not otherwise defined herein shall have the meanings assigned to such terms in the Agreement when used herein. The undersigned, in its capacity as [ABL Agent] [Notes Agent] [Term Agent] [Additional Pari Passu Agent] hereby acknowledges the terms and conditions of the Agreement and agrees to be bound thereby. [For all purposes of the Agreement, [identify agreement] shall be an Additional Pari Passu Agreement thereunder.]

[ABL Agent] [NotesAgent] [Term Agent] [Additional Pari Passu Agent]
By:	________________________________
	Name:_____________________________
	Title:_______________________________

By:
	Name:
	Title:

Annex C

Security Agreement

[See Attached]

Annex C

SECURITY AGREEMENT

SECURITY AGREEMENT (this “Agreement”), dated as of July 21st, 2005, by and among:

The Domestic Borrowers identified on the signature pages hereto and each other Domestic Borrower that hereafter becomes a party hereto (each such Person, individually, a “Domestic Borrower” and, collectively, the “Domestic Borrowers”); and

The Facility Guarantors identified on the signature pages hereto and each other Facility Guarantor that hereafter becomes a party hereto (each such Person, individually, a “Facility Guarantor” and, collectively, the “Facility Guarantors”) (each Domestic Borrower and Facility Guarantor is hereinafter referred to individually as a “Grantor” and the Domestic Borrowers and the Facility Guarantors are hereinafter referred to collectively as the “Grantors”); and

BANK OF AMERICA, N.A., a national banking association, having a place of business at 40 Broad Street, Boston, Massachusetts 02109, as administrative agent for its own benefit and the benefit of the other Secured Parties (in such capacity, the “Administrative Agent”).

WITNESSETH:

WHEREAS, reference is made to that certain Credit Agreement, dated as of July 21, 2005 (as modified, amended, supplemented or restated and in effect from time to time, the “Credit Agreement”), by and among (i) Toys “R” Us, Inc., as the Initial Borrower, (ii) Toys “R” Us-Delaware, Inc., as a Domestic Borrower and as agent (in such capacity, the “Lead Borrower”) for the other Domestic Borrowers party thereto, (iii) the Domestic Borrowers, (iv) Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee (the “Canadian Borrower” and, collectively with the Domestic Borrowers, the “Borrowers”), (v) the Administrative Agent, (vi) Bank of America, N.A. (acting through its Canada branch), as Canadian Administrative Agent for its own benefit and the benefit of the other Secured Parties, (vii) Deutsche Bank Trust Company Americas, as Collateral Agent for its own benefit and the benefit of the other Secured Parties, (viii) the Lenders party thereto (the “Lenders”), (ix) Deutsche Bank Securities Inc. and Citigroup Global Markets, Inc., as Co-Syndication Agents, and (x) Credit Suisse First Boston LLC and General Electric Capital Corporation, as Co-Documentation Agents, pursuant to which the Lenders have agreed to make Loans to the Borrowers, and the Issuing Banks have agreed to issue Letters of Credit for the account of the Borrowers, upon the terms and subject to the conditions specified therein; and

WHEREAS, reference is made to that certain Facility Guarantee, dated as of July 21, 2005, in favor of the Administrative Agent and the other Secured Parties (as modified, amended, supplemented or restated and in effect from time to time, the “Facility Guarantee”), pursuant to which each Facility Guarantor guarantees the Guaranteed Obligations (as defined in the Facility Guarantee); and

WHEREAS, the obligations of the Lenders to make Loans and of the Issuing Banks to issue Letters of Credit are each conditioned on, among other things, the execution and delivery by the Grantors of an agreement in the form hereof to secure the Obligations (as defined herein).

NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in this Agreement, and for good and valuable consideration, the receipt of which is hereby acknowledged, the Grantors and the Administrative Agent hereby agree as follows:

SECTION 1

Definitions

1.1Generally. All references herein to the UCC shall mean the Uniform Commercial Code as in effect from time to time in the State of New York; provided, however, that if a term is defined in Article 9 of the UCC differently thatthan in another Article thereof, the term shall have the meaning set forth in Article 9, and providedfurther that if by reason of mandatory provisions of law, perfection, or the effect of perfection or non-perfection, of the Security Interest in any Collateral or the availability of any remedy hereunder is governed by the Uniform Commercial Code as in effect in a jurisdiction other than New York, “UCC” means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or effect of perfection or non-perfection or availability of such remedy, as the case may be.

1.2Definition of Certain Terms Used Herein. Unless the context otherwise requires, all capitalized terms used but not defined herein shall have the meanings set forth in the Credit Agreement. In addition, the following terms shall have the following meanings:

“Accessions” shall have the meaning given that term in the UCC.

“Account Debtor” shall have the meaning given that term in the UCC and shall include any Person who is or who may become obligated to any Grantor under, with respect to or on account of an Account.

“Accounts” shall mean “accounts” as defined in the UCC, and also means a right to payment of a monetary obligation, whether or not earned by performance, (a) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (b) for services rendered or to be rendered, or (c) arising out of the use of a credit or charge card or information contained on or for use with the card.

“Agent’s Rights and Remedies” shall have the meaning provided in Section 8.9.

“Blue Sky Laws” shall have the meaning provided in Section 6.1.

“Borrowers” shall have the meaning provided in the preliminary statement of this Agreement.

“Chattel Paper” shall have the meaning given that term in the UCC.

“Collateral” shall mean all of the following personal property of each Grantor: (a) Accounts, (b) Chattel Paper, (c) Commercial Tort Claims, (d) Deposit Accounts, (e) Documents, (f) Equipment, (g) General Intangibles (including Payment Intangibles and Intellectual Property), (h) Goods, (i) Instruments, (j) Inventory, (k) Investment Property, (1l) Letter-of-Credit Rights, (m) Software, (n) Supporting

Obligations, (o) money, policies and, certificates of insurance, deposits, cash or other property, (p) all books, records, and information relating to any of the foregoing and/or to the operation of any Grantor’s business, and all rights of access to such books, records, and information, and all property in which such books, records, and information are stored, recorded and maintained, (q) all insurance proceeds, refunds, and premium rebates, including, without limitation, proceeds of fire and credit insurance, whether any of such proceeds, refunds, and premium rebates arise out of any of the foregoing ((a) through (p)) or otherwise, (r) all liens, guaranties, rights, remedies, and privileges pertaining to any of the foregoing ((a) through (q)), including the right of stoppage in transit, (s) all other personal property of every kind and nature of each Grantor, and (t) any of the foregoing whether now owned or now due, or in which any Grantor has an interest, or hereafter acquired, arising, or to become due, or in which any Grantor obtains an interest, and all products, Proceeds, substitutions, and Accessions of or to any of the foregoing; provided, however, that the Collateral shall not include (a) any rights or property acquired under a lease, contract, property rights agreement or license, the grant of a security interest in which shall constitute or result in (i) the abandonment, invalidation or unenforceability of any right, title or interest of any Grantor therein or (ii) a breach or termination pursuant to the terms of, or a default under, any lease, contract, property rights agreement or license (other than to the extent that any restriction on such assignment would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other Applicable Law or principles of equity), provided that the proceeds therefrom shall not be excluded from the definition of Collateral to the extent that the assignment of such proceeds is not prohibited, (b) any governmental permit or franchise that prohibits Liens on or collateral assignments of such permit or franchise, (c) any Instrument evidencing indebtedness (defined consistently with such term as used in the Indentures) of any Domestic Subsidiary, (d) any Security or other equity interest representing more than 65% of the outstanding voting stock of any Foreign Subsidiary, (e) any Security or other equity interest representing any ownership interest in any Domestic Subsidiary, (f) any Security or other equity interest representing any ownership interest in TRU of Puerto Rico, Inc. or SALTRU Associates JV, (g) Fixtures, (h) the Designated Account and any and all deposits, cash or other property in such account (but not excluding, after and during the continuance of a Cash Dominion Event, such deposits, cash or other property to the extent such cash, deposits or other property exceed the maximum amount permitted to be on deposit in the Designated Account pursuant to Sections 2.18 (e) and (f) of the Credit Agreement, it being understood that the Administrative Agent shall not take any action to take Control of such Designated Account and that the Debtor shall not enter into any agreement granting Control over such Designated Account (other than Control in favor of the depositary bank at which such Designated Account is maintained)), or (i) any rights any Grantor has pursuant to, or rights any Grantor has in, any Residual Interest Instrumentthe Secured Specified Real Property (as defined in the IntercreditoraAgreementsevidencing the Bridge Financing Facilityas in effect on the First Amendment Effective Date).

“Commercial Tort Claim” shall have the meaning given that term in the UCC.

“Control” shall have the meaning given that term in the UCC.

“Credit Agreement” shall have the meaning provided in the preliminary statement of this Agreement.

“Credit Party” means (a) the Lenders, (b) the Agents and the Canadian Agent and their respective Affiliates and branches, (c) the Issuing Banks, (d) the Arrangers, and (e) the successors and, subject to any limitations contained in the Credit Agreement, assigns of each of the foregoing.

“Deposit Account” shall have the meaning given that term in the UCC.

“Documents” shall have the meaning given that term in the UCC.

“Domestic Subsidiary” shall mean, anyany Subsidiary of Toys “R” US;, Inc. that is organized under the laws of the United States of America or any state thereof or the District of Columbia.

“Equipment” shall mean “equipment” as defined in the UCC, and any and all Accessions or additions thereto or substitutions therefor. The term “Equipment” shall not include Fixtures.

“Facility Guarantee” shall have the meaning provided in the preliminary statement of this Agreement.

“Financing Statement” shall have the meaning given that term in the UCC.

“Fixtures” shall have the meaning given that term in the UCC.

“Foreign Subsidiary” shall mean, as to any Grantor, a Subsidiary that is organized under the laws of any jurisdiction other than the United States of America or any state thereof or the District of Columbia.

“General Intangibles” shall have the meaning given that term in the UCC, and shall also include, without limitation, all: Intellectual Property; Payment Intangibles; rights to payment for credit extended; deposits; amounts due to any Grantor; credit memoranda in favor of any Grantor; warranty claims; tax refunds and abatements; insurance refunds and premium rebates; all means and vehicles of investment or hedging, including, without limitation, options, warrants, and futures contracts; records; customer lists; telephone numbers; goodwill; causes of action; judgments; payments under any settlement or other agreement; literary rights; rights to performance; royalties; license and/or franchise fees; rights of admission; licenses; franchises; license agreements, including all rights of any Grantor to enforce same; permits, certificates of convenience and necessity, and similar rights granted by any governmental authority; internet addresses and domain names; developmental ideas and concepts; proprietary processes; blueprints, drawings, designs, diagrams, plans, reports, and charts; catalogs; technical data; computer software programs (including the source and object codes therefor), computer records, computer software, rights of access to computer record service bureaus, service bureau computer contracts, and computer data; tapes, disks, semi‑conductors chips and printouts; user, technical reference, and other manuals and materials; proposals; cost estimates, and reproductions on paper, or otherwise, of any and all concepts or ideas, and any matter related to, or connected with, the design, development, manufacture, sale, marketing, leasing, or use of any or all property produced, sold, or leased, by or credit extended or services performed, by any Grantor, whether intended for an individual customer or the general business of any Grantor;, or used or useful in connection with research by any Grantor; provided, that “General Intangibles” shall not include any indebtedness (defined consistently with such term as used in the Indentures) of any Domestic Subsidiary.

“Geoffrey” shall mean Geoffrey, Inc.LLC, a Delaware corporationlimited liability company.

“Goods” shall have the meaning given that term in the UCC.

“Guaranteed Obligations” shall have the meaning given that term in the Facility Guarantee.

“Indemnitee” shall have the meaning provided in Section 8.6.

“Instruments” shall have the meaning given that term in the UCC, provided, that “Instruments” shall not include any Instrument evidencing indebtedness of any Domestic Subsidiary.

“Intellectual Property”“ shall mean (a) the Intercompany Licenses and (b) all of the following owned by any Grantor: all (i) allpatents, patent applications and patents pending; (ii) trade secret rights; (iii) copyrights and copyright applications, including mask work rights and derivative works; (iv) trade names, trademarks, trademark applications, service marks, and service mark applications and (v) all other general intangible property in the nature of intellectual property recognized by the laws of the United States or Canada.; provided, that any “intent to use” trademark applications for which a statement of use has not been filed with the United States Patent and Trademark Office pursuant to Section 1(c) or 1(d) of the Lanham Act (15 U.S.C. 1051, et seq.) (but only until such statement is filed and accepted by the United States Patent and Trademark Office) are excluded from this definition.

“Intercompany Licenses” shall mean the license agreements described on Exhibit A hereto between certain of the Domestic Borrowers and Geoffrey, pursuant to which Geoffrey has granted to such Domestic Borrowers licenses of the Proprietary Marks.

“Intercreditor Agreement” shall mean that certain Amended and Restated Intercreditor Agreement, dated as of August 24, 2010 (as amended, supplemented, restated or otherwise modified from time to time), by and between the Administrative Agent, as ABL Agent, and Bank of America, N.A., as Term Agent.

“Inventory” shall have the meaning given that term in the UCC, and shall also include, without limitation, all (a) Goods which (i) are leased by a Person as lessor, (ii) are held by a Person for sale or lease or to be furnished under a contract of service, (iii) are furnished by a Person under a contract of service, or (iv) consist of raw materials, work in process, or materials used or consumed in a business; (b) Goods of said description in transit; (c) Goods of said description which are returned, repossessed or rejected; (d) packaging, advertising, and shipping materials related to any of the foregoing; (e) all names, marks, and General Intangibles affixed or to be affixed thereto or associated therewith; and (f) Documents which represent any of the foregoing.

“Investment Property” shall have the meaning given that term in the UCC;provided, that, “Investment Property” (a) shall not include any Security representing more than 65% of the outstanding voting stock of any Foreign Subsidiary, (b) shall not include any Security representing any ownership interest in any Domestic Subsidiary and (c) shall not include any Security or other equity interest representing any ownership interest in TRU of Puerto Rico, Inc.or, SALTRU Associates JVor ZT-Winston-Salem Associates.

“Lead Borrower” shall have the meaning provided in the preliminary statement of this Agreement.

“Lenders” shall have the meaning provided in the preliminary statement of this Agreement.

“Letter-of-Credit Right” shall have the meaning given that term in the UCC.

“Obligations” shall mean collectively, the “Obligations” (as defined in the Credit Agreement), the Other Liabilities (as defined in the Credit Agreement) and the Guaranteed Obligations.

“Payment Intangible” shall have the meaning given that term in the UCC.

“Perfection Certificate” shall mean a certificate substantially in the form of Annex 1 hereto, dated the date hereof, completed and supplemented with the schedules and attachments contemplated thereby, and duly executed by a Financial Officer of each Borrower.

“Proceeds” shall include, without limitation, “Proceeds” as defined in the UCC and each type of property described in the definition of Collateral.

“Proprietary Marks” shall mean any and all United States trademarks (including any copyrights that exist in such trademarks, but excluding all other copyrights), service marks, trade names, corporate names, company names, business names, fictitious business names, trade dress, trade styles, designs, logos and other source or business identifiers, whether registered or unregistered, which are owned or licensed, now or in the future, by Geoffrey, including, but not limited to, as of the date hereof, the United States Proprietary Marks set forth on Exhibit B annexed hereto.

“Secured Party” means (a) each Credit Party, (b) any Lender or any Affiliate of a Lender providing Cash Management Services or entering into or furnishing any Hedge Agreements to or with any Loan Party, (c) the beneficiaries of each indemnification obligation undertaken by any Loan Party, and (d) the successors and, subject to any limitations contained in the Credit Agreement, assigns of each of the foregoing.

“Securities Act” shall have the meaning provided in Section 6.1.

“Security” shall have the meaning given that term in the UCC.

“Security Interest” shall have the meaning provided in Section 2.1.

“Software” shall have the meaning given that term in the UCC.

“Supporting Obligation” shall have the meaning given that term in the UCC .

1.3 Rules of Interpretation. The rules of interpretation specified in Section 1.02 of the Credit Agreement shall be applicable to this Agreement.

SECTION 2

Security Interest

2.1Security Interest. As security for the payment or performance, as the case may be, in full of their respective Obligations, each Grantor hereby grants to the Administrative Agent, its successors and assigns, for the benefit of the Secured Parties, a security interest in all of such Grantor’s right, title and interest in, to and under the Collateral, wherever located, whether now owned or hereafter acquired or arising (the “Security Interest”); provided that, the security interest granted to the Administrative Agent in, to and under Intercompany Licenses shall be limited to the non-exclusive right to use the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with a Liquidation. Without limiting the foregoing, each Grantor hereby designates the Administrative Agent as such Grantor’s true and lawful attorney, exercisable by the Administrative Agent whether or not an Event of Default exists, with full power of substitution, at the Administrative Agent’s option, to file one or more Financing Statements, continuation statements, or to sign other documents for the purpose of perfecting, confirming or continuing the Security Interest granted by each Grantor, without the signature of any Grantor (each Grantor hereby appointing the Administrative Agent as such Person’s attorney to sign such Person’s name to any such instrument or document, whether or not an Event of Default exists), and naming any Grantor or the Grantors as debtors and the Administrative Agent as secured party.Notwithstanding anything herein to the contrary, in no event shall the Collateral include, and no Grantor shall be deemed to have assigned, pledged or granted a Security Interest in, any of such Grantor’s right, title or interest (i) in any asset where the grant of a Lien

over such asset as reasonably determined by the Lead Borrower (in consultation with the Administrative Agent) would result in material adverse tax consequences to any Grantor, (ii) in any motor vehicles and other assets subject to certificate of title, (iii) any Commercial Tort Claim with a value of less than $1,000,000 or (iv) any Security or other equity interest representing any ownership interest in ZT-Winston-Salem Associates.

2.2 No Assumption of Liability. The Security Interest is granted as security only and shall not subject the Administrative Agent or any other Secured Party to, or in any way alter or modify, any obligation or liability of, any Grantor with respect to or arising out of the Collateral.

SECTION 3

Representations and Warranties

The Grantors jointly and severally represent and warrant to the Administrative Agent and the Secured Parties that:

3.1Filings. The Perfection Certificate has been duly prepared, completed and executed, and the information set forth therein is correct and complete in all material respects as of the date hereof. UCC Financing Statements or other appropriate filings, recordings or registrations containing a description of the Collateral (including, without limitation, the UCC Financing Statements identified on Schedule 3.2 hereto) have been or will be timely filed in each governmental, municipal or other office as is necessary to publish notice of and protect the validity of and to establish a legal, valid and perfected security interest in favor of the Administrative Agent (for the benefit of the Secured Parties) in respect of all Collateral in which the Security Interest may be perfected by filing, recording or registration in the United States (or any political subdivision thereof) and no further or subsequent filing, refiling, recording, rerecording, registration or re-registration is necessary in any such jurisdiction, except as provided under Applicable Law with respect to the filing of continuation statements or as a result of any change in a Grantor’s name or jurisdiction of incorporation or formation or under any other circumstances under which, pursuant to the UCC, filings previously made have become misleading or ineffective in whole or in part.

3.2Validity and Priority of Security Interest. The Security Interest constitutes (a) a legal and valid security interest in all of the Collateral securing the payment and performance of the Obligations, (b) subject to the filings described on Schedule 3.2 or other requisite filings or registrations described in Section 3.2, a perfected security interest in all of the Collateral (to the extent perfection in the Collateral can be accomplished by such filing) and (c) subject to the obtaining of Control, a perfected security interest in all of the Collateral (to the extent perfection in the Collateral can be accomplished by Control and perfection of the Security Interest in such Collateral is required by the terms hereof). The Security Interest is and shall be prior to any other Lien on any of the Collateral, subject only to Permitted Encumbrances having priority by operation of Applicable Law.

3.3Absence of Other Liens. The Collateral is owned by the Grantors free and clear of any Lien, except for (i) Permitted Encumbrances or (ii) Liens for which termination statements have been delivered

to the Administrative Agent. Except as provided in the Loan Documents, the Grantors have not filed or consented to the filing of (a) any Financing Statement or analogous document under the UCC or any other Applicable Law covering any Collateral, or (b) any assignment in which any Grantor assigns any Collateral or any security agreement or similar instrument covering any Collateral with any foreign governmental, municipal or other office, which Financing Statement or analogous document, assignment, security agreement or similar instrument is still in effect, except, in each case, for Permitted Encumbrances.

3.4Bailees, Warehousemen, Etc. Schedule3.53.4 hereto sets forth a list, as of the Closing Date, of each bailee, warehouseman and other third party in possession or control of any Inventory of any Loan Party and specifies as to each bailee, warehouseman or other third party whether the value of the Inventory, at Cost, possessed or controlled by such bailee, warehouseman or other third party exceeds $20,000,000.

3.5Consignments. No Grantor has, and none shall have, possession of any property on consignment from any consignor having a value greater than $10,000,000 unless a lien waiver or other agreement in favor of the Administrative Agent reasonably satisfactory to the Administrative Agent is delivered to the Administrative Agent by such consignor.

3.6Intercompany Licenses. The Intercompany Licenses have not been terminated and, to each Grantor’s knowledge, no breach, default or other circumstances exist in respect thereof which would reasonably likely materially impair or restrict the ability of the Administrative Agent to utilize the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with any Liquidation.

3.7Commercial Tort Claims. Except as set forth on Schedule 3.7 hereof, as of the Closing Date, no Grantor owns any rights in, to or under any Commercial Tort Claim having a value in excess of $1,000,000.

SECTION 4

Covenants

The Grantors jointly and severally covenant and agree with the Administrative Agent and the Secured Parties as follows:

4.1Change of Name; Location of Collateral; Records; Place of Business.

(a)Each Grantor agrees to furnish to the Administrative Agent prompt written notice of any change in: (i) any Loan Party’s name; (ii) the location of any Loan Party’s chief executive office or, its principal place of business; (iii) any Loan Party’s organizational legal entity designation or jurisdiction of incorporation or formation; (iv) any Loan Party’s Federal Taxpayer Identification Number or organizational identification number assigned to it by its jurisdiction of incorporation or formation; or (v) the acquisition by any Grantor of any material property for which additional filings or recordings are necessary to perfect and maintain the Administrative Agent’s Security Interest therein (to the extent perfection of the Security Interest in such property is required by the terms hereof). Each Grantor agrees not to effect or permit any change referred to in the preceding sentence unless all filings have been made under the UCC or other Applicable Law that are required in order for the Administrative Agent to continue at all times following such change to have a valid, legal and perfected (to the extent perfection of the Security Interest in such property is required by

the terms hereof), first priority security interest (subject only to Permitted Encumbrances having priority by operation of Applicable Law Lawor, with respect to Shared Collateral (as such term is defined in the Intercreditor Agreement), subject to Liens in favor of the Shared Collateral Agents (as such term is defined in the Intercreditor Agreement) to the extent provided in the Intercreditor Agreement) in the Collateral for its benefit and the benefit of the other Secured Parties.

(b)Each Grantor agrees to maintain, at its own cost and expense, such complete and accurate records with respect to the Collateral owned by it as is consistent with its current practices or in accordance with such prudent and standard practices used in industries that are the same as, or similar to, those in which such Grantor is engaged, but in any event to include materially complete accounting records indicating all payments and proceeds received with respect to any part of the Collateral, and, at such time or times as the Administrative Agent may reasonably request in writing, promptly to prepare and deliver to the Administrative Agent a duly certified schedule or schedules in form and detail reasonably satisfactory to the Administrative Agent showing the identity, amount and location of any and all Collateral.

4.2Protection of Security. Each Grantor shall, at its own cost and expense, take any and all actions reasonably necessary to defend the Security Interest of the Administrative Agent in the Collateral against any Lien (other than Permitted Encumbrances) and the priority thereof (except for Permitted Encumbrances having priority by operation of Applicable Law).

4.3Further Assurances. Each Grantor agrees, at its own expense, to execute, acknowledge, deliver and cause to be duly filed all such further documents, financing statements, agreements and instruments and take all such further actions as the Administrative Agent may from time to time reasonably request to better assure, preserve, protect and perfect the Security Interest and the rights and remedies created or intended to be created hereby or the validity or priority of such Security Interest, including the payment of any fees and taxes required in connection with the execution and delivery of this Agreement, the granting of the Security Interest and the filing of any Financing Statements or other documents in connection herewith or therewith. Without limiting the foregoing, each Grantor, at its own expense, shall execute, acknowledge, deliver and cause to be duly filed all such further documents, financing statements, agreements and instruments and take all such further actions as the Administrative Agent may from time to time reasonably request to perfect the Administrative Agent’s Security Interest in all Accounts, Inventory, Deposit Accounts (to the extent required by Section 2.18 of the Credit Agreement), and the proceeds therefrom (including causing the Administrative Agent to have Control of any such Collateral to the extent perfection in such Collateral can be accomplished by Control to the extent required hereunder). If any amount payable under or in connection with any of the Collateral shall be or become evidenced by any promissory note or other instrument with an individual face value in excess of $1,000,000, such note or instrument shall be promptly pledged to the Administrative Agent and delivered to the Administrative Agent, duly endorsed in a manner satisfactory to the Administrative Agent.

4.4Taxes; Encumbrances. At its option, the Administrative Agent may discharge past due taxes, assessments, charges, fees, Liens, security interests or other encumbrances at any time levied or placed on the Collateral (other than Permitted Encumbrances), and may take any other action which the Administrative Agent may reasonably deem necessary or desirable to repair, maintain or preserve any of the Collateral to the extent any Grantor fails to do so as required by the Credit Agreement or this Agreement, and each

Grantor jointly and severally agrees to reimburse the Administrative Agent for any payment made or any reasonable out-of-pocket expense incurred by the Administrative Agent pursuant to the foregoing authorization within fifteen (15) Business Days after receipt of an invoice therefore setting forth such payments or expenses in reasonable detail; provided, however, that nothing in this Section 4.4 shall be interpreted as excusing any Grantor from the performance of, or imposing any obligation on the Administrative Agent or any Secured Party to cure or perform, any covenants or other promises of any Grantor with respect to taxes, assessments, charges, fees, Liens, security interests or other encumbrances and maintenance as set forth herein or in the other Loan Documents; and provided, further, that the making of any such payments or the taking of any such action by the Administrative Agent shall not be deemed to constitute a waiver of any Default or Event of Default arising from any Grantor’s failure to have made such payments or taken such action.

4.5Assignment of Security Interest.

(a)If at any time any Grantor shall take a security interest in any property of an Account Debtor or any other Person to secure payment and performance of an Account, such Grantor shall promptly assign such security interest to the Administrative Agent. Such assignment need not be filed of public record unless necessary to continue the perfected status of the security interest against creditors of, and transferees from, the Account Debtor or other Person granting the security interest.

(b)To the extent that any Grantor is a beneficiary under any written letter of credit now or hereafter issued in favor of such Grantor having a face amount in excess of $1,000,000, such Grantor shall deliver such letter of credit to the Administrative Agent. The Administrative Agent shall from time to time, at the request and expense of such Grantor, promptly make such arrangements with such Grantor as are in the Administrative Agent’s reasonable judgment necessary and appropriate so that such Grantor may make any drawing to which such Grantor is entitled under such letter of credit, without impairment of the Administrative Agent’s perfected security interest in such Grantor’s rights to proceeds of such letter of credit or in the actual proceeds of such drawing. At the Administrative Agent’s request, such Grantor shall, for any such letter of credit now or hereafter issued in favor of such Grantor as beneficiary, execute and deliver to the issuer and any confirmer of such letter of credit an assignment of proceeds form, in favor of the Administrative Agent and reasonably satisfactory to the Administrative Agent and such issuer or (as the case may be) such confirmer, requiring, after the occurrence of a Cash Dominion Event, the proceeds of any drawing under such letter of credit to be paid directly to the Administrative Agent.

4.6Continuing Obligations of the Grantors. Each Grantor hereby acknowledges and agrees that the Administrative Agent shall have no obligation or duty to perform any obligation of any Grantor under the contracts, agreements or instruments constituting or relating to the Collateral (including, without limitation, the Intercompany Licenses and the payment of royalties thereunder) and that each Grantor shall at all times remain solely and exclusively liable to observe and perform all the conditions and obligations to be observed and performed by it under each contract, agreement or instrument constituting or relating to the Collateral (including, without limitation, the Intercompany Licenses and the payment of royalties thereunder).

4.7Use and Disposition of Collateral. None of the Grantors shall make or permit to be made any collateral assignment, pledge or hypothecation of the Collateral or shall grant any other Lien in respect of the Collateral or shall grant Control (for purposes of security) of any Collateral to any Person, except for Permitted Encumbrances. Except for Permitted Dispositions expressly permitted in the Credit Agreement, none of the Grantors shall make or permit to be made any sale or transfer of the Collateral, and, except as expressly permitted in the Credit Agreement with respect to Eligible In-Transit Inventory and Eligible Letter of Credit Inventory, each Grantor shall remain at all times in possession of the Collateral owned by it. The Grantors shall not permit any expiration, termination, modification, amendment or waiver of any Intercompany License that would reasonably likely materially impair or restrict the ability of the Administrative Agent to utilize the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with any Liquidation.

4.8Limitation on Modification of Accounts. None of the Grantors will, without the Administrative Agent’s prior written consent, grant any extension of the time of payment of any of the Accounts, compromise, compound or settle the same for less than the full amount thereof, release, wholly or partly, any Person liable for the payment thereof or allow any credit or discount whatsoever thereon, other than extensions, releases, credits, discounts, compromises or settlements (a) granted or made in the ordinary course of business and consistent with its current practices or in accordance with such prudent business practices as determined by the Responsible Officers of the Loan Parties acting reasonably in their business judgment or (b) constituting a Permitted Disposition as described in clause (f) of the definition thereof.

4.9Insurance.

(a)The Grantors shall maintain insurance on the Collateral as required by Section 5.07 of the Credit Agreement, which insurance shall include the endorsements and provisions required by Section 5.07 of the Credit Agreement.

(b)Each Grantor hereby irrevocably makes, constitutes and appoints the Administrative Agent (and all officers, employees or agents designated by the Administrative Agent) as such Grantor’s true and lawful agent and attorney-in-fact, exercisable only after the occurrence and during the continuance of an Event of Default, for the purpose of making, settling and adjusting claims in respect of Collateral under policies of insurance, endorsing the name of such Grantor on any check, draft, instrument or other item of payment for the proceeds of such policies of insurance and for making all determinations and decisions with respect thereto. In the event that any Grantor at any time or times shall fail to obtain or maintain any of the policies of insurance required hereby or to pay any premium in whole or part relating thereto, the Administrative Agent may, without waiving or releasing any obligation or liability of the Grantors hereunder or any Default or Event of Default, in its sole discretion, obtain and maintain such policies of insurance and pay such premium and take any other actions with respect thereto as the Administrative Agent deems reasonably advisable. All sums reasonably disbursed by the Administrative Agent in connection with this Section 4.9, including reasonable attorneys’ fees, court costs, out-of-pocket expenses and other charges relating thereto, shall be payable, upon demand, by the Grantors to the Administrative Agent and shall be additional Obligations secured hereby.

4.10Commercial Tort Claims. If any Grantor shall at any time acquire a Commercial Tort Claim having a value in excess of $1,000,000, such Grantor shall promptly notify the Administrative Agent in writing of the details thereof and the Grantors shall take such actions as the Administrative Agent shall reasonably request in order to grant to the Administrative Agent, for the benefit of the Secured Parties, a perfected and first priority security interest therein and in the Proceeds thereof, subject to Liens in favor of Term Agent (as defined in the Intercreditor Agreement) to the extent provided in the Intercreditor Agreement.

4.11Legend. At the request of the Administrative Agent, each Grantor shall legend, in form and manner reasonably satisfactory to the Administrative Agent, its Accounts and its books, records and documents evidencing or pertaining thereto with an appropriate reference to the fact that such Accounts have been assigned to the Administrative Agent for the benefit of the Secured Parties and that the Administrative Agent has a security interest therein.

4.12Notices and Reports Pertaining to Intercompany Licenses. In addition to any other notice or reporting requirement imposed on the Grantors under this Agreement and the Credit Agreement, the Grantors will promptly notify the Administrative Agent of any breach, default or other circumstance in respect of any Intercompany License which would reasonably likely materially impair or restrict the ability of the Administrative Agent to utilize the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with any Liquidation.

SECTION 5

Collections

5.1Collections.

(a)Each Grantor shall at all times comply with the Cash Receipts provisions of Section 2.18 of the Credit Agreement including, without limitation, after the occurrence and during the continuance of a Cash Dominion Event, causing the sweep on each Business Day of all Cash Receipts into the Domestic Concentration Account or a Blocked Account, as provided for in the Credit Agreement.

(b)Without the prior written consent of the Administrative Agent, no Grantor shall modify or amend the instructions pursuant to any of the Credit Card Notifications or the Blocked Account Agreements. So long as no Event of Default has occurred and is continuing, each Grantor shall, and the Administrative Agent hereby authorizes each Grantor to, enforce and collect all amounts owing on the Inventory and Accounts, for the benefit and on behalf of the Administrative Agent and the other Secured Parties; provided, however, that such right may, at the direction of the Administrative Agent or the Required Lenders, be terminated upon the occurrence and during the continuance of any Event of Default.

5.2Power of Attorney. Each Grantor irrevocably makes, constitutes and appoints the Administrative Agent (and all officers, employees or agents designated by the Administrative Agent) as such Grantor’s true and lawful agent and attorney-in-fact, and in such capacity the Administrative Agent

shall have the right, with power of substitution for each Grantor and in each Grantor’s name or otherwise, for the use and benefit of the Administrative Agent and the Secured Parties, (a) at any time, whether or not a Default or Event of Default has occurred, to take actions required to be taken by the Grantors under Section 2.1 of this Agreement, (b) upon the occurrence and during the continuance of a Cash Dominion Event or as otherwise permitted under the Credit Agreement, (i) to take actions required to be taken by the Grantors under Section 5.1 of this Agreement, and (ii) to receive, endorse, assign and/or deliver any and all notes, acceptances, checks, drafts, money orders or other evidences of payment relating to the Collateral or any part thereof; and (c) upon the occurrence and during the continuance of an Event of Default or as otherwise permitted under the Credit Agreement, (i) to demand, collect, receive payment of, give receipt for and give discharges and releases of all or any of the Collateral; (ii) to sign the name of any Grantor on any invoices, schedules of Collateral, freight or express receipts, or bills of lading storage receipts, warehouse receipts or other documents of title relating to any of the Collateral; (iii) to sign the name of any Grantor on any notice to such Grantor’s Account Debtors; (iv) to sign the name of any Grantor on any proof of claim in bankruptcy against Account Debtors, and on notices of lien, claims of mechanic’s liens, or assignments or releases of mechanic’s liens securing the Accounts; (v) to sign change of address forms to change the address to which each Grantor’s mail is to be sent to such address as the Administrative Agent shall designate; (vi) to receive and open each Grantor’s mail, remove any Proceeds of Collateral therefrom and turn over the balance of such mail either to the Lead Borrower or to any trustee in bankruptcy or receiver of a Grantor, or other legal representative of a Grantor whom the Administrative Agent reasonably determines to be the appropriate person to whom to so turn over such mail; (vii) to commence and prosecute any and all suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect or otherwise realize on all or any of the Collateral or to enforce any rights in respect of any Collateral; (viii) to settle, compromise, compound, adjust or defend any actions, suits or proceedings relating to all or any of the Collateral; (ix) to take all such action as may be reasonably necessary to obtain the payment of any letter of credit and/or banker’s acceptance of which any Grantor is a beneficiary; (x) to repair, manufacture, assemble, complete, package, deliver, alter or supply goods, if any, necessary to fulfill in whole or in part the purchase order of any customer of any Grantor; (xi) to use, license or transfer any or all General Intangibles of any Grantor; and (xii) to use, sell, assign, transfer, pledge, make any agreement with respect to or otherwise deal with all or any of the Collateral, and to do all other acts and things reasonably necessary to carry out the purposes of this Agreement, as fully and completely as though the Administrative Agent was the absolute owner of the Collateral for all purposes; provided, however, that nothing herein contained shall be construed as requiring or obligating the Administrative Agent or any other Secured Party to make any inquiry as to the nature or sufficiency of any payment received by the Administrative Agent or any other Secured Party, or to present or file any claim or notice. It is understood and agreed that the appointment of the Administrative Agent as the agent and attorney-in-fact of the Grantors for the purposes set forth above is coupled with an interest and is irrevocable. The appointment of the Administrative Agent as the agent and attorney-in-fact of the Grantors for the purposes set forth above shall terminate when (a) the Commitments have expired or been terminated, (b) the principal of and interest on each Loan and all fees and other Obligations (which for purposes of this clause shall include the Other Liabilities only if the Obligations (as defined in the Credit Agreement) have been accelerated and Liquidation has commenced and then only to the extent then due and payable) (other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full, (c) all Letters of Credit shall have expired or terminated (or been cash collateralized in a manner satisfactory to the applicable

Issuing Banks) and (d) all Letter of Credit Outstandings have been reduced to zero (or cash collateralized in a manner satisfactory to the applicable Issuing Banks).

5.3No Obligation to Act. The Administrative Agent shall not be obligated to do any of the acts or to exercise any of the powers authorized by Section 5.2, but if the Administrative Agent elects to do any such act or to exercise any of such powers, it shall not be accountable for more than it actually receives as a result of such exercise of power, and shall not be responsible to any Grantor for any act or omission to act except for any act or omission to act as to which there is a determination by a court of competent jurisdiction or another independent tribunal having jurisdiction that (i) the subject act or omission to act by the Administrative Agent or any Affiliate of the Administrative Agent or any officer, director, employee, advisor or agent of the Administrative Agent or such Affiliate constituted gross negligence, was in bad faith, or constituted willful misconduct or (ii) constituted a breach by the Administrative Agent or any Affiliate of the Administrative Agent or any officer, director, employee, advisor or agent of the Administrative Agent or such Affiliate of its obligations to such Grantor. The provisions of Section 5.2 shall in no event relieve any Grantor of any of its obligations hereunder or under any other Loan Document with respect to the Collateral or any part thereof or impose any obligation on the Administrative Agent or any other Secured Party to proceed in any particular manner with respect to the Collateral or any part thereof, or in any way limit the exercise by the Administrative Agent or any other Secured Party of any other or further right which it may have on the date of this Agreement or hereafter, whether hereunder, under any other Loan Document, by law or otherwise.

SECTION 6

Remedies

6.1Remedies upon Default. Upon the occurrence and during the continuance of an Event of Default, it is agreed that the Administrative Agent shall have in any jurisdiction in which enforcement hereof is sought, in addition to all other rights and remedies, the rights and remedies of a secured party under the UCC or other Applicable Law. The Agent’s Rights and Remedies shall include, without limitation, the right to take any of or all the following actions at the same or different times as directed by the Administrative Agent or the Required Lenders:

(a)With respect to any Collateral consisting of Accounts, General Intangibles (including Payment Intangibles), Letter-of-Credit Rights, Instruments, Chattel Paper, Documents, and Investment Property, the Administrative Agent may collect the Collateral with or without the taking of possession of any of the Collateral.

(b)With respect to any Collateral consisting of Accounts, the Administrative Agent may (i) demand, collect and receive any amounts relating thereto, as the Administrative Agent may determine; (ii) commence and prosecute any actions in any court for the purposes of collecting any such Accounts and enforcing any other rights in respect thereof; (iii) defend, settle or compromise any action brought and, in connection therewith, give such discharges or releases as the Administrative Agent may reasonably deem appropriate; (iv) without limiting the rights of the Administrative Agent set forth in Section 5.2 hereof, receive, open and dispose of mail addressed to any Grantor and endorse checks, notes, drafts, acceptances, money orders, bills of lading, warehouse receipts or other instruments or documents evidencing payment, shipment or storage of

the goods giving rise to such Accounts or securing or relating to such Accounts, on behalf of and in the name of such Grantor; and (v) sell, assign, transfer, make any agreement in respect of, or otherwise deal with or exercise rights in respect of, any such Accounts or the goods or services which have given rise thereto, as fully and completely as though the Administrative Agent was the absolute owner thereof for all purposes.

(c)With respect to any Collateral consisting of Investment Property, the Administrative Agent may (i) exercise all rights of any Grantor with respect thereto, including without limitation, the right to exercise all voting and corporate rights at any meeting of the shareholders of the issuer of any Investment Property and to exercise any and all rights of conversion, exchange, subscription or any other rights, privileges or options pertaining to any Investment Property as if the Administrative Agent was the absolute owner thereof, including the right to exchange, at its discretion, any and all of any Investment Property upon the merger, consolidation, reorganization, recapitalization or other readjustment of the issuer thereof, all without liability except to account for property actually received as provided in Section 5.3 hereof; (ii) transfer such Collateral at any time to itself, or to its nominee, and receive the income thereon and hold the same as. Collateral hereunder or apply it to the Obligations; and (iii) demand, sue for, collect or make any compromise or settlement it deems desirable. The Grantors recognize that (a) the Administrative Agent may be unable to effect a public sale of all or a part of the Investment Property by reason of certain prohibitions contained in the Securities Act of 1933, 15 U.S.C. §77, (as amended and in effect, the “Securities Act”) or the Securities laws of various states (the “Blue Sky Laws”), but may be compelled to resort to one or more private sales to a restricted group of purchasers who will be obliged to agree, among other things, to acquire the Investment Property for their own account, for investment and not with a view to the distribution or resale thereof, (b) that private sales so made may be at prices and upon other terms less favorable to the seller than if the Investment Property were sold at public sales, (c) that neither the Administrative Agent nor any Secured Party has any obligation to delay sale of any of the Investment Property for the period of time necessary to permit the Investment Property to be registered for public sale under the Securities Act or the Blue Sky Laws, and (d) that private sales made under the foregoing circumstances shall be deemed to have been made in a commercially reasonable manner. Notwithstanding anything herein to the contrary, no Grantor shall be required to register, or cause the registration of, any Investment Property under the Securities Act or any or Blue Sky Laws.

(d)With respect to any Collateral consisting of Inventory, Goods, and Equipment, the Administrative Agent may conduct one or more going out of business sales, in the Administrative Agent’s own right or by one or more agents and contractors. Such sale(s) may be conducted upon any premises owned, leased, or occupied by any Grantor. The Administrative Agent and any such agent or contractor, in conjunction with any such sale, may augment the Inventory with other goods (all of which other goods shall remain the sole property of the Administrative Agent or such agent or contractor). Any amounts realized from the sale of such goods which constitute augmentations to the Inventory (net of an allocable share of the costs and expenses incurred in their disposition) shall be the sole property of the Administrative Agent or such agent or contractor and neither any Grantor nor any Person claiming under or in right of any Grantor shall have any interest therein.

Each purchaser at any such going out of business sale shall hold the property sold absolutely, free from any claim or right on the part of any Grantor.

(e)With respect to any Proprietary Marks, the Administrative Agent may exercise all of the rights granted to the Grantors under the Intercompany Licenses (for the limited purpose of allowing the Administrative Agent to utilize the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with any Liquidation of any Grantor’s Inventory or other Collateral).

(f)With or without legal process and with or without prior notice or demand for performance, the Administrative Agent may enter upon, occupy, and use any premises owned or occupied by each Grantor, and may exclude the Grantors from such premises or portion thereof as may have been so entered upon, occupied, or used by the Administrative Agent to the extent the Administrative Agent deems such exclusion reasonably necessary to preserve and protect the Collateral. The Administrative Agent shall not be required to remove any of the Collateral from any such premises upon the Administrative Agent’s taking possession thereof, and may render any Collateral unusable to the Grantors. In no event shall the Administrative Agent be liable to any Grantor for use or occupancy by the Administrative Agent of any premises pursuant to this Section 6.1, nor for any royalties or any other amounts due under, or any other obligations in respect of, the Intercompany Licenses, nor for any charge (such as wages for the Grantors’ employees and utilities) incurred in connection with the Administrative Agent’s exercise of the Agents’ Rights and Remedies.

(g)The Administrative Agent may require any Grantor to assemble the Collateral and make it available to the Administrative Agent at the Grantor’s sole risk and expense at a place or places which are reasonably convenient to both the Administrative Agent and such Grantor.

(h)Each Grantor agrees that the Administrative Agent shall have the right, subject to Applicable Law, to sell or otherwise dispose of all or any part of the Collateral, at public or private sale, for cash, upon credit or for future delivery as the Administrative Agent shall deem appropriate. Each purchaser at any such sale shall hold the property sold absolutely, free from any claim or right on the part of any Grantor.

(i)Unless the Collateral is perishable or threatens to decline speedily in value, or is of a type customarily sold on a recognized market (in which event the Administrative Agent shall provide the Grantors such notice as may be practicable under the circumstances), the Administrative Agent shall give the Grantors at least ten (10) days’ prior written notice, by authenticated record, of the date, time and place of any proposed public sale, and of the date after which any private sale or other disposition of the Collateral may be made. Each Grantor agrees that such written notice shall satisfy all requirements for notice to that Grantor which are imposed under the UCC or other Applicable Law with respect to the exercise of the Agent’s Rights and Remedies upon default. The Administrative Agent shall not be obligated to make any sale or other disposition of any Collateral if it shall determine not to do so, regardless of the fact that notice of sale or other disposition of such Collateral shall have been given. The Administrative Agent may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for sale, and such sale may, without further notice, be made at the time and place to which the same was so adjourned.

(j)Any public sale shall be held at such time or times within ordinary business hours and at such place or places as the Administrative Agent may fix and state in the notice of such sale. At any sale or other disposition, the Collateral, or portion thereof, to be sold may be sold in one lot as an entirety or in separate parcels, as the Administrative Agent may (in its sole and absolute discretion) determine. If any of the Collateral is sold, leased, or otherwise disposed of by the Administrative Agent on credit, the Obligations shall not be deemed to have been reduced as a result thereof unless and until payment is received thereon by the Administrative Agent.

(k)At any public (or, to the extent permitted by Applicable Law, private) sale made pursuant to this Section 6.1, the Administrative Agent or any other Secured Party may bid for or purchase, free (to the extent permitted by Applicable Law) from any right of redemption, stay, valuation or appraisal on the part of any Grantor, the Collateral or any part thereof offered for sale and may make payment on account thereof by using any claim then due and payable to the Administrative Agent or such other Secured Party from any Grantor on account of the Obligations as a credit against the purchase price, and the Administrative Agent or such other Secured Party may, upon compliance with the terms of sale, hold, retain and dispose of such property without further accountability to any Grantor therefor.

(l)For purposes hereof, a written agreement to purchase the Collateral or any portion thereof shall be treated as a sale thereof. The Administrative Agent shall be free to carry out such sale pursuant to such agreement and no Grantor shall be entitled to the return of the Collateral or any portion thereof subject thereto, notwithstanding the fact that after the Administrative Agent shall have entered into such an agreement all Events of Default shall have been remedied and the Obligations paid in full.

(m)As an alternative to exercising the power of sale herein conferred upon it, the Administrative Agent may proceed by a suit or suits at law or in equity to foreclose upon the Collateral and to sell the Collateral or any portion thereof pursuant to a judgment or decree of a court or courts having competent jurisdiction or pursuant to a proceeding by a court-appointed receiver.

(n)To the extent permitted by Applicable Law, each Grantor hereby waives all rights of redemption, stay, valuation and appraisal which such Grantor now has or may at any time in the future have under any rule of law or statute now existing or hereafter enacted.

(o)In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting any Borrower or the creditors or property of any Borrower, the Administrative Agent and. Secured Party, to the extent permitted by Applicable Law, shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of the Administrative Agent and the other Secured Parties allowed in such proceedings for the entire amount of the Obligations at the date of the institution of such proceedings and for any additional portion of the Obligations accruing after such date.

6.2Application of Proceeds. After the occurrence and during the continuance of any Event of Default and acceleration of the Obligations pursuant to Section 7.1 of the Credit Agreement, the

Administrative Agent shall promptly apply the proceeds of any collection or sale of the Collateral, as well as any Collateral consisting of cash, or any Collateral granted under any other of the Security Documents, in accordance with Section 7.03 of the Credit Agreement.

Subject to the right of the Required Lenders to direct the exercise of the Agent’s Rights and Remedies upon the occurrence of an Event of Default, the Administrative Agent shall have absolute discretion as to the time of application of any such proceeds, moneys or balances in accordance with this Agreement. Upon any sale or other disposition of the Collateral by the Administrative Agent (including pursuant to a power of sale granted by statute or under a judicial proceeding), the receipt of the purchase money by. the Administrative Agent or of the officer making the sale or other disposition shall be a sufficient discharge to the purchaser or purchasers of the Collateral so sold or otherwise disposed of and such purchaser or purchasers shall not be obligated to see to the application of any part of the purchase money paid over to the Administrative Agent or such officer or be answerable in any way for the misapplication thereof.

SECTION 7

Perfection of Security Interest

7.1Perfection by Filing. This Agreement constitutes an authenticated record, and each Grantor hereby authorizes the Administrative Agent, pursuant to the provisions of Sections 2.1 and 5.2, to file one or more financing or continuation statements, and amendments thereto, relative to all or any part of the Collateral, in such filing offices as the Administrative Agent shall reasonably deem appropriate, and the Grantors shall pay the Administrative Agent’s reasonable costs and expenses incurred in connection therewith. Each Grantor hereby further agrees that a carbon, photographic, or other reproduction of this Agreement shall be sufficient as a Financing Statement and may be filed as a Financing Statement in any and all jurisdictions.

7.2Other Perfection, Etc. The Grantors shall at any time and from time to time take such steps as the Administrative Agent may reasonably request for the Administrative Agent (a) to obtain Control of any Deposit Accounts (including the Designated Account) to the extent required by Section 2.18 of the Credit Agreement, with any agreements establishing control to be in form and substance reasonably satisfactory to the Administrative Agent, (b) to obtain Control of any Investment Property, Letter-of-Credit Rights or electronic Chattel Paper, with any agreements establishing control to be in form and substance reasonably satisfactory to the Administrative Agent, and (b) otherwise to insure the continued perfection of the Administrative Agent’s security interest in any of the Collateral with the priority described in Section 3.2 and of the preservation of its rights therein.

7.3Savings Clause.  Nothing contained in this Article VII shall be construed to narrow the scope of the Administrative Agent’s Security Interest in any of the Collateral or the perfection or priority thereof or to impair or otherwise limit any of the Agent’s Rights and Remedies hereunder except (and then only to the extent) as mandated by the UCC.

SECTION 8

Miscellaneous

8.1Notices. All communications and notices hereunder shall (except as otherwise expressly permitted herein) be in writing and given as provided in Section 9.01 of the Credit Agreement.

8.2Grant of Non-Exclusive License. Without limiting the rights of the Administrative Agent under the assignment of the Intercompany Licenses provided herein, each Grantor hereby grants to the Administrative Agent a royalty free, non-exclusive, irrevocable license, which license shall be exercisable upon the existence and during the continuance of an Event of Default, to use, apply, and affix any Intellectual Property (other than Intellectual Property licensed pursuant to the Intercompany Licenses, including the Proprietary Marks) in which any Grantor now or hereafter has rights, such license being with respect to the Administrative Agent’s exercise of the Agent’s Rights and Remedies hereunder including, without limitation, in connection with any Liquidation of Inventory; provided, however, that the Administrative Agent’s exercise of the foregoing license shall be conditioned upon the Administrative Agent not violating any obligations (excluding the payment of royalties) or restrictions to which the Grantor of the related Intellectual Property is subject (except those obligations or restrictions which would reasonably likely materially impair or restrict the ability of the Administrative Agent to utilize the Intellectual Property in exercising the Agent’s Rights and Remedies).

8.3Security Interest Absolute. All rights of the Administrative Agent hereunder, the Security Interest and all obligations of the Grantors hereunder shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of the Credit Agreement, any other Loan Document, any agreement with respect to any of the Obligations or any other agreement or instrument relating to any of the foregoing, (b) any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to any departure from the Credit Agreement, any other Loan Document, or any other agreement or instrument, (c) any exchange, release or non-perfection of any Lien on other collateral, or any release or amendment or waiver of or consent under or departure from the Facility Guarantee or any other guarantee, securing or guaranteeing all or any of the Obligations, or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, any Grantor in respect of the Obligations or this Agreement (other than circumstances under which (i) the Commitments have expired or been terminated, (ii) the principal of and interest on each Loan and all fees and other Obligations (which for purposes of this clause shall include the Other Liabilities only if the Obligations (as defined in the Credit Agreement) have been accelerated and Liquidation has commenced and then only to the extent then due and payable) (other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full, (iii) all Letters of Credit shall have expired or terminated (or been cash collateralized in a manner satisfactory to the applicable Issuing Banks) and (iv) all Letter of Credit Outstandings have been reduced to zero (or cash collateralized in a manner satisfactory to the applicable Issuing Banks)).

8.4Survival of Agreement. All covenants, agreements, representations and warranties made by the Grantors herein and in any other Loan Document and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the Administrative Agent and the other Secured Parties and shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans and the issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Secured Party may have had notice or knowledge of

any Default or Event of Default or incorrect representation or warranty at the time any credit is extended under the Loan Agreement, and shall continue in full force and effect unless terminated in accordance with Section 8.15 hereof. In connection with the termination of this Agreement and the release and termination of the security interests in the Collateral, the Administrative Agent, on behalf of itself and the other Secured Parties, may require such indemnities as it shall reasonably deem necessary or appropriate to protect the Secured Parties against (x) loss on account of credits previously applied to the Obligations that may subsequently be reversed or revoked, and (y) any obligations that may thereafter arise with respect to the Other Liabilities.

8.5Binding Effect; Several Agreement; Assignments. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and assigns of such party, and all covenants, promises and agreements by or on behalf of the Grantors that are contained in this Agreement shall bind and inure to the benefit of each Grantor and its respective successors and assigns. This Agreement shall be binding upon each Grantor and the Administrative Agent and its successors and permitted assigns, and shall inure to the benefit of each Grantor, the Administrative Agent and the other Secured Parties and their respective successors and permitted assigns, except that no Grantor shall have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral (and any such attempted assignment or transfer shall be void) except as expressly permitted by this Agreement or the Credit Agreement. This Agreement shall be construed as a separate agreement with respect to each Grantor and may be amended, modified, supplemented, waived or released with respect to any Grantor without the approval of any other Grantor and without affecting the obligations of any other Grantor hereunder.

8.6Fees and Expenses; Indemnification.

(a)Without limiting any of their obligations under the Credit Agreement or the other Loan Documents, and without duplication of any fees, expenses or indemnification provided for under the Credit Agreement and the other Loan Documents, the Grantors jointly and severally shall pay all Credit Party Expenses, within fifteen (15) Business Days after receipt of an invoice therefore setting forth such expenses in reasonable detail, in connection with (i) the administration of this Agreement, (ii) the custody or preservation of, or the sale of, collection from or other realization upon any of the Collateral, (iii) the exercise, enforcement or protection of any of the Agent’s Rights and Remedies hereunder or (iv) the failure of any Grantor to perform or observe any of the provisions hereof; provided, that in the event the Grantors have a bona fide dispute with any such expenses, payment of such disputed amounts shall not be required until the earlier of the date such dispute is resolved to the reasonable satisfaction of the Grantors or thirty (30) days after receipt of any such invoice Jana(and any such disputed amount which is so paid shall be subject to a reservation of the Grantors’ rights with respect thereto).

8.7Without limiting any of their indemnification obligations under the Credit Agreement or the other Loan Documents, and without duplication of any fees, expenses or indemnification provided for under the Credit Agreement and the other Loan Documents, each Grantor, shall, jointly and severally, indemnify the Secured Parties and each of their Subsidiaries and Affiliates, and each of the respective stockholders, directors, officers, employees, agents, attorneys, and advisors of any of the foregoing Persons

(each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all damages, actual out-of-pocket losses, claims, actions, causes of action, settlement payments, obligations, liabilities and related expenses, including the reasonable fees, charges and disbursements of one counsel for the Agents and one counsel for all other Indemnitees (other than the Agents), incurred, suffered, sustained or required to be paid by, or asserted against, any Indemnitee arising out of, in any way connected with, or as a result of (i) the execution or delivery of this Agreement or any other Loan Document, the performance by any Grantor of its obligations under this Agreement or any other Loan Document, or the consummation of the transactions contemplated by the Loan Documents or any other transactions contemplated hereby, or (ii) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing or to the Collateral, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided, however, that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (w) are determined by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from the gross negligence, bad faith or willful misconduct of any Agent or such Indemnitee or any Affiliate of such Indemnitee (or any officer, director, employee, advisor or agent of such Indemnitee or any such Indemnitee’s Affiliates), (x) are relating to disputes among Indemnitees, (y) are determined by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from a breach by such Indemnitee of its obligations to a Loan Party, or (z) which constitute indirect, consequential, special or punitive damages. In connection with any indemnified claim hereunder, the Indemnitee shall be entitled to select its own counsel and the Grantors shall promptly pay the reasonable fees and expenses of such counsel.

(a)Any such amounts payable as provided hereunder shall be additional Obligations secured hereby and by the other Security Documents. The provisions of this Section 8.6 shall remain operative and in full force and effect regardless of the termination of this Agreement or any other Loan Document, the consummation of the transactions contemplated hereby or thereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments, the payment of all fees and other Obligations, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan Document, or any investigation made by or on behalf of any Secured Party. All amounts due under this Section 8.6 shall be payable promptly after written demand therefor.

8.8Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

8.9Waivers; Amendment.

(a)The rights, remedies, powers, privileges, and discretions of the Administrative Agent hereunder (herein, the “Agent’s Rights and Remedies”) shall be cumulative and not exclusive of any rights or remedies which it would otherwise have. No delay or omission by the Administrative Agent in exercising or enforcing any of the Agent’s Rights and Remedies shall operate as, or constitute, a waiver thereof. No waiver by the Administrative Agent of any Event of Default or of any Default under any other agreement shall operate as a waiver of any other Event of Default or other Default hereunder or under any other agreement. No single or partial exercise of any of the Agent’s Rights or Remedies, and no express or implied agreement or transaction of whatever nature

entered into between the Administrative Agent and any Person, at any time, shall preclude the other or further exercise of the Agent’s Rights and Remedies. No waiver by the Administrative Agent of any of the Agent’s Rights and Remedies on any one occasion shall be deemed a waiver on any subsequent occasion, nor shall it be deemed a continuing waiver. Subject to the right of the Administrative Agent and the Required Lenders to direct the exercise of the Agent’s Rights and Remedies upon the occurrence and during the continuance of an Event of Default, the Agent’s Rights and Remedies may be exercised at such time or times and in such order of preference as the Administrative Agent may determine. The Agent’s Rights and Remedies may be exercised without resort or regard to any other source of satisfaction of the Obligations. No waiver of any provisions of this Agreement or any other Loan Document or consent to any departure by any Grantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice to or demand on any Grantor in any case shall entitle such Grantor or any other Grantor to any other or further notice or demand in similar or other circumstances.

(b)Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to a written agreement entered into between the Administrative Agent and the Grantor or Grantors with respect to whom such waiver, amendment or modification is to apply, subject to any consent required in accordance with Section 9.02 of the Credit Agreement.

8.10WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY); AND WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES THEREOF AS WELL AS NOTICE OF NONPAYMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.9.

8.11Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof, and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

8.12Counterparts. This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this

Agreement by telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Agreement.

8.13Headings. Section headings used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

8.14Jurisdiction; Consent to Service of Process. The Grantors agree that any suit for the enforcement of this Agreement or any other Loan Document may be brought in the courts of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consent to the non-exclusive jurisdiction of such courts. The Grantors hereby waive any objection which they may now or hereafter have to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum and agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Administrative Agent may otherwise have to bring any action or proceeding relating to this Agreement against a Grantor or its properties in the courts of any jurisdiction. The Grantors agree that any action commenced by any Grantor asserting any claim or counterclaim arising under or in connection with this Agreement or any other Loan Document shall be brought solely in a court sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consent to the exclusive jurisdiction of such courts with respect to any such action. Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 8.1. Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

8.15Joinder to Security Agreement. As contemplated in the Credit Agreement, additional Subsidiaries may from time to time become parties hereto and additional Grantors hereunder by execution and delivery of a Joinder to Security Agreement. Such Joinder to Security Agreement shall be effective upon delivery by such additional Grantor, without further action or consent or notice to any party hereto. Upon delivery of such Joinder to Security Agreement, all obligations of each Grantor hereunder shall be joint and several with the obligations of each other Grantor hereunder.

8.16Joinder to Credit Agreement. Each Grantor hereby agrees to be bound by the terms and provisions of Articles III, V and VI of the Credit Agreement as a “"Loan Party”" thereunder.

8.17Termination; Release of Collateral.

(a)Any Lien upon any Collateral will be released (i) automatically, if the Collateral constitutes property being sold, transferred or disposed of in a Permitted Disposition upon receipt by the Administrative Agent of the Net Proceeds thereof to the extent required by the Credit Agreement; or (ii) upon request of the Lead Borrower, constituting DDA or Blocked Accounts closed by the Loan Parties pursuant to Section 2.18(f) of the Credit Agreement subject to compliance by the Loan Parties with all of the terms and conditions of Section 2.18 of the Credit Agreement.

(b)Upon at least two (2)Business Days’ prior written request by the Lead Borrower, the Administrative Agent shall execute such documents as may be necessary to evidence the release of the Liens upon any Collateral described in Section 8.17(a); provided, however, that (i) the

Administrative Agent shall not be required to execute any such document on terms which, in its reasonable opinion, would, under Applicable Law, expose the Administrative Agent to liability or create any obligation or entail any adverse consequence other than the release of such Liens without recourse or warranty, and (ii) such release shall not in any manner discharge, affect or impair the Obligations or any Liens (other than those expressly being released) upon (or obligations of any Loan Party in respect of) all interests retained by any Loan Party, including (without limitation) the proceeds of any sale, all of which shall continue to constitute part of the Collateral.

(c)Except for those provisions which expressly survive the termination thereof, this Agreement and the Security Interest granted herein shall terminate when (i) the Commitments have expired or been terminated, (ii) the principal of and interest on each Loan and all fees and other Obligations (which for purposes of this clause shall include the Other Liabilities only if the Obligations (as defined in the Credit Agreement) have been accelerated and Liquidation has commenced and then only to the extent then due and payable) (other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full, (iii) all Letters of Credit shall have expired or terminated (or been cash collateralized in a manner satisfactory to the applicable Issuing Banks) and (iv) all Letter of Credit Outstandings have been reduced to zero (or cash collateralized in a manner satisfactory to the applicable Issuing Banks), at which time the Administrative Agent shall execute and deliver to the Grantors, at the Grantors’ expense, all UCC termination statements and similar documents that the Grantors shall reasonably request to evidence such termination; provided, however, that the Credit Agreement, this Agreement, and the Security Interest granted herein shall be reinstated if at any time payment, or any part thereof, of any Obligation is rescinded or must otherwise be restored by any Secured Party upon the bankruptcy or reorganization of any Borrower, Grantor or other Loan Party. Any execution and delivery of termination statements or documents pursuant to this Section 8.17 shall be without recourse to, or warranty by, the Administrative Agent or any other Secured Party.

8.18Supremacy of Credit Agreement and Security Agreement. Notwithstanding any provisions contained in any Mortgage (including for the purposes of this Section 8.18 any Hypotec of Immovable Property only to the extent that the provisions therein relate to Real Estate or immovable property) to the contrary, in the event that there is a conflict between the terms of any representation, warranty or covenant contained in the Mortgage and an express representation, warranty or covenant contained in the Credit Agreement or the Security Agreement, the terms of the Credit Agreement and Security Agreement shall control to the end that the (A) failure of any Loan Party to comply with the covenants contained in any Mortgage or (B) the inaccuracy of any representations or warranties of any Loan Party contained in any Mortgage, shall not constitute a Default or Event of Default unless it would constitute an Event of Default under the similar provision of the Credit Agreement or Security Agreement, as applicable. Nothing contained in this Section 8.18 shall (i) limit or restrict the ability of the Agents to establish any Reserve relating to any Real Property, (ii) modify or qualify the definition of Eligible Real Estate or (iii) limit or restrict the ability of the Administrative Agent or the Canadian Agent, as applicable, to exercise the rights and remedies available to them under and with respect to any Mortgage upon the occurrence and during the continuance of an Event of Default under the Credit Agreement.

8.19Intercreditor Agreement. Notwithstanding anything herein to the contrary, the lien and Security Interest granted to the Administrative Agent pursuant to this Agreement and the exercise of any

right or remedy by the Administrative Agent hereunder are subject to the provisions of the Intercreditor Agreement. In the event of any conflict between the terms of the Intercreditor Agreement and the terms of this Agreement, the terms of the Intercreditor Agreement shall govern and control.

[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement under seal as of the day and year first above written.

GRANTORS:

TOYS “R” US-DELAWARE, INC.  as a Domestic Borrower
By:_______________________________
By:______
	Name:
	Title:

S-1

TOYSRUS.COM, LLC
as a Domestic Borrower
By:_____________________________
	Name:
	Title:

S-2

BABIESRUS.COM, LLC as a Domestic Borrower
By:_____________________________
	Name:
	Title:

S-3

GEOFFREY HOLDINGS, LLC, as a
Facility Guarantor,
By: TOYS “R” US-DELAWARE, INC., its sole
member
By:______
By:____________________________________
	Name:
	Title”:

S-4

TOYS ACQUISITION, LLCTOYSRUS.COM, INC.as a Facility Guarantor
By:____________________________
By:______
	Name:
	Title:

S-5

TRU INVESTMENTS, INC. TRU-SVC, LLCas a Facility Guarantor
By:___________________________
By:______
	Name:
	Title:

S-6

TRU-SVC, LLC TRU OF PUERTO RICO, INC. as a Facility Guarantor
By:____________________________
By:______
	Name:
	Title::

S-7

ADMINISTRATIVE AGENT:	BANK OF AMERICA, N.A.
	By:____________________________________
	Name:__________________________________
	Title:___________________________________

S-8

EX-10.11

Exhibit 10.11

AMENDMENT NO. 3 TO AMENDED AND RESTATED CREDIT AGREEMENT

THIS AMENDMENT No. 3, dated as of October 24, 2014 (this “Amendment No. 3”), is entered into by and among TOYS “R” US-DELAWARE, INC.,a Delaware corporation (the “Borrower”), the lenders party hereto (collectively, the “Lenders”; and each individually, a “Lender”), the Guarantors party hereto, BANK OF AMERICA, N.A., as administrative agent for the Lenders (in such capacity, the “Administrative Agent”) and the Fronting Term B-4 Lender (as defined below).

W I T N E S S E T H

WHEREAS, the Borrower, the lenders party thereto (the “Existing Lenders”), the Administrative Agent, and certain other agents from time to time named therein entered into that certain Amended and Restated Credit Agreement, dated as of August 24, 2010 (as amended by that certain Amendment No. 1 dated as of September 20, 2010, as further amended by that certain Incremental Joinder Agreement dated as of May 24, 2011 (“Joinder #1”), as further amended by that certain Incremental Joinder Agreement No. 2 dated as of April 10, 2012 (“Joinder #2”), as further amended by that certain Amendment No. 2 dated as of April 10, 2012 and as may be further amended, supplemented or otherwise modified from time to time pursuant to the terms thereof, the “Amended and Restated Credit Agreement”) pursuant to which the Existing Lenders made certain loans and certain other extensions of credit to the Borrower;

WHEREAS, pursuant to certain preapproved amendments set forth in Joinder #1 and Joinder #2 and to Section 10.01 of the Amended and Restated Credit Agreement, the Borrower and the Required Lenders may amend the Amended and Restated Credit Agreement and the other Loan Documents as set forth herein to, among other things, (i) create a new tranche of Loans (the “Term B-4 Loans”) in an aggregate principal amount of $1,025,726,000, (ii) permit the prepayment of the Initial Loans (through either a cash prepayment or a cash or cashless roll of Initial Loans into Term B-4 Loans), (iii) add “amend and extend” provisions to the Amended and Restated Credit Agreement, to permit, among other things, certain Term B-2 Lenders and certain Term B-3 Lenders to elect to extend the maturity of their Term B-2 Loans and Term B-3 Loans, respectively, by an exchange into Term B-4 Loans, (iv) provide for the Term B-4 Loans to receive the benefit of the IntermediateCo Unsecured Guarantee, a first priority security interest in the Canadian Pledge and after the Springing Covenant is triggered, a first priority security interest in all of the Specified Real Property, subject to Permitted Liens, Applicable Law and any restrictions or limitations under the applicable deeds, leases or real estate contracts and (v) provide for the other amendments set forth herein (including, without limitation, the amendments to each of the documents set forth in Annex 1 through Annex 6 hereof contemplated by Section 2.1) (collectively, the “Initial Amendments”);

WHEREAS, the Existing Lenders party hereto constituting the Required Lenders as of the date hereof and the Borrower have agreed to the Initial Amendments;

WHEREAS, after giving effect to the Initial Amendments, the Borrower will incur the Term B-4 Loans through (i) the conversion of all or a portion of the Initial Loans of Initial Loan Lenders that elect, by executing a signature page hereto, to convert all or a portion of their Initial

Loans into Term B-4 Loans, (ii) the conversion of a portion, if any, of the Term B-2 Loans and Term B-3 Loans of Term B-2 Lenders and/or Term B-3 Lenders, respectively, that elect, by executing a signature page hereto, to convert all or a portion of their Term B-2 Loans and/or Term B-3 Loans, as applicable, into Term B-4 Loans pursuant to the Pro Rata Extension Offer herein and (iii) the incurrence of additional Term B-4 Loans provided by the Fronting Term B-4 Lender;

WHEREAS, the proceeds of the Term B-4 Loans together with the proceeds of (x) $280 million of term loans under the ABL Credit Agreement incurred on the date hereof (the “FILO Loans”) and (y) revolving loans drawn under the ABL Credit Agreement on or prior to the date hereof (the “ABL Revolving Drawing”) will be used (i) to refinance and/or extend the maturity of all outstanding Initial Loans, (ii) to redeem all (whether through tender offer, defeasance, discharge or otherwise) of the Borrower’s outstanding 7.373% Senior Secured Notes due 2016 (including payment of accrued and unpaid interest, premiums and other amounts due), (iii) to pay costs, fees and expenses in connection therewith and (iv) for general corporate purposes;

WHEREAS, the Term B-4 Lenders party hereto (which for the avoidance of doubt, shall include Existing Lenders that will become Term B-4 Lenders on the date hereof) have agreed to provide the Borrower with Term B-4 Loans (whether through cash or cashless rolls of Initial Loans, the conversion of Term B-2 Loans and/or Term B-3 Loans into Term B-4 Loans or pursuant to providing a Term B-4 Commitment (as defined below) under this Amendment No. 3) on the date hereof, subject to the satisfaction of certain conditions herein;

NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

SECTION 1

DEFINITIONS

1.1Certain Definitions. The following terms (whether or not underscored) when used in this Amendment No. 3 shall have the following meanings (such meanings to be equally applicable to the singular and plural form thereof):

(a)“Amendment Date” shall mean the first date on which all conditions set forth in Section 7 of this Amendment No. 3 are satisfied, which date was October 24, 2014.

(b)“Amended Credit Agreement” shall mean the Amended and Restated Credit Agreement as amended by this Amendment No. 3.

(c)“Term B-4 Joinder Agreement” shall mean the Term B-4 Joinder Agreement attached hereto as Annex 7.

1.2Other Definitions. Unless otherwise defined or the context otherwise requires, capitalized terms for which meanings are not provided herein shall have the meanings ascribed

such terms in the Amended and Restated Credit Agreement or the Amended Credit Agreement, as applicable.

SECTION 2

AMENDMENTS

2.1Amendment to Amended and Restated Credit Agreement. Subject to the satisfaction of the applicable closing conditions set forth in Section 7 below, from and after the date such conditions have been satisfied, (i) the changes to the Amended and Restated Credit Agreement shown in the redline attached as Annex 1 shall be effective, (ii)the terms of the Term B-4 Loans set forth in the Term B-4 Joinder Agreement shall be deemed incorporated into the Amended Credit Agreement, (iii) the changes to the ABL Intercreditor Agreement shown in the redline attached hereto as Annex 2 shall be effective, (iv) the changes to the Security Agreement shown in the redline attached hereto as Annex 3 shall be effective, (v) the changes to the Guarantee shown in the redline attached hereto as Annex 4 shall be effective, (vi) the changes to the form of Prepayment Option Notice shown in the redline attached hereto as Annex 5 shall be effective and (vii) Annex 6 hereof shall be Schedule 1.01(b) to the Amended Credit Agreement.

2.2Consent to Amendments. Each Lender hereby consents to the Initial Amendments and acknowledges receipt and approval of, each other document delivered or required to be delivered pursuant to the Amended and Restated Credit Agreement or the other Loan Documents to effect the Initial Amendments contemplated hereby.

2.3Effect of Amendments. Except as modified hereby, all of the terms and provisions of the other Loan Documents remain in full force and effect. To the extent that any conflict may exist between the provisions of this Amendment No. 3 (including any Loan Documents amended in connection herewith) and the provisions of the Amended and Restated Credit Agreement or any other Loan Document, then this Amendment No. 3 (including any Loan Documents amended in connection herewith) shall control.

SECTION 3

TERM B-4 LOANS

3.1Consent. Each Lender hereby consents to the incurrence by the Borrower of the Term B-4 Loans as a new tranche of Loans under the Amended Credit Agreement with the terms and conditions as set forth in the Amended Credit Agreement and the Term B-4 Joinder Agreement. Each Lender that is or will become a Term B-4 Lender hereby waives the notice requirements set forth in Section 2.02 of the Amended and Restated Credit Agreement with respect to any borrowing requests related to the Term B-4 Loans to be incurred on the date hereof.

3.2Funding. Goldman Sachs Lending Partners LLC, as the initial fronting Term B-4 Lender (the “Fronting Term B-4 Lender”), hereby agrees, subject to the conditions set forth herein, to fund Term B-4 Loans in the amount set forth on its signature page to this Amendment No. 3 (the “Term B-4 Commitment”).

3.3Terms. The pricing terms, maturity date, amortization and certain other terms applicable to the Term B-4 Loans will be set forth in the Term B-4 Joinder Agreement and all other terms of the Term B-4 Loans will be set forth in the Loan Documents, as amended on the date hereof.

SECTION 4

INTERMEDIATECO UNSECURED GUARANTEE

4. 1Consent. Each Lender hereby consents to the granting of an unsecured guarantee by IntermediateCo for the benefit of the Term B-4 Lenders pursuant to the IntermediateCo Unsecured Guarantee.

SECTION 5

EXTENSION OFFER

5.1Extension Offer.    After giving effect to the Initial Amendments, pursuant to Section 2.15 of the Amended Credit Agreement, the Borrower hereby offers to each existing Term B-2 Lender and Term B-3 Lender the ability to extend the maturity of such Lender’s Term B-2 Loans and Term B-3 Loans by an exchange into Term B-4 Loans; provided that, in the event that the aggregate principal amount of Term B-2 Loans and Term B-3 Loans which elect to extend into Term B-4 Loans exceeds $380 million, the Term B-2 Loans and Term B-3 Loans which have so elected to be extended, shall be extended on a pro rata basis (subject to rounding requirements as may be established by the Administrative Agent) based on the aggregate principal amount of Term B-2 Loans and Term B-3 Loans that have elected to be extended into Term B-4 Loans until the aggregate amount of Term B-2 Loans and Term B-3 Loans that have been extended into Term B-4 Loans equals $380 million (a “Reallocation”).

5.2Extension. Each Term B-2 Lender and Term B-3 Lender that executes a signature page to this Amendment No.3 and elects to extend all or a portion of its Term B-2 Loans and/or Term B-3 Loans pursuant to a cashless roll of its Loans shall, after giving effect to the incurrence of the Term B-4 Loans, become a Term B-4 Lender under the Amended Credit Agreement and such portion of its Term B-2 Loans and/or Term B-3 Loans, as applicable, which have been extended into Term B-4 Loans shall be considered Term B-4 Loans for all purposes of the Loan Documents. Any Term B-2 Loans and/or Term B-3 Loans which have not been exchanged into Term B-4 Loans (including any Term B-2 Loans and/or Term B-3 Loans which were not permitted to be extended because of a Reallocation) shall continue to be Term B-2 Loans and/or Term B-3 Loans, as applicable, under the Loan Documents after giving effect to this Amendment No. 3.

5.3Waiver. Each Term B-2 Lender and Term B-3 Lender party hereto waives any right to compensation for losses, expenses or liabilities incurred by such Lender in connection with the extension of such Lender’s Term B-2 Loans and/or Term B-3 Loans, as applicable, on the date

hereof which it may otherwise be entitled to pursuant to Section 3.05 of the Amended and Restated Credit Agreement.

5.4Interest. The Borrower shall pay all accrued and unpaid interest on the Term B-2 Loans and Term B-3 Loans which are extended into Term B-4 Loans to, but not including the date hereof and such payment shall be made on the date hereof.

SECTION 6

CONVERSION AND REPAYMENT OF INITIAL LOANS

6.1Conversion. Subject to and upon the terms and conditions herein, each Initial Loan Lender who elected a conversion on its signature page hereto, agrees to convert its Initial Loans into Term B-4 Loans as indicated on its signature page hereto.

6.2Interest. The Borrower shall pay all accrued and unpaid interest on the Initial Loans to, but not including, the date hereof and such payment shall be made on the date hereof.

6.3Waiver. Each Initial Lender party hereto waives any right to compensation for losses, expenses or liabilities incurred by such Lender in connection with the prepayment or extension of such Lender’s Loans which it may otherwise be entitled to pursuant to Section 3.05 of the Amended and Restated Credit Agreement. The Administrative Agent and the Initial Loan Lenders party hereto hereby waive the prepayment notice requirements set forth in Section 2.03(f) of the Amended and Restated Credit Agreement with respect to the prepayment of Initial Loans.

SECTION 7

CLOSING CONDITIONS

7.1Conditions Precedent to the Effectiveness of Amendment No. 3. This Amendment No. 3 and the amendments to the other Loan Documents contemplated hereby shall become effective upon (or upon the waiver of such condition):

(a)receipt by the Administrative Agent of this Amendment No. 3, duly executed by the Borrower, the Administrative Agent and the Required Lenders;

(b)receipt by the Administrative Agent of such certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as the Administrative Agent may reasonably require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Amendment No. 3 and the other Loan Documents to which such Loan Party is a party;

(c)receipt by the Administrative Agent of such documents and certifications as the Administrative Agent may reasonably require to evidence that each Loan Party is duly organized or formed, is validly existing, in good standing and qualified to engage in business in each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such

qualification, except those jurisdictions where the failure to be so qualified could not reasonably be expected to have a Material Adverse Effect;

(d)receipt by the Administrative Agent of a certificate signed by a Responsible Officer of the Borrower on behalf of the Borrower certifying that the conditions specified in clauses (g), (h) and (j) below have been satisfied;

(e)all fees and out-of-pocket expenses incurred by the Administrative Agent and Goldman Sachs Lending Partners LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Securities LLC, J.P. Morgan Securities LLC, Citigroup Global Markets Inc. and Deutsche Bank Securities Inc. (collectively, the “Term B-4 Lead Arrangers”) and required to be paid or reimbursed by the Borrower as separately agreed, including all invoiced fees and expenses of Cahill, Gordon & Reindel LLP, counsel to the Administrative Agent and the Term B-4 Lead Arrangers, shall have been paid or reimbursed, on or prior to the date hereof;

(f)the Administrative Agent shall have received an opinion of (i) Simpson Thacher & Bartlett LLP, (ii) Hunton & Williams LLP, special Virginia counsel to the Loan Parties and (iii) O’Neill & Borges LLC, special Puerto Rico counsel to the Loan Parties, in form and substance reasonably satisfactory to the Administrative Agent;

(g)both immediately before and after giving effect to this Amendment No. 3 (and the incurrence of any Term B-4 Loans on the date hereof), the representations and warranties of the Loan Parties contained in Article V of the Amended and Restated Credit Agreement and in each other Loan Document shall be true and correct in all material respects (provided that any representations and warranties which are qualified by materiality, material adverse effect or similar language shall be true and correct in all respects) on and as of the Amendment Date as though made on such date (except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects (provided that any representations and warranties which are qualified by materiality, material adverse effect or similar language shall be true and correct in all respects) as of such earlier date);

(h)no Default or Event of Default shall exist on the date hereof both before and after giving effect to this Amendment No. 3 and the amendments to the other Loan Documents;

(i)receipt by the Collateral Agent of copies of UCC, tax and judgment lien searches, bankruptcy and pending lawsuit searches or equivalent reports or searches for Delaware, Virginia and Puerto Rico, as applicable, each of a recent date, the results of which shall not reveal any Liens on the Collateral covered or intended to be covered by the Security Documents (other than Permitted Liens or any other Liens reasonably acceptable to the Collateral Agent); and

(j)the representations and warranties in Section 8.5 of this Amendment No. 3 shall be true and correct in all material respects (provided that any representations and warranties which are qualified by materiality, material adverse effect or similar language shall be true and correct in all respects) as of the date hereof.

7.2Conditions Precedent to the Incurrence of the Term B-4 Loans. The incurrence of the Term B-4 Loans (through a cash or cashless roll, extension of Term B-2 Loans or Term B-3 Loans or otherwise) shall occur upon (or upon the waiver of such condition):

(a)receipt by the Administrative Agent of aBorrowing Notice, relating to the Term B-4 Loans;

(b)receipt by the Administrative Agent of executed counterparts to the Term B-4 Joinder Agreement by each of the Administrative Agent and the Borrower;

(c)receipt by the Administrative Agent of a Note executed by the Borrower in favor of each Term B-4 Lender requesting a Note;

(d)all of the Borrower’s outstanding 7.375% Senior Secured Notes due 2016 shall have been redeemed (whether through tender offer or otherwise) or have been defeased or discharged;

(e)the Borrower shall have incurred, or will incur substantially simultaneously with the incurrence of the Term B-4 Loans, the FILO Loans and the ABL Revolving Drawing;

(f)receipt by the Administrative Agent of a certificate signed by a Responsible Officer of the Borrower on behalf of the Borrower certifying that the conditions specified in clauses (h) and (k) below have been satisfied;

(g)the Borrower shall have paid the fees due as set forth in the Term B-4 Joinder Agreement;

(h)no Default or Event of Default shall exist on the date hereof both before and after giving effect to the incurrence of the Term B-4 Loans, the FILO Loans, the ABL Revolving Drawing and the use of proceeds therefrom;

(i)receipt by the Administrative Agent of the IntermediateCo Unsecured Guarantee executed by the Administrative Agent and IntermediateCo;

(j)the effectiveness of this Amendment No. 3 and the other Loan Documents amended on the date hereof;

(k)the representations and warranties in Section 8.5 of this Amendment No. 3 shall be true and correct in all material respects (provided that any representations and warranties which are qualified by materiality, material adverse effect or similar language shall be true and correct in all respects) as of the date hereof;

(l)the payment of all accrued and unpaid interest on the Term B-2 Loans and Term B-3 Loans which are extended into Term B-4 Loans to, but not including the date hereof; and

(m)the repayment of any Initial Loans not converted into Term B-4 Loans, including accrued and unpaid interest, if any, thereof.

SECTION 8

MISCELLANEOUS

8.1Amended Terms. The term “Credit Agreement” as used in each of the Loan Documents shall hereafter mean the Amended and Restated Credit Agreement as amended by this Amendment No. 3. The term “Security Agreement” as used in each of the Loan Documents shall hereafter mean the Security Agreement as amended by this Amendment No. 3. The term “Guarantee” as used in each of the Loan Documents shall hereafter mean the Guarantee as amended by this Amendment No. 3. The term “Prepayment Option Notice” as used in each of the Loan Documents shall hereafter mean the Prepayment Option Notice as amended by this Amendment No. 3. Except as specifically amended hereby or otherwise agreed, each of the Loan Documents are hereby ratified and confirmed and shall remain in full force and effect according to their respective terms.

8.2Loan Document. This Amendment No. 3, the Term B-4 Joinder Agreement and each Loan Document amended in connection herewith shall constitute a Loan Document under the terms of the Amended Credit Agreement and shall be subject to the terms and conditions thereof (including, without limitation, Sections 10.14 and 10.15 of the Amended Credit Agreement).

8.3Entirety. This Amendment No. 3 and the other Loan Documents embody the entire agreement between the parties hereto and supersede all prior agreements and understandings, oral or written, if any, relating to the subject matter hereof.

8.4Counterparts. This Amendment No. 3 may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument. Delivery of executed counterparts of this Amendment No. 3 by facsimile or electronic mail shall be effective as an original and shall constitute a representation that an original shall be delivered.

8.5Representations and Warranties.

(a)By its execution of this Amendment No. 3, the Borrower and each other Loan Party hereby certifies that:

(i)this Amendment No. 3 and all the other Loan Documents executed on the date hereof have been duly authorized by all necessary corporate, membership, partnership or other necessary action and has been duly executed and delivered by each Loan Party that is a party hereto and constitutes a legal, valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law;

(ii)the execution, delivery and performance of this Amendment No. 3 and the other Loan Documents executed in connection herewith (a) have been duly authorized by

its requisite corporate or other organizational and, if required, stockholder or member action and (b) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except for such as (i) have been obtained or made and are in full force and effect, or (ii) the failure of which to obtain would not reasonably be expected to result in a Material Adverse Effect, (c) will not violate any Applicable Law or the Charter Documents of any Loan Party, except to the extent that such violation would not reasonably be expected to result in a Material Adverse Effect, (d) will not violate or result in a default under the Amended and Restated Credit Agreement, any indenture, agreement, instrument or other evidence of Material Indebtedness, except to the extent that such violation or default would not reasonably be expected to result in a Material Adverse Effect and (e) will not result in the creation or imposition of any Lien on any asset of any Loan Party (other than Permitted Liens or as contemplated hereby).

(b)Each Loan Party hereby represents and warrants that both immediately before and after giving effect to this Amendment No. 3 and the incurrence of any Term B-4 Loans on the date hereof the representations and warranties contained in the Amended and Restated Credit Agreement and in each other Loan Document are true and correct in all material respects (provided that any representations and warranties which are qualified by materiality, material adverse effect or similar language shall be true and correct in all respects) on and as of the date hereof as though made on the date hereof (except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects (provided that any representations and warranties which are qualified by materiality, material adverse effect or similar language shall be true and correct in all respects) as of such earlier date.

8.6Term B-4 Lead Arrangers. For purposes of this Amendment No. 3, the Term B-4 Lead Arrangers shall receive the benefit of Section 10.19 of the Amended Credit Agreement mutatis mutandis.

8.7Loan Party Acknowledgments.

(a)Each Loan Party hereby (i) expressly acknowledges the terms of the Amended Credit Agreement, (ii) ratifies and affirms its obligations under the Loan Documents (including guarantees and security agreements) executed by the undersigned, (iii) acknowledges, renews and extends its continued liability under all such Loan Documents and agrees such Loan Documents remain in full force and effect and (iv) agrees that each Security Document secures all Obligations of the Guarantors in accordance with the terms thereof.

(b)Each Loan Party hereby reaffirms, as of the Amendment Date, (i) the covenants and agreements contained in each Loan Document to which it is a party, including, in each case, such covenants and agreements as in effect immediately after giving effect to this Amendment No. 3 and the transactions contemplated thereby, and (ii) its guarantee of payment of the Secured Obligations pursuant to the Guarantee and its grant of Liens on the Collateral to secure the Secured Obligations.

(c)Each Loan Party further confirms that each Loan Document to which it is a party is and shall continue to be in full force and effect and the same are hereby ratified and confirmed in all respects.

8.8Loss of FATCA Grandfathering.

Solely for purposes of determining withholding Taxes imposed under the Foreign Account Tax Compliance Act (FATCA), from and after the effective date of this Amendment No. 3, the Borrower and the Administrative Agent shall treat (and the Lenders hereby authorize the Administrative Agent to treat) the Loans (including the Term B-2 Loans and the Term B-3 Loans) as not qualifying as “grandfathered obligations” within the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i).

8.9GOVERNING LAW. THIS AMENDMENT NO. 3 AND ALL ACTIONS ARISING UNDER THIS AMENDMENT NO. 3 SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[Signature pages follow]

IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Amendment No. 3 to be duly executed and delivered as of the date first above written.

TOYS “R” US-DELAWARE, INC., as Borrower
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer

TRU-SVC, LLC, as Guarantor
By:	TOYS “R” US-DELAWARE, INC., its sole member
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer
TOYS ACQUISITION, LLC, as Guarantor
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer
TRU OF PUERTO RICO, INC., as Guarantor
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer
GEOFFREY HOLDINGS, LLC, as Guarantor
By:	TOYS “R” US-DELAWARE, INC., its sole member
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer

GEOFFREY, LLC, as Guarantor
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer
GEOFFREY INTERNATIONAL, LLC, as Guarantor
By:	GEOFFREY, LLC, its sole member
By:	/s/ Chetan Bhandari
Name:	Chetan Bhandari
Title:	Senior Vice President – Corporate Finance and Treasurer

BANK OF AMERICA, N.A., as Administrative Agent
By:	/s/ Kelly Weaver
Name:	Kelly Weaver
Title:	Assistant Vice President

[Additional Lender Signatures On File With Administrative Agent]

ANNEX 1

[SEE ATTACHED]

Annex 1

AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of August 24, 2010
amongTOYS “R” US-DELAWARE, INC.,as Borrower,
andBANK OF AMERICA, N.A.,as Administrative Agent and as Collateral Agent,,GOLDMAN SACHS CREDIT PARTNERS L.P..andJPMORGAN CHASE BANK, N.A..,as Syndication Agents,The Lenders Party Hereto,CREDIT SUISSE SECURITIES (USA) LLCand WELLS FARGO BANK, N.A.,
as Documentation Agents,BANC OF AMERICA SECURITIES LLC,
J.P. MORGAN SECURITIES INC.and GOLDMAN SACHS LENDING PARTNERS LLC,as Joint Lead Arrangers,
andBANC OF AMERICA SECURITIES LLC,
J.P. MORGAN SECURITIES INC.,
WELLS FARGO SECURITIES, LLC,
GOLDMAN SACHS LENDING PARTNERS LLC,
CREDIT SUISSE SECURITIES (USA) LLC,
CITIGROUP GLOBAL MARKETS INC.andDEUTSCHE BANK SECURITIES INC.,as Joint Bookrunning Managers

CAHILL GORDON & REINDEL LLP80 Pine Street
New York, New York 10005

TABLE OF CONTENTS

		Page
	ARTICLE I
	DEFINITIONS AND ACCOUNTING TERMS
1.01	Defined Terms	2
1.02	Other Interpretive Provisions	4041
1.03	Accounting Terms	4142
1.04	Times of Day	4142
1.05	Resolution of Drafting Ambiguities	4142
1.06	Currency Equivalents Generally	4142
	ARTICLE II
	THE COMMITMENTS AND BORROWING OF LOANS
2.01	Loans	4243
2.02	Borrowings, Conversions and Continuations of Loans	4243
2.03	Prepayments	4344
2.04	Termination of Commitments	4649
2.05	Repayment of Loans	4649
2.06	Interest	4750
2.07	Fees	4851
2.08	Computation of Interest and Fees	4851
2.09	Evidence of Indebtedness	4851
2.10	Payments Generally; Administrative Agent’s Clawback	4952
2.11	Sharing of Payments by Lenders	5053
2.12	Incremental Facilities	5154
2.13	Defaulting Lenders	5355
2.14	Refinancing Amendments	56
2.15	Extension Offers	56
	ARTICLE III
	TAXES, YIELD PROTECTION AND ILLEGALITY
3.01	Taxes	5358
3.02	Change in Legality	5761
3.03	Alternate Rate of Interest for Loans	5761
3.04	Increased Costs; Reserves on Eurodollar Rate Loans	5861
3.05	Compensation for Losses	5962
3.06	Mitigation Obligations; Replacement of Lenders	5963
3.07	Survival	6063

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		Page
	ARTICLE IV
	CONDITIONS PRECEDENT TO LOANS
4.01	Conditions of Loans	6063
	ARTICLE V
	REPRESENTATIONS AND WARRANTIES
5.01	Organization; Powers	6265
5.02	Authorization; Enforceability	6266
5.03	Governmental Approvals; No Conflicts	6366
5.04	Financial Condition	6366
5.05	Properties	6366
5.06	Litigation and Environmental Matters	6366
5.07	Compliance with Laws and Agreements	6467
5.08	Investment and Holding Company Status	6467
5.09	Taxes	6467
5.10	ERISA	6467
5.11	Disclosure	6568
5.12	Subsidiaries	6568
5.13	Insurance	6568
5.14	Labor Matters	6568
5.15	Federal Reserve Regulations	6568
5.16	Solvency	6669
5.17	Use of Proceeds	6669
5.18	Intellectual Property Matters	6669
5.19	Security Documents	6669
5.20	Anti-Terrorism Law	6770
	ARTICLE VI
	AFFIRMATIVE COVENANTS
6.01	Financial Statements and Other Information	6871
6.02	Notices of Material Events	7173
6.03	Existence; Conduct of Business	7173
6.04	Payment of Obligations	7173
6.05	Maintenance of Properties	7174
6.06	Insurance	7274
6.07	Books and Records; Inspection Rights; Accountants	7374
6.08	Compliance with Laws	7374
6.09	Use of Proceeds	7375
6.10	Additional Collateral; Additional Guarantors	73; Additional Covenants75
6.11	Security Interests; Further Assurances	7478
6.12	Information Regarding Collateral	7479

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6.13	Interest Rate Protection	75
	ARTICLE VII
	NEGATIVE COVENANTS
7.01	Liens	7579
7.02	Investments	7883
7.03	Indebtedness and Disqualified Capital Stock	8084
7.04	Fundamental Changes	8387
7.05	Asset Sales	8388
7.06	Restricted Payments	8589
7.07	Transactions with Affiliates	8690
7.08	Sales and Leasebacks	8791
7.09	Clauses Restricting Subsidiary Distributions	8791
7.10	Use of Proceeds	8892
7.11	Modifications of Charter Documents and Other Documents, Etc.	8893
7.12	Fiscal Year	8993
7.13	Anti-Terrorism Law; Anti-Money Laundering	8993
7.14	Embargoed Person	8993
7.15	No Further Negative Pledge	8994
	ARTICLE VIII
	EVENTS OF DEFAULT AND REMEDIES
8.01	Events of Default	9094
8.02	Remedies upon Event of Default	9296
8.03	Application of Funds	9397
	ARTICLE IX
	AGENTS
9.01	Appointment and Authority	9397
9.02	Rights as a Lender	9498
9.03	Exculpatory Provisions	9498
9.04	Reliance by the Administrative Agent	9599
9.05	Delegation of Duties	9599
9.06	Resignation of the Administrative Agent	9599
9.07	Non-Reliance on the Agents and Other Lenders	96100
9.08	No Other Duties, Etc.	96100
9.09	Administrative Agent May File Proofs of Claim	96100
9.10	Collateral and Guarantee Matters	97101
9.11	Withholding Tax	98102
	ARTICLE X
	MISCELLANEOUS
10.01	Amendments, Etc.	98102
10.02	Notices; Effectiveness; Electronic Communication	100104
10.03	No Waiver; Cumulative Remedies	102106

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10.04	Expenses; Indemnity; Damage Waiver	103106
10.05	Payments Set Aside	104108
10.06	Successors and Assigns	105108
10.07	Treatment of Certain Information; Confidentiality	110113
10.08	Right of Setoff	111114
10.09	Interest Rate Limitation	112114
10.10	Counterparts; Integration; Effectiveness	112114
10.11	Survival of Representations and Warranties	112115
10.12	Severability	113115
10.13	Replacement of Lenders	113115
10.14	Governing Law, Jurisdiction; Etc.	113116
10.15	Waiver of Jury Trial	114117
10.16	USA PATRIOT Act Notice	115117
10.17	Intercreditor Agreements	115117
10.18	Affiliated Lenders	115117
10.19	No Advisory or Fiduciary Responsibility	116118
10.20	Electronic Execution of Assignments and Certain Other Documents	116118
10.21	IntermediateCo Unsecured Guarantee	119
10.22	Incremental Joinder Covenants and Agreements.	119
SIGNATURES		S-1

SCHEDULES
1.01	Specified Holdings Indebtedness
1.01(b)	Specified Real Property
1.02	Non-Material Subsidiaries
1.03	Propco Subsidiaries
2.01	Commitments
5.01	Organization Information
5.06(a)	Disclosed Matters
5.06(b)	Environmental Matters
5.12	Subsidiaries; Joint Ventures; Assessable Equity Interests
5.13	Insurance
5.14	Collective Bargaining Agreements
6.01(a)	Business Segment Reporting Requirements
7.01(g)	Existing Liens
7.02(i)	Existing Investments
7.03(c)	Existing Indebtedness
7.07	Transactions with Affiliates
10.02	Administrative Agent’s Office; Certain Addresses for Notices
EXHIBITS
Exhibit A-1	Form of Borrowing or Conversion Notice
Exhibit A-2	Form of Prepayment Notice
Exhibit B	Form of Note
Exhibit C	Form of Assignment and Assumption
Exhibit D	Form of Guarantee
Exhibit E-1	Form of Opinion of Simpson Thacher & Bartlett LLP

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Exhibit E-2	Form of Opinion of Hunton & Williams LLP
Exhibit F	Form of Perfection Certificate
Exhibit H	[Reserved]
Exhibit H-1	Form of ABL Intercreditor Agreement
Exhibit H-2	Form of Non-ABL Intercreditor Agreement
Exhibit I	Form of Intellectual Property Security Agreement
Exhibit J	Form of Joinder Agreement
Exhibit K	Form of Prepayment Option Notice
Exhibit L	[Reserved]
Exhibit M	United States Tax Compliance Certificate
Exhibit N	Loan Auction Procedures
Exhibit O	Form of Leverage/Prepayment Certificate
Exhibit P	Form of Security Agreement

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AMENDED AND RESTATED CREDIT AGREEMENT

AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”) dated as of August 24, 2010, among TOYS “R” US-DELAWARE, INC., a Delaware corporation (the “Borrower”), each lender from time to time party hereto (collectively, the “Lenders” and individually, a “Lender”), BANK OF AMERICA, N.A., as administrative agent for the Lenders (together with its permitted successors and assigns in such capacity, the “Administrative Agent”), GOLDMAN SACHS CREDIT PARTNERS, L.P. and JPMORGAN CHASE BANK, N.A., as syndication agents (the “Syndication Agents”), BANK OF AMERICA, N.A., as collateral agent for the Lenders (Secured Parties (together with its permitted successors and assigns in such capacity,the “Collateral Agent”), CREDIT SUISSE SECURITIES (USA) LLC and WELLS FARGO SECURITIES, LLC, as documentation agents (the “Documentation Agents”), BANC OF AMERICA SECURITIES LLC (“BAS”), J.P. MORGAN SECURITIES INC. and GOLDMAN SACHS LENDING PARTNERS LLC, as joint lead arrangers (“Lead Arrangers”) and BAS, J.P. MORGAN SECURITIES INC., WELLS FARGO SECURITIES, LLC, GOLDMAN SACHS LENDING PARTNERS LLC, CREDIT SUISSE SECURITIES (USA) LLC, CITIGROUP GLOBAL MARKETS INC. and DEUTSCHE BANK SECURITIES INC., as joint bookrunning managers (in such capacity, the “Joint Book Managers”; and together with the Lead Arrangers, the “Arrangers”).

WHEREAS, the Borrower, certain lenders party thereto (the “Existing Lenders”), Banc of America Bridge LLC, as administrative agent, Deutsche Bank Securities Inc., as syndication agent, Citicorp North America, Inc., as collateral agent, Banc of America Securities LLC and Deutsche Bank Securities Inc., as joint lead arrangers, and certain other agents and lenders named therein entered into that certain Credit Agreement, dated as of July 19, 2006 (the “Existing Credit Agreement”) (as amended from time to time pursuant to the terms thereof), pursuant to which the Existing Lenders made certain loans and certain other extensions of credit to the Borrower;

WHEREAS, the Obligations (as defined in the Existing Credit Agreement, hereinafter the “Existing Obligations”) of the Borrower and the other Loan Parties under the Existing Credit Agreement, the Security Documents (as defined in the Existing Credit Agreement, such Security Documents hereinafter the “Existing Security Documents”) and the Guarantees (as defined in the Existing Credit Agreement, such Guarantees hereinafter the “Existing Guarantees”) are secured by certain collateral (hereinafter the “Existing Collateral”) and are guaranteed or supported or otherwise benefited by the Existing Security Documents and the Existing Guarantees;

WHEREAS, immediately prior to the Restatement Date, Loans (as defined in the Existing Credit Agreement) in the aggregate principal amount of $800,000,000 were outstanding under the Existing Credit Agreement (the “Existing Loans”);

WHEREAS, the parties hereto wish to amend and restate the Existing Credit Agreement in its entirety to allow for transactions (collectively, the “Amendment Transactions”) which (a) provide for new term loans (the “Initial Loans”) to the Borrower in an aggregate principal amount of $700,000,000, (b) provide for the issuance of a new series of senior secured notes of the Borrower (as amended, refinanced or replaced from time to time, the “Secured Notes”) to be secured by the Collateral on a pari passu basis with the Loans hereunder and (c) repay in full all obligations outstanding under the Existing Credit Agreement and the Borrower’s existing Unsecured Term Loan Agreement (clauses (a), (b) and (c), collectively, the “Refinancing”) in each case, on and subject to the terms and conditions of this Agreement;

WHEREAS, the parties hereto intend that (a) the Existing Obligations which remain unpaid and outstanding as of the Restatement Date shall continue to exist under this Agreement on the terms set forth herein and (b) the Existing Security Documents and Existing Guarantees shall continue to secure,

guarantee, support and otherwise benefit the Existing Obligations as well as the other Obligations of the Borrower and the other Loan Parties under this Agreement and the other Loan Documents; and

WHEREAS, (a) this Agreement shall be deemed to amend, restate and supersede the Existing Credit Agreement, except that (1) the grants of security interests and Liens under and pursuant to the Existing Security Documents shall continue unaltered, and each other Existing Security Document shall continue in full force and effect in accordance with its terms, and the parties hereto hereby ratify and confirm the terms thereof as being in full force and effect and unaltered by this Agreement except to the extent expressly amended or modified by amendments thereto entered into in connection with the Amendment Transactions to provide for, among other things, the Secured Notes, and (2) all schedules, appendices and exhibits to the Existing Credit Agreement shall be incorporated by reference herein, mutatis mutandis, except for, and to the extent expressly amended and restated in connection herewith; (b) all Existing Obligations (including all indemnities) under the Existing Credit Agreement and the other Loan Documents shall continue to be outstanding except as expressly modified by this Agreement and shall be governed in all respects by this Agreement and the other Loan Documents; and (c) all references to the Existing Credit Agreement in any Loan Document or other document or instrument delivered in connection therewith shall be deemed to refer to this Agreement and the provisions hereof.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the Existing Credit Agreement is hereby amended and restated to read in its entirety as follows and, accordingly, the parties hereto agree as follows:

ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS

1.01     Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below:

“2011 Notes” has the meaning assigned to such term in the definition of “Indentures.”

“2013 Notes” has the meaning assigned to such term in thedefinition of “Indentures.”

“2017 Notes” has the meaning assigned to such term in the definition of “Indentures.”

“2018 Notes” has the meaning assigned to such term in the definition of “Indentures.”

“2021 Debentures” has the meaning assigned to such term in the definition of “Indentures.”

“ABL Collateral Agent” means Bank of America, N.A., in its capacity as administrative agent under the ABL Credit Agreement.

“ABL Credit Agreement” means (a) that certain asset-based credit agreement as amended and restated as of August 10March 21, 20102014(as amended, modified or otherwise supplemented) among Toys “R” Us-Delaware, Inc., as lead borrower for the borrowers named therein, the lenders party thereto, Bank of America, N.A., as administrative agent, Bank of America, N.A. (acting through its Canada branch), as Canadian agent, Bank of America, N.A. and Wells Fargo Retail Finance LLC, as co-collateral agents, and the other agents and arrangers party thereto, and (b) one or more other credit agreements, loan agreements, note agreements, promissory notes, indentures or other agreements or instruments evidencing or governing the terms of any indebtedness or other financial accommodation that has been incurred to extend, increase or refinance in whole or in part the indebtedness and other obligations outstanding under

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(x) the agreement referred to in clause (a) or (y) any subsequent ABL Credit Agreement, unless such agreement or instrument expressly provides that it is not intended to be and is not an ABL Credit Agreement hereunder, in all cases under clause (a) and/or (b) above, as amended, restated, supplemented, waived or modified from time to time to the extent permitted by this Agreement.

“ABL Credit Agreement Documents” means (a) the ABL Credit Agreement and (b) the other Loan Documents (as defined in the ABL Credit Agreement or any similar term used in any subsequent ABL Credit Agreement referred to in clause (b) of the definition thereof), including each mortgage and other security documents, guarantees, letter of credit documents and the notes issued thereunder, each as amended, restated, supplemented, waived or modified from time to time to the extent permitted by this Agreement.

“ABL Credit Agreement Obligations” means the “ABL Obligations” as defined in the ABL Intercreditor Agreement.

“ABL Credit Agreement Obligations” means the “ABL Obligations” as defined in the ABL Intercreditor Agreement.

“ABL Intercreditor Agreement” has the meaning assigned to such term in the definition of “Intercreditor Agreements.”

“ABL Priority Collateral” has the meaning assigned to the term “ABL Collateral” in theABL Intercreditor Agreement.

“Administrative Agent” has the meaning assigned to such term in the preamble hereto.

“Administrative Agent’s Office” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 10.02, or such other address or account as the Administrative Agent may from time to time notify to the Borrower and the Lenders.

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

“Affiliate” means, with respect to a specified Person, any other Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

“Affiliated Debt Fund” means any investment fund managed or advised by Affiliates of the Sponsors that is a bona fide debt fund that extends credit or buys loans or debt securities as part of its ordinary course of business.

“Affiliated Lender” means a Sponsor or any Affiliate thereof that is not an Affiliated Debt Fund.

“Agent Party” has the meaning assigned to such term in Section 10.02(c).

“Agents” means the Administrative Agent, the Collateral Agent, the Syndication Agents, the Documentation Agents and the Arrangers; and “Agent” shall mean any of them.

“Aggregate Commitments” means the Commitments of all the Lenders. As of the Restatement Date, the Aggregate Commitments total $700.0 million.

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“Agreement” has the meaning assigned to such term in the preamble hereto.

“Agreement Value” means, for each Hedge Agreement, on any date of determination, an amount determined by the Administrative Agent in its reasonable discretion equal to:

(a)    in the case of a Hedge Agreement documented pursuant to the ISDA Master Agreement, the amount, if any, that would be payable by any Loan Party to its counterparty to such Hedge Agreement, if (i) such Hedge Agreement was being terminated early on such date of determination, (ii) such Loan Party was the sole “Affected Party” (as therein defined) and (iii) the Administrative Agent was the sole party determining such payment amount (with the Administrative Agent making such determination pursuant to the provisions of the form of ISDA Master Agreement);

(b)    in the case of a Hedge Agreement traded on an exchange, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss on such Hedge Agreement to the Loan Party which is party to such Hedge Agreement, determined by the Administrative Agent based on the settlement price of such Hedge Agreement on such date of determination; or

(c)    in all other cases, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss on such Hedge Agreement to the Loan Party that is party to such Hedge Agreement determined by the Administrative Agent as the amount, if any, by which (i) the present value of the future cash flows to be paid by such Loan Party exceeds (ii) the present value of the future cash flows to be received by such Loan Party, in each case pursuant to such Hedge Agreement.

“Amendment No. 1” means Amendment No. 1 to this Agreement, dated as of September 20, 2010, among the Borrower, the Lenders party thereto and Bank of America, as Administrative Agent.

“Amendment No. 2” means Amendment No. 2 to this Agreement, dated as of April 10, 2012, among the Borrower, the Lenders party thereto and Bank of America, as Administrative Agent.

“Amendment No. 2 Effective Date” means April 10, 2012.

“Amendment No. 3” means Amendment No. 3 to this Agreement, dated as of October 24, 2014, among the Borrower, the Lenders party thereto and Bank of America, as Administrative Agent.

“Amendment No. 3 Effective Date” means October 24, 2014.

“Amendment Transactions” has the meaning assigned to such term in the recitals hereto.

“Anti-Terrorism Laws” has the meaning assigned to such term in Section 5.20.

“Applicable Law” means as to any Person: (a) all laws, statutes, rules, regulations, orders, codes, ordinances or other requirements having the force of law; and (b) all court orders, decrees, judgments, injunctions, notices, binding agreements and/or rulings, in each case of or by any Governmental Authority which has jurisdiction over such Person, or any property of such Person.

“ApplicablePercentage”Premium” shall means, with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of all Loans represented by the principal amountof such Lender’s Loansat such time, subject to adjustment as provided inSection 2.13.prepayment of the Term B-4 Loans in accordance with Section 2.03(h) prior to the one and one-half

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year anniversary of the Term B-4 Closing Date, the present value at such date of prepayment of (i) the prepayment premium of such Term B-4 Loans that would be payable on the one and one-half year anniversary of the Term B-4 Closing Date plus (ii) all interest that would accrue on such Term B-4 Loans from such date of prepayment to the one and one-half year anniversary of the Term B-4 Closing Date (excluding accrued but unpaid interest to the prepayment date), calculated assuming a 360-day year consisting of twelve 30-day months and that the rate of interest on the Term B-4 Loans from the date of prepayment through the one and one-half year anniversary of the Term B-4 Closing Date will equal the rate of interest on the Term B-4 Loans in effect on the date on which the applicable notice of prepayment is given, computed using a discount rate equal to the Treasury Rate as of such prepayment date, plus 50 basis points.

“Applicable Rate” means:

“Applicable Rate” means(x)    with respect to the Loans (other than any New Loans) (i) from the Restatement Date to the date on which the Administrative Agent receives a Leverage/Prepayment Certificate pursuant to Section 6.01(g) for the fiscal quarter ending October 30, 2010, 3.50% per annum for Base Rate Loans and 4.50% per annum for Eurodollar Rate Loans and (ii) thereafter, the applicable percentage per annum set forth below determined by reference to the Total Leverage Ratio as set forth in the most recent Leverage/Prepayment Certificate received by the Administrative Agent pursuant to Section 6.01(g):

Pricing Level	Total Leverage Ratio	Eurodollar Rate	Base Rate
1	≤ 1.75:11.00	4.25%	3.25%
2	> 1.75:11.00	4.50%	3.50%

Any increase or decrease in the Applicable Rate resulting from a change in the Total Leverage Ratio shall become effective as of the first Business Day immediately following the date a Leverage/Prepayment Certificate is delivered pursuant to Section 6.01(g); provided, however, that if a Leverage/Prepayment Certificate is not delivered when due in accordance with such Section, then, upon the request of the Lenders, Pricing Level 2 shall apply in respect of the Loans.;

(y)    with respect to the New Loans, the Applicable Rate set forth in the applicable Joinder Agreement pursuant to Section 2.12; and

(z)    with respect to the Term B-4 Loans, the Applicable Rate set forth in the Term B-4 Joinder.

“Applicable Subsidiaries” has the meaning assigned to such term in the definition “Net Cash Proceeds.”

“Appraisal” means an appraisal of Real Property by Cushman & Wakefield or another third party appraisal firm selected by the Borrower and reasonably satisfactory to the Administrative Agent.

“Appraised Value” means the value of any Real Property, or a group of Real Properties, as determined by an Appraisal (i) with respect to stores, based on market rents or (ii) with respect to other Real Property, based on appraised fair market value.

“Approved Fund” means any Fund that is managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that manages a Lender.

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“Arrangers” has the meaning assigned to such term in the preamble hereto.

“Asset Sale” means any conveyance, sale, lease (as lessor), transfer (other than in connection with a granting of a Lien permitted hereunder) or other voluntary disposition (but excluding any Restricted Payment) (including by way of merger or consolidation and including any sale and leaseback transaction) of any property or assets (including, for the avoidance of doubt, any sale of any Equity Interests of any Subsidiary of a Loan Party other than any Propco Subsidiary), excluding:

(i)    sales of inventory in the ordinary course of business or pursuant to any going-out-of-business sale;

(ii)    any use or dispositions of cash and Cash Equivalents by any Loan Party or any of its Subsidiaries(other than a Special Refinancing Subsidiary);

(iii)    any casualty or property losses covered by insurance or condemnation proceeds by a Governmental Authority;

(iv)    subject to the Lenders’ security interests therein, any licensing, sublicensing, settlement of claims or entering into co-existence agreements with respect to intellectual property in the ordinary course of businessand consistent with past practice; and

(v)    any transaction permitted by Section 7.05 (other than transactions permitted by Sections 7.05(h), (l) and (n) and, to the extent relating to a lease that is required to be capitalized on the lessor’s financial statements prepared in accordance with GAAP, Section 7.05(g);

to any Person other than a Loan Party; provided that (x) sales of assets other than Real Property for an aggregate consideration of $5.0 million or less with respect to any individual transaction or series of related transactions shall not constitute an “Asset Sale.”” and (y) sales of assets in respect of Real Property for an aggregate consideration of $2.5 million or less with respect to any individual transaction or series of related transactions (“De Minimis Real Property Asset Sale”) shall not constitute an “Asset Sale”; provided that, if the total amount of De Minimis Real Property Asset Sales exceeds $25 million in the aggregate, then sales of assets in respect of Real Property thereafter (other than a sale of Real Property for a consideration of $1.0 million or less) will be considered “Asset Sales”.

“Assignee Group” means two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same investment advisor.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 10.06(b)), and accepted by the Agents, in substantially the form of Exhibit C or any other form approved by the Agents.

“Attributable Indebtedness” means, on any date, (a) in respect of any capital lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any synthetic lease obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capital lease.

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“Available Amount” means as at any date, the sum of, without duplication:

(a)    the aggregate cumulative amount, not less than zero, of 50% of Consolidated Net Income for each Fiscal Year beginning with the fiscal quarter ending August 2, 2009 and ending as of the most recent period for which quarterly financial statements have been delivered pursuant to Section 6.01 hereof;

(b)    the Net Cash Proceeds received after the Restatement Date and on or prior to such date from any equity issuance (other than Disqualified Capital Stock) by, the Borrower; and

(c)    the amount received by the Borrower or any Subsidiary Guarantor in cash after the Restatement Date from any dividend or other distribution by any Subsidiary, joint venture or minority Investment that, in each case, is not otherwise already included in the calculation of Consolidated Net Income.

in each case, that has not been previously or concurrently applied pursuant to Section 7.02(h), 7.02(q) or 7.06(g).

“Bank of America” means Bank of America, N.A. and its successors.

“Bankruptcy Code” means Title 11, U.S.C., as now or hereafter in effect, or any successor thereto.

“BAS” has the meaning assigned to such term in the preamble hereto.

“Base Rate”means, for any day a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus ½ of 1%, (b) the rate of interest in effect for such day as publicly announced from time to time by the Administrative Agent as its “prime rate” and (c) the Eurodollar Rate for interest periods of one month plus 1.00%. The “prime rate” is a rate set by the Administrative Agent based upon various factors including the Administrative Agent’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such prime rate announced by the Administrative Agent shall take effect at the opening of business on the day specified in the public announcement of such change.

“Base Rate Loan” means a Loan that bears interest based on the Base Rate; provided that with respect to Term B-4 Loans, a Base Rate Loan means a Term B-4 Loan that bears interest at a rate based on the Base Rate as set forth in the Term B-4 Joinder.

“Board” means the Board of Governors of the Federal Reserve System of the United States of America.

“Borrower” has the meaning assigned to such term in the preamble hereto.

“Borrower Materials” has the meaning assigned to such term in Section 6.01.

“Borrowing” means a borrowing consisting of Loans of the same Type and, in the case of Eurodollar Rate Loans, having the same Interest Period.

“Borrowing or Conversion Notice” means a notice of (a) a borrowing, (b) a conversion of Loans from one Type to the other, or (c) a continuation of Eurodollar Rate Loans, pursuant to Section 2.02(a),

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which, if in writing, shall be executed by the Borrower and substantially in the form of Exhibit A-1.or such other form as may be approved by the Administrative Agent (including any form on an electronic platform or electronic transmission system as shall be approved by the Administrative Agent), appropriately completed and signed by a Responsible Officer of the Borrower.

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located and, if such day relates to any Eurodollar Rate Loan, means any such day that is also a London Banking Day.

“Canadian Pledge” means the pledge of 65% of the voting Equity Interests and 100% of the non-voting Equity Interests of Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee and related stock certificates, dividends, distributions, rights and proceeds of the foregoing pursuant to the Security Agreement.

“Capital Lease Obligations” means, as to any Person, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP; for purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP consistently applied with the principles existing on the Restatement Date.

“Cash Equivalents” means, as to any Person, (a) securities issued, or directly, unconditionally and fully guaranteed or insured, by the United States, Canada or any agency or instrumentality thereof (provided that the full faith and credit of the United States or Canada is pledged in support thereof) or any state or state agency thereof having maturities of not more than one year from the date of acquisition by such Person; (b) time deposits, banker’s acceptances and certificates of deposit of any Lender or any commercial bank having, or which is the principal banking subsidiary of a bank holding company organized under the laws of the United States, any state thereof or the District of Columbia (or Canada or any province thereof) having, capital and surplus aggregating in excess of $500.0 million with maturities of not more than one year from the date of acquisition by such Person; (c) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in subsection (a) above (without regard to the limitation on maturity contained in such clause) and entered into with any financial institution meeting the qualifications specified in subsection (b) above or with any primary dealer, which repurchase obligations are secured by a valid perfected security interest in the underlying securities; (d) commercial paper rated at least A‑1 or the equivalent thereof by S&P or at least P‑1 or the equivalent thereof by Moody’s and in each case maturing not more than one year after the date of acquisition by such Person; (e) investments in money market or mutual funds substantially all of whose assets are comprised of securities of the types described in subsections (a) through (d) above; (f) in the case of Foreign Subsidiaries, Investments made locally of a type comparable to those described in subsections (a)-(e) of this definition; and (g) demand deposit accounts maintained in the ordinary course of business.

“CERCLA” means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. § 9601 etseq.

“Certain Holdings Indebtedness” means, collectively, the Indebtedness represented by the Indentures.

“Change in Law” means the occurrence, after the Amendment No. 3 EffectivedDateof this Agreement, of any of the following: (a) the adoption of any law, rule or regulation, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority

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or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority.; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to have gone into effect after the Amendment No. 3 Effective Date regardless of the date enacted, adopted or issued and shall be included as a Change in Law but only to the extent a Lender is imposing applicable increased costs or costs in connection with capital adequacy requirements generally on other borrowers of loans under United States credit facilities.

“Change of Control” means

(a)    Holdings at any time ceases to directly own 100% of the Equity Interests of the Borrower;

(b)    the sale, lease, transfer or other conveyance, in one or a series of related transactions, of all or substantially all of the assets of the Borrower and its Subsidiaries, taken as a whole, to any Person other than a Permitted Holder;

(c)    the Borrower becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than the Permitted Holders, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision), of 50% or more of the total voting power of the Voting Stock of the Borrower or Holdings; or

(d)    occupation of a majority of the non-vacant seats on the board of directors (or other body exercising similar management authority) of Holdings by Persons who were neither (i) nominated by the board of directors of Holdings (or prior to the consummation of a Qualifying IPO, the Sponsors) nor (ii) appointed by directors so nominated.

“Charter Documents” means (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

“Class” (a) when used with respect to Lenders, refers to whether such Lenders are Initial Loan Lendersor, New Term Loan Lenders, New Revolving Credit Lenders, Term B-2 Lenders, Term B-3 Lenders or Term B-4 Lenders, (b) when used with respect to Commitments, refers to whether such Commitments are Initial Loan Commitmentsor New Loan, New Term Loan Commitments or New Revolving Credit Commitments and (c) when used with respect to Loans or a Borrowing, refers to whether such Loans, or the Loans comprising such Borrowing, are Initial Loansor, New Loans.Term

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Loans, New Revolving Credit Loans, Term B-2 Loans, Term B-3 Loans or Term B-4 Loans. Loans that have different terms and conditions shall be construed to be in different Classes and Loans that have the same terms and conditions shall be construed to be in the same Class.

“Closing Date” means July 19, 2006.

“Code” means the Internal Revenue Code of 1986 and the Treasury regulations promulgated thereunder, as amended from time to time.

“Collateral” means all the property pledged or granted as collateral pursuant to the Security AgreementDocuments (a) on the Closing Date and (b) thereafter pursuant to Sections 6.10 and 6.11.

“Collateral Agent” has the meaning assigned to such term in the preamble hereto.

“Commitment” means, with respect to each Lender (to the extent applicable), such Lender’s Initial Loan Commitmentor, New Term Loan Commitmentor New Revolving Credit Commitment.

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

“Consolidated” means, when used to modify a financial term, test, statement or report of a Person, the application or preparation of such term, test, statement or report (as applicable) based upon the consolidation, in accordance with GAAP, of the financial condition or operating results of such Person and its Subsidiaries (other than the Propco Subsidiaries).

“Consolidated Current Assets” means, at any date, all amounts (other than cash and Cash Equivalents) that would, in conformity with GAAP, be set forth opposite the caption “total current assets” (or any like caption) on a consolidated balance sheet of the Borrower and its Subsidiaries (but not including the Propco Subsidiaries) at such date.For the avoidance of doubt, any assets related to income taxes shall be excluded from calculation of Consolidated Current Assets.

“Consolidated Current Liabilities” means, at any date, all amounts that would, in conformity with GAAP, be set forth opposite the caption “total current liabilities” (or any like caption) on a consolidated balance sheet of Borrower and its Subsidiaries (but not the Propco Subsidiaries) at such date, but excluding the current portion of any Funded Debt of Borrower and its Subsidiaries (but not including the Propco Subsidiaries).For the avoidance of doubt, any liabilities related to income taxes and short term borrowings shall be excluded from the calculation of Consolidated Current Liabilities.

“Consolidated Depreciation and Amortization Expense” means with respect to any Person for any period, the total amount of depreciation and amortization expense, including the amortization of deferred financing fees, debt issuance costs, commissions, fees and expenses and capitalized software expenditures, of such Person and its Subsidiaries for such period on a consolidated basis and otherwise determined in accordance with GAAP.

“Consolidated EBITDA” means, with respect to any Person for any period, the Consolidated Net Income of such Person (but not including the Propco Subsidiaries) for such period

(1)    increased (without duplication) by:

(a)    provision for taxes based on income or profits or capital gains, including, without limitation, state, franchise and similar taxes and foreign withholding taxes of

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such Person paid or accrued during such period to the extent the same was deducted (and not added back) in computing Consolidated Net Income; plus

(b)    Fixed Charges of such Person for such period (including (x) net losses on Hedge Agreements or other derivative instruments entered into for the purpose of hedging interest rate risk and (y) costs of surety bonds in connection with financing activities, in each case, to the extent included in Fixed Charges) to the extent the same was deducted (and not added back) in calculating such Consolidated Net Income; plus

(c)    Consolidated Depreciation and Amortization Expense of such Person for such period to the extent the same were deducted (and not added back) in computing Consolidated Net Income; plus

(d)    any other non-cash charges, including any write-offs or write-downs, reducing Consolidated Net Income for such period (provided that if any such non-cash charges represent an accrual or reserve for potential cash items in any future period, the cash payment in respect thereof in such future period shall be subtracted from EBITDA to such extent, and excluding amortization of a prepaid cash item that was paid in a prior period); plus

(e)    the amount of any minority interest expense consisting of Subsidiary income attributable to minority equity interests of third parties in any non-wholly owned Subsidiary deducted (and not added back) in such period in calculating Consolidated Net Income; plus

(f)    the amount of management, monitoring, consulting, and advisory fees, and related expenses paid in such period pursuant to the Management Agreement; plus

(g)    any costs or expense incurred by the such Person or a Subsidiary pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or agreement or any stock subscription or shareholder agreement, to the extent that such cost or expenses are funded with cash proceeds contributed to the capital of such Person or net cash proceeds of an issuance of Equity Interests of such Person (other than Disqualified Capital Stock) solely to the extent such net cash proceeds are excluded from the calculation of the “Available Amount”;

(2)    decreased by (without duplication) non-cash gains increasing Consolidated Net Income of such Person for such period, excluding any non-cash gains to the extent they represent the reversal of an accrual or reserve for, a potential cash item that reduced EBITDA in any prior period; and

(3)    increased or decreased by (without duplication):

(a)    any net gain or loss resulting in such period from Hedge Agreements and the application of Statement of Financial Accounting Standards No. 133; plus or minus, as applicable,

(b)    any net gain or loss resulting in such period from currency translation gains or losses related to currency remeasurements of Indebtedness (including any net loss or gain resulting from hedge agreements for currency exchange risk).

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“Consolidated Fixed Charge Coverage Ratio” means, with respect to any Person for any period consisting of such Person’s most recently ended four fiscal quarters for which internal financial statements are available, the ratio of Consolidated EBITDA of such Person for such period to the Fixed Charges of such Person for such period.

In the event that the Borrower or any Subsidiary incurs, assumes, guarantees or repays any Indebtedness (other than Indebtedness incurred under any revolving credit facility unless such Indebtedness has been permanently repaid and has not been replaced) or issues or redeems Disqualified CapitalStock or preferred stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but on or prior to the date on which the calculation of the Fixed Charge Coverage Ratio is made (the “Calculation Date”), then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, guarantee or repayment of Indebtedness, or such issuance or redemption of Disqualified CapitalStock or preferred stock, as if the same had occurred at the beginning of the applicable four-quarter period and as if the Borrower or the applicable Subsidiary had not earned the interest income actually earned during such period in respect of such cash used to repay, repurchase, defease or otherwise discharge such Indebtedness.

If Investments, acquisitions, dispositions, mergers or consolidations (as determined in accordance with GAAP) have been made by the Borrower or Subsidiary during the four-quarter reference period or subsequent to such reference period and on or prior to or simultaneously with the Calculation Date, then the Fixed Charge Coverage Ratio shall be calculated on a pro forma basis assuming that all such Investments, acquisitions, dispositions, mergers or consolidations (and the change in any associated Fixed Charge obligations and the change in Consolidated EBITDA resulting therefrom) had occurred on the first day of the four-quarter reference period.

If since the beginning of such period any Person that was merged with or into the Borrower or another Subsidiary since the beginning of such period shall have made any Investment, acquisition, disposition, merger or consolidation that would have required adjustment pursuant to this definition, then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Investment, acquisition, disposition, merger or consolidation had occurred at the beginning of the applicable four-quarter period.

For purposes of this definition, whenever pro forma effect is to be given to an Investment, acquisition, disposition, merger or consolidation and the amount of income or earnings relating thereto, the pro forma calculations shall be determined in good faith by a responsible financial or accounting Officer of the Borrower and shall comply with the requirements of Rule 11-02 of Regulation S-X promulgated by the SEC.

If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedge Agreements applicable to such Indebtedness if the related hedge has a remaining term in excess of twelve months). Interest on a Capital Lease Obligation shall be deemed to accrue at the interest rate reasonably determined by a responsible financial or accounting officer of the Borrower to be the rate of interest implicit in such Capital Lease Obligation in accordance with GAAP. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rate, shall be deemed to have been based upon the rate actually chosen, or, if none, then based upon such optional rate chosen as the Borrower may designate.

“Consolidated Indebtedness” means, at any date, all Indebtedness of the types described in clause (a), clause (b), clause (c) (but only to the extent of any unreimbursed drawings under any letter of credit),

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and clause (g) of the definition of “Indebtedness” of the Borrower and its Subsidiaries (other than Propco Subsidiaries), on a consolidated basis in accordance with GAAP.

“Consolidated Interest Expense” means, with respect to any Person for any period, without duplication, the sum of:

(1)    consolidated interest expense of such Person for such period, to the extent such expense was deducted (and not added back) in computing Consolidated Net Income (including (a) amortization of original issue discount resulting from the issuance of Indebtedness at less than par, (b) all commissions, discounts and other fees and charges owed with respect to letters of credit or bankers’ acceptances, (c) non-cash interest payments (but excluding any non-cash interest expense attributable to the movement in the mark to market valuation of Hedge Agreements or other derivative instruments pursuant to GAAP), (d) the interest component of Capital Lease Obligations and (e) net payments, if any, pursuant to interest rate Hedge Agreements with respect to Indebtedness, and excluding (x) any additional interest owing on the 2011 Notes, the 2013 Notes or other securities pursuant to any registration rights agreements, (y) amortization of deferred financing fees, debt issuance costs, commissions, fees and expenses and (z) any expensing of bridge, commitment and other financing fees; plus

(2)    consolidated capitalized interest of such Person for such period, whether paid or accrued; less

(3)    interest income for such period.

For purposes of this definition, interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by such Person to be the rate of interest implicit in such Capital Lease Obligation in accordance with GAAP.

“Consolidated Net Income” means, with respect to any Person for any period, the aggregate of the net income of such Person for such period, on a consolidated basis (but not including the Propco Subsidiaries), and otherwise determined in accordance with GAAP; provided that

(1)    any after-tax effect of extraordinary or non-recurring gains or losses (less all fees and expenses relating thereto) shall be excluded;

(2)    the net income for such period shall not include the cumulative effect of a change in accounting principle(s) during such period;

(3)    any net after-tax gains or losses attributable to asset dispositions other than in the ordinary course of business (as determined in good faith by the board of directors of such Person) and any gain (or loss) realized upon the sale or other disposition of any Equity Interests of any Person shall be excluded;

(4)    the net income for such period of any Person that is not a Subsidiary of such Person (or that is a Propco Subsidiary or other Subsidiary but is not otherwise consolidated with such Person), or that is accounted for by the equity method of accounting, shall be excluded; provided that, to the extent not already included, Consolidated Net Income of such Person shall be (A) increased by the amount of dividends or other distributions that are actually paid in cash (or to the extent converted into cash) to the referent Person or Subsidiary thereof in respect of such period and (B) decreased by the amount of any equity of the Borrower in a net loss of any such Person for such period to the extent the Borrower has funded such net loss;

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(5)    non-cash compensation charges, including any such charges arising from stock options, restricted stock grants, stock appreciation rights or other equity-incentive programs shall be excluded;

(6)    any net after-tax gains or losses (less all fees and expenses or charges relating thereto) attributable to the early extinguishment of Indebtedness shall be excluded;

(7)    the effect of any non-cash items resulting from any amortization, write-up, write-down or write-off of assets (including intangible assets, goodwill and deferred financing costs but excluding inventory) in connection with any acquisition, merger, consolidation or similar transaction or any other non-cash impairment charges incurred subsequent to the Restatement Date (excluding any such non-cash item to the extent that it represents an accrual of or reserve for cash expenditures in any future period except to the extent such item is subsequently reversed) shall be excluded;

(8)    any fees and expenses incurred during such period, or any amortization thereof for such period, in connection with any acquisition, disposition, recapitalization, Investment, Asset Sale, issuance or repayment of Indebtedness, issuance of Equity Interests, refinancing transaction or amendment or modification of any debt instrument (in each case, including any such transaction consummated prior to the Restatement Date and any such transaction undertaken but not completed) and any charges or non-recurring merger costs incurred during such period as a result of any such transaction shall be excluded; and

(9)    effects of adjustments (including the effects of such adjustments pushed down to such Person and its Subsidiaries) in the property and equipment, inventory and other intangible assets, deferred revenue and debt line items in such Person’s consolidated financial statements pursuant to GAAP resulting from the application of purchase accounting in relation to any consummated acquisition or the amortization or write-off of any amounts thereof, net of taxes, shall be excluded.

“Consolidated Working Capital” means, at any date, the excess of Consolidated Current Assets on such date over Consolidated Current Liabilities on such date.

“Contract Consideration” has the meaning assigned to such term in the definition of “Excess Cash Flow.”

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Controlled Investment Affiliate” means, as to any Person, any other Person which directly or indirectly is in Control of, is Controlled by, or is under common Control with, such Person and is organized by such Person (or any Person Controlling such Person) primarily for making equity or debt investments in Holdings or other portfolio companies.

“Credit Agreement Refinancing Indebtedness” means Indebtedness issued, incurred or otherwise obtained (including by means of the extension or renewal of existing Indebtedness) in exchange for, or to extend, renew, replace or refinance, in whole or part, existing Loans (“Refinanced Debt”); provided that such exchanging, extending, renewing, replacing or refinancing Indebtedness (a) is in an originalaggregate principal amount not greater than the aggregate principal amount of the Refinanced Debt (when taken as a whole) (plus any premium, accrued interest and fees and expenses incurred in connection with

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such exchange, extension, renewal, replacement or refinancing), (b) does not mature earlier than or have a weighted average life to maturity shorter than the Refinanced Debt, (c) in the case of any secured Indebtedness (i) is not secured by any assets not securing the Refinanced Debt and (ii) is subject to an Intercreditor Agreement(s), (d) shall not be guaranteed by any entity that does not guarantee the Refinanced Debt and (e) has terms and conditions (excluding pricing, interest rate margins, rate floors, discounts, fees, premiums and prepayment or redemption provisions) that are not materially more favorable (when taken as a whole) to the lenders or investors providing such Indebtedness than the terms and conditions of this Agreement (when taken as a whole) are to the Lenders (except for covenants or other provisions applicable only to periods after the Latest Maturity Date at the time of such refinancing).

“Debt Issuance” means the incurrence by the Borrower or any of its Subsidiaries of any Indebtedness (other than any Excluded Debt) after the Restatement Date.

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the lapse of any cure period set forth in Section 8.01, or both, would, unless cured or waived, become an Event of Default.

“Default Rate” has the meaning assigned to such term in Section 2.06(b).

“Defaulting Lender” means, subject to Section 2.13(b), any Lender that, as determined by the Administrative Agent, has (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or a custodian appointed for it or (iii) taken any action in furtherance of, or indicated its consent to, approval of or acquiescence in any such proceeding or appointment; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority.

“Discharge of ABL Obligations” means the “Discharge ofABL Obligations” as defined in the ABL Intercreditor Agreement.

“Disclosed Matters” means the actions, suits and proceedings and the environmental matters disclosed on Schedule 5.06.

“Disqualified Capital Stock” means any Equity Interest which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, (a) matures (excluding any maturity as the result of an optional redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that is six months following the Maturity Date, (b) is convertible into or exchangeable (unless at the sole option of the issuer thereof) for (i) debt securities or (ii) any Equity Interests referred to in (a) above, in each case at any time on or prior to the date that is six months following the Maturity Date, or (c) contains any mandatory repurchase obligation which may come into effect prior to payment in full of all Obligations; provided that any Equity Interests that would not constitute Disqualified Capital Stock but for provisions thereof giving holders thereof (or the holders of any security into or for which such Equity Interests is convertible, exchangeable or exercisable) the right to require the issuer thereof to redeem such Equity Interests upon

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the occurrence of a change in control or an asset sale occurring prior to the date that is six months following the Maturity Date shall not constitute Disqualified Capital Stock.

“Documentation Agents” has the meaning assigned to such term in the preamble hereto.

“Dollar” and “$” mean lawful money of the United States.

“Eligible Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; (d) any other commercial bank, insurance company, investment or mutual fund that is engaged in the business of making, purchasing, holding or investing in commercial or bank loans and similar extensions of credit or a commercial finance company, which Person, together with its Affiliates or Approved Funds, have a combined capital and surplus or net asset value in excess of $750.0 million; (e) any Affiliated Debt Fund; and (f) any Affiliated Lender (subject to the requirements and limitations of Section 10.06(h)), in each case approved by (i) the Administrative Agent and (ii) except as otherwise provided in Section 10.06(b), the Borrower (each such approval not to be unreasonably withheld or delayed); provided that an “Eligible Assignee” shall not include any natural person.

“Embargoed Person” has the meaning assigned to such term in Section 7.14.

“Employee Benefit Plan” means an employee benefit plan (as defined in Section 3(3) of ERISA) that is maintained or contributed to by a Loan Party or with respect to which a Loan Party or any ERISA Affiliate could incur liability.

“Environmental Laws” means all Applicable Laws issued, promulgated or entered into by or with any Governmental Authority, relating in any way to the protection of human health or the environment, to the handling, treatment, storage, disposal of Hazardous Materials or to the assessment or remediation of any Release or threatened Release of any Hazardous Material to the environment.

“Environmental Liability” means any liability, contingent or otherwise (including, without limitation, any liability for damages, natural resource damage, costs of environmental remediation, administrative oversight costs, fines, penalties or indemnities), of any Loan Party directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release or threatened Release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“Equity Interest” means, with respect to any Person, any and all shares, interests, participations or other equivalents, including membership interests (however designated, whether voting or nonvoting), of equity of such Person, including, if such Person is a partnership, partnership interests (whether general or limited) and any other interest or participation (including an interest or participation in one or more divisions or lines of a business of a Loan Party) that confers on a Person the right to receive a share of the profits and losses of, or distributions of property of, such Person, division or line of business, whether outstanding on the date hereof or issued after the Restatement Date, but excluding debt securities convertible or exchangeable into such equity.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated thereunder.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for

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purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

“ERISA Event” means (a) with respect to the Borrower and its domestic Subsidiaries, any “reportable event,” as defined in Section 4043 of ERISA with respect to a Plan (other than an event for which the 30 day notice period is waived); (b) with respect to the Borrower and its domestic Subsidiaries, the failure to satisfy the minimum funding standard under Section 412 of the Code and Section 302 of ERISA with respect to any Plan, whether or not waived, the failure to make by its due date a required installment under Section 430(j) of the Code with respect to any Plan or the failure to make any required contribution to a Multiemployer Plan, where any such failure, individually or in the aggregate, is in excess of $150.0 million (or such lesser amount as would reasonably be expected to result in a Material Adverse Effect); (c) the filing pursuant to Section 412 of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan that has a funding deficiency of more than $150.0 million (or such lesser amount as would reasonably be expected to result in a Material Adverse Effect); (d) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan (other than in a standard termination under Section 4041(b) of ERISA); (f) the incurrence by the Borrower or any of its ERISA Affiliates of any liability in excess of $150.0 million (or such lesser amount as would reasonably be expected to result in a Material Adverse Effect) with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability in excess of $150.0 million (or such lesser amount as would reasonably be expected to result in a Material Adverse Effect) or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.

“Eurodollar Base Rate” means

(a)    for any Interest Period with respect to a Eurodollar Rate Loan, the rate per annum equal to theBritish Bankers Association LIBORLondon Interbank Offered Rate (“BBALIBOR”)or a comparable or successor rate, which rate is approved by the Administrative Agent, as published by Reuters (oron the applicable Bloomberg screen page (or such other commercially available source providing such quotations of BBA LIBOR asas may be designated by the Administrative Agent from time to time)at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for deposits in dollars (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period. If such rate is not available at such time for any reason, then the “Eurodollar Rate” for such Interest Period shall be the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or converted by Bank of America and with a term equivalent to such Interest Period would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period; provided that, notwithstanding the foregoing, in no event shall the Eurodollar Rate with respect to a Eurodollar Rate Loan at any time be less than 1.50%(other than with respect to Term B-4 Loans); and

(b)    for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to (i) BBALIBOR, at approximately 11:00 a.m., London time determined two

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Business Days prior to such date for Dollar deposits being delivered in the London interbank market for a term of one month commencing that day or (ii) if such published rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the date of determination in same day funds in the approximate amount of the Base Rate Loan being made or maintained and with a term equal to one month would be offered by Bank of America’s London Branch to major banks in the London interbank Eurodollar market at their request at the date and time of determination.

“Eurodollar Rate” means for any Interest Period with respect to a Eurodollar Rate Loan, a rate per annum determined by the Administrative Agent pursuant to the following formula:

Eurodollar Rate =	Eurodollar Base Rate
	1.00 - Eurodollar Reserve Percentage

“Eurodollar Rate Loan” means a Loan that bears interest at a rate based on the Eurodollar Rate; provided that with respect to Term B-4 Loans, a Eurodollar Rate Loan means a Term B-4 Loan that bears interest at a rate based on the Eurodollar Rate as set forth in the Term B-4 Joinder.

“Eurodollar Reserve Percentage” means, for any day during any Interest Period, the reserve percentage (expressed as a decimal, carried out to five decimal places) in effect on such day, whether or not applicable to any Lender, under regulations issued from time to time by the FRB for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurodollar funding (currently referred to as “Eurocurrency liabilities”). The Eurodollar Rate for each outstanding Eurodollar Rate Loan shall be adjusted automatically as of the effective date of any change in the Eurodollar Reserve Percentage.

“Event of Default” has the meaning assigned to such term in Section 8.01.

“Excess Amount” has the meaning assigned to such term in Section 2.03(f).

“Excess Cash Flow” means, for any Fiscal Year of the Borrower commencing with the Fiscal Year ending January 2830, 20122016, an amount equal to the excess of:

(a)    the sum, without duplication, of:

(i) Consolidated Net Income for such period,

(ii) an amount equal to the amount of all non-cash charges to the extent deducted in arriving at such Consolidated Net Income,

(iii) an amount equal to the provision for taxes based on income, profits or capital of the Loan Parties, including federal, foreign, state, franchise, excise and similar taxes and foreign withholding taxes paid or accrued during such period to the extent deducted in arriving at such Consolidated Net Income,

(iv) decreases in Consolidated Working Capital for such period (other than any such decreases arising from acquisitions by the Loan Parties completed during such period),

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(v) an amount equal to the aggregate net non-cash loss on the sale, lease, transfer or other disposition of assets by the Loan Parties during such period (other than sales, leases, transfers or other dispositions in the ordinary course of business) to the extent deducted in arriving at such Consolidated Net Income, and

(vi) cash receipts in respect of Hedge Agreements during such Fiscal Year to the extent not otherwise included in Consolidated Net Income;

over (b) the sum, without duplication, of:

(i) an amount equal to the amount of all non-cash credits included in arriving at such Consolidated Net Income and cash charges described in clauses (1) through (9) of the definition of Consolidated Net Income and included in arriving at such Consolidated Net Income,

(ii) without duplication of amounts deducted pursuant to clause (xi) below in prior years, the amount of capital expenditures made in cash during such period, except to the extent that such capital expenditures were financed with the proceeds of Indebtedness or a sale of Equity Interests of Loan Parties,

(iii) the aggregate amount of all principal payments of unsubordinated Indebtedness of the Loan Parties and of Holdings (with respect to Indebtedness of Holdings, to the extent financed or paid by Borrower or a Loan Party) including (A) the principal component of payments in respect of Capital Lease Obligations, (B) the amount of any repayment of Loans pursuant to Section 2.05, (C) the amount of any repayment of the 2011 Notes and 2013 Notes and (D) the amount of a mandatory prepayment of Loans pursuant to Section 2.03 to the extent required due to an Asset Sale, but excluding prepayments of loans under the ABL Credit Agreement made during such period (except to the extent there is an equivalent permanent reduction in commitments thereunder), except, in each case, to the extent financed with the proceeds of other Indebtedness of the Loan Parties, Holdings or their Subsidiaries (other than a Propco Subsidiary),

(iv) an amount equal to the aggregate net non-cash gain on the sale, lease, transfer or other disposition of assets by the Loan Parties during such period (other than sales in the ordinary course of business) to the extent included in arriving at such Consolidated Net Income,

(v) increases in Consolidated Working Capital for such period (other than any such increases arising from acquisitions by the Loan Parties completed during such period),

(vi) payments by the Loan Parties during such period in respect of long-term liabilities of the Loan Parties other than Indebtedness,

(vii) without duplication of amounts deducted pursuant to clause (xi) below in prior Fiscal Years, the aggregate amount of cash consideration paid by

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the Loan Parties (on a consolidated basis) in connection with Investments (including acquisitions) made during such period pursuant to Section 7.02 to the extent that such Investments were financed with internally generated cash flow of the Loan Parties,

(viii) the amount of dividends paid during such period (on a consolidated basis) by the Loan Parties in accordance with Section 7.06 to the extent such dividends were financed with internally generated cash flow of the Loan Parties,

(ix) the aggregate amount of expenditures actually made by the Loan Parties in cash during such period (including expenditures for the payment of financing fees) to the extent that such expenditures are not expensed during such period,

(x) the aggregate amount of any premium, make-whole or penalty payments actually paid in cash by the Loan Parties during such period that are required to be made in connection with any pre-payment of Indebtedness,

(xi) without duplication of amounts deducted from Excess Cash Flow in prior periods, the aggregate consideration required to be paid in cash by the Loan Parties pursuant to binding contracts (the “Contract Consideration”) entered into prior to or during such period relating to Permitted Acquisitions or capital expenditures to be consummated or made during the period of four consecutive fiscal quarters of the Borrower following the end of such period, provided that to the extent the aggregate amount of internally generated cash actually utilized to finance such Permitted Acquisitions or capital expenditures during such period of four consecutive fiscal quarters is less than the Contract Consideration, the amount of such shortfall shall be added to the calculation of Excess Cash Flow at the end of such period of four consecutive fiscal quarters,

(xii) the amount of taxes (including penalties and interest) paid in cash in such period,

(xiii) cash expenditures in respect of Hedge Agreements during such Fiscal Year to the extent not deducted in arriving at such Consolidated Net Income, and

(xiv) the amount of cash payments made in respect of pension obligations and other post-employment benefits obligations in such period to the extent not deducted in arriving at such Consolidated Net Income and the amount representing accrued expenses for cash payments (including with respect to retirement plan obligations) that are not paid in cash in such fiscal year; provided that such amounts will be added to Excess Cash Flow for the following Fiscal Year to the extent not paid in cash during such following fiscal year.

“Excess Cash Flow Application Date” has the meaning assigned to such term in Section 2.03(e).

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“Excess Cash Flow Percentage” means, for any Fiscal Year, 50%; provided that the Excess Cash Flow Percentage shall be reduced to 25% if the Total Net Leverage Ratio as of the last day of such Fiscal Year is equal to or less than 1.75 to 1.00 and reduced further to 0% if the Total Net Leverage Ratio as of the last day of such Fiscal Year is equal to or less than 1.40 to 1.00.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Excluded Debt” means, collectively, any Indebtedness permitted by Section 7.03other than7.03(t).

“Excluded Specified Real Property” has the meaning assigned to such term in Section 6.10(c).

“Excluded Subsidiaries” means, collectively, the Propco Subsidiaries, SALTRU Associates JV, any Special Refinancing Subsidiary and Immaterial Subsidiaries of Loan Parties.

“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to Section 24 of the Guarantee and any other “keepwell, support or other agreement” for the benefit of such Guarantor and any and all guarantees of such Guarantor’s Swap Obligations by other Loan Parties) at the time the Guarantee of such Guarantor, or a grant by such Guarantor of a security interest, becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes excluded in accordance with the first sentence of this definition.

“Excluded Taxes” means, with respect to the Agents, any Lender or any other recipient of any payment to be made by or on account of any obligation of any Loan Party hereunder or under any other Loan Document, (a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the recipient’s principal office or applicable lending office is located, (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 10.13, any U.S. federal withholding tax that is imposed pursuant to any laws in effect at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from such Loan Party with respect to such withholding tax pursuant to Section 3.01(a), (d) any withholding tax that is attributable to such Foreign Lender’s failure to comply with Section 3.01(e), or (e) any U.S. federal withholding tax that is imposed by reason of Section 1471 or Section 1472 of the Code other than by reason of a change in law after the date such Lender becomes a party to this Agreement (or designates a new lending office), except to the extent such Lender (or its assignees, if any) was entitled at the time of designation of a new lending office (or assignment), to receive additional amounts from such Loan Party with respect to such withholding tax pursuant toSection 3.01(a).FATCA.

“Executive Order” has the meaning assigned to such term in Section 5.20.

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“ExistingCredit AgreementCollateral” has the meaning assigned to such term in the preamble hereto.

“ExistingCollateralCredit Agreement” has the meaning assigned to such term in the preamble hereto.

“Existing Guarantorees” has the meaning assigned to such term in the preamble hereto.

“Existing Lenders” has the meaning assigned to such term in the preamble hereto.

“Existing Loans” has the meaning assigned to such term in the preamble hereto.

“Existing Obligations” has the meaning assigned to such term in the preamble hereto.

“Existing Security Documents” has the meaning assigned to such term in the preamble hereto.

“Extended Loans” has the meaning assigned to such term in Section 2.15.

“Extending Lender” has the meaning assigned to such term in Section10.012.15.

“Extension” has the meaning assigned to such term in Section 2.15.

“Extension Amendment Agreement” means an Extension Amendment Agreement,in form and substance reasonably satisfactory to the Administrative Agent,among the Borrower,the Administrative Agentand one or more Extending Lenders, effecting one or more Extensions and such other amendments hereto and to the other Loan Documents as are contemplated by Section 2.15.

“Extension Offer Class” has the meaning assigned to such term in Section 2.15.

“Extraordinary Receipts” means any receipt by any Loan Party or any of its Subsidiaries of any casualty or property insurance proceeds or condemnation awards in respect of any equipment, fixed assets or real property (including any improvements thereon) to replace or repair such equipment, fixed assets or real property; provided that any casualty or property insurance proceeds or condemnation awards of $5.0 million or less with respect to any individual event or series of related events shall not constitute “Extraordinary Receipts.”

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Sections 1471(b)(1) of the Code, as of the date of this Agreement (or any amended or successor version described above).

“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Administrative Agent.

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“Fiscal Quarter” means any fiscal quarter of any Fiscal Year, which quarters shall generally end on the last Saturday of each April, July, October or January of such Fiscal Year in accordance with the fiscal accounting calendar of the Borrower.

“Fiscal Year” means any period of twelve consecutive months ending on the Saturday closest to January 31 of any calendar year.

“Fixed Charges” means, with respect to any Person for any period, the sum of, without duplication, (a) Consolidated Interest Expense of such Person for such period, (b) all cash dividends paid, accrued and/or scheduled to be paid or accrued during such period (excluding items eliminated in consolidation) on any series of preferred stock of such Person and its Subsidiaries and (c) all cash dividends paid, accrued and/or scheduled to be paid or accrued during such period (excluding items eliminated in consolidation) on any series of Disqualified CapitalStock of such Person and its Subsidiaries.

“Flood Insurance Laws” means, collectively, (i) the National Flood Insurance Reform Act of 1994 (which comprehensively revised the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973) as now or hereafter in effect or any successor statute thereto, (ii) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute thereto and (iii) the Biggert-Waters Flood Insurance Reform Act of 2012 as now or hereafter in effect or any successor statute thereto.

“Foreign Lender” means any Lender that is not a U.S. Person within the meaning of Section 7701(a)(30) of the Code.

“Foreign Subsidiary” means any direct or indirect Subsidiary of a Loan Party which is not organized under the laws of the United States, any State thereof or the District of Columbia.

“FRB” means the Board of Governors of the Federal Reserve System of the United States.

“Fund” means any Person (other than a natural person) that is (or will be) engaged in investing in commercial loans and similar extensions of credit in the ordinary course.

“Funded Debt” means, as to any Person, all Indebtedness (of the type described in clauses (a), (b), (e), (f) and (g), of the definition of such term) of such Person that matures more than one year from the date of its creation or matures within one year from the date of its creation but is renewable or extendible, at the option of such Person, to a date more than one year from such date or arises under a revolving credit or similar agreement that obligates the lender or lenders to extend credit during a period of more than one year from such date, including all current maturities and current sinking fund payments in respect of such Indebtedness whether or not required to be paid within one year from the date of its creation and, in the case of the Borrowers, Indebtedness in respect of the Loans.

“GAAP” means principles which are consistent with those promulgated or adopted by the Financial Accounting Standards Board and its predecessors (or successors) in effect and applicable to that accounting period in respect of which reference to GAAP is being made; provided that with respect to Foreign Subsidiaries of Borrower organized under the laws of Canada, “GAAP” shall mean principles which are consistent with those promulgated or adopted by the Canadian Institute of Chartered Accountants and its predecessors (or successors) in effect and applicable to the accounting period in respect of which reference to GAAP is being made.

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“Geoffrey Collateral” means the “Geoffrey Collateral” as defined in the ABL Intercreditor Agreement.

“Geoffrey Entities” means collectively (a) Geoffrey, LLC, a Delaware limited liability company and a wholly owned subsidiary of the Borrower, which owns the intellectual property related to the Borrower’s business and operations and (b) each of its domestic subsidiaries.

“Governmental Authority” means the government of the United States or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supranational bodies such as the European Union or the European Central Bank).

“Granting Lender” has the meaning assigned to such term in Section 10.06(g).

“Guarantee” means, collectively, the guarantee made by the Subsidiary Guarantors in favor of the Administrative Agent, substantially in the form of Exhibit DAnnex 5 to Amendment No. 3, and each other guarantee and guarantee supplement delivered pursuant to Section 6.10.For the avoidance of doubt, the term “Guarantee” as used herein shall not be deemed to include the IntermediateCo Unsecured Guarantee.

“Guarantors” means, collectively, the Subsidiary Guarantors and any Person required to execute a Guarantee pursuant to Section 6.10.

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, mold, fungi or similar bacteria, and all other substances or wastes of any nature regulated pursuant to any Environmental Law because of their dangerous or deleterious properties, including any material listed as a hazardous substance under Section 101(14) of CERCLA.

“Hedge Agreement” means any derivative agreement, any interest rate protection agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement designed to hedge against fluctuations in interest rates or foreign exchange rates or commodity prices.

“Holdings” means Toys “R” Us, Inc., a Delaware corporation.

“Immaterial Specified Real Property” has the meaning assigned to such term in Section 6.10(c).

“Immaterial Subsidiaries” means, as to any Person, all Subsidiaries of such Person other than its Material Subsidiaries.

“Increased Amount Date” has the meaning assigned to such term in Section 2.12(a).

“Incremental Notes” has the meaning assigned to such term in Section 2.12(a).

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“Indebtedness” means, as to any Person at a particular time, the following (without duplication):

(a)    all obligations of such Person for borrowed moneymoney(including any obligations which are without recourse to the credit of such Person); provided that all such obligations and liabilities which are limited in recourse to such property shall be included in Indebtedness only to the extent of the lesser of the fair market value of such property and the then outstanding amount of such Indebtedness;

(b)    all obligations of such Person evidenced by bonds, debentures, notes or similar instruments;

(c)    all direct or contingent obligations of such Person arising under letters of credit as an account party (including standby and commercial), letters of guarantee, bankers’ acceptances and bank guarantees;

(d)    the Agreement Value of all Hedge Agreements;

(e)    all obligations of such Person to pay the deferred purchase price of property or services (excluding accrued expenses and accounts payable incurred in the ordinary course of business);

(f)    Indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse; provided that all such obligations and liabilities which are limited in recourse to such property shall be included in Indebtedness only to the extent of the lesser of the fair market value of such property and the then outstanding amount of such Indebtedness;

(g)    Capital Lease Obligations; provided that all such obligations and liabilities which are limited in recourse to such property shall be included in Indebtedness only to the extent of the lesser of the fair market value of such property and the then outstanding amount of such Indebtedness;

(h)    all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Disqualified Capital Stock in such Person or any other Person (except any obligation to purchase, redeem, retire or otherwise acquire for value any Equity Interests of any Loan Party from present or former officers, directors or employees of such Loan Party or any Subsidiary thereof upon the death, disability, retirement or termination of employment or service of such officer, director or employee, or otherwise under any stock option or employee stock ownership plan approved by the board of directors of such Loan Party), valued, in the case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends;

(i)    the principal and interest portions of all rental obligations of such Person under any synthetic lease, tax retention operating lease, off-balance-sheet loan or similar off-balance-sheet financing where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an operating lease in accordance with GAAP; and

(j)    all guarantees of such Person in respect of Indebtedness of others.

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Indebtedness shall not include (A) any sale-leaseback transactions to the extent the lease or sublease thereunder is not required to be recorded under GAAP as a capital lease, (B) any obligations relating to overdraft protection and netting services, or (C) any preferred stock required to be included as Indebtedness in accordance with GAAP and FAS 150.

For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner), to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. The amount of any Capital Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.

“Indemnified Taxes” means all Taxes other than Excluded Taxes.

“Indemnitee” has the meaning assigned to such term in Section 10.04(b).

“Indentures” means each of

(i)    the Indenture, dated as of July 24, 2001, originally between Holdings and The Bank of New York, as trustee, with respect to 7.625% Notes due 2011 (the “2011 Notes”),

(ii)    the Indenture dated as of May 28, 2002 originally between Holdings and The Bank of New York, as trustee, with respect to 7.875% Notes due 2013 (the “2013 Notes”),

(iii)the Indenture dated as of August 1, 2012 originally between Holdings and The Bank of New York, as trustee, with respect to 10.375% Notes due 2017 (the “2017 Notes”),

(iiiiv)the Indenture dated as of May 28, 2002 originally between Holdings and The Bank of New York, as trustee, with respect to 7.375% Notes due 2018(the “2018 Notes”), and

(ivv)the Indenture dated as of August 29, 1991 originally between Holdings and The Bank of New York, as successor trustee, with respect to 8.75% Debentures due 2021 (the “2021 Debentures”)

, each as modified, amended, supplemented or restated and in effect from time to time.

“Information” has the meaning assigned to such term in Section 10.07.

“Initial Appraisal” means the Appraisal of all of the Specified Real Property that will be delivered by the Borrower to the Administrative Agent within twenty four (24) months after the Amendment No. 3 Effective Date (or such longer period as the Borrower and the Administrative Agent may agree) pursuant to Section 6.13.

“Initial Loan” has the meaning assigned to such term in the recitals hereto.

“Initial Loan Commitment” shall mean, (a) in the case of each Lender that is a Lender on the Restatement Date, the amount set forth opposite such Lender’s name on Schedule 2.01 as such Lender’s “Initial Loan Commitment” and (b) in the case of any Lender that becomes a Lender after the date hereof, the amount specified as such Lender’s “Initial Loan Commitment” in the Assignment and Acceptance pursuant to which such Lender assumes a portion of the Initial Loan Commitments, as the same may be

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changed from time to time pursuant to the terms hereof. The aggregate amount of the Initial Loan Commitments as of the Restatement Date totals $700.0 million.

“Initial Loan Lender” shall mean a Lender with an Initial Loan Commitment or an outstanding Initial Loan.

“Intellectual Property” has the meaning assigned to such term in Section 5.18.

“Intellectual Property Security Agreement” means an intellectual property security agreement, in substantially the form of Exhibit I (together with each other intellectual property security agreement supplement delivered pursuant to Section 6.10, in each case as amended).

“Intercreditor Agreements” means (1)an intercreditor agreement relating to the ABL Credit Agreement and this Agreement substantially in the form of Exhibit H-1Annex 3 to Amendment No. 3 (the “ABL Intercreditor Agreement”) and (2) anor another intercreditor agreement relating to the Secured Notes and Permitted Additional Secured Notes and this Agreement substantially in the form ofExhibit H-2(the “Non-ABL Intercreditor Agreement”)reasonably satisfactory to the Administrative Agent.

“Interest Payment Date” means (a) as to any Eurodollar Rate Loan, the last day of each Interest Period applicable to such Eurodollar Rate Loan and the Maturity Date; provided that if any Interest Period for a Eurodollar Rate Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Base Rate Loan, the last day of each March, June, September and December and the Maturity Date.

“Interest Period” means, as to each Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan is disbursed or converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three or six months thereafter or nine ortwelve months thereafter (to the extent available to all Lenders), as selected by the Borrower in its Borrowing or Conversion Notice; provided that:

(i)    any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;

(ii)    any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and

(iii)no Interest Period shall extend beyond the Maturity Date (in the case of Initial Loans)or, the applicable New Loan Maturity Date (in the case of New Loans)or the Term B-4 Maturity Date (in the the case of Term B-4 Loans).

“IntermediateCo” means Wayne Real Estate Parent Company, LLC, a Delaware limited liability company.

“IntermediateCo Unsecured Guarantee” means that certain guarantee agreement, dated as of the Term B-4 Closing Date, pursuant to which IntermediateCo shall provide an unsecured guarantee to the Term B-4 Lenders.

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“Investment” means, as to any Person, any direct or indirect (a) purchase or other acquisition of capital stock or other securities, including any option, warrant or right to acquire the same, of another Person, (b) loan, advance or capital contribution to, extension of credit (except for current trade and customer accounts receivable for inventory sold or services rendered in the ordinary course of business), guarantee of Indebtedness of a Non-Loan Party or assumption of obligations of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor guarantees Indebtedness of such other Person, or (c) purchase or other acquisition (in one transaction or a series of transactions) of all or substantially all of the assets of another Person or any merger or consolidation of such Person with any other Person, in each case in any transaction or group of transactions which are part of a common plan. For purposes of covenant compliance, the amount of any Investment shall be the aggregate Investment less all cash returns, cash dividends and cash distributions (or the fair market value of any non-cash returns, dividends or distributions) received by such Person and less all liabilities expressly assumed by another Person in connection with the sale of such Investment.

“ISDA Master Agreement” means the form entitled “2002 ISDA Master Agreement” or such other replacement form then currently published by the International Swap and Derivatives Association, Inc. or any successor thereto.

“Joinder Agreement” means a joinder agreement substantially in the form of Exhibit J.

“Joint Book Managers” has the meaning assigned to such term in the preamble hereto.

“Latest Maturity Date” means, at any date of determination, the latest maturity or expiration date applicable to any Loan or Commitment hereunder at such time, including the latest maturity or expiration date of any Other Loan or any Other Commitment, in each case as extended in accordance with this Agreement from time to time.

“Laws” means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, regulations, ordinances, codes and administrative or judicial precedents, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, licenses, authorizations and permits of, and agreements with, any Governmental Authority.

“Lead Arrangers” has the meaning assigned to such term in the preamble hereto.

“Lenders” means a financial institution party hereto with a Commitment or an outstanding Loan, together with any Person that subsequently becomes a Lender by way of assignment in accordance with the terms of Section 10.06, together with their respective successors, other than any Person that ceases to be a Lender as a result of an assignment in accordance with Section 10.06 or an amendment of this Agreement.

“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.

“Leverage/Prepayment Certificate” means a certificate substantially in the form of Exhibit O.

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, collateral assignment, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention

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agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

“Loan Documents” means this Agreement, each Note, the Guarantees, the Security Documents, Amendment No. 1and, Amendment No. 2, Amendment No. 3 and the Term B-4 Joinder Agreement.

“Loan Parties” means, collectively, the Borrower and each Subsidiary Guarantor.

“Loans” means any Initial Loanor, New Loan or Other Loan made by any Lender hereunderincluding, for the avoidance of doubt, Term B-4 Loans.

“London Banking Day” means any day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market.

“Management Agreement” means that certain management agreement dated as of July 21, 2005 by and among Holdings, Bain Capital Partners, LLC, Bain Capital, Ltd., Toybox Holdings, LLC and Vornado Truck LLC, as amended, modified and supplemented from time to time; provided that no such amendment, modification or supplement may effect any increase in fees payable thereunder.

“Mandatory Prepayment Date” has the meaning assigned to such term in Section 2.03(i).

“Margin Stock” has the meaning assigned to such term in Regulation U.

“Marketable Securities” means any security that is listed or recorded on a United States national securities exchange, quoted on Nasdaq (or any other successors thereto), on the Nasdaq National Market (or any successors thereto) or any United States national automated interdealer quotation system, with a seven-day average public float of at least $500.0 million.

“Master Lease” means each of the Master Leases entered into by any Loan Party with any other direct or indirect domestic subsidiary of Holdings, and any and all modifications thereto, substitutions therefor and replacements thereof.

“Material Adverse Effect” means any event, facts, or circumstances, which, after the Restatement Date, has a material adverse effect on (a) the business, assets, financial condition or income of the Loan Parties taken as a whole or (b) the validity or enforceability of this Agreement or the other Loan Documents (or in the case of the Term B-4 Loans only, the IntermediateCo Unsecured Guarantee) in any material respect or any of the material rights or remedies of the Lenders or the Agents hereunder or thereunder; provided that no event, fact or circumstance existing on the Restatement Date of which the Agents have knowledge (based on information disclosed to the Agents prior to the Restatement Date or set forth in SEC publicly filed documents regarding Holdings prior to the Restatement Date) shall be deemed to be the basis for a Material Adverse Effect.

“Material Indebtedness” means any Indebtedness (other than the Obligations) of the Loan Parties individually having an aggregate principal amount of $50.0 million or more.

“Material Subsidiary” means a Subsidiary of the Borrower that had, as of the end of the most recent Fiscal Quarter for which annual financial statements or quarterly financial statements (whichever are more recent) are available prior to the date of determination, total assets (as determined in accordance with GAAP) of more than $50.0 million or any Subsidiary designated by the Borrower as a Material Subsidiary. Notwithstanding the foregoing, Material Subsidiaries shall include each Subsidiary, that

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together with its subsidiaries, account for no less than 95% of total assets of the Borrower and its domestic Subsidiaries, determined on a quarterly basis simultaneously with the delivery of the financial statements required to be delivered by Section 6.01(b). For the avoidance of doubt, the designation of a Subsidiary as a “Material Subsidiary” shall be permanent notwithstanding any subsequent reduction in such Subsidiary’s net tangible assets, unless otherwise consented to by the Administrative Agent. Notwithstanding the foregoing, the Geoffrey Entities and each other Subsidiary of the Borrower that is a Loan Party on the Restatement Date (in each case for so long as they are a Subsidiary of a Loan Party) shall at all times be deemed a Material Subsidiary. As of the Restatement Date, the Subsidiaries listed on Schedule 1.02 are Material Subsidiaries.

“Maturity Date” means September 1, 2016.

“Maximum Incremental Facilities Amount” shall mean $700,000,000, less the amount of any additional secured Indebtedness issued after the Restatement Date pursuant toSection 7.03(w)means, as of the Amendment No. 3 Effective Date, zero Dollars.

“Maximum Rate” has the meaning assigned to such term in Section 10.09.

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

“Mortgage” means, individually or collectively as the context may require, one or more mortgages, deeds of trust, trust deeds, deeds to secure indebtedness, debenture, financing statement or other similar document entered into or authorized to be filed by the owner or lessee, as applicable, of each parcel of Specified Real Property encumbering each such owner’s fee interest, or lessee’s leasehold interest, in such Specified Real Property, collectively with all additions, improvements, component parts and personal property related thereto and all rents and profits therefrom, each securing the Term B-4 Loans, in favor of the Collateral Agent for the benefit of the Term B-4 Lenders, as the same may be amended, supplemented or otherwise modified from time to time, in each case, subject to Permitted Liens.

“Mortgage Policy” has the meaning assigned to such term in Section 6.10(c)(v).

“Multiemployer Plan” means an Employee Benefit Plan that is a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

“Net Cash Proceeds” means:

(a)    with respect to any asset sale, the cash proceeds received by any Loan Party or any of its Subsidiaries (other than (1) the Propco Subsidiaries and (2) any Foreign Subsidiary to the extent the repatriation of such cash proceeds would result in more than nominal adverse tax consequence to the Borrower, until such time as any such cash proceeds are repatriated or otherwise transferred out of the home jurisdiction of any such Foreign Subsidiary, (collectively, the “Applicable Subsidiaries”) including cash proceeds subsequently received (as and when received by such Loan Party or any of its Subsidiaries (other than the Applicable Subsidiaries)) in respect of non-cash consideration initially received, other than proceeds of ABL Priority Collateral (which, for the avoidance of doubt, shall not include the Canadian Pledge) if and for so long as the obligations under the ABL Credit Agreement remain outstanding, net of (i) selling and/or liquidation expenses (including reasonable brokers’ fees or commissions, legal, accounting and other professional and transactional fees, appraisal and title expenses, recording, transfer and similar taxes and the Loan Party’s good faith estimate of other taxes paid or payable in connection with such sale); (ii) amounts reasonably and in good faith provided as a reserve, in accordance

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with GAAP, against (x) any liabilities under any indemnification obligations associated with such Asset Sale or (y) any other liabilities retained by such Loan Party or any of its Subsidiaries (other than the Applicable Subsidiaries) associated with the properties sold in such Asset Sale (provided that, to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds); (iii) such Loan Party’s good faith estimate of payments required to be made with respect to unassumed liabilities relating to the properties sold within 90 days of such Asset Sale (provided that, to the extent such cash proceeds are not used to make payments in respect of such unassumed liabilities within 90 days of such Asset Sale, such cash proceeds shall constitute Net Cash Proceeds); (iv) in the case of a sale or other disposition (including casualty or condemnation) of an asset, the amount of all payments required to be made by any Loan Party or any of its Subsidiaries (other than the Applicable Subsidiaries) as a result of such event to repay (or to establish any required escrow for the repayment of) any Indebtedness secured by such asset; (v) other reasonable fees and expenses actually incurred in connection therewith; (vi) capital gains or other income taxes paid or payable as a result of any such sale or disposition (after taking into account available tax credits or deductions) and (vii) in the case of assets sold in connection with a sale and leaseback transaction, the amount of all (x) repayments made with such proceeds in respect of borrowings incurred and (y) prior capital expenditures made by the Loan Parties, in each case to finance the acquisition or improvement of such assets in contemplation of such sale and leaseback transaction;

(b)    with respect to any Debt Issuance or equity issuance by any Person or any of its Subsidiaries (other than the Applicable Subsidiaries), the cash proceeds thereof, net of reasonable fees, commissions, costs and other expenses incurred in connection therewith; and

(c)    with respect to any Extraordinary Receipts, the cash insurance proceeds, condemnation awards and other compensation received in respect thereof, other than proceeds of ABL Priority Collateral (as defined in the ABL Credit Agreementwhich, for the avoidance of doubt, shall not include the Canadian Pledge) if and for so long as the obligations under the ABL Credit Agreement remain outstanding, net of (i) all reasonable fees, costs and expenses incurred in connection with the collection of such proceeds, awards or other compensation in respect of such Extraordinary Receipts and net of any portion of such proceeds, awards or compensation constituting reimbursement or compensation for amounts previously paid by the Loan Parties or their Subsidiaries (other than the Applicable Subsidiaries) in respect of the theft, loss, destruction, damage or other similar event relating to such Extraordinary Receipts, (ii) in the case of a sale or other disposition of an asset pursuant to a casualty or condemnation, the amount of all payments required to be made by any Loan Party or any of their respective Subsidiaries (other than the Applicable Subsidiaries) as a result of such event to repay (or to establish an escrow for the repayment of) any Indebtedness secured by such asset or otherwise subject to mandatory prepayment under the ABL Credit Agreement (other than a prepayment in respect of the Canadian Pledge) as a result of such event, and (iii) capital gains or other income taxes paid or payable as a result of any such sale or disposition (after taking into account any available tax credits or deductions).

“New Loan” has the meaning assigned to such term in Section 2.12(b).

“New Loan Commitments” has the meaning assigned to such term in Section 2.12(b).

“New LoanMaturity Date” means the date on which a New Loan matures.

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“NewLoanRevolving CreditCommitment” has the meaning assigned to such term in Section 2.12(a).

“NewLoanRevolving CreditLender” has the meaning assigned to such term in Section 2.12(b).

“NewRevolving CreditLoanMaturity Date” means the date on which a New Loan matures” has the meaning assigned to such term in Section 2.12(b).

“Non-ABL Intercreditor AgreementNew Term Loan” has the meaning assigned to such term in the definition of “Intercreditor Agreements.”Section 2.12(b).

“New Term Loan Commitment” has the meaning assigned to such term in Section 2.12(a).

“New Term Loan Lender” has the meaning assigned to such term in Section 2.12(b).

“Non-Guarantor Subsidiary” means any Subsidiary of a Loan Party that is not a Guarantor.

“Non-Loan Party” means Holdings and any direct or indirect Subsidiary of Holdings that is not a Loan Party.

“Note” means a promissory note made by the Borrower in favor of a Lender or its registered assigns, in substantially the form of Exhibit B hereto, evidencing Loans made by such Lender to the Borrower.

“Obligations” means (a) obligations of the Borrower and the other Loan Parties from time to time arising under or in respect of the due and punctual payment of (i) the principal of and premium, if any, and interest (including interestmonetary obligations accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, and (ii) all other monetary obligations(including monetary obligations accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceedings), including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise, of the Borrower and the other Loan Parties under this Agreement and the other Loan Documents and (b) the due and punctual performance of all covenants, agreements, obligations and liabilities of the Borrower and the other Loan Parties under or pursuant to this Agreement and the other Loan Documents.

“OFAC” has the meaning assigned to such term in Section 5.20.

“OID” has the meaning assigned to such term in Section 2.12(a).

“on” when used with respect to the Property or any property adjacent to the Property, means “on, in, under, above or about.”

“Other Commitments” means one or more Classes of term loan commitments hereunder that result from a Refinancing Amendment.

“Other Loans” means one or more Classes of Loans that result from a Refinancing Amendment.

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“Other Taxes” means any and all current or future stamp or documentary Taxes or any other excise, property or similar Taxes arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document.

“Participant” has the meaning assigned to such term in Section 10.06(d).

“Participation Register” has the meaning assigned to such term in Section 10.06(d)(vii).

“Patriot Act” has the meaning assigned to such term in Section 10.16.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

“Perfection Certificate” means a certificate in the form of Exhibit G.

“Permitted Acquisition” shall mean any transaction or series of related transactions for the direct or indirect (a) acquisition of all or substantially all of the property of any pPerson, or of any business or division of any pPerson; (b) acquisition of in excess of 50% of the Equity Interests of any pPerson, and otherwise causing such pPerson to become a Subsidiary of such pPerson; or (c) merger or consolidation or any other combination with any pPerson, if each of the following conditions is met:

(i)no Default then exists or would result therefrom;

(ii)the pPerson or business to be acquired shall be, or shall be engaged in, a business of the type that Borrower and the Subsidiaries are engaged in on the Restatement Date and reasonable extensions thereof, including, but not limited to businesses which are complementary to the business of the type that Borrower and the Subsidiaries are engaged in on the Restatement Date, such as manufacturing and shipping, or any other business otherwise permitted to be engaged in the Borrower or its Subsidiaries under this Agreement, and the property acquired in connection with any such transaction shall be made subject to the Lien of the Security Documents, to the extent required therein;

(iii)the board of directors of the pPerson to be acquired shall not have indicated publicly its opposition to the consummation of such acquisition (which opposition has not been publicly withdrawn) or commenced any action which alleges that such acquisition will violate Applicable Law; and

(iv)the Borrower shall have furnished the Administrative Agent with ten (10) days’ prior notice of such intended acquisition and shall have furnished the Administrative Agent with (i) a current draft of the acquisition agreement and other acquisition documents relating to the Acquisition and (ii) to the extent the purchase price relating to the Acquisition is in excess of $100,000,000100.0 million (excluding such portion of the purchase price consisting of Equity Interests or Subordinated Indebtedness of a Loan Party (or cash proceeds of the issuance of the foregoing) or contingent earn out obligations), a summary of any due diligence undertaken by the Borrower in connection with such acquisition, appropriate financial statements for the twelve (12) month period following such Acquisition after giving effect to such Acquisition (including balance sheets, cash flows and income statements by month for the acquired Person, individually, and on a Consolidated basis for all Loan Parties) and such other information readily available to the Loan Parties as the Administrative Agent shall reasonably request.

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“Permitted Additional Secured Notes” shall mean Indebtedness of the Borrower (other than the Secured Notes) that is secured by a Lien ranking equally and ratably with the Lien of the Secured Notes pursuant to the terms of the Intercreditor Agreements; provided that (a) the holders of such Permitted Additional Secured Notes (or a trustee or agent authorized to act on behalf of such holders) shall have executed a supplement to the Intercreditor Agreements agreeing to be bound thereby on the same terms applicable to the holders of Secured Notes and (b) no Event of Default shall have occurred and be continuing immediately after giving effect to the issuance thereof and the application of proceeds therefrom.

“Permitted Holders” means (a) the Sponsors and (b) their respective Permitted Transferees.

“Permitted Holdings Expenses” means expenses of Holdings consisting of (a) franchise taxes and other costs required to maintain the legal existence of Holdings, (b) corporate overhead expenses incurred in the ordinary course of business, (c) audit costs, professional fees and expenses and other costs incurred by Holdings in connection with reporting obligations under or otherwise incurred in connection with compliance with Applicable Law (including applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Exchange Act or the respective rules and regulations promulgated thereunder), (d) obligations of Holdings under or in respect of director and officer insurance policies or indemnification obligations to directors or officers and directors’ fees and expenses, (e) reimbursement of indemnities and actual expenses and, so long as no Specified Default has occurred and is continuing or would result therefrom, fees, in each case, payable pursuant to the Management Agreement; provided that such fees not paid shall accrue and be paid when the applicable Specified Default has been cured or waived and no additional Specified Default has occurred and is continuing or would arise as a result of such payment and (f) trade payables and other operating expenses incurred in the ordinary course of business and attributable to the operations of the Borrower and its Subsidiaries and which are reasonably expected to be, and appropriately should be payable by, the Borrower and its Subsidiaries.

“Permitted Junior Refinancing Debt” means any secured Indebtedness incurred by the Borrower or any Loan Party in the form of one or more series of junior lien secured notes or junior lien secured loans; provided that (i) such Indebtedness is secured by the Collateral on a junior basis with the Secured Obligations and is not secured by any property or assets of the Borrower or any Subsidiary other than the Collateral securing the Refinanced Debt, (ii) such Indebtedness constitutes Credit Agreement Refinancing Indebtedness in respect of Loans (including portions of Classes of Loans or Other Loans), (iii) such Indebtedness does not have mandatory redemption features (other than customary asset sale, insurance and condemnation proceeds events, change of control offers or events of default) that could result in redemptions of such Indebtedness prior to the maturity of the Refinanced Debt and (iv) a Senior Representative acting on behalf of the holders of such Indebtedness shall have become party to an Intercreditor Agreement.

“Permitted Liens” has the meaning assigned to such term in Section 7.01.

“Permitted Pari Passu Refinancing Debt” means any secured Indebtedness incurred by the Borrower or any Loan Party in the form of one or more series of senior secured notes; provided that (i) such Indebtedness is secured by the Collateral on an equal priority basis (but without control of remedies) with the Secured Obligations in respect of the Refinanced Debt and is not secured by any property or assets of the Borrower or any Subsidiary other than the Collateral securing the Refinanced Debt, (ii) such Indebtedness constitutes Credit Agreement Refinancing Indebtedness in respect of Loans (including portions of Classes of Loans or Other Loans), (iii) such Indebtedness does not have mandatory redemption features (other than customary asset sale, insurance and condemnation proceeds events,

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change of control offers or events of default) that could result in redemptions of such Indebtedness prior to the maturity of the Refinanced Debt and (iv) a Senior Representative acting on behalf of the holders of such Indebtedness shall have become party to an Intercreditor Agreement.

“Permitted Tax Distributions” means without duplication, (A) payments, dividends or distributions by any Loan Party to Holdings in order to pay consolidated or combined federal, state or local income or franchise taxes attributable to the income of Holdings, the Loan Parties or any of their Subsidiaries, to the extent such taxes are not payable directly by the Loan Parties or any of their Subsidiaries, which payments, dividends and distributions by such Loan Party (less any such taxes payable directly by the Loan Parties or any of their Subsidiaries) shall not be in excess of the applicable income or franchise tax liabilities that would have been payable by Holdings, the Loan Parties and the Loan Parties’ Subsidiaries on a stand-alone basis and (B) the capitalization, distribution and/or contribution of amounts payable or receivable by a Loan Party in respect of any such attributable taxes.

“Permitted Transferees” means (a) any Controlled Investment Affiliate of the Sponsors (collectively, “Sponsor Affiliates”), (b) any managing director, general partner, limited partner, director, officer or employee of the Sponsors or any Sponsor Affiliate (collectively, the “Sponsor Associates”), (c) the heirs, executors, administrators, testamentary trustees, legatees or beneficiaries of any Sponsor Associate and (d) any trust, the beneficiaries of which, or a corporation or partnership, the stockholders or partners of which, include only a Sponsor Associate, his or her spouse, parents, siblings, members of his or her immediate family (including adopted children) and/or direct lineal descendants.

“Permitted Unsecured Refinancing Debt” means unsecured Indebtedness incurred by the Borrower or any Loan Party in the form of one or more series of senior unsecured notes or loans; provided that (i) such Indebtedness constitutes Credit Agreement Refinancing Indebtedness in respect of Loans (including portions of Classes of Loans or Other Loans), (ii) such Indebtedness does not have mandatory redemption features (other than customary asset sale, insurance and condemnation proceeds events, change of control offers or events of default) that could result in redemptions of such Indebtedness prior to the maturity of the Refinanced Debt and (iii) such Indebtedness is not secured by any Lien on any property or assets of Holdings, the Borrower or any Subsidiary.

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, could reasonably under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Platform” has the meaning assigned to such term in Section 10.026.01.

“Prepayment Option Notice” has the meaning assigned to such term in Section 2.03(i).

“Pro Rata Extension Offers” has the meaning assigned to such term in Section 2.15.

“Pro Rata Share” means, with respect to each Lender, (i) at or prior to the funding on the Restatement Date, a fraction (expressed as a percentage, carried out to the ninth decimal place), the numerator of which is the amount of the Commitment of such Lender and the denominator of which is the amount of the Aggregate Commitments and (ii) thereafter, a fraction (expressed as a percentage, carried out to the ninth decimal place), the numerator of which is the principal amount of the Loans of such Lender and the denominator of which is the aggregate principal amount of the Loans of all Lenders.

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“Propco II” means Toys “R” Us Property Company II, LLC.

“Propco Subsidiaries” means the special purpose Subsidiaries of the Loan Parties listed on Schedule 1.03 hereto and any other newly created or acquired Subsidiaries (i) party to CMBS facilities, high yield indentures or other financings secured by interests in real property and (ii) designated by the Borrower as “Propco Subsidiaries” from time to time.

“Qualified Capital Stock” means, of any Person, any Equity Interests of such Person that are not Disqualified Capital Stock.

“Qualifying IPO” means an equity issuance by Holdings consisting of an underwritten primary public offering (other than a public offering pursuant to a registration statement on Form S-8) of its common stock (a) pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act (whether alone or in connection with a secondary public offering) and (b) resulting in gross proceeds to Holdings of at least $100.0 million.

“Real Property” means, collectively, all right, title and interest (including any leasehold, mineral or other estate) in and to any and all parcels of or interests in real property owned, leased or operated by any Person, whether by lease, license or other means, together with, in each case, all easements, hereditaments and appurtenances relating thereto, all buildings, structures, parking areas and improvements and appurtenant fixtures and equipment, all general intangibles and contract rights and other property and rights incidental to the ownership, lease or operation thereof.

“Real Property Collateral Documentation” has the meaning assigned to such term in Section 6.10(c).

“Recent Appraisal” means an Appraisal that has been delivered by the Borrower to the Administrative Agent within six (6) months of the date of such Appraisal. To the extent that more than one such Appraisal has been delivered, then the Appraisal dated as of the latest date shall be deemed to be the “Recent Appraisal”.

“Refinanced Debt” has the meaning set forth in the definition of “Credit Agreement Refinancing Indebtedness.”

“Refinancing” has the meaning specified in the recitals hereto.

“Refinancing Amendment” means an amendment to this Agreement executed by each of (a) the Borrower, (b) the Administrative Agent and (c) each additional Lender that agrees to provide any portion of the Credit Agreement Refinancing Indebtedness being incurred pursuant thereto, in accordance with Section 2.14.

“Register” has the meaning specified in Section 10.06(c).

“Regulation U” means Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Regulation X” means Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

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“Related Parties” means, with respect to any Person, such Person’s Affiliates and the respective directors, officers, employees, agents, trustees and advisors of such Person and of such Person’s Affiliates.

“Release” has the meaning provided in Section 101(22) of CERCLA.

“Repricing Transaction” means the incurrence by Holdings or any Loan Party of any Indebted-ness (including, without limitation, any new or additional term loans under this Agreement or additional notes) that is secured or is broadly marketed or syndicated to banks and other institutional investors in financings similar to this Agreement or the Secured Notes (i) having an effective interest rate margin or weighted average yield (to be determined by the Administrative Agent consistent with generally accepted financial practice) that is less than the Applicable Rate for, or weighted average yield (to be determined by the Administrative Agent on the same basis) of, the Loans then in effect and (ii) the proceeds of which are used to repay, in whole or in part, principal of outstanding Loans.

“Required ABL Prepayment Amount” means, as of any date of determination, the amount necessary to be repaid under the ABL Credit Agreement to result in Capped Availability (as defined in the ABL Credit Agreement) immediately following such repayment of at least $300.0 million.

“Required Lenders” means, as of any date of determination, Lenders holding more than 50%of the Loans and Commitments outstanding on such date; provided that Loans held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

“Requirements of Law” means, collectively, any and all requirements of any Governmental Authority including any and all laws, judgments, orders, decrees, ordinances, rules, regulations, statutes or case law.

“Responsible Officer” of any Person shall mean any executive officer or financial officer of such Person and any other officer or similar official thereof with responsibility for the administration of the obligations of such Person in respect of this Agreement.and, solely for purposes of notices given pursuant to Article II, any other officer of the applicable Loan Party so designated by any of the foregoing officers in a notice to the Administrative Agent or any other officer or employee of the applicable Loan Party designated in or pursuant to an agreement between the applicable Loan Party and the Administrative Agent.

“Restatement Date” means the first date all conditions precedent set forth in Section 4.01 of this Agreement are satisfied or waived in accordance with Section 10.01 of this Agreement, which date was August 24, 2010.

“Restricted Payment” means any (a) dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests of a Loan Party or any of its Subsidiaries, (b) payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Equity Interests of any Loan Party or any of its Subsidiaries or (c) payment on or in respect of any Indebtedness of Holdings other than with respect to the 2021 Debentures, interest payments when due in respect of other Certain Holdings Indebtedness, and principal and interest payments in respect of Specified Holdings Indebtedness; provided that “Restricted Payments” shall not include any dividends payable solely in Equity Interests (other than Disqualified Capital Stock) of a Loan Party or any of its Subsidiaries to its direct parent.

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“S&P” means Standard & Poor’s RatingsFinancial Services, a division of The McGraw-Hill Companies, Inc., andLLC or any successor thereto.

“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

“Secured Notes” has the meaning assigned to such term in the Recitals hereto.

“Secured Obligations” means (a) the Obligations and (b) the due and punctual payment and performance of all obligations of the Borrower and the other Loan Parties under each Hedge Agreement permitted pursuant to Section 7.03(e) entered into with any counter party that is a Secured Party; provided that the Secured Obligations shall exclude any Excluded Swap Obligations.

“Secured Parties” means collectively, (a) the Administrative Agent, (b) the Collateral Agent, (c) each other Agent, (d) the Lenders, (e) each Affiliate of an Agent or a Lender that is a counterparty to a Hedge Agreement, if at the date of entering into such Hedge Agreement, such Person was an Agent or Lender or an Affiliate of an Agent or Lender and (f) with respect to the Secured Obligations under Section 10.04(b), the other Indemnitees; it being understood and agreed that such Indemnitees shall be bound by the relevant Intercreditor Agreements.

“Securities Act” means the Securities Act of 1933, as amended.

“Security Agreement” means the amended and restatedsecurity agreement, dated as of the Restatementas amended on the Amendment No. 3 Effective Date, by and among the Borrower and the other Loan Parties and grantors that are party thereto and the Collateral Agent for its own benefit and the benefit of the other Secured Parties, as amended or supplemented from time to time and substantially in the form of Exhibit PAnnex 4 to Amendment No. 3.

“Security Documents” means the Security Agreement, the Intellectual Property Security Agreements, the Intercreditor Agreements and each other security agreement, pledge agreement or other document or agreement delivered in accordance with applicable law to grant, or purport to grant, a security interest in any property as collateral for the SecuredObligationsand, to the extent applicable to the Secured Obligations under the Term B-4 Loans, the Mortgages.

“Senior Representative” means, with respect to any series of Permitted Pari Passu Refinancing Debt, Permitted Junior Refinancing Debt or other Indebtedness, the trustee, administrative agent, collateral agent, security agent or similar agent under the indenture or agreement pursuant to which such Indebtedness is issued, incurred or otherwise obtained, as the case may be, and each of their successors in such capacities.

“Senior Secured Leverage Ratio” means the ratio of (1) the aggregate amount of Consolidated Indebtedness of the Borrower and its Subsidiaries (other than the Propco Subsidiaries) secured by a Lien that is pari passu or senior in priority to the Liens securing the Loans to (2) the Consolidated EBITDA of the Borrower (other than the Propco Subsidiaries) for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such event for which such calculation is being made shall occur, in each case calculated on a pro forma basis for such proposed incurrence and any other pro forma adjustments to Indebtedness and Consolidated EBITDA as are appropriate and consistent with the pro forma adjustment provisions set forth in the definition of Consolidated Fixed Charge Coverage Ratio; provided that the amount of Indebtedness under revolving credit facilities shall be based on the average of the month-end balances of such Indebtedness for the applicable four-quarter period.

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“Significant Subsidiary” means any Subsidiary of a Loan Party that would be a “significant subsidiary” as defined in Article 1, Rule 1‑02 of Regulation S‑X, promulgated pursuant to the Securities Act, as such Regulation is in effect on the date hereof.

“Solvent” means, with respect to any Person on a particular date, that on such date (a) at fair valuation on a going concern basis, all of the properties and assets of such Person are greater than the sum of the debts, including contingent liabilities, of such Person, (b) the present fair saleable value of the properties and assets of such Person on a going concern basis is not less than the amount that would be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person is able to realize upon its properties and assets and generally pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, (d) such Person does not intend to, and does not believe that it will, incur debts beyond such Person’s ability to generally pay as such debts mature, and (e) such Person is not engaged in a business or a transaction, and is not about to engage in a business or transaction, for which such Person’s properties and assets would constitute unreasonably small capital after giving due consideration to the prevailing practices in the industry in which such Person is engaged.

“SPC” has the meaning assigned to such term in Section 10.06(g).

“Special Refinancing Indebtedness” has the meaning assigned to such term in Section 7.03(aa).

“Special Refinancing Indebtedness Amount” means an amount equal to the aggregate principal amount of Term B-2 Loans, Term B-3 Loans and the Tranche A-1 Loans (as defined in the ABL Credit Agreement) outstanding on the Amendment No. 3 Effective Date.

“Special Refinancing Subsidiary” means a subsidiary of the Borrower that incurs Special Refinancing Indebtedness.

“Specified Default” means the occurrence of any Event of Default specified in Section 8.01(a) or (d).

“Specified Holdings Indebtedness” means the Indebtedness set forth on Schedule 1.01 hereto.

“Specified Mandatory Prepayment Event” has the meaning assigned to such term in the IntermediateCo Unsecured Guarantee.

“Specified Real Property” means, as of any date, the Real Property listed on Schedule 1.01(b); provided that the Borrower may, at any time prior to the Springing Covenant Trigger Date exchange, swap or replace (or acquire, with the proceeds of a sale of) Real Property on Schedule 1.01(b) with any other Real Property with a substantially equivalent Appraised Value as determined by a Recent Appraisal and such Real Property shall be considered Specified Real Property thereafter. For the avoidance of doubt, if a Specified Real Property is sold, exchanged, swapped out or replaced, such Specified Real Property shall no longer be deemed to be Specified Real Property and shall be deemed to be removed from Schedule 1.01(b).

“Specified Real Property Value” means (x) the Appraised Value (as set forth in the Initial Appraisal) of the Specified Real Properties, plus (y) the Net Cash Proceeds from any Asset Sale (determined at the time of such sale) of any Specified Real Property that was sold prior to the date of the Initial Appraisal (and was not included in such Initial Appraisal).

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“Sponsors” means Bain Capital (TRU) VIII, L.P., a Delaware limited partnership, Bain Capital (TRU) VIII-E, L.P., a Delaware limited partnership, Bain Capital (TRU) VIII Coinvestment, L.P., a Delaware limited partnership, Bain Capital Integral Investors, LLC, a Delaware limited liability company, and BCIP TCV, LLC, a Delaware limited liability company, Kohlberg Kravis Roberts & Co., Toybox Holdings, LLC, Vornado Realty Trust and Vornado Truck, LLC, and their respective affiliates.

“Springing Covenant” has the meaning assigned to such term in Section 6.10(c).

“Springing Covenant Trigger Date” means the date of the earlier of (x) the date on which the 2018 Notes have been redeemed (whether through tender offer or otherwise) or have been defeased or discharged or (y) the removal of the negative pledge covenant and any restrictions on liens related to the Specified Real Property in the 2018 Notes.

“Store” means any retail store (which includes any real property, fixtures, equipment, inventory and other property related thereto) operated, or to be operated, by any Loan Party or a Subsidiary thereof.

“Subordinated Indebtedness” means Indebtedness of the Borrower or any other Loan Party that is by its terms subordinated in right of payment to the Obligations (other than intercompany Loans made pursuant to Section 7.03(l)).

“Subsidiary” means, of a Person, a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless the context otherwise requires, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of a Loan Party.

“Subsidiary Guarantors” means, collectively, each existing and future direct and indirect Subsidiary of the Borrower that is party to the Guarantee. For the avoidance of debt, Propco II will not be a Subsidiary Guarantor.

"Swap Obligations” means with respect to any Guarantor any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Syndication Agents” has the meaning assigned to such term in the preamble hereto.

“Taxes” means any and all current or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Term B-2 Lenders” means the Lenders under the Term B-2 Loans.

“Term B-2 Loans” means the New Term Loans made by the New Term Loan Lenders to the Borrower pursuant to a Joinder Agreement dated as of May 25, 2011.

“Term B-3 Lenders” means the Lenders under the Term B-3 Loans.

“Term B-3 Loans” means the New Term Loans made by the New Term Loan Lenders to the Borrower pursuant to a Joinder Agreement dated as of April 10, 2012.

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“Term B-4 Closing Date” means the date upon which the funding of the Term B-4 Loans shall have been made to the Borrower by the Term B-4 Lenders.

“Term B-4 Lenders” means the Lenders under the Term B-4 Loans.

“Term B-4 Loans” means the Term B-4 Loans made by the Term B-4 Lenders to the Borrower pursuant to the Term B-4 Joinder Agreement dated as of the Term B-4 Closing Date.

“Term B-4 Joinder Agreement” means that certain joinder agreement among the Loan Parties and the Administrative Agent dated as of the Term B-4 Closing Date.

“Term B-4 Maturity Date” means April 24, 2020.

“Term B-4 Required Lenders” means, as of any date of determination, Term B-4 Lenders holding more than 50%of the Term B-4 Loans and Term B-4 Commitments outstanding on such date; provided that Term B-4 Loans held by any Defaulting Lender shall be excluded for purposes of making a determination of Term B-4 Required Lenders.

“Total Leverage Ratio” means, with respect to the Borrower, at any date the ratio of (i) Consolidated Indebtedness of the Borrower (other than the Propco Subsidiaries) as of the last day of the fiscal quarter for which internal financial statements are available immediately preceding the date of calculation, determined on a consolidated basis in accordance with GAAP and as provided below to (ii) Consolidated EBITDA of Borrower (other than the Propco Subsidiaries) for the four full fiscal quarters for which internal financial statements are available immediately preceding the date of calculation. For purposes of calculating the Total Leverage Ratio for any period, the amount of Indebtedness of any Person represented by outstanding letters of credit shall be excluded from the amount of Indebtedness except to the extent such letter of credit has been drawn and not reimbursed by such Person. In the event that a Loan Party or Subsidiary of a Loan Party (other than the Propco Subsidiaries) incurs or repays or redeems any Indebtedness (other than Indebtedness incurred or repaid under any revolving credit facilities) subsequent to the end of the period for which the Total Leverage Ratio is being calculated and on or prior to the event for which the calculation of the Total Leverage Ratio is made, then the Total Leverage Ratio shall be calculated giving pro forma effect to such incurrence or redemption or repayment of Indebtedness as if the same had occurred on the last day of the applicable period. The Total Leverage Ratio shall be calculated in a manner consistent with the pro forma provisions (to the extent applicable) of the definition of “Consolidated Fixed Charge Coverage Ratio.” The amount of Indebtedness under revolving credit facilities shall be based on the average of the month-end balances of such Indebtedness for the applicable prior twelve-month period.

“Total Net Leverage Ratio” means, with respect to the Borrower, at any date, the Total Leverage Ratio of Borrower as of such date; provided that for purposes of calculating Total Net Leverage Ratio, total Unrestricted Cash and Cash Equivalents held by a Loan Party or its Subsidiaries (other than Propco Subsidiaries) shall be deducted from Consolidated Indebtedness. The amount of Unrestricted Cash and Cash Equivalents included in such calculation (i) for purposes of Section 7.06(f) shall be based on the average of the month-end balances of such Unrestricted Cash and Cash Equivalents for the applicable period and (ii) for purposes of Section 2.03(e) shall be based on the amount of Unrestricted Cash and Cash Equivalents as of the last day of the applicable Fiscal Year. Notwithstanding anything to the contrary herein, the maximum amount of Unrestricted Cash and Cash Equivalents that may be netted from Consolidated Indebtedness in calculating the Total Net Leverage Ratio for purposes of Section 2.03(e) shall not exceed (x) $175.0 million in respect of the Fiscal Year ending January 2012 and (y) $225.0 million in respect of each Fiscal Year thereafter.

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“Transactions” means the execution, delivery and performance by each of the Loan Parties of each of the Loan Documents to which it is a party, the borrowing of Loans, the issuance of the Secured Notes, the Refinancing and the payment of the fees and expenses incurred in connection therewith.

“Treasury Rate” means, as of any date of prepayment, the yield to maturity as of such date of prepayment of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to the date of prepayment (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the date of prepayment to the one and one-half year anniversary of the Term B-4 Closing Date.

“Trigger Date Appraisal” means a Recent Appraisal of all Specified Real Property that may be delivered by the Borrower to the Administrative Agent prior to the date that is 120 days after the Springing Covenant Trigger Date that is designated as the “Trigger Date Appraisal”; provided that, the Initial Appraisal cannot be the Trigger Date Appraisal. To the extent that more than one such Appraisal has been delivered during such period, then the Appraisal dated as of the latest date shall be deemed to be the “Trigger Date Appraisal”.

“Type” means the character of a Loan as a Base Rate Loan or a Eurodollar Rate Loan.

“UCC” means the Uniform Commercial Code as in effect from time to time (except as otherwise specified) in any applicable state or jurisdiction.

“United States” and “U.S.” mean the United States of America.

“Unrestricted Cash and Cash Equivalents” means cash and Cash Equivalents characterized as unrestricted in accordance with GAAP.

“Unsecured Term Loan Agreement” means that certain credit agreement, dated as of December 1, 2006, by the Borrower, each lender from time to time party thereto, Banc of America Bridge LLC, as administrative agent, and the other arrangers and agents party thereto, as amended prior to the Restatement Date.

“Voting Stock” means, with respect to any Person, any class or classes of Equity Interests pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the board of directors of such Person.

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

1.02     Other Interpretive Provisions. With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

(a)    The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or other document (including any Charter Document) shall be construed as referring to such agreement,

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instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person’s permitted successors and assigns, (iii) the words “herein,” “hereof,” “hereto” and “hereunder,” and words of similar import when used in any Loan Document, shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time and (vi) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

(b)    In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including,” the words “to” and “until” each mean “to but excluding,” and the word “through” means “to and including.”

(c)    Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

1.03     Accounting Terms. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect on the Restatement Date. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. It is understood and agreed that any recharacterization of an accounting entry or term shall be permitted hereunder so long as the action relating to or underlying the entry or item as so recharacterized would have been permitted if it had originally been characterized in such manner.

1.04     Times of Day. Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

1.05     Resolution of Drafting Ambiguities. The Borrower acknowledges and agrees that it was represented by counsel in connection with the execution and delivery of the Loan Documents, that it and its counsel reviewed and participated in the preparation and negotiation of the Loan Documents and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Loan Documents.

1.06     Currency Equivalents Generally. Any amount specified in this Agreement (other than in Articles II, IX and X) or any of the other Loan Documents to be in Dollars shall also include the equivalent of such amount in any currency other than Dollars, such equivalent amount thereof in the

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applicable currency to be determined by the Administrative Agent at such time on the basis of the Spot Rate (as defined below) for the purchase of such currency with Dollars. For purposes of this Section 1.06, the “Spot Rate” for a currency means the rate determined by the Administrative Agent to be the rate quoted by the Person acting in such capacity as the spot rate for the purchase by such Person of such currency with another currency through its principal foreign exchange trading office at approximately 11:00 a.m. on the date two Business Days prior to the date of such determination; provided that the Administrative Agent may obtain such spot rate from another financial institution designated by the Administrative Agent if the Person acting in such capacity does not have as of the date of determination a spot buying rate for any such currency.

ARTICLE II
THE COMMITMENTS AND BORROWING OF LOANS

2.01     Loans. Subject to the terms and conditions set forth herein, each Lender having an Initial Loan Commitment severally agrees to make an Initial Loan to the Borrower on the Restatement Date, in the amount of such Lender’s Initial Loan Commitment as set forth on Schedule 2.01. Amounts borrowed under this Section 2.01 and subsequently repaid or prepaid may not be reborrowed. Initial Loans on the Restatement Date may be made as Eurodollar Rate Loans.

2.02     Borrowings, Conversions and Continuations of Loans.

(a)The borrowing of Loans, each conversion of Loans from one Type to the other, and each continuation of Eurodollar Rate Loans shall be made upon the Borrower’s irrevocable notice to the Administrative Agent. Such notices may be provided by (A) telephoneor (B) a Borrowing or Conversion Notice;provided that each such telephone notice (x) in respect of Base Rate Loans must be received by no later than 3:00 p.m. on the Business Day prior to the date of such Borrowing and (y) is thereafter confirmed in writing and received by the Administrative Agent not later than (i) 2:00 p.m., two Business Days prior to the requested date of any borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Loans and (ii) 12:00 noon, on the requested date of any borrowing of Base Rate Loans;provided, further, that if the Borrower wishes to request Eurodollar Rate Loans having an Interest Period other than one, two, three, six or twelve months in duration as provided in the definition of “Interest Period,” the applicable notice must be received by the Administrative Agent not later than 11:00 a.m. four Business Days prior to the requested date of such Borrowing, conversion or continuation, whereupon the Administrative Agent shall give prompt notice to the applicable Lenders of such request and determine whether the requested Interest Period is acceptable to all of them. Not later than 11:00 a.m., three Business Days before the requested date of such Borrowing, conversion or continuation, the Administrative Agent shall notify the Borrower (which notice may be by telephone) whether or not the requested Interest Period has been consented to by all the Lenders. Each telephonic notice by the Borrower pursuant to this Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a written Borrowing or Conversion Notice, appropriately completed and signed by a Responsible Officer of the Borrower. Each conversion to or continuation of Eurodollar Rate Loans shall be in an amount equal to $1.0 million or a whole multiple of $1.0 million in excess thereof. Each conversion to Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each Borrowing or Conversion Notice (whether telephonic or written) shall specify (i) in the case of a conversion or continuation, whether the Borrower is requesting a conversion of Loans from one Type to the other or a continuation of Eurodollar Rate Loans, (ii) the requested date of the borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Loans to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to which existing Loans are to be converted and (v) in the case of a Eurodollar Rate Borrowing, the initial Interest Period to be applicable thereto, which shall

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be a period contemplated by the definition of the term “Interest Period.” If the Borrower fails to specify a Type of Loan in a Borrowing or Conversion Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Loans shall be made as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurodollar Rate Loans.

(b)    Following receipt of a Conversion Notice, the Administrative Agent shall promptly notify each Lender of the amount of its Pro Rata Share of Loans, and if no timely notice of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Loans or continuation described in Section 2.02(a). In the case of the borrowing, each Lender shall make the amount of its Loan available to the Administrative Agent in Dollars in immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m. on the Business Day specified in the applicable Borrowing or Conversion Notice. Upon satisfaction of the applicable conditions set forth in Section 4.01, the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent either by (i) crediting the account of the Borrower on the books of Banc of America with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower.

(c)    Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted only on the last day of an Interest Period for such Eurodollar Rate Loan unless the Borrower pays breakage costs incurred in connection with such conversion and required to be paid pursuant to Section 3.05 of which it has been notified. During the existence of a Default, no Loans may be converted to or continued as Eurodollar Rate Loans without the consent of the Required Lenders.

(d)    The Administrative Agent shall promptly notify the Borrower and the applicable Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Loans upon determination of such interest rate. At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify the Borrower and the Lenders of any change in the Administrative Agent’s prime rate used in determining the Base Rate promptly following the public announcement of such change.

2.03     Prepayments.

(a)Optional. The Borrower may, upon notice to the Administrative Agent, voluntarily prepay the Loans in whole or in part (and such prepayment shall be applied to any Class and Type of Loan as directed by the Borrower)at any time without premium or penalty (subject to the premium set forth in Section 2.03(h), if applicable); provided that (A) such notice shall be in a form reasonably acceptable to the Administrative Agent andbe given in accordance with Section 2.03(g); (B) any prepayment of Eurodollar Rate Loans shall be in a principal amount of $1.0 million or a whole multiple of $1.0 million in excess thereof or, if less, the entire principal amount thereof then outstanding; and (C) any prepayment of Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof or, if less, the entire principal amount thereof then outstanding. For the avoidance of doubt, the Borrower may, in its sole discretion, optionally prepay any Class of Loans on a non-pro rata basis without prepaying any other Class of Loans.Each such notice shall be in the form of Exhibit A-2 and shall specify the date and amount of such prepayment and the Class(es) and Type(s) of Loans to be prepaid. The Administrative Agent will promptly notify each Lender of its receipt of each such notice, and of the amount of such Lender’s Pro Rata Share of such prepayment. If such notice is given by the Borrower, the Borrower shall be committed to make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein, unless otherwise revoked prior to the date of such prepayment in accordance with Section 2.03(f). Any prepayment of a Eurodollar Rate Loan shall be accompanied by any additional amounts required pursuant to Section 3.05.

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(b)    Asset Sales. Following the receipt of any Net Cash Proceeds of any Asset Sale after the Restatement Date, (x) at the option of the Borrower pursuant to a written notice of reinvestment delivered to the Administrative Agent, the Borrower may reinvest all or any portion of such Net Cash Proceeds in assets useful for its business (A) within twelve (12) months following receipt of such Net Cash Proceeds or (B) if within twelve (12) months following receipt thereof the Borrower enters into a legally binding commitment to reinvest such Net Cash Proceeds, within 180 days of the date of such legally binding commitment; provided that (1) if the assets subject to such Asset Sale constituted Real Property, such reinvestment may not be made in assets other than Real Property (other than fixtures that are depreciated on a book value basis in accordance with GAAP within four years or less), (2) ifan Event of Default shall have occurred and be continuing, the Borrower shall not be permitted to make any such reinvestments (other than pursuant to a legally binding commitment that the Borrower entered into at a time when no Event of Default existed or was continuing)and, (23) if the assets subject to such Asset Sale constituted Geoffrey Collateral, such reinvestment may only be in assets constituting Geoffrey Collateraland (4) following the Springing Covenant Trigger Date, if the assets subject to such Asset Sale constituted Specified Real Property that is Collateral, such reinvestment may only be made in Specified Real Property that is Collateral (or that will, upon such reinvestment become Collateral) and (y) any remaining Net Cash Proceeds from such Asset Sale shall be applied on the last day of such twelve-month or 180-day period, as applicable, to the prepayment of the Loans pursuant to thisSection 2.03(bf)or (j), as applicable.

Notwithstanding the foregoing, no such prepayment shall be required under this Section 2.03(b) with respect to:

(A)amounts not in excess of the Required ABL Prepayment Amount on such date;

(BA)the disposition of property which constitutes Extraordinary Receipts; and

(CB)Net Cash Proceeds from an Asset Sale by (1) a Foreign Subsidiary of the Borrower (unless, and to the extent that, any such proceeds are repatriated to the United States) or (2) Geoffrey International LLC unless and to the extent that such proceeds are dividended, loaned or otherwise transferred to a Loan Party.

(Dc)Debt Issuance or Disqualified Capital Stock Issuance. Promptly following the receipt of any Net Cash Proceeds of any Debt Issuance after the Restatement Date or any issuance by any Loan Party of Disqualified Capital Stock after the Restatement Date, the Borrower shall apply 100% of such Net Cash Proceeds to the repayment of Loans;providedthat no such prepayment shall be requiredunder thisSection 2.03(c)with respect to amounts not in excess of the Required ABL Prepayment Amount.

(cd)Extraordinary Receipts. Promptly following the receipt of any Net Cash Proceeds from any Extraordinary Receipts, at the option of the Borrower, the Borrower may reinvest all or any portion of such Net Cash Proceeds to repair, replace or restore any property in respect of which such Net Cash Proceeds were paid isor to reinvest in other fixed or capital assets (provided that (1) if such Extraordinary Receipts are in respect of Real Property, such reinvestment may not be made in assets other than Real Property (other than fixtures that are depreciated on a book value basis in accordance with GAAP within four years or less) and (2) following the Springing Covenant Trigger Date, if such Extraordinary Receipts are in respect of Specified Real Property that is Collateral, such reinvestment may only be made in Specified Real Property that is Collateral (or that will, upon such reinvestment become Collateral)) within (x) twelve (12) months following receipt of such Net Cash Proceeds or (y) if the Borrower enters into a legally binding commitment to reinvest such Net Cash Proceeds within twelve (12) months following receipt thereof, within 180 days of the date of such legally binding commitment but in any event no earlier than the twelfth month following receipt of such Net Cash Proceeds; provided that (i) if an Event

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of Default shall have occurred and be continuing, the Borrower shall not be permitted to make any such reinvestments (other than pursuant to a legally binding commitment that the Borrower entered into at a time when no Event of Default existed or was continuing) and (ii) if any Net Cash Proceeds cannot be so reinvested during the periods described above, an amount equal to any such Net Cash Proceeds shall be applied on the last day of such period to the prepayment of the Loans pursuant to thisSection 2.03(df)or (j) as applicable.

(de)Excess Cash Flow. If, for any Fiscal Year of the Borrower commencing with the Fiscal Year ending January 2830, 20122016, there shall be Excess Cash Flow, the Borrower shall, on the Excess Cash Flow Application Date relating to such Fiscal Year, prepay the Loans in an amount equal to the Excess Cash Flow Percentage of such Excess Cash Flow. Each such prepayment shall be made on a date (an “Excess Cash Flow Application Date”) no later than ten days after the date on which the financial statements of the Borrower referred to in Section 6.01(a) for such Fiscal Year are required to be delivered to the Administrative Agent. Each such prepayment shall be subject to the procedures set forth in this Section 2.3.

(ef)Application of Prepayments. Prior to any optional or mandatory prepayment of Borrowings hereunder, the Borrower shall select the Borrowing(s) to be prepaid and shall specify such selection in the notice of such prepayment pursuant to paragraph (g) of this Section. Except as provided in Section 2.03(j), in the event of any mandatory prepayment of Borrowings made at a time when Borrowings of more than one Class remain outstanding, the Borrower shall select Borrowings to be prepaid so that the aggregate amount of such prepayment is allocated between Borrowings (and, to the extent provided in the Refinancing Amendment for any Class of Other Loans, the Borrowings of such Class) pro rata based on the aggregate principal amount of outstanding Borrowings of each such Class. Any Lender (and, to the extent provided in the Refinancing Amendment for any Class of Other Loans, any Lender that holds Other Loans of such Class) may elect, by notice to the Administrative Agent in writing at least three Business Days prior to the prepayment date, to decline all or any portion of any prepayment of its Loans or Other Loans of any such Class pursuant to this Section (other than an optional prepayment pursuant to paragraph (a) of this Section, a mandatory prepayment pursuant to Section 2.03(c) in respect of refinancing indebtedness and mandatory prepayments pursuant to Section 2.03(j), which may not be declined), in which case the aggregate amount of the prepayment that would have been applied to prepay Loans or Other Loans of any such Class but was so declined shall be retained by the Borrower and the Subsidiaries (such amounts, “Retained Declined Proceeds”). Optional prepayments of Borrowings shall be allocated among the Classes of Borrowings as directed by the Borrower. In the absence of a designation by the Borrower as described in the preceding provisions of this paragraph of the Type of Loan of any Class,Amounts to be applied pursuant to this Section 2.03 to the prepayment of Loans shall be applied first to reduce outstanding Base Rate Loans. Any amounts remaining after each such application shall be applied to prepay Eurodollar Rate Loans. Notwithstanding the foregoing, if the amount of any prepayment of Loans required under this Section 2.03 shall be in excess of the amount of the Base Rate Loans at the time outstanding (an “Excess Amount”), only the portion of the amount of such prepayment as is equal to the amount of such outstanding Base Rate Loans shall be immediately prepaid and, at the election of the Borrower, the Excess Amount shall be either (A) deposited in an escrow account on terms reasonably satisfactory to the Administrative Agent and the Borrower and applied to the prepayment of Eurodollar Rate Loans on the last day of the then next-expiring Interest Period for Eurodollar Rate Loans; provided that (i) interest in respect of such Excess Amount shall continue to accrue thereon at the rate provided hereunder for the Loans which such Excess Amount is intended to repay until such Excess Amount (and any returns on investment relating thereto) shall have been used in full to repay such Loans and (ii) at any time while an Event of Default has occurred and is continuing, the Administrative Agent may, and upon written direction from the Required Lenders shall, apply any or all proceeds then on deposit to the payment of such Loans in an amount equal to such Excess Amount or (B) prepaid immediately, together with any amounts owing to the Lenders under Section 3.05.

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(fg)Notice of Prepayment. The Borrower shall notify the Administrative Agent by written notice of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Rate Loan, not later than 12:00 noon, two Business Days before the date of prepayment and (ii) in the case of prepayment of a Base Rate Loan, not later than 12:00 noon, one Business Day before the date of prepayment. Each such notice shall be in the form of Exhibit A-2 and shall specify the prepayment date, the principal amount of each Borrowing or portion thereof to be prepaid and, in the case of a mandatory prepayment, a reasonably detailed calculation of the amount of such prepayment. Promptly following receipt of any such notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice of prepayment shall be revocable on any Business Day prior to the date of repayment, provided that, within 5 Business Days of receiving a written demand for such reimbursement which sets forth the calculation of breakage costs incurred and payable pursuant to Section 3.05 in reasonable detail, the Borrower shall reimburse the Lenders for such breakage costs associated with the revocation of any notice of prepayment. Each mandatory prepayment of a Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing and otherwise in accordance with this Section 2.03. Each optional prepayment of a Borrowing shall be applied among the Classes and Types of Borrowings as directed by the Borrower and otherwise in accordance with this Section 2.03. Prepayments shall be accompanied by accrued interest as required by Section 2.06.

(gh)Prepayment Premium. Upon any voluntary prepayment of the Loans (in whole or in part, including pursuant to a refinancing thereof) at any time on or prior to the first anniversary of the Restatement Date with the proceeds of any Repricing Transaction, Borrower shall pay a premium equal to 1.00% of the principal amount of any portion of such Loans optionally prepaid. Upon any voluntary prepayment of the Loans (including, for the avoidance of doubt, any Initial Loans, Term B-2 Loans or Term B-3 Loans) (in whole or in part, including pursuant to a refinancing thereof) at any time after the Amendment No. 2 Effective Date and prior to the first anniversary of the Amendment No. 2 Effective Date with the proceeds of any Repricing Transaction, Borrower shall pay a premium equal to 1.00% of the principal amount of any portion of such Loans optionally prepaid.Upon any voluntary prepayment of the Term B-4 Loans (in whole or in part, including pursuant to a refinancing thereof) or mandatory prepayments pursuant to Sections 2.03(c) or 2.03(j)(i) (other than with respect to Restricted Payments (as defined in the IntermediateCo Unsecured Guarantee) funded from net cash proceeds of Asset Sales (as defined in the IntermediateCo Unsecured Guarantee, but without giving effect to the minimum dollar threshold in clause (c) in the definition thereof) by IntermediateCo and its Subsidiaries) at any time after the Term B-4 Closing Date and prior to the date that is one and one-half years after the Term B-4 Closing Date, Borrower shall pay a premium equal to the Applicable Premium of the principal amount of any portion of the Term B-4 Loans prepaid, (ii) from the one and one-half year anniversary of the Term B-4 Closing Date but prior to the two and one-half year anniversary of the Term B-4 Closing Date, Borrower shall pay a premium equal to 2.00% of the principal amount of any portion of the Term B-4 Loans optionally prepaid (including pursuant to a refinancing thereof) or any mandatory prepayment pursuant to Sections 2.03(c) and 2.03(j)(i) (other than with respect to Restricted Payments (as defined in the IntermediateCo Unsecured Guarantee) funded from net cash proceeds of Asset Sales (as defined in the IntermediateCo Unsecured Guarantee, but without giving effect to the minimum dollar threshold in clause (c) in the definition thereof) by IntermediateCo and its Subsidiaries) and (iii) from the two and one-half year anniversary of the Term B-4 Closing Date but prior to the three and one-half year anniversary of the Term B-4 Closing Date, Borrower shall pay a premium equal to 1.00% of the principal amount of any portion of the Term B-4 Loans optionally prepaid (including pursuant to a refinancing thereof) or any mandatory prepayment pursuant to Sections 2.03(c) and 2.03(j)(i) (other than with respect to Restricted Payments (as defined in the IntermediateCo Unsecured Guarantee) funded from net cash proceeds of Asset Sales (as defined in the IntermediateCo Unsecured Guarantee, but without giving effect to the minimum dollar threshold in clause (c) in the definition thereof) by IntermediateCo and its Subsidiaries).

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(hi)Notwithstanding anything to the contrary in Section 2.03, with respect to the amount of any mandatory prepayment described in Sections 2.03(b)through, (c) (other than refinancing indebtedness),(d) and (e) that is required to be applied towards the repayment of Loans (such amount, the “Prepayment Amount”), the Borrower will, in lieu of automatically applying such amount to the prepayment of Loans as provided in Section 2.03 above on the date specified in Sections 2.03(b)through, (c) (other than refinancing indebtedness),(d) and (e) for such prepayment, give the Administrative Agent telephonic notice (promptly confirmed in writing)written notice requesting that the Administrative Agent prepare and provide to each Lender a notice (each, a “Prepayment Option Notice”), as described below. As promptly as practicable after receiving such notice from the Borrower, the Administrative Agent will send to each Lenderprovide a Prepayment Option Noticeto the Lender via posting to the Platform, which shall be in the form of Exhibit K, and shall include an offer by the Borrower to prepay on the date (each a “Mandatory Prepayment Date”) that is 5 Business Days after the date of the Prepayment Option Notice, the relevant Loans of such Lender by an amount equal to the portion of the Prepayment Amount indicated in such Lender’s Prepayment Option Notice as being applicable to such Lender’s Loans. On the Mandatory Prepayment Date, the Borrower shall pay to the relevant Lenders the aggregate amount necessary to prepay that portion of the outstanding relevant Loans as described above in respect of which such Lenders have accepted prepayment (it being understood that a failure to respond to a Prepayment Option Notice shall be deemed an acceptance of the prepayment referenced therein); provided that if after the application of amounts above, any portion of the Prepayment Amount not accepted by the Lenders shall remain, such amount may be retained by the Borrower.

(j)Term B-4 Loan Mandatory Prepayments.

(i) Upon the occurrence of (x) a Specified Mandatory Prepayment Event (as defined in the IntermediateCo Unsecured Guarantee), the Borrower shall within 30 days mandatorily prepay to the Term B-4 Lenders an amount equal to 100% of the amount of the net cash proceeds from the corresponding debt incurrence or issuance or restricted payment which triggered such Specified Mandatory Prepayment Event and (y) an Incremental Mandatory Prepayment Event (as defined in the IntermediateCo Unsecured Guarantee), the Borrower shall within 10 days mandatorily prepay to the Term B-4 Lenders an amount equal to 50% of the corresponding dividend or distribution made by IntermediateCo to its parent entity, in each case, without duplication of any other mandatory prepayments made under this Section 2.03(j).

(ii)Following the Springing Covenant Trigger Date, any Net Cash Proceeds from Asset Sales in respect of Specified Real Property which are not otherwise reinvested in accordance with Section 2.03(b) shall be applied by the Borrower to prepay the Term B-4 Loans (without duplication of any other mandatory prepayments made under this Section 2.03(j)).

(iii)Following the Springing Covenant Trigger Date, any Net Cash Proceeds from Extraordinary Receipts in respect of Specified Real Property which are not otherwise reinvested in accordance with Section 2.03(d) shall be applied by the Borrower to prepay the Term B-4 Loans (without duplication of any other mandatory prepayments made under this Section 2.03(j)).

(iv)The Borrower shall mandatorily prepay the Term B-4 Loans in an amount equal to 100% of the net cash proceeds of any Asset Sales (as defined in the InteremediateCo Unsecured Guarantee) made by IntermediateCo or any Intermediate Parent (as defined in the IntermediateCo Unsecured Guarantee) which are not reinvested in accordance with Section 5.2 of the IntermediateCo Unsecured Guarantee (without duplication of any other mandatory prepayments made under this Section 2.03(j)).

(v)If, on the Springing Covenant Trigger Date,

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(A) the Administrative Agent has received the Initial Appraisal and the Trigger Date Appraisal and the Appraised Value (as determined by the Trigger Date Appraisal) of the Specified Real Property is less than the Specified Real Property Value, then to the extent that, prior to the Springing Covenant Trigger Date, the Borrower has sold any Real Property that at the time of such sale was Specified Real Property, the Borrower shall mandatorily prepay the Term B-4 Loans on the date that is 120 days after the Springing Covenant Trigger Date in an amount equal to the lesser of (i)(1) the Net Cash Proceeds from such sale of Specified Real Property (determined as of the time of such sale) (other than to the extent that any such Net Cash Proceeds were reinvested in any Real Property that became Specified Real Property), less (2) the amount of Net Cash Proceeds that were mandatorily prepaid in respect of Term B-4 Loans from such sales of Specified Real Property (determined as of the time of such sale) pursuant to Sections 2.03(b) and 2.03(d) and (ii)(1) the Specified Real Property Value, less (2) the Appraised Value (as determined by the Trigger Date Appraisal) of the Specified Real Property on the Springing Covenant Trigger Date; or

(B) the Administrative Agent has not received the Initial Appraisal and/or the Trigger Date Appraisal, then to the extent that, prior to the Springing Covenant Trigger Date, the Borrower has sold any Real Property that at the time of such sale was Specified Real Property, the Borrower shall mandatorily prepay the Term B-4 Loans on the date that is 120 days after the Springing Covenant Trigger Date in an amount equal to (1) the Net Cash Proceeds from such sale of Specified Real Property (determined as of the time of such sale) (other than to the extent that any such Net Cash Proceeds were reinvested in any Real Property that became Specified Real Property), less (2) the amount of Net Cash Proceeds that were mandatorily prepaid in respect of Term B-4 Loans from such sales of Specified Real Property (determined as of the time of such sale) pursuant to Sections 2.03(b) and 2.03(d).

With respect to each mandatory prepayment pursuant to this Section 2.03(j), the amount of such mandatory prepayment shall be the amount set forth in the notice from IntermediateCo to the Administrative Agent and the Borrower upon the occurrence of such mandatory prepayment event, and such amount shall be deemed to be accurate and conclusive, absent manifest error promptly notified to the Administrative Agent and the Borrower and reasonably determined as such by the Administrative Agent.

For the avoidance of doubt, if a mandatory prepayment event arisesunder this Section 2.03(j) with respect to (i) an incurrence or issuance of Indebtedness or Disqualified Capital Stock (regardless of what the use of proceeds of such incurrence or issuance are used for (including if a RP Mandatory Prepayment Event would arise in connection therewith)) other than an incurrence or issuance of Indebtedness which would trigger an Incremental Mandatory Prepayment Event, such mandatory prepayment shall be treated only as an Indebtedness Mandatory Prepayment Event, (ii) an incurrence or issuance of Indebtedness which would trigger an Incremental Mandatory Prepayment Event (including if a RP Mandatory Prepayment Event would arise in connection with the use of proceeds of such incurrence or issuance), such mandatory prepayment shall be treated only as an Incremental Mandatory Prepayment Event, (iii) a Restricted Payment which is not funded with the proceeds of a concurrent or related (A) issuance or incurrence of Indebtedness that is subject to an Incremental Mandatory Prepayment Event or an Indebtedness Mandatory Prepayment Event or (B) asset sale which gives rise to a mandatory prepayment event pursuant to Section 2.03(j)(iv), in the cases of clauses (A) and (B), such mandatory prepayment shall be treated only as a RP Mandatory Prepayment Event and (iv) an asset sale which gives rise to a mandatory prepayment event pursuant to Section 2.03(j)(iv), such mandatory prepayment shall be treated only as a mandatory prepayment arising from Section 2.03(j)(iv). Notwithstanding anything herein to the contrary, the capitalized terms used in this paragraph shall have the meanings ascribed to such defined terms in the IntermediateCo Unsecured Guarantee, and if not defined therein, the Propco I Term Loan Agreement (as defined in the IntermediateCo Unsecured Guarantee).

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2.04     Termination of Commitments. The Commitments of each Lender shall automatically terminate on the Restatement Date upon the borrowing of the Loans on such date.

2.05     Repayment of Loans.

(a)    The Borrower shall repay to the Administrative Agent for the ratable account of the Initial Loan Lenders on the Maturity Date the aggregate amount of all Initial Loans outstanding on such date.

(b)    The Borrower shall repay to the Administrative Agent for the ratable account of the Initial Loan Lenders on each date set forth below (each, an “Initial Loan Repayment Date”) a principal amount in respect of the Initial Loans equal to (x) the outstanding principal amount of Initial Loans made on the Restatement Date multiplied by (y) the percentage set forth below opposite such Initial Loan Repayment Date (each, an “Initial Loan Repayment Amount”):

Date	Initial Loan Repayment Amount
November 30, 2010	0.25%
February 28, 2011	0.25%
May 31, 2011	0.25%
August 31, 2011	0.25%
November 30, 2011	0.25%
February 29, 2012	0.25%
May 31, 2012	0.25%
August 31, 2012	0.25%
November 30, 2012	0.25%
February 28, 2013	0.25%
May 31, 2013	0.25%
August 31, 2013	0.25%
November 30, 2013	0.25%
February 28, 2014	0.25%
May 31, 2014	0.25%
August 31, 2014	0.25%
November 30, 2014	0.25%
February 28, 2015	0.25%
May 31, 2015	0.25%
August 31, 2015	0.25%
November 30, 2015	0.25%
February 28, 2016	0.25%
May 31, 2016	0.25%
Maturity Date	Remaining outstanding amount

(c)In the event that any New Term Loans are made, such New Term Loans shall be repaid by the Borrower in the amounts (each, a “NewLoan Repayment Amount”)and on the dates set forth in the applicable Joinder Agreement.

(d)The Term B-4 Loans shall be repaid by the Borrower in the amounts and on the dates set forth in the Term B-4 Joinder.

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2.06     Interest.

(a)    Subject to the provisions of subsection (b) below, each Loan that is a (i) Eurodollar Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; and (ii) Base Rate Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate.

(b)    Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder is not paid when due (without regard to any applicable grace periods), whether at stated maturity, upon acceleration or otherwise, such overdue amount shall, to the extent permitted by applicable law, bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal or interest on any Loan, 2% plus the rate otherwise applicable to such Loan as provided in Section 2.06(a) or (ii) in the case of any other overdue amount, 2% plus the rate applicable to Base Rate Loans as provided in Section 2.06(a) (in either case, the “Default Rate”).

(c)    Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto; provided that (i) interest accrued pursuant to Section 2.06(b) shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Rate Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.    

2.07     Fees.

(a)    The Borrower shall pay to the Arrangers and the Administrative Agent for their own respective accounts fees in the amounts and at the times previously agreed in writing by such parties.

(b)    The Borrower shall pay to the Lenders such fees as shall have been separately agreed upon in writing in the amounts and at the times so specified.

2.08     Computation of Interest and Fees. All computations of interest for Base Rate Loans including Base Rate Loans (determined by reference to the Eurodollar Rate) shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year). Interest shall accrue on each Loan for the day on which the Loan is made or continued or converted from a Loan of another Type, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid; provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.10(a), bear interest for one day. Any change in the interest rate in a Loan resulting from a change in the Base Rate or the Eurodollar Reserve Percentage shall become effective as of the opening of business on the day on which such change becomes effective. Each determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error.

2.09     Evidence of Indebtedness.

(a)    The Loans, and the principal and interest due with respect thereto, made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and by the Administrative Agent in the ordinary course of business. The accounts or records maintained by the

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Administrative Agent and each Lender shall be conclusive absent manifest error of the amount of the Loans made by the Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.

(b)    Upon the request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a Note, which shall evidence such Lender’s Loans in addition to such accounts or records. Each Lender may attach schedules to a Note and endorse thereon the date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto.

2.10     Payments Generally; Administrative Agent’s Clawback.

(a)    General. All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim or setoff. Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date specified herein. The Administrative Agent will promptly distribute to each Lender its Pro Rata Share (or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s Lending Office. All payments received by the Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue. If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.

(b)    (i) Funding by Lenders; Presumption by Administrative Agent. Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s Pro Rata Share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.02 and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then each of the applicable Lender and the Borrower agrees to pay to the Administrative Agent forthwith on demand such corresponding amount in immediately available funds with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent at (A) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation and (B) in the case of a payment to be made by the Borrower, the interest rate applicable to Loans of the Type comprising such Borrowing. If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Lender pays its share of the applicable Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in such Borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

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(ii)    Payments by the Borrower; Presumptions by Administrative Agent. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender in immediately available funds with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing under this subsection (b) shall be conclusive, absent manifest error.

(c)    Failure to Satisfy Conditions Precedent. If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this Article II, and such funds are not made available to the Borrower by the Administrative Agent because the conditions to the Loans set forth in Article IV are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.

(d)    Obligations of Lenders Several. The obligations of the Lenders hereunder to make Loans and to make payments pursuant to Section 10.04(c) are several and not joint. The failure of any Lender to make any Loan or to make any payment under Section 10.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Loan or to make its payment under Section 10.04(c).

(e)    Funding Source. Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

(f)    Insufficient Funds. If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied (i) first, toward payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, toward payment of Loans then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of Loans then due to such parties.

2.11     Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of the Loans made by it resulting in such Lender’s receiving payment of a proportion of the aggregate amount of such Loans and accrued interest thereon greater than its Pro Rata Share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact and (b) purchase (for cash at face value) participations in the Loans of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with their respective Pro Rata Share; provided that:

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(i)    if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest;

(ii)    the provisions of this section shall not be construed to apply to (x) any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant, other than to the Borrower or any Subsidiary thereof (as to which, subject to clause (iii) below, the provisions of this section shall apply); and

(iii) the provisions of this section shall not apply to any assignment made pursuant to, and in accordance with, Section 10.06(h)(II).

Subject to the provisions of Section 10.06(d), each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against such Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of such participation.

2.12     Incremental Facilities.

(a)The Borrower may by written notice to the Administrative Agent elect to request the establishment of (i) one or more additional tranches of term loans (the commitments thereto, the “NewTermLoan Commitments”), by(ii) one or more new revolving credit commitments or unsecured revolving credit commitments (any such new commitments, the “New Revolving Credit Commitments”), or (iii) one or more newpari passunotes (any such new notes, the “Incremental Notes” and together with the New Term Loan Commitments and the New Revolving Credit Commitments, the “New Loan Commitments”), in an aggregate amount not in excess of the Maximum Incremental Facilities Amount in the aggregate and not less than $25,000,00025 million individually (or such lesser amount as (x) may be approved by the Administrative Agent or (y) shall constitute the difference between the Maximum Incremental Facilities Amount and all such New Loan Commitments obtained on or prior to such date). Each such notice shall specify the date (each, an “Increased Amount Date”) on which the Borrower proposes that the New Loan Commitments shall be effective, which shall be a date not less than ten Business Days after the date on which such notice is delivered to the Administrative Agent. The Borrower shall specify the identity of each Eligible Assignee (and any existing Lender) to whom the Borrower proposes any portion of such New LoansCommitments be allocated and the amounts of such allocations; provided, however, that (A) any existing Lender approached to provide all or a portion of the New LoansCommitments may elect or decline, in its sole discretion, to provide all or any portion of such New LoansCommitments and (B) any Eligible Assignee that is not an existing Lender shall be approved by the Administrative Agent and the Borrower. In each case, such New Loan Commitments shall become effective as of the applicable Increased Amount Date; provided that (i) no Default or Event of Default shall exist on such Increased Amount Date before or after giving effect to such New Loan Commitments, as applicable; (ii) both before and after giving effect to the making of any New LoansCommitments, each of the conditions set forth in Section 4.01 shall be satisfied; (iii) the New Term Loan Commitments shall be effected pursuant to one or more Joinder Agreements executed and delivered by the Borrower and Administrative Agent, and each of which shall be recorded in the Register and shall be subject to the requirements set forth in Section 3.01(e); (iv) the Borrower shall make any payments required pursuant to Section 2.11 in connection with the New Loan Commitments, as applicable; (v) the Borrower shall deliver or cause to be delivered any legal opinions or other documents reasonably requested by Administrative Agent in connection with any such transaction; and (vi) the interest rates and amortization

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schedule applicable to any New Loans under the NewLoan Commitments shall be determined by the Borrower and the New Term Loan Lenders or New Revolving Credit Lenders, as applicable, thereunder; provided that if the applicable interest rate margin relating to the New LoansCommitments (the “IncrementalNewLoan Applicable Rate”) exceeds the Applicable Rate relating to the existing Loans by more than 0.25%, the Applicable Rate relating to the existing Loans shall be adjusted to be equal to the IncrementalNew Loan Applicable Rate minus 0.25%; provided, further, that in determining such applicable interest rates, (x) original issue discount (“OID”) or upfront fees (which shall be deemed to constitute like amount of OID) paid by the Borrower to the Lenders under the New LoansCommitments and the existing Loans in the initial primary syndication thereof shall be included and equated to interest rate (with OID being equated to interest based on an assumed four-year life to maturity) and (y) any changes to the interest rate “floor” shall be deemed to be an equivalent change in the applicable interest rate margin for the New LoansCommitments.

(b)On any Increased Amount Date on which any New Term Loan Commitments are effective, subject to the satisfaction of the foregoing terms and conditions, (i) each Lender with a New Term Loan Commitment (each, a “NewTermLoan Lender”) of any series shall make a loan (which may be in the form of cash or through a cashless rollover of existing Loans of another Class hereunder) to the Borrower (a “NewTermLoan”) in an amount equal to its New Term Loan Commitment, and (ii) each New Term Loan Lender shall become a Lender hereunder with respect to the New Term Loan Commitment and the New Term Loans of such series made pursuant thereto. On any Increased Amount Date on which any New Revolving Credit Commitments of any Class are effected through the establishment of one or more New Revolving Credit Commitments, subject to the satisfaction of the terms and conditions in this Section 2.12, (i) each Lender with a New Revolving Credit Commitment(each, a “New Revolving Credit Lender”) of such Class shall make its Commitment available to the Borrower (when borrowed, a “New Revolving Credit Loan” and collectively with any New Term Loan, an “New Loan”) in an amount equal to its New Revolving Credit Commitment of such Class and (ii) each New Revolving Credit Lender of such Class shall become a Lender hereunder with respect to the New Revolving Credit Commitment of such Class and the New Revolving Credit Loans of such Class made pursuant thereto. Notwithstanding the foregoing, New Term Loans may have identical terms to any of the Loans and be treated as the same Class as any of such Loans.

(c)    The terms and provisions of any New Term Loans and New Term Loan Commitments shall be, except as otherwise set forth herein or in the applicable Joinder Agreement, identical to one or more Classes of the existing initial Loans; provided that (i) the applicable New Loan Maturity Date of each series shall be no earlier than the Maturity Date and mandatory prepayment and other payment rights (other than scheduled amortization) of the New Term Loans and the Initial Loans shall be identical, (ii) the rate of interest and the amortization schedule applicable to the New Term Loans of each series shall be determined by the Borrower and the applicable New Term Loan Lenders and shall be set forth in each applicable Joinder Agreement; provided that the weighted average life to maturity of all New Term Loans shall be no shorter than the weighted average life to maturity of the Initial Loans, (iii) the New Term Loans shall rank pari passu in right of payment and of security with the Initial Loans and (iv) all other terms applicable to the New Term Loans of each series that differ from the existing Initial Loans shall be reasonably acceptable to the Administrative Agent (as evidenced by its execution of the applicable Joinder Agreement).The terms and provisions of any New Revolving Credit Loans and New Revolving Credit Commitments shall be reasonably determined by the Borrower and the New Revolving Credit Lenders.

(d)    As a condition precedent to such increase, the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party dated as of the Additional Loans EffectiveIncreased Amount Date signed by a Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such increase and (ii) in the case of

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the Borrower, certifying that, before and after giving effect to such increase, (A) the representations and warranties contained in Article Vand, the other Loan Documents and the IntermediateCo Unsecured Guarantee are true and correct in all material respects on and as of the Additional Loans EffectiveIncreased Amount Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and except that for purposes of this Section 2.12, the representations and warranties contained in subsections (a) and (b) of Section 5.06 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01 and (B) no Event of Default or Default exists immediately before or immediately after giving effect to such addition.

(e)Each Joinder Agreement may, without the consent of any other Lenders, effect such amendments to this Agreementand, the other Loan Documents and the IntermediateCo Unsecured Guarantee as may be necessary or appropriate, in the opinion of the Administrative Agent and the Borrower, to effect the provision of this Section 2.12.

2.13     Defaulting Lenders.

(a)    Waivers and Amendments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law, such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in Section 10.01.

(b)    Defaulting Lender Cure. If the Borrower and the Administrative Agent agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto.

2.14Refinancing Amendments

(a)At any timeafter the Restatement Date, the Borrower may obtain, from any Lender or any additional Lender, Credit Agreement Refinancing Indebtedness in respect of all or any portion of the Loans then outstanding under this Agreement (which will be deemed to include any then outstanding Other Loans), in the form of Other Loans or Other Commitments, in each case pursuant to a Refinancing Amendment; provided that the net proceeds of such Credit Agreement Refinancing Indebtedness shall be applied, substantially concurrently with the incurrence thereof, to the prepayment of outstanding Loans (and termination of commitments related thereto) being so refinanced. Each Class of Credit Agreement Refinancing Indebtedness incurred under this Section 2.14 shall be in anaggregate principal amountthat is (i) not less than $10 million and (ii) an integral multiple of $1.0 million, in excess thereof (in each case unless the Borrower andthe Administrative Agent otherwise agree). The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Refinancing Amendment. Each of the parties hereto hereby agrees that, upon the effectiveness of any Refinancing Amendment, this Agreement shall be deemed amended to the extent necessary to reflect the existence and terms of the Credit Agreement Refinancing Indebtedness incurred pursuant thereto (including any amendments necessary to treat the Loans and Commitments subject thereto as Other Loans and/or Other Commitments). Any Refinancing Amendment may, without the consent of any other Lenders, effect such amendments to this Agreement, the other Loan Documents and the IntermediateCo Unsecured Guarantee as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Borrower, to effect the provisions of this Section.

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(b)Notwithstanding anything to the contrary, this Section 2.14 shall supersede any provisions in Section 2.03, Section 2.05, Section 2.10 or Section 10.01 to the contrary, in each case, to the extent necessary to implement the provisions contemplated by this Section 2.14.

2.15 Extension Offers

(a)Notwithstanding anything to the contrary in this Agreement, pursuant to one or more offers made from time to time by the Borrower to all Lenders of any Class of Loans (each such Class, the “Extension Offer Class”), on a pro rata basis (based, in the case of an offer to the Lenders under any Class of Loans, on the aggregate outstanding Loans of such Class) (“Pro Rata Extension Offers”), the Borrower is hereby permitted, subject to the terms of this Section, to consummate transactions with individual Lenders from time to time to extend the maturity dateof such Lender’s Loans of the applicable Extension Offer Class and, in connection therewith, to otherwise modify the terms of such Lender’s Loans of the applicable Extension Offer Class pursuant to the terms of the relevant Pro Rata Extension Offer (including, without limitation, increasing the interest rate or fees payable in respect of such Lender’s Loans and/or modifying the amortization schedule in respect of such Lender’s Loans of the applicable Extension Offer Class). Any such extension (an “Extension”) agreed to between the Borrower and any such Lender (an “Extending Lender”) shall become effective only with respect to such Lender’s Loans of the applicable Extension Offer Class as to which such Lender’s acceptance has been made (such extended Loans, the “Extended Loans”). The Borrower may pay a fee to any Extending Lender in connection with any such Extension so long as such fee is offered to all Lenders pursuant to the Pro Rata Extension Offers.

(b)Each Extension shall be effected pursuant to an Extension Amendment Agreement executed and delivered by the Borrower, each applicable Extending Lender and the Administrative Agent; provided that the Borrower shall have delivered to the Administrative Agent such legal opinions, board resolutions, secretary’s certificates, officer’s certificates and other customary documents as shall reasonably be requested by the Administrative Agent in connection therewith. Each Pro Rata Extension Offer and the applicable Extension Amendment Agreement shall specify the terms of the applicable Extended Loans; provided that (i) except as to interest rates, fees, other pricing terms, amortization, final maturity date, guarantees (only in the case of Extended Term Loans made on the Amendement No. 3 Effective Date), Collateral (only in the case of Extended Term Loans made on the Amendment No. 3 Effective Date) and participation in prepayments (which shall, subject to clauses (ii) through (iv) of this proviso, be determined by the Borrower and set forth in the Pro Rata Extension Offer), the Extended Loans shall have the same terms as the Class of Loans to which the applicable Pro Rata Extension Offer relates, (ii) the final maturity date of any Extended Loans shall be no earlier than the final maturity date applicable to the Class of Loans to which the applicable Pro Rata Extension Offer relates, (iii) the weighted average life to maturity of any Extended Loans shall be no shorter than the remaining weighted average life to maturity of the Class of Loans to which the applicable Pro Rata Extension Offer relates, and (iv) any Extended Loans may participate on (x) a pro rata basis, a less than pro rata basis or a greater than pro rata basis in any voluntary repayments or prepayments hereunder and (y) a pro rata basis or a less than pro rata basis (but not on a greater than pro rata basis) in any mandatory repayments or prepayments hereunder; provided that Extended Term Loans made on the Amendment No. 3 Effective Date pursuant to Amendment No. 3, may participate on a greater than pro rata basis in any mandatory repayments or prepayments hereunder. Each Extension Amendment Agreement may, without the consent of any Lender other than the applicable Extending Lenders, effect such amendments to this Agreement, the other Loan Documents and the IntermediateCo Unsecured Guarantee as may be necessary or appropriate, in the opinion of the Administrative Agent, to give effect to the provisions of this Section 2.15. Notwithstanding anything to the contrary herein, the Extended Loans may constitute a new Class of Loans or become a part of an existing Class of Loans as determined by the Borrower and set forth in the applicable Extension Amendment Agreement.

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(c)Notwithstanding anything to the contrary set forth in this Agreement or any other Loan Document, (i) no Extended Loan is required to be in any minimum amount or any minimum increment unless the Borrower shall so determine, (ii) any Extending Lender may extend all or any portion of its Loans pursuant to one or more Pro Rata Extension Offers (subject to applicable proration in the case of over participation) (including the extension of any Extended Loan), (iii) unless otherwise set forth in an Intercreditor Agreement, all Extended Loans and all obligations in respect thereof shall be Obligations under this Agreement and the other Loan Documents that aresecured by the Collateral on a pari passu basis with all other Obligations under this Agreement and the other Loan Documents and (iv) an Extension may be effected through a cashless rollover of existing Loans into Extended Loans and/or a cash prepayment of existing Loans followed by a concurrent funding of such cash prepayment amount less any fees paid in connection with such Extension into Extended Loans.

(d)If the aggregate principal amount of the Loans in respect of which Lenders have accepted the relevant Pro Rata Extension Offer exceed the maximum aggregate principal amount of Loans offered to be extended by the Borrower pursuant to such Pro Rata Extension Offer, then the Loans shall be extended pro rata up to such maximum amount based on the respective principal amounts with respect to which such Lenders have accepted such Pro Rata Extension Offer.

(e)Each Extension shall be consummated pursuant to procedures reasonably acceptable to the Administrative Agent and the Borrower and set forth in the associated Pro Rata Extension Offer; provided that the Borrower shall cooperate with the Administrative Agent in connection with making any Pro Rata Extension Offer to establish reasonable procedures with respect to mechanical provisions relating to such Extension, including, without limitation, timing, rounding and other adjustments.

ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY

3.01     Taxes.

(a)    Payments Free of Taxes. Unless required by applicable Law (as determined in good faith by the applicable withholding agent), and all payments by or on account of any obligation of the Loan Parties hereunder or under any other Loan Document shall be made free and clear of and without deduction or withholding for any Indemnified Taxes or Other Taxes; provided, however, that if the applicable withholding agent shall be required by applicable Law to deduct, or an Agent or a Lender shall be required to remit, any Taxes from such payments, then (i) in the case of Indemnified Taxes or Other Taxes, the sum payable by the applicable Loan Party shall be increased as necessary so that after all required deductions or remittances for such Taxes (including deductions applicable to additional sums payable under this Section 3.01) have been made, the Administrative Agent or Lender, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made, (ii) the applicable withholding agent shall make such deductions and (iii) the applicable withholding agent shall pay the full amount deducted to the relevant Governmental Authority in accordance with Applicable Law.

(b)    Payment of Other Taxes by the Loan Parties. In addition, the Loan Parties shall pay any Other Taxes to the relevant Governmental Authority in accordance with Applicable Law.

(c)    Indemnification by the Borrower. The Borrower shall indemnify the Administrative Agent and each Lender, within 10 days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by the Administrative Agent or such Lender, as the case may be, on or with respect to any payment by or on account of any obligation of the Loan Parties hereunder or

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under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this section) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto; provided that if the Borrower reasonably believes that such Taxes were not correctly or legally asserted, each Lender will use reasonable efforts to cooperate with the Borrower to obtain a refund of such taxes (which shall be repaid to the Borrower in accordance with Section 3.01(f)) so long as such efforts would not, in the sole determination of such Lender result in any additional costs, expenses or risks or be otherwise disadvantageous to it; provided, further, that the Borrower shall not be required to compensate any Lender pursuant to this Section 3.01 for any amounts incurred in any fiscal year for which such Lender is claiming compensation if such Lender does not furnish notice of such claim within six months from the end of such fiscal year; provided, further, that if the circumstances giving rise to such claim have a retroactive effect (e.g., in connection with the audit of a prior tax year), then the beginning of such six-month period shall be extended to include such period of retroactive effect. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender or by the Administrative Agent on its own behalf or on behalf of any Lender, setting forth in reasonable detail the manner in which such amount was determined, shall be conclusive absent manifest error.

(d)    Evidence of Payments. As soon as practicable after any payment of Indemnified Taxes or Other Taxes by a Loan Party to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(e)    Status of Lenders. Each Lender shall, at such times as are reasonably requested by the Borrower or the Administrative Agent, provide the Borrower and the Administrative Agent with any documentation prescribed by Law, or reasonably requested by the Borrower or the Administrative Agent, certifying as to any entitlement of such Lender to an exemption from, or reduction in, any withholding Tax with respect to any payments to be made to such Lender under the Loan Documents. Each such Lender shall, whenever a lapse in time or change in circumstances renders such documentation expired, obsolete or inaccurate in any material respect, deliver promptly to the Borrower and the Administrative Agent updated or other appropriate documentation (including any new documentation reasonably requested by the applicable withholding agent) or promptly notify the Borrower and the Administrative Agent of its inability to do so. Unless the applicable withholding agent has received forms or other documents satisfactory to it indicating that payments under any Loan Document to or for a Lender are not subject to withholding tax or are subject to such Tax at a rate reduced by an applicable tax treaty, the Borrower, Administrative Agent or other applicable withholding agent shall withhold amounts required to be withheld by applicable Law from such payments at the applicable statutory rate.

Without limiting the generality of the foregoing:

(a)    Each Lender that is a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver to the Borrower and the Administrative Agent on or before the date on which it becomes a party to this Agreement two properly completed and duly signed original copies of Internal Revenue Service Form W-9 (or any successor form) certifying that such Lender is exempt from U.S. federal backup withholding.

(b)    Each Foreign Lender shall deliver to the Borrower and the Administrative Agent on or before the date on which it becomes a party to this Agreement (and from time to time thereafter when required by Law or upon the reasonable request of the Borrower or the Administrative Agent) whichever of the following is applicable:

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(I)    two duly completed copies of Internal Revenue Service Form W-8BEN (or any successor forms) claiming eligibility for benefits of an income tax treaty to which the United States of America is a party,

(II)    two duly completed copies of Internal Revenue Service Form W-8ECI (or any successor forms),

(III)    in the case of a Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate, in substantially the form of Exhibit M (any such certificate a “United States Tax Compliance Certificate”), or any other form approved by the Administrative Agent, to the effect that such Lender is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code, and that no payments in connection with the Loan Documents are effectively connected with such Lender’s conduct of a U.S. trade or business and (y) two duly completed copies of Internal Revenue Service Form W-8BEN (or any successor forms),

(IV)    to the extent a Lender is not the beneficial owner (for example, where the Lender is a partnership, or is a Lender that has granted a participation), Internal Revenue Service Form W-8IMY (or any successor forms) of the Lender, accompanied by a Form W-8ECI, W-8BEN, United States Tax Compliance Certificate, Form W-9, Form W-8IMY (or other successor forms) or any other required information from each beneficial owner, as applicable (provided that, if the Lender is a partnership (and not a participating Lender) and one or more beneficial owners are claiming the portfolio interest exemption, the United States Tax Compliance Certificate shall be provided by such Lender on behalf of such beneficial owner(s)), or

(V)    any other form prescribed by applicable requirements of U.S. federal income tax Law as a basis for claiming exemption from or a reduction in U.S. federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable Requirements of Law to permit the Borrower and the Administrative Agent to determine the withholding or deduction required to be made (including, in the case of any Lender claiming exemption from withholding under Sections 1471 and 1472 of the CodeFATCA, any documentation required to comply with such exemption).

Each Lender shall, from time to time after the initial delivery by such Lender of the forms described above, whenever a lapse in time or change in such Lender’s circumstances renders such forms, certificates or other evidence so delivered expired, obsolete or inaccurate, promptly (1) deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) renewals, amendments or additional or successor forms, properly completed and duly executed by such Lender, together with any other certificate or statement of exemption required in order to confirm or establish such Lender’s status or that such Lender is entitled to an exemption from or reduction in U.S. federal withholding tax or (2) notify Administrative Agent and the Borrower of its inability to deliver any such forms, certificates or other evidence.

Notwithstanding any other provision of this clause (e), a Lender shall not be required to deliver any form that such Lender is not legally eligible to deliver.

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(f)    Should a Lender become subject to Taxes because of its failure to deliver a form required hereunder (including any documentation necessary to prevent withholding under Section 1471 or Section 1472 of the CodeFATCA), the Loan Parties shall, at such Lender’s expense, take such steps as such Lender shall reasonably request to assist such Lender to recover such Taxes.

(g)    If any Loan Party shall be required pursuant to this Section 3.01 to pay any additional amount to, or to indemnify, any Agent or Lender to the extent that such Agent or Lender becomes subject to Taxes subsequent to the Restatement Date (or, if applicable, subsequent to the date such Person becomes a party to this Agreement) as a result of any change in the circumstances of such Agent or Lender (other than a change in Applicable Law), including without limitation a change in the residence, place of incorporation, principal place of business of such Agent or Lender or a change in the branch or lending office of such Agent or Lender, as the case may be, such Agent or Lender shall use reasonable efforts to avoid or minimize any amounts which might otherwise be payable pursuant to this Section 3.01; provided, however, that such efforts shall not include the taking of any actions by such Agent or Lender that would result in any tax, costs or other expense to such Agent or Lender (other than a tax, cost or other expense for which such Agent or Lender shall have been reimbursed or indemnified by the Loan Parties pursuant to this Agreement or otherwise) or any action which would or might in the reasonable opinion of such Agent or Lender have an adverse effect upon its business, operations or financial condition or otherwise be disadvantageous to such Agent or Lender.

(h)    If any Lender or Agent reasonably determines that it has actually and finally realized, by reason of a refund, deduction or credit of any Indemnified Taxes or Other Taxes as to which it has been paid or reimbursed by the Loan Parties pursuant to subsection (a) or (c) above in respect of payments under the Loan Documents, a current monetary benefit that it would otherwise not have obtained and that would result in the total payments under this Section 3.01 exceeding the amount needed to make such Lender or Agent whole, such Lender or Agent shall pay to the Borrower, with reasonable promptness following the date upon which it actually realizes such benefit, an amount equal to the lesser of the amount of such benefit or the amount of such excess, in each case net of all out-of-pocket expenses (including Taxes) incurred in securing such refund, deduction or credit and without interest (other than any interest paid by the relevant taxing authority with respect to such refund net of any Taxes payable by any Lender or Agent on such interest).

3.02     Change in Legality.

(a)    Notwithstanding anything to the contrary contained elsewhere in this Agreement, if any Change in Law occurring after the Restatement Date shall make it unlawful for a Lender to make or maintain a Eurodollar Rate Loan or to give effect to its obligations as contemplated hereby with respect to a Eurodollar Rate Loan, then, by written notice to the Borrower, such Lender may (x) declare that Eurodollar Rate Loans will not thereafter be made by such Lender hereunder, whereupon any request by the Borrower for a Eurodollar Rate Loan shall, unless withdrawn, as to such Lender only, be deemed a request for a Base Rate Loan unless such declaration shall be subsequently withdrawn; and (y) require that all outstanding Eurodollar Rate Loans made by such Lender be converted to Base Rate Loans, in which event all such Eurodollar Rate Loans shall be automatically converted to Base Rate Loans as of the effective date of such notice as provided in Section 2.02. In the event any Lender shall exercise its rights hereunder, all payments and prepayments of principal which would otherwise have been applied to repay the Eurodollar Rate Loans that would have been made by such Lender or the converted Eurodollar Rate Loans of such Lender shall instead be applied to repay the Base Rate Loans made by such Lender in lieu of, or resulting from the conversion of, such Eurodollar Rate Loans.

(b)    For purposes of this Section 3.02, a notice to the Borrower pursuant to Section 3.02(a) above shall be effective, if lawful, and if any Eurodollar Rate Loans shall then be outstanding, on the last

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day of the then-current Interest Period; and otherwise such notice shall be effective on the date of receipt by the Borrower.

3.03     Alternate Rate of Interest for Loans. If, prior to the commencement of any Interest Period for a Eurodollar Rate Loan, the Administrative Agent:

(a)    reasonably determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Eurodollar Rate (in accordance with the terms of the definitions thereof) for such Interest Period; or

(b)    is advised by the Required Lenders that the Eurodollar Rate for such Interest Period will not adequately and fairly reflect the cost to such Required Lenders of making or maintaining their Loans included in such Borrowing for such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the applicable Lenders that the circumstances giving rise to such notice no longer exist (which notice the Administrative Agent shall deliver promptly upon obtaining knowledge of the same), (i) any Borrowing or Conversion Notice that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Rate Loan shall be ineffective and (ii) if any Borrowing Request requests a Eurodollar Rate Loan, such Borrowing shall be made as a Borrowing of Base Rate Loans unless withdrawn by the Borrower.

3.04     Increased Costs; Reserves on Eurodollar Rate Loans.

(a)    Increased Costs Generally. If any Change in Law shall:

(i)    impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender (except any reserve requirement reflected in the Eurodollar Rate); or

(ii)    impose on any Lender or the London interbank market any other condition affecting Eurodollar Rate Loans made by such Lender;

and the result of any of the foregoing shall be to increase the cost in any material amount in excess of that incurred by similarly situated lenders to such Lender of making or maintaining any Eurodollar Rate Loan or to reduce the amount in any material respect of any sum received or receivable by such Lender hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender such additional amount or amounts as will compensate such Lender for such additional costs incurred or reduction suffered.

(b)    Capital Requirements. If any Lender determines that (i) any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement or the Loans made by such Lender to a level below that which such Lender or such Lender’s holding company would have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy) then from time to time the Borrower will pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

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(c)    Certificates for Reimbursement. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section 3.04 and setting forth in reasonable detail the manner in which such amount or amounts were determined shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within fifteen (15) Business Days after receipt thereof.

(d)    Delay in Requests. Failure or delay on the part of any Lender to demand compensation pursuant to the foregoing provisions of this Section 3.04 shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to the foregoing provisions of this Section 3.04 for any increased costs or reductions incurred more than 90 days prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefore and provided, further, that if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 90-day period referred to above shall be extended to include the period of retroactive effect thereof.

3.05     Compensation for Losses. The Borrower shall promptly reimburse any Lender for any loss, cost or expense incurred by it in the reemployment of funds resulting from:

(a)    any continuation, conversion, payment or prepayment of any Eurodollar Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise); or

(b)    any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan or the failure of the Lender to deliver any notice pursuant to Section 3.02, 3.03 or 3.04) to prepay, borrow, continue or convert any Eurodollar Rate Loan on the date or in the amount notified by the Borrower.

Such loss shall be the amount as reasonably determined by such Lender as the excess, if any, of (A) the amount of interest which would have accrued to such Lender on the amount so paid, not prepaid or not borrowed at a rate of interest equal to the Eurodollar Rate for such Loan (but specifically excluding any Applicable Rate) for the period from the date of such payment or failure to borrow or failure to prepay to the last day (x) in the case of a payment or refinancing of a Eurodollar Rate Loan with Base Rate Loans other than on the last day of the Interest Period for such Loan or the failure to prepay a Eurodollar Rate Loan, of the then current Interest Period for such Loan or (y) in the case of such failure to borrow, of the Interest Period for such Eurodollar Rate Loan which would have commenced on the date of such failure to borrow, over (B) in the case of a Eurodollar Rate Loan, the amount of interest which would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the London interbank market. A certificate of any Lender setting forth in reasonable detail any amount or amounts that such Lender is entitled to receive pursuant to this Section 3.05 and the manner in which such amount was determined shall be delivered to the Borrower (with a copy to the Administrative Agent). The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 Business Days after receipt thereof.

3.06     Mitigation Obligations; Replacement of Lenders.

(a)    Designation of Different Lending Office. If any Lender requests compensation under Section 3.04 or cannot make Loans under Section 3.02, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, then such Lender shall use reasonable efforts to designate a different lending office for

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funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates if, in the reasonable judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment; provided, however, that the Borrower shall not be liable for such costs and expenses of a Lender requesting compensation if (i) such Lender becomes a party to this Agreement on a date after the Restatement Date and (ii) the relevant Change in Law occurs on a date prior to the date such Lender becomes a party hereto.

(b)    Replacement of Lenders. If any Lender requests compensation under Section 3.04, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, the Borrower may replace such Lender in accordance with Section 10.13.

3.07     Survival. All of the Borrower’s obligations under this Article III shall survive termination of the Aggregate Commitments and repayment of all other Obligations hereunder.

ARTICLE IV
CONDITIONS PRECEDENT TO LOANS

4.01     Conditions of Loans. The obligation of each Lender to make its Loan on the Restatement Date is subject to satisfaction of the following conditions precedent:

(a)    Loan and Corporate Documents; Certificates. Receipt by the Administrative Agent of the following, each of which shall be originals or facsimiles (followed promptly by originals) unless otherwise specified, each, if applicable, properly executed by a Responsible Officer of the signing Loan Party, each dated the Restatement Date (or, in the case of certificates of governmental officials, a recent date before the Restatement Date):

(i)    executed counterparts of this Agreement (including the Exhibits and Schedules thereto) and each other Loan Document and the Perfection Certificate;

(ii)    a Note executed by the Borrower in favor of each Lender requesting a Note;

(iii)    such certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as the Administrative Agent may reasonably require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents to which such Loan Party is a party;

(iv)    such documents and certifications as the Administrative Agent may reasonably require to evidence that each Loan Party is duly organized or formed, is validly existing, in good standing and qualified to engage in business in each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification, except those jurisdictions where the failure to be so qualified could not reasonably be expected to have a Material Adverse Effect;

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(v)    a certificate signed by a Responsible Officer of the Borrower on behalf of the Borrower certifying (A) that the conditions specified in Sections 4.01(d) and 4.01(e) have been satisfied and (B) that there has been no Material Adverse Effect since January 30, 2010; and

(vi)    a Borrowing Notice, relating to the Loans.

(b)    Opinions of Counsel. The Administrative Agent shall have received, on behalf of itself, the other Agents and the Arrangers and the Lenders, opinions of counsel to the Loan Parties, in each case addressed to each of the Agents, the Arrangers and the Lenders and dated the Restatement Date, substantially in the form of Exhibits E-1 and E-2.

(c)    Fees and Expenses. All accrued fees and invoiced expenses of the Agents, the Arrangers and the Lenders (including the fees and expenses of Cahill Gordon & Reindel LLP, counsel for the Agents and the Arrangers, and of local counsel for the Lenders) required to be paid on or before the Restatement Date and presented for payment shall have been paid.

(d)    Representations. The representations and warranties of the Loan Parties contained in Article V or any other Loan Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be true and correct in all material respects on and as of the Restatement Date as though made on such date; provided that to the extent that such representations and warranties specifically refer to an earlier date, then such representations and warranties shall be true and correct in all material respects as of such earlier date.

(e)    No Default. As of the Restatement Date, no Default or Event of Default exists and immediately after the consummation of the Transactions, no Default or Event of Default will exist.

(f)    Personal Property Requirements. The Collateral Agent shall have received:

(i)    reasonably satisfactory evidence that all other certificates, agreements, including control agreements, or instruments necessary to perfect the Collateral Agent’s security interest in the Collateral (as each such term is defined in the Security Agreement and to the extent required by the Security Agreement) have been delivered to the ABL Collateral Agent (which shall act as bailee for the Collateral Agent);

(ii)    UCC financing statements in appropriate form for filing under the UCC, filings with the United States Patent and Trademark Officer and United States Copyright Office and such other documents under applicable law in each jurisdiction as may be necessary to perfect the Liens created, or purported to be created, by the Security Documents (to the extent required by the Security Agreement);

(iii)    copies of UCC, United States Patent and Trademark Office and United States Copyright Office, tax and judgment lien searches, bankruptcy and pending lawsuit searches or equivalent reports or searches, each of a recent date in each of the jurisdictions set forth in Schedules 1(c) and 4attached to the Perfection Certificate, the results of which shall not reveal any Liens on the Collateral covered or intended to be covered by the Security Documents (other than Permitted Liens or any other Liens reasonably acceptable to the Collateral Agent);

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(iv)    evidence reasonably acceptable to the Collateral Agent of payment or arrangements for payment by the Loan Parties of all applicable recording taxes, fees, charges, costs and expenses required for the recording of the Security Documents.

(g)    The Secured Notes shall have been issued by the Borrower and the Borrower shall have received net proceeds from the issuance of the Secured Notes in an amount that, together with the proceeds from the Initial Loans made hereunder on the Restatement Date, is sufficient to repay the Existing Loans and to effect the Refinancing. The Existing Loans and the Existing Unsecured Term Loan Agreement shall be repaid concurrently with the making of the Initial Loans hereunder.

Without limiting the generality of the provisions of Section 9.04, for purposes of determining compliance with the conditions specified in this Section 4.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to funding on the Restatement Date specifying its objection thereto.

ARTICLE V
REPRESENTATIONS AND WARRANTIES

In order to induce the Lenders to enter into this Agreement and to make the Loans to be made hereby, each Loan Party represents and warrants to each Lender as of the date hereof that the following statements are true and correct (it being understood and agreed that the representations and warranties made herein are deemed to be made concurrently with the consummation of the Transactions):

5.01     Organization; Powers. Each Loan Party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has all requisite power and authority to own its property and assets and to carry on its business as now conducted except, in each case, where the failure to do so, or so possess, individually or in the aggregate would not reasonably be expected to result in a Material Adverse Effect. Each Loan Party has all requisite organizational power and authority to execute and deliver and perform all its obligations under all Loan Documents to which such Loan Party is a party. Each Loan Party is qualified to do business in, and is in good standing (where such concept exists) in, every jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified or in good standing individually or in the aggregate would not reasonably be expected to result in a Material Adverse Effect. Schedule 5.01 annexed hereto sets forth, as of the Restatement Date, each Loan Party’s name as it appears in official filings in its state of incorporation or organization, its state of incorporation or organization, organization type, organization number, if any, issued by its state of incorporation or organization, and its federal employer identification number.

5.02     Authorization; Enforceability. The transactions contemplated hereby and by the other Loan Documents to be entered into by each Loan Party are within such Loan Party’s corporate powers and have been duly authorized by all necessary corporate, membership, partnership or other necessary action. This Agreement has been duly executed and delivered by each Loan Party that is a party hereto and constitutes, and each other Loan Document to which any Loan Party is a party, when executed and delivered by such Loan Party, will constitute, a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

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5.03     Governmental Approvals; No Conflicts. The transactions to be entered into and contemplated by the Loan Documents (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except for such as (i) have been obtained or made and are in full force and effect, or (ii) the failure of which to obtain would not reasonably be expected to result in a Material Adverse Effect, (b) will not violate any Applicable Law or the Charter Documents of any Loan Party, except to the extent that such violation would not reasonably be expected to result in a Material Adverse Effect, (c) will not violate or result in a default under any indenture or any other agreement, instrument or other evidence of Material Indebtedness, except to the extent that such default would not reasonably be expected to result in a Material Adverse Effect and (d) will not result in the creation or imposition of any Lien on any asset of any Loan Party.

5.04     Financial Condition. The Borrower has heretofore furnished to the Agents the Consolidated balance sheet, and statements of income, stockholders’ equity and cash flows for the Borrower and its Subsidiaries as of and for the Fiscal Year ending January 30, 2010, certified by a Responsible Officer of the Borrower. Such financial statements present fairly, in all material respects, the financial position, results of operations and cash flows of the Borrower and its Subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year end audit adjustments and the absence of footnotes. Since January 30, 2010, there has been no Material Adverse Effect.

5.05     Properties. Each Loan Party has title to, or valid leasehold interests in, all its real (immovable) and personal (movable) property material to its business, except for defects which would not reasonably be expected to have a Material Adverse Effect.

5.06     Litigation and Environmental Matters.

(a)    Except as set forth on Schedule 5.06(a) or as disclosed in the annual or quarterly financial statements delivered to the Lenders, there are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the actual knowledge of Responsible Officers of a Loan Party and its Subsidiaries, threatened in writing against any Loan Party or its Subsidiaries (other than claims (A) which are covered by insurance, (B) which are being defended by the relevant insurance company and (C) as to which no Loan Party has knowledge (though notice from such insurance company or otherwise) that the claim potentially exceeds the total amount of insurance coverage applicable to such claim) (i) as to which there is a reasonable possibility of an adverse determination which, if adversely determined, would reasonably be expected individually or in the aggregate to result in a Material Adverse Effect or (ii) that involve any of the Loan Documents and would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.

(b)    Except as set forth on Schedule 5.06(b) or as disclosed in the annual or quarterly financial statements delivered to the Lenders, no Loan Party (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability, which, in each case, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.

(c)    Since the date of this Agreement, there has been no change in the status of the Disclosed Matters that, individually or in the aggregate, has resulted in, or would reasonably be expected to result in, a Material Adverse Effect.

5.07     Compliance with Laws and Agreements. Each Loan Party is in compliance with all Applicable Law and all Material Indebtedness (including, without limitation, the Indentures), and no

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event of default has occurred and is continuing thereunder, except in each case where the failure to comply or the existence of a default, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. Without limiting the generality of the foregoing, each Loan Party has obtained all permits, licenses and other authorizations which are required with respect to the ownership and operations of its business except where the failure to obtain such permits, licenses or other authorizations, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. Each Loan Party is in material compliance with all terms and conditions of all such permits, licenses, orders and authorizations, except where the failure to comply with such terms or conditions, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

5.08     Investment and Holding Company Status. No Loan Party or any of its Subsidiaries is an “investment company” as defined in, and required to be registered as such under, the Investment Company Act of 1940.

5.09     Taxes. Each Loan Party and its Subsidiaries has timely filed or caused to be filed all tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings, for which such Loan Party and its Subsidiaries have set aside on its books adequate reserves, and as to which no Lien has arisen or (b) to the extent that the failure to do so would not reasonably be expected to result in a Material Adverse Effect.

5.10     ERISA. No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, would reasonably be expected to result in a Material Adverse Effect. The present value of all accumulated benefit obligations under each Plan subject to ERISA (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed the fair market value of the assets of such Plan, and the present value of all accumulated benefit obligations of all underfunded Plans subject to ERISA (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed the fair market value of the assets of all such underfunded Plans, in each case, to the extent that any resulting liabilities would reasonably be expect to result in a Material Adverse Effect.

5.11     Disclosure. None of the reports, financial statements, certificates or other information (other than any projections, pro formas, budgets and general market information) concerning the Loan Parties furnished by or on at the direction of any Loan Party to any Lender or Agent in connection with the negotiation of this Agreement or any other Loan Document or delivered hereunder or thereunder (as modified or supplemented by other information so furnished), when taken as a whole, contains, as of the date furnished, any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not materially misleading in light of the circumstances under which such statements were made.

5.12     Subsidiaries.

(a)    Schedule 5.12 sets forth the name of, and the ownership interest of each Loan Party in, each Subsidiary as of the Restatement Date; there are no other Equity Interests of any class outstanding as of the Restatement Date. To the knowledge of the Responsible Officers of the Loan Parties, all such Equity Interests are validly issued, fully paid and, except as set forth on Schedule 5.12, non-assessable.

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(b)    Except as set forth on Schedule 5.12, no Loan Party is party to any joint venture, general or limited partnership, or limited liability company agreements as of the Restatement Date.

5.13     Insurance. Schedule 5.13 sets forth a description of all business interruption, general liability, directors’ and officers’ liability, comprehensive, and casualty insurance maintained by or on behalf of the Loan Parties as of the Restatement Date. Each insurance policy listed on Schedule 5.13 is in full force and effect as of the Restatement Date and all premiums in respect thereof that are due and payable as of the Restatement Date have been paid.

5.14     Labor Matters. As of the Restatement Date, there are no strikes, lockouts or slowdowns against any Loan Party pending or, to the actual knowledge of any Responsible Officer of any Loan Party, threatened, except to the extent that strikes, lockouts or slowdowns would not reasonably be expected to result in a Material Adverse AEffect. The hours worked by and payments made to employees of the Loan Parties have not been in violation of the Fair Labor Standards Act or any other applicable federal, state, local or foreign law dealing with such matters to the extent that any such violation could reasonably be expected to have a Material Adverse Effect. Except for Disclosed Matters and to the extent that such liability would not reasonably be expected to have a Material Adverse Effect, all payments due from any Loan Party, or for which any claim may be made against any Loan Party, on account of wages and employee health and welfare insurance and other benefits, have been paid or accrued in accordance with GAAP as a liability on the books of such Loan Party. Except as set forth on Schedule 5.14, as of the Restatement Date no Loan Party nor any of its Subsidiaries is a party to or bound by any material collective bargaining agreement, bonus, restricted stock, stock option, or stock appreciation plan or agreement or any similar plan, agreement or arrangement. As of the Restatement Date, there are no representation proceedings pending or, to the actual knowledge of any Responsible Officer of any Loan Party, threatened to be filed with the National Labor Relations Board or other applicable Governmental Authority, and no labor organization or group of employees of any Loan Party has made a pending demand for recognition. As of the Restatement Date, the consummation of the transactions contemplated by the Loan Documents will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which any Loan Party is bound to the extent that such would be reasonably expected to result in a Material Adverse Effect.

5.15     Federal Reserve Regulations.

(a)    No Loan Party nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of buying or carrying Margin Stock.

(b)    No part of the proceeds of any Loan will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, (i) to buy or carry Margin Stock or to extend credit to others for the purpose of buying or carrying Margin Stock or to refund indebtedness originally incurred for such purpose in violation of Regulation U or X or (ii) for any purpose that entails a violation of, or that is inconsistent with, the provisions of the Regulations of the Board, including Regulation U or Regulation X.

5.16     Solvency. The Loan Parties, on a Consolidated basis, are Solvent. No transfer of property is being made by any Loan Party and no obligation is being incurred by any Loan Party in connection with Transactions or this Agreement or the other Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of any Loan Party.

5.17     Use of Proceeds. The Borrower will use the proceeds of the Loans (i) to consummate the Refinancing, (ii) to pay fees and expenses incurred in connection with the Transactions and (iii) for

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working capital and general corporate purposes.The Borrower will use the proceeds of the Term B-4 Loans (i) to repay in full (or allow for a cashless roll of) the Initial Loans, (ii) to redeem (whether through tender offer or otherwise), defease or discharge all of the Borrower’s outstanding 7.375% Senior Secured Notes due 2016 (including payment of accrued and unpaid interest, premiums and other amounts due), (iii) to pay related fees and expenses in connection with the foregoing and this Agreement and (iv) for general corporate purposes.

5.18     Intellectual Property Matters. Each Loan Party owns, or is licensed to use, all patents, patent applications, trademarks, trade names, service marks, copyrights, technology, trade secrets, proprietary information, domain names, know-how and processes necessary for the conduct of its business as currently conducted (the “Intellectual Property”), except for those the failure to own or license which, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. To the knowledge of each Loan Party, no claim has been asserted and is pending by any Person challenging or questioning the use of any such Intellectual Property or the validity or effectiveness of any such Intellectual Property, nor to the knowledge of each Loan Party does the use of such Intellectual Property by each Loan Party infringe the rights of any Person, except for such claims and infringements disclosed on Schedule 5.06(a) or that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

5.19     Security Documents.

(a)Security Agreement. The Security Agreement is effective to create in favor of the Collateral Agent for the benefit of the Secured Parties, legal, valid and enforceable first priorityLiens on and security interests in the GeoffreyCollateral and seconddescribed therein with the priority liens inthe ABL Priority Collateralrequired by the Intercreditor Agreements (subject to applicable bankruptcy, insolvency, moratorium or other laws affecting creditors’ rights generally and subject to general principals of equity, regardless of whether considered in a proceeding in equity or at law) and, when (i) financing statements and other filings in appropriate form are filed in the offices specified on Schedule 11 to the Perfection Certificate and (ii) upon the taking of possession or control by the Collateral Agent of the Collateral with respect to which a security interest may be perfected only by possession or control (which possession or control shall be given to the Collateral Agent to the extent possession or control by the Collateral Agent is required by the Security Agreement), the Liens created by the Security Agreement shall (to the extent provided therein) constitute perfected Liens on, and security interests in, all right, title and interest of the grantors in the Collateral (other than such Collateral in which a security interest cannot be perfected under the UCC as in effect at the relevant time in the relevant jurisdiction), in each case subject to no Liens other than Permitted Liens. Prior to the Discharge oftheABL Credit AgreementObligations, the representations made in this Section 5.19(a) with respect to the delivery of any Collateral constitutingABL Priority Collateral to the Collateral Agent shall be deemed satisfied by the delivery of such Collateral byto the ABL Collateral Agentas bailee for the Collateral Agent pursuant to the ABL Intercreditor Agreement.

(b)Copyright Office and Patent and Trademark Office Filing. When the applicable Intellectual Property Security Agreement is filed in the United States Copyright Office or the United States Patent and Trademark Office, as the case may be, the Liens created by such Intellectual Property Security Agreement shall (to the extent provided therein) constitute perfected first priorityLiens on, and security interests in, all right, title and interest of the grantors thereunder in such Intellectual Propertywith the priority required by the Intercreditor Agreements, in each case subject to no Liens other than Permitted Liens.

(c)    Valid Liens. Each Security Document delivered pursuant to Section 6.11 will, upon execution and delivery thereof, be effective to create in favor of the Collateral Agent, for the benefit of the

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Secured Parties, legal, valid and enforceable Liens on, and security interests in, all of the Loan Parties’ right, title and interest in and to the Collateral thereunder, and when all appropriate filings or recordings are made in the appropriate offices as may be required under applicable law, such Security Document will (to the extent provided therein) constitute perfected first priorityLiens on all GeoffreyCollateral and seconddescribed therein for the benefit of all the Secured Parties with the priority Liens on all ABL Priority Collateralrequired by the Intercreditor Agreements, in each case subject to no Liens other than the applicable Permitted Liens (subject to applicable bankruptcy, insolvency, moratorium or other laws affecting creditors’ rights generally and subject to general principals of equity, regardless of whether considered in a proceeding in equity or at law). Prior to the Discharge of theABL Credit AgreementObligations, the representations made in this Section 5.19(c) with respect to the delivery of any Collateral constituting ABL Priority Collateral to the Collateral Agent shall be deemed satisfied by the delivery of such Collateral to the ABL Collateral Agentas bailee for the Collateral Agent pursuant to the ABL Intercreditor Agreement.

5.20     Anti-Terrorism Law.

(a)    No Loan Party and, to the knowledge of the Loan Parties, none of its Affiliates is in violation (other than an immaterial violation) of any applicable law relating to terrorism or money laundering (“Anti-Terrorism Laws”), including Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001 (the “Executive Order”), and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107‑56.

(b)    No Loan Party and, to the knowledge of the Loan Parties, no Affiliate or broker or other agent of any Loan Party acting or benefiting in any capacity in connection with the Loans is any of the following:

(i)    a Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;

(ii)    a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;

(iii)    a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;

(iv)    a Person that commits, threatens or conspires to commit or supports “terrorism” as defined in the Executive Order; or

(v)    a Person that is named as a “specially designated national and blocked person” on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control (“OFAC”) at its official website or any replacement website or other replacement official publication of such list.

(c)    No Loan Party and, to the knowledge of the Loan Parties, no broker or other agent of any Loan Party acting in any capacity in connection with the Loans (i) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of any Person described in paragraph (b) above, (ii) deals in, or otherwise engages in any transaction relating to, any property or interests in property blocked pursuant to the Executive Order, or (iii) engages in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law.

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ARTICLE VI
AFFIRMATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder or any Loan or other Obligation hereunder shall remain unpaid or unsatisfied (other than contingent indemnity obligations with respect to then unasserted claims), each Loan Party shall, and shall cause each of its Subsidiaries (other than the Excluded Subsidiaries) to:

6.01     Financial Statements and Other Information. Furnish to the Administrative Agent:

(a)    (i) Within one hundred twenty (120) days after the end of each Fiscal Year of the Borrower, the Consolidated balance sheet and related statements of operations, and Consolidated statements of cash flows as of the end of and for such year for the Borrower and its Subsidiaries, all audited and reported on by independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without a qualification or exception as to the scope of such audit) to the effect that such Consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Borrower and its Subsidiaries on a Consolidated basis in accordance with GAAP, together with separate financial statements for each business segment identified on, and as required by, Schedule 6.01(a) hereto and (ii) simultaneously with the delivery of the financial statements pursuant to clause (i) hereof, make publicly available (for so long as Holdings is subject to the reporting requirements under the Exchange Act) such financial statements (but, to the extent prohibited by the independent public accountants, excluding the audit report thereto; provided that if such audit report contains material non-public information, the Borrower shall use its commercially reasonable efforts to make such information publicly available simultaneously with the financial statements);

(b)    Within sixty (60) days after the end of each of the first three Fiscal Quarters of the Borrower, and simultaneously make publicly available (for so long as Holdings is subject to the reporting requirements under the Exchange Act), (x) the unaudited Consolidated balance sheet and related statements of operations and Consolidated statements of cashflowsfor the Borrower and its Subsidiaries, as of the end of and for such Fiscal Quarter and (y) the unaudited Consolidated balance sheet and related statements of operationsand Consolidated statements of cash flow for the Borrower and its Subsidiaries forthe elapsed portion of the Fiscal Year, in each case, all certified by one of the Borrower’s Responsible Officers as presenting in all material respects the financial condition and results of operations of the Borrower and its Subsidiaries on a Consolidated basis in accordance with GAAP, subject to year-end audit adjustments and the absence of footnotes, together with separate financial statements for each business segment identified on, and as required by, Schedule 6.01(a) hereto;

(c)    Promptly after the same become publicly available, copies of (i) all material periodic and other reports, proxy statements and other materials filed by any Loan Party with the SEC or any Governmental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange, as the case may be, and (ii) SEC Forms 10-K and 10-Q for Holdings (for so long as Holdings is subject to the reporting requirements under the Exchange Act); provided that no delivery shall be required hereunder with respect to each of the foregoing to the extent that such are publicly available via EDGAR or other publicly available reporting system;

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(d)    Within two weeks after the financial statements of the Borrower are required to be delivered pursuant to Sections 6.01(a) and 6.01(b), the Borrower shall participate in a conference call to discuss results of operations of the Borrower and its Subsidiaries with the Lenders; provided that (i) the Borrower shall not be required to disclose any information that would be considered to be material non-public information (as determined by the Borrower in its reasonable discretion) and (ii) so long as Holdings is an SEC registrant, the participation by Holdings in quarterly conference calls to discuss results of Holdings’ domestic operations shall be deemed to satisfy the obligations of Borrower under this Section 6.01(d).;

(e)    Promptly upon receipt thereof, copies of all material reports submitted to any Loan Party by independent certified public accountants in connection with each annual, interim or special audit of the books of the Loan Parties or any of their Subsidiaries made by such accountants, including any management letter commenting on the Loan Parties’ internal controls submitted by such accountants to management in connection with their annual audit;

(f)    Promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of any Loan Party as the Agents or any Lender may reasonably request including, without limitation, evidence of insurance renewals as required under Section 6.06 in form and substance reasonably acceptable to the Administrative Agent (except such information that is subject to attorney-client privilege or would result in a breach of a confidentiality obligation); provided that the Borrower shall not be required to disclose any information that would be considered to be material non-public information (as determined by the Borrower in its reasonable discretion); and

(g)    Concurrently with the delivery of the financial statements referred to in Sections 6.01(a) and (b) (commencing with the delivery of the financial statements for the fiscal quarter ended October 30, 2010, a duly completed Leverage/Prepayment Certificate signed by the chief executive officer, chief financial officer, treasurer or controller of the Borrower on behalf of the Borrower, indicating the Total Leverage Ratio of the Borrower, as well as a description of each event, condition or circumstance during the last fiscal quarter covered by such Leverage/Prepayment Certificate requiring a mandatory prepayment under Section 2.03 (and, with respect to any event described in Section 2.03(e), a calculation of the Excess Cash Flow for such period) (which delivery may be by electronic communication including fax or email and shall be deemed to be an original authentic counterpart thereof for all purposes).

The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Arrangers will make available to the Lenders materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on IntraLinks or another similar electronic system (the “Platform”) and (b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to receive material non-public information with respect to the Borrower or its Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such Persons’ securities. The Borrower hereby agrees that it will use commercially reasonable efforts to identify that portion of the Borrower Materials that may be distributed to the Public Lenders and that (w) all such Borrower Materials shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the Administrative Agent, the Arrangers and the Lenders to treat such Borrower Materials as not containing any material non-public information (although it may be sensitive and proprietary) with respect to the Borrower or its securities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower

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Materials constitute Information, they shall be treated as set forth in Section 10.07); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Side Information”; and (z) the Administrative Agent and the Arrangers shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Side Information.”

6.02     Notices of Material Events. Furnish to the Administrative Agent prompt written notice of the occurrence of any of the following after any Responsible Officer of the Borrower obtains knowledge thereof:

(a)    a Default or Event of Default, specifying the nature and extent thereof and the action (if any) which is proposed to be taken with respect thereto;

(b)    the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting any Loan Party or any Subsidiary of Holdings thereof that would reasonably be expected to result in a Material Adverse Effect;

(c)    an ERISA Event that, alone or together with any other ERISA Events that have occurred, would reasonably be expected to result in a Material Adverse Effect;

(d)    any development that results in a Material Adverse Effect;

(e)    any change in any Loan Party’s chief executive officer or chief financial officer; and

(f)    the discharge by any Loan Party of its present independent accountants or any withdrawal or resignation by such independent accountants.

Each notice delivered under this Section shall be accompanied by a statement of a Responsible Officer or other executive officer of the Borrower setting forth the details of the event or development requiring such notice and, if applicable, any action taken or proposed to be taken with respect thereto.

6.03     Existence; Conduct of Business. Do all things necessary to comply with its Charter Documents in all material respects, and to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of its business, except to the extent that the failure to do so would not reasonably be expected to have a Material Adverse Effect; provided that the foregoing shall not prohibit any merger, consolidation, amalgamation, liquidation or dissolution permitted under Section 7.04.

6.04     Payment of Obligations. Pay its Tax liabilities before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, such Loan Party or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP, and such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (b) the failure to make payment would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.

6.05     Maintenance of Properties. Keep and maintain all property material to the conduct of its business in good working order and condition (ordinary wear and tear, casualty loss and condemnation excepted), except where the failure to do so would not reasonably be expected to result in a Material Adverse Effect and except for Store closings and Asset Sales permitted pursuant to Section 7.05.

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6.06     Insurance.

(a)    (i) Maintain insurance with financially sound and reputable insurers (or, to the extent consistent with business practices in effect on the Restatement Date, a program of self-insurance) on such of its property and in at least such amounts and against at least such risks as is consistent with business practices in effect on the Restatement Date or as otherwise determined by the Responsible Officers of the Loan Parties acting reasonably in their business judgment, including public liability insurance against claims for personal injury or death occurring upon, in or about or in connection with the use of any properties owned, occupied or controlled by it; (ii) maintain such other insurance as may be required by law; and (iii) furnish to the Administrative Agent, upon written request, full information as to the insurance carried.

(b)After the Springing Covenant Trigger Date, if any portion of any Specified Real Property encumbered by a Mortgage is at any time located in an area identified by the Federal Emergency Management Agency (or any successor agency) as a special flood hazard area with respect to which flood insurance has been made available under the Flood Insurance Laws, then the Borrower shall, or shall cause each applicable Loan Party to (i) maintain, or cause to be maintained, with a financially sound and reputable insurer, flood insurance in an amount and otherwise sufficient to comply with all applicable rules and regulations promulgated pursuant to the Flood Insurance Laws and (ii) deliver to the Administrative Agent evidence of such compliance in form and substance reasonably acceptable to the Administrative Agent, including, without limitation, evidence of annual renewals of such insurance.

(b)Subject to the terms of the Intercreditor Agreements, maintain fire and extended coverage policies with respect to any Collateralendorsed or otherwise amended to include(i) a lenders’loss payableclause (regarding personal property), in form and substance reasonably satisfactory to the Administrative Agent,which endorsements or amendments shall provide that the insurer shall pay all proceeds otherwise payable to the Loan Parties under the policies directlyto the Administrative Agent, (ii) a provision to the effect that none of the Loan Parties, the Secured Parties or any other Affiliate of a Loan Party shall be a co-insurer (the foregoing not being deemed to limit the amount of self-insured retention or deductibles under such policies, which self-insured retention or deductibles shall be consistent with business practices in effect on the Restatement Date or as otherwise determined by the Responsible Officers of the Loan Parties acting reasonably in their business judgment), and (iii) such other provisions asthe Administrative Agentmay reasonably require from time to time to protect the interests of the Secured Parties. Subject to the terms of the Intercreditor Agreements (i) commercial general liability policies shall be endorsed to name the Administrative Agent as an additional insured and (ii) business interruption policies shall name the Administrative Agent as a loss payee and shall be endorsed or amended to include (x) a provision that, during the continuance of a Cash Dominion Event(as defined in the ABL Credit Agreementand for so long as theABL Credit Agreementis in effect), the insurer shall pay all proceeds otherwise payable to the Loan Parties under such policies directly to the Administrative Agent, (y) a provision to the effect that none of the Loan Parties, Secured Parties (in their capacity as such) or any other Affiliate of a Loan Party shall be a co-insurer and (z) such other provisions to the endorsement as the Administrative Agent may reasonably require from time to time to protect the interests of the Secured Parties. Each such casualty or liability policy referred to in thisSection 6.06(b)shall also provide that it shall not be canceled, modified in any manner than would cause thisSection 6.06(b)to be violated, or not renewed (i) by reason of nonpayment of premium except upon no less than thirty (30) days’ prior written notice thereof by the insurer to the Administrative Agent (giving the Administrative Agent the right to cure defaults in the payment of premiums) or (ii) for any other reason except upon not less than thirty (30) days’ prior written notice thereof by the insurer to the Administrative Agent. The Borrower shall deliver to the Administrative Agent, prior to the cancellation, modification or non-renewal of any such policy of insurance, a copy of a renewal or replacement policy (or other evidence of renewal of a policy previously delivered to the Administrative Agent, including an insurance binder) together with evidence satisfactory to the Administrative Agent of payment of the premium therefor.

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(c)The Agents acknowledge that the insurance policies described onSchedule 5.13are satisfactory to them as of the Restatement Date and are in compliance with the provisions of thisSection 6.06.

6.07     Books and Records; Inspection Rights; Accountants.

(a)    Keep proper books of record and account in accordance with GAAP and in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities and permit any representatives designated by the Agents, upon reasonable prior notice, to visit and inspect its properties, to discuss its affairs, finances and condition with its officers and independent accountants (so long as a representative of the Borrower is afforded an opportunity to be present) and to examine and make extracts from its books and records, all for such reasonable times and as often as reasonably requested.

(b)    Shall at all times retain independent certified public accountants of national standing and shall instruct such accountants to cooperate with, and be available to, the Agents or their representatives to discuss the annual audited statements, the financial performance, financial condition, operating results, controls, and such other matters, within the scope of the retention of such accountants for such audited statements, as may be raised by the Agents; provided that a representative of the Borrower shall be given the opportunity to be present at all such discussions.

6.08     Compliance with Laws. Comply with all Applicable Laws and the orders of any Governmental Authority, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

6.09     Use of Proceeds. Use the proceeds of the Loans made hereunder only (i) to directly or indirectly finance the Refinancing, (ii) pay fees and expenses incurred in connection with the Transactions and (iii) for working capital and general corporate purposes. No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any of the regulations of the Board, including Regulations U and X. The Borrower will use the proceeds of the Term B-4 Loans (i) to repay in full (or allow for a cashless roll of) the Initial Loans, (ii) to redeem (whether through tender offer or otherwise), defease or discharge all of the Borrower’s outstanding 7.375% Senior Secured Notes due 2016 (including payment of accrued and unpaid interest, premiums and other amounts due), (iii) to pay related fees and expenses in connection with the foregoing and this Agreement and (iv) for general corporate purposes.

6.10     Additional Collateral; Additional Guarantors; Additional Covenants.

(a)    Subject to the terms of the Intercreditor Agreements and this Section 6.10, with respect to any property acquired after the Restatement Date by any Loan Party that is intended to be subject to the Lien created by any of the Security Documents but is not so subject, promptly (and in any event within 30 days after the acquisition thereof) (i) execute and deliver to the Administrative Agent and the Collateral Agent such amendments or supplements to the relevant Security Documents or such other documents as the Administrative Agent or the Collateral Agent shall reasonably deem necessary or advisable to grant to the Collateral Agent, for its benefit and for the benefit of the other Secured Parties, a Lien on the Priority Collateraland the GeoffreyCollateral subject to no Liens other than Permitted Liens and (ii) take all actions necessary to cause such Liens to be duly perfected to the extent required by such Security Documents in accordance with all applicable law, including the filing of financing statements in such jurisdictions as may be reasonably requested by the Administrative Agent. Subject to the terms of the Intercreditor Agreements, the Borrower shall otherwise take such actions and execute and/or deliver to the Collateral Agent such documents as the Administrative Agent or the Collateral Agent shall reasonably

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require to confirm the validity, perfection and priority of the Liens of the Security Documents on such after-acquired properties. Prior to the Discharge of theABL Credit AgreementObligations, (i) the requirements of this Section 6.10(a) to deliver any Collateral constituting ABL Priority Collateral to the Collateral Agent shall be deemed satisfied by the delivery of such Collateral to the ABL Collateral Agent as bailee for the Collateral Agent pursuant to the ABL Intercreditor Agreement and (ii) solely in the case of any property that constitutesABL Priority Collateral, the Borrower shall, and shall cause each domestic Subsidiary to, comply with the requirements of this Section 6.10(a) with respect to the Obligations hereunder only to the same extent that the Borrower and such Subsidiaries are required to comply with provisions analogous to this Section 6.10(a) with respect to the ABL Credit Agreement Obligations in the ABL Credit Agreement, other than with respect to the Canadian Pledge, the Geoffrey Collateral and the Specified Real Property after the Springing Covenant Trigger Date.

(b)    Subject to the terms of the Intercreditor Agreements, with respect to any Person that is or becomes a Material Subsidiary after the Restatement Date, cause such Material Subsidiary (other than any Foreign Subsidiary), within ten (10) Business Days after such Material Subsidiary is formed or acquired or becomes a Material Subsidiary, (i) to execute the joinder agreements to the Guarantee and the Security Agreement, substantially in the forms annexed thereto and (ii) to take all actions necessary in the reasonable opinion of the Administrative Agent or the Collateral Agent to cause the Liens created by the Security Agreement to be duly perfected to the extent required by such agreement in accordance with all applicable law, including the filing of financing statements in such jurisdictions as may be reasonably requested by the Administrative Agent or the Collateral Agent.

(c)Subjectto the terms of the Intercreditor Agreements, within 120 days (or such longer period as the Borrower and the Administrative Agent may agree) after the Springing Covenant Trigger Date, directly or indirectly, grant a first priority lien on and security interest in all of the Specified Real Property for the benefit of the Term B-4 Lenders and deliver the Real Property Collateral Documentation with respect to such Specified Real Property, as applicable, listed in clauses (i) through (xi) below, subject to Permitted Liens, Applicable Law and any restrictions or limitations under the applicable deeds, leases or real estate contracts (the “Springing Covenant”); provided that the Springing Covenant shall not apply to (x) any individual Specified Real Property with an Appraised Value equal to or less than $1,000,000 (each, an “Immaterial Specified Real Property”); provided that the total Appraised Value (as determined by a Recent Appraisal) of all Immaterial Specified Real Properties shall not exceed $5,000,000 in the aggregate, (iii) the Springing Covenant shall not apply to a grant of any Loan Party’s right, title or interest in any lease of a Specified Real Property that prohibits the creation by such Loan Party of a lien thereon and/or a security interest therein or with respect to which a recorded memorandum of such lease does not exist (collectively with any Immaterial Specified Real Properties, an “Excluded Specified Real Property”); provided that the applicable Loan Party shall use commercially reasonable efforts to obtain (A) any lessor consent or approval of the lien and security interest to be placed on such portion of the Specified Real Property as may be required pursuant to the terms of the applicable lease with respect to such leasehold interest and (B) a recorded memorandum of such lease, and provided, further, that at such time as any such lease is no longer subject to such prohibition and/or a memorandum of such lease has been recorded, as applicable, such lease shall (without any act or delivery by any person) be subject to the Springing Covenant. The Borrower shall deliver written notice to the Administrative Agent that the Springing Covenant has been triggered within ten (10) business days after the Springing Covenant Trigger Date. If, following the Springing Covenant Trigger Date, the Borrower makes an Asset Sale or receives Extraordinary Receipts in respect of Specified Real Property that is Collateral and reinvests the Net Cash Proceeds of such Asset Sale or such Extraordinary Receiptin accordance with Section 2.03(b) or Section 2.03(d), as applicable, the Borrower shall, directly or indirectly, grant a first priority lien on and security interest in, and deliver the Real Property Collateral Documentation with respect to, such Specified Real Property subject to such reinvestment if such Specified Real Property is not Collateral within 120 days (or such longer period as the Borrower and the Administrative Agent may agree) after

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such reinvestment. If, following the Springing Covenant Trigger Date, the Borrower swaps or exchanges any Specified Real Property that is Collateral pursuant to Section 7.05(o), the Borrower shall (x) directly or indirectly, grant a first priority lien on and security interest in, and deliver the Real Property Collateral Documentation with respect to, the replaced Real Property within 120 days (or such longer period as the Borrower and the Administrative Agent may agree) after such swap and (y) such Real Property shall become Specified Real Property. If, following the Springing Covenant Trigger Date, the Borrower sells Real Property that is a Specified Real Property pursuant to Section 7.05(p), the Borrower shall (x) directly or indirectly, grant a first priority lien on and security interest in, and deliver the Real Property Collateral Documentation with respect to, the relocated Real Property within 120 days (or such longer period as the Borrower and the Administrative Agent may agree) after such relocation and (y) such Real Property shall become a Specified Real Property.

The liens and security interests in the Specified Real Property shall be granted pursuant to the following Real Property collateral documentation (the “Real Property Collateral Documentation”):

(i) a completed “Life-of-Loan” Federal Emergency Management Agency standard flood hazard determination with respect to each parcel of Specified Real Property (together with a notice about special flood hazard area status and flood disaster assistance duly executed by the Borrower);

(ii) a copy of, or a certificate as to coverage under, and a declaration page relating to, the insurance policies required by Section 6.06 (including, without limitation, flood insurance policies) and the applicable provisions of the Security Documents, each of which (i) shall beendorsed or otherwise amended to include a “standard” or “New York” lender’sloss payable or mortgagee endorsement (as applicable), (ii) shall name the Collateral Agent, on behalf of the Term B-4 Lenders, as additional insured or loss payee, as applicable, (iii) in the case of flood insurance, shall (a) identify the addresses of each property located in a special flood hazard area, (b) indicate the applicable flood zone designation, the flood insurance coverage and the deductible relating thereto and (c) provide that the insurer will give the Collateral Agent 10 days written notice of cancellation or non-renewal and (iv) shall be otherwise in form and substance satisfactory to the Administrative Agent;

(iii) fully executed counterparts of Mortgages covering the Specified Real Property, for recording in all places to the extent necessary or, in the reasonable opinion of the Administrative Agent, desirable to effectively create a valid and enforceable first priority mortgage or deed of trust lien (subject to Permitted Liens) on each parcel of Specified Real Property in favor of the Collateral Agent for its benefit and the benefit of the other Term B-4 Lenders, in form for recording in the applicable jurisdiction as advised by local counsel;

(iv) to the extent requested by the Administrative Agent, proper fixture filings under the UCC on Form UCC-1 for filing under the UCC in the appropriate jurisdiction in which each parcel of Specified Real Property is located, desirable to perfect the security interests in fixtures purported to be created by the Mortgages in favor of the Collateral Agent for its benefit and the benefit of the Term B-4 Lenders;

(v) with respect to each Mortgage encumbering any Specified Real Property, a policy of title insurance (or commitment to issue such a policy having the effect of a policy of title insurance) (each, a “Mortgage Policy”) insuring (or committing to insure) the lien of such Mortgage as a valid and enforceable first priority mortgage or deed of trust lien on the Specified Real Property described therein, which reasonably assures the Collateral Agent that the Mortgage on such Specified Real Property is valid and enforceable mortgage or deed of trust lien on the Specified Real Property subject thereto, free and clear of all defects and encumbrances except

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Permitted Liens and such Mortgage Policy shall (A) to the extent reasonably necessary, include such co-insurance and re-insurance arrangements (with provisions for direct access, if reasonably necessary) as shall be reasonably acceptableto the Administrative Agent, (B) contain a “tie-in” or “cluster” endorsement, if available under applicable law (i.e., policies which insure against losses regardless of location or allocated value of the insured property up to a stated maximum coverage amount) and (C) have been supplemented by such endorsements as shall be reasonably requested by the Administrative Agent and available in the applicable jurisdiction at commercially reasonable rates (including endorsements on matters relating to usury, first loss, zoning, contiguity, future advances, doing business, public road access, survey, variable rate, environmental lien, subdivision, mortgage recording tax, address, separate tax lot and so-called comprehensive coverage over covenants and restrictions;

(vi) Opinions addressed to the Administrative Agent and the Collateral Agent for its benefit and for the benefit of the other Term B-4 Lenders of (i) local counsel in each jurisdiction where the Specified Real Property is located with respect to the enforceability and perfection of the Mortgages and other matters customarily included in such opinions and (ii) counsel for the Borrower regarding due authorization, execution and delivery of the Mortgages, in each case, in form and substance reasonably satisfactory to the Administrative Agent;

(vii) a survey of each parcel of Specified Real Property in such form as shall (a) be required by the title company issuing the applicable Mortgage Policy to issue the so-called comprehensive and other survey-related endorsements and to remove the standard survey exceptions from such Mortgage Policy with respect to such Specified Real Property and (b) comply with the minimum detail requirements of the American Land Title Association and as shall be reasonably requested by the Administrative Agent, which survey shall locate all improvements, public streets and recorded easements affecting such Specified Real Property, provided, however, that a new survey shall not be required to the extent that (x) an existing survey together with an “affidavit of no change” satisfactory to the title company issuing the applicable Mortgage Policy is provided, and (y) the title company issuing the applicable Mortgage Policy removes the standard survey exception and provides reasonable and customary survey-related endorsements and other coverages in such Mortgage Policy; provided, however, that no survey shall be required if the applicable Specified Real Property is not a free standing building;

(viii) copies of all notices delivered to the lessor under each lease relating to the Specified Real Property, solely with respect to (x) the applicable Loan Party’s compliance under the terms of each lease with the applicable provisions of such lease concerning notification to the lessor thereunder of the Borrower and/or the Loan Parties entering into the Transactions, and (y) such notice affording the Collateral Agent all of the benefits and protections of a mortgagee lender, as set forth in such lease;

(ix) with respect to each parcel of Specified Real Property, such affidavits, certificates, instruments of indemnification and other items (including a so-called “gap” indemnification) as shall be reasonably required to induce the title company to issue the Mortgage Policies, endorsements and coverages contemplated above;

(x) evidence reasonably acceptable to the Administrative Agent of payment by the Borrower of all Mortgage Policy premiums, search and examination charges, mortgage recording

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taxes, fees, charges, costs and expenses required for the recording of the Mortgages, fixture filings and issuance of the Mortgaged Policies referred to above; and

(xi) UCC-3 termination statements, mortgage releases and other similar lien releases relating to the release of existing liens on the Specified Real Property (other than Permitted Liens).

6.11     Security Interests; Further Assurances. Subject to the terms of the Intercreditor Agreements, promptly, execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements and other documents), that may be required under any Applicable Law, or which any Agent or the Required Lenders shall reasonably request, to effectuate the transactions contemplated by the Loan Documents or to grant, preserve, protect or perfect the Liens created or intended to be created by the Security Documents or the validity or priority of any such Lien, all at the expense of the Loan Parties (to the extent required by this Agreement). The Loan Parties also agree to provide each Agent, from time to time upon the reasonably request of any Agent, evidence reasonably satisfactory to each such Agent as to the perfection and priority of the Liens created or intended to be created by the Security Documents. Prior to the Discharge of theABL Credit AgreementObligations, (i) the requirements of this Section 6.11 to deliver any Collateral constituting ABL Priority Collateral to the Collateral Agent shall be deemed satisfied by the delivery of such Collateral to the ABL Collateral Agent as bailee for the Collateral Agent pursuant to the ABL Intercreditor Agreementand (ii)solely in the case of any property that constitutes ABL Priority Collateral, the Borrower shall, and shall cause each domestic Subsidiary to, comply with the requirements of this Section 6.11 with respect to the Obligations hereunder only to the same extent that the Borrower and such Subsidiaries are required to comply with provisions analogous to this Section 6.11 with respect to the ABL Credit Agreement Obligations in the ABL Credit Agreement, other than with respect to the Canadian Pledge, the Geoffrey Collateral and the Specified Real Property after the Springing Covenant Trigger Date.

6.12     Information Regarding Collateral.

(a)    Not effect any change (i) in any Loan Party’s legal name, (ii) in the location of any Loan Party’s chief executive office or principal place of business, (iii) in any Loan Party’s identity or organizational structure, (iv) in any Loan Party’s organizational identification number, if any, or (v) in any Loan Party’s jurisdiction of organization (in each case, including by merging with or into any other entity, reorganizing, dissolving, liquidating, reorganizing or organizing in any other jurisdiction), unless all filings, publications and registrations have been made under the Uniform Commercial CodeUCC or other Applicable Law that are required in order for the AdministrativeCollateral Agent to continue at all times following such change to have a valid, legal and perfected first prioritysecurity interest or secondwith the priority security interest, as applicablerequired by the Intercreditor Agreements (subject only to Permitted Liens having priority by operationg of Applicable Law) in all the Collateral for its own benefit and the benefit of the Secured Parties. Each Loan Party agrees to promptly provide the Collateral Agent with certified Organization Documents reflecting any of the changes described in the preceding sentence. Each Loan Party also agrees to promptly notify the Collateral Agent of any change in the location of any office in which it maintains books or records relating to Collateral owned by it or any office or facility at which Collateral in excess of $100,000 in value is located (including the establishment of any such new office or facility). ThePrior to the Discharge of ABL Obligations and solely in the case of any Collateral constituting ABL Priority Collateral, the Borrower shall, and shall cause each domestic Subsidiary to, comply with the requirements of this Section 6.12 with respect to the Obligations hereunder only to the

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same extent that the Borrower and such Subsidiaries are required to comply with provisions analogous to this Section 6.12 with respect to the ABL Credit Agreement Obligations in the ABL Credit Agreement, other than with respect to the Canadian Pledge, the Geoffrey Collateral and the Specified Real Property after the Springing Covenant Trigger Date.

(b)    Deliver to the Administrative Agent and the Collateral Agent, upon reasonable request, such information reasonably deemed by the Administrative Agent or the Collateral Agent necessary to obtain or maintain (to the extent provided in the applicable Security Document) a valid, perfected Lien on all ABL Priority Collateralor all GeoffreyCollateral acquired after the Closing Date to the extent required under the Security Documents.

6.13Interest Rate Protection

. No later than the 90^th day after the Restatement Date, the Borrower shall enter into, and for a minimum of two years thereafter maintain, Hedging Agreements with terms and conditions reasonably acceptable to the Administrative Agent that result in at least 50% of the aggregate principal amount of the outstanding consolidated Indebtedness (other than the ABL Credit Agreement Obligations) being effectively subject to a fixed or maximum interest rate reasonably acceptable to the Administrative Agent.

6.13 Initial Appraisal

(a)Within twenty four (24) months after the Amendment No. 3 Effective Date (or such longer period as the Borrower and the Administrative Agent may agree), the Borrower shall deliver the Initial Appraisal to the Administrative Agent.

ARTICLE VII
NEGATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder or any Loan or other Obligation hereunder shall remain unpaid or unsatisfied (other than contingent indemnity obligations with respect to unasserted claims), the Loan Parties shall not, nor shall any Loan Party permit any of its Subsidiaries (other than the Excluded Subsidiaries) to, directly or indirectly:

7.01     Liens. Create, incur, assume or suffer to exist any Lien upon any of their assets, whether now owned or hereafter acquired, other than the following (“Permitted Liens”):

(a)    Liens imposed by law for Taxes that are not required to be paid pursuant to Section 6.04;

(b)    carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by Applicable Law, (i) arising in the ordinary course of business and securing obligations that are not overdue by more than sixty (60) days, (ii) (A) that are being contested in good faith by appropriate proceedings, (B) the applicable Loan Party or Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation or (iii) the existence of which would not reasonably be expected to result in a Material Adverse Effect;

(c)    pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;

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(d)    deposits to secure or relating to the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds (and Liens arising in accordance with Applicable Law in connection therewith), and other obligations of a like nature, in each case in the ordinary course of business;

(e)    Liens securing judgments that do not constitute an Event of Default under Section 8.01(e);

(f)    easements, covenants, conditions, restrictions, building code laws, zoning restrictions, rights-of-way, development, site plan or similar agreements and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or materially interfere with the ordinary conduct of business of a Loan Party and such other minor title defects, or survey matters that are disclosed by current surveys, but that, in each case, do not interfere with the current use of the Property in any material respect;

(g)    Liens on any property or assets of a Loan Party or its Subsidiaries set forth on Schedule 7.01(g); provided that if such Lien secured Indebtedness, such Lien shall secure only the Indebtedness permitted by Section 7.03(c) and refinancings thereof;

(h)    (i) Liens on fixed or capital assets acquired by any Loan Party or any Subsidiary which are permitted under Section 7.03(f) so long as (A) such Liens and the Indebtedness secured thereby are incurred prior to or within ninety days after such acquisition or the completion of the construction or improvement thereof (other than refinancings thereof permitted hereunder), (B) the Indebtedness secured thereby does not exceed 100% of the cost of acquisition or improvement of such fixed or capital assets, (C) such Liens shall not violate the terms of the Indentures, and (D) such Liens shall not extend to any other property or assets of the Loan Parties and (ii) Liens incurred in connection with sale leaseback transactions of fixed or capital assets as long as such Liens shall not violate the terms of the Indentures and the proceeds are applied in accordance with Section 7.08;

(i)    Liens on Collateral having the priority set forth in the Intercreditor Agreements securing Indebtedness incurred pursuant to Section 7.03(b), (e) and (w);

(j)    landlords’ and lessors’ Liens in respect of rent not in default for more than sixty days or the existence of which, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect;

(k)    Liens arising solely by virtue of any statutory or common law provisions relating to banker’s liens, liens in favor of securities intermediaries, rights of setoff or similar rights and remedies as to deposit accounts or securities accounts or other funds maintained with depository institutions or securities intermediaries;

(l)    Liens on furniture, fixtures and equipment that are not part of Specified Real Properties securing Indebtedness in an amount not to exceed $150.0 million;

(m)    Liens attaching solely to cash earnest money deposits in connection with any letter of intent or purchase agreement in connection with any Investment permitted pursuant to Section 7.02(m);

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(n)    Liens arising from precautionary UCC filings regarding “true” operating leases or the consignment of goods to a Loan Party or a Subsidiary thereof;

(o)    Liens in favor of customs and revenues authorities imposed by Applicable Law arising in the ordinary course of business in connection with the importation of goods and securing obligations (i) that are not overdue by more than sixty (60) days, (ii) (A) that are being contested in good faith by appropriate proceedings, (B) the applicable Loan Party or Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (iii) the existence of which would not reasonably be expected to result in a Material Adverse Effect;

(p)    Liens placed on any of the assets or equity interests of a Foreign Subsidiaryother than the Canadian Pledge that are senior in priority to or pari passu with the Canadian Pledge securing the Secured Obligations;

(q)    any interest or title of a licensor, sublicensor, lessor or sublessor under any license or operating or true lease agreement;

(r)    licenses, sublicenses, leases or subleases granted to third Persons in the ordinary course of business;

(s)    the replacement, extension or renewal of any Permitted Lien; provided that such Lien shall at no time be extended to cover any assets or property other than such assets or property subject thereto on the Restatement Date or the date such Lien was incurred, as applicable;

(t)    Liens on insurance policies and the proceeds thereof incurred in the ordinary course of business in connection with the financing of insurance premiums; provided that such Liens shall be limited only to the insurance policies and proceeds of such insurance premiums;

(u)    Liens on securities which are the subject of repurchase agreements incurred in the ordinary course of business;

(v)    Liens arising by operation of law under Article 4 of the UCC (or, with respect to the assets of any Foreign Subsidiary of the Borrower organized under the Laws of Canada, any similar Laws in Canada) in connection with collection of items provided for therein;

(w)    Liens arising by operation of law under Article 2 of the UCC (or, with respect to the assets of any Foreign Subsidiary of the Borrower organized under the Laws of Canada, any similar Laws in Canada) in favor of a reclaiming seller of goods or buyer of goods;

(x)    Liens on deposit accounts or securities accounts in connection with overdraft protection and netting services;

(y)    security given to a public or private utility or any Governmental Authority as required in the ordinary course of business;

(z)    possessory Liens in favor of brokers and dealers arising in connection with the acquisition or disposition of Investments owned as of the date hereof and Investments permitted pursuant to Section7.037.02; provided that such Liens (i) attach only to such Investments and (ii)

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secure only obligations incurred in the ordinary course and arising in connection with the acquisition or disposition of such Investments and not any obligation in connection with margin financing;

(aa)    with respect to any Real Property located in Canada, any rights, reservations, limitations and conditions contained in the grant from the Crown or any Crown Patent;

(bb)    Liens relating to Indebtedness permitted by Section 7.03(r) that comply with the provisions of Section 7.03(r);

(cc)    Liens in favor of a financial institution encumbering deposits (including the right of setoff) held by such financial institution in the ordinary course of business in respect of Indebtedness permitted hereunder and which are within the general parameters customary in the banking industry;

(dd)    Liens in the nature of the right of setoff in favor of counterparties to contractual agreements with the Loan Parties (other than the Sponsors (other than Holdings and any of its Subsidiaries)) in the ordinary course of business;

(ee)    Liens on assets other than Specified Real Properties not otherwise permitted by this Section 7.01; provided that the aggregate outstanding principal amount of the obligations secured by such Liens shall not exceed (as to all Loan Parties) $100.0 million at any one time;and

(ff)Liens which are pari passu in priority to the Liens securing the Secured Obligations and are incurred to secure obligations in respect of any Indebtedness permitted to be incurred pursuant to Section 7.03(n).; provided that no Liens shall be permitted pursuant to this clause on any Specified Real Property;

(gg)Liens on the Collateral securing Permitted Pari Passu Refinancing Debt and/or Permitted Junior Refinancing Debt;

(hh)Liens to secure debt assumed in connection with the consummation of Permitted Acquisitions so long as such debt was not incurred in contemplation of the Permitted Acquisitions and such Liens are only secured by the assets or entities acquired;

(ii)Liens created under the Loan Documents;

(jj)Liens on Specified Real Property that is not Collateral after the later of (x) the Springing Covenant Trigger Date and (y) the date all the Specified Real Property required to be Collateral becomes Collateral; and

(kk)Liens securing the Special Refinancing Indebtedness to the extent such Liens are contemplated in the definition of “Special Refinancing Indebtedness”.

7.02     Investments. Make any Investments, except:

(a)    Investments held by any Loan Party or a Subsidiary thereof in the form of Cash Equivalents;

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(b)    Investments (i) of any Loan Party in any Subsidiary Guarantor, (ii) of any Subsidiary Guarantor in the Borrower or any other Subsidiary Guarantor, (iii) of up to $25.0 million in one or more Non-Guarantor Subsidiaries by the Borrower and/or one or more Subsidiary GuarantorsGuarantorsand, (iv) of a Non-Non-Guarantor Subsidiary in another Non-Guarantor Subsidiary or of up to $30.0 million in a Non-Loan Party and (v) of any Non-Guarantor Subsidiary in any Loan Party; provided that in the case of Investments in the form of Indebtedness, all such Indebtedness shall be evidenced by promissory notes;

(c)    Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case, in the ordinary course of business;

(d)    guarantees permitted by Sections 7.03(d) and (s);

(e)    Hedge Agreements permitted by Section 7.03(e);

(f)    non-cash consideration received in any asset sale permitted by Section 7.05;

(g)    transactions permitted by Section 7.04 and Investments constituting loans or advances by the Borrower to Holdings in lieu of dividends or other distributions otherwise permitted pursuant to Section 7.06;

(h)    (x) Investments made in order to consummate a Permitted Acquisition to the extent that any Person or property acquired in such acquisition becomes a Subsidiary Guarantor or a part of the Borrower or any Subsidiary Guarantor and after giving effect to such Permitted Acquisition the Consolidated Fixed Charge Coverage Ratio of the Borrower would be at least 2.00 to 1.00 and (y) other Permitted Acquisitions, consummated after the Restatement Date, with an aggregate purchase price in the case of this clause (y) (other than purchase price paid with the proceeds of the issuance of equity by Holdings or other capital contributions (other than relating to Disqualified Capital Stock)) not to exceed an amount equal to the Available Amount;

(i)    Investments existing on the Restatement Date and set forth on Schedule 7.02(i), and refinancings thereof on substantially the same terms or the capitalization of an existing intercompany loan to a Non-Guarantor Subsidiary;

(j)    loans or advances to employees for the purpose of travel, entertainment or relocation in the ordinary course of business; provided that all such loans or advances to employees shall not exceed $20.0 million in the aggregate at any time, and determined without regard to any write-downs or write-offs thereof;

(k)    capitalization or forgiveness of any Indebtedness owed to a Loan Party by another Loan Party;

(l)    to the extent permitted by Applicable Law, notes from officers and employees of a Loan Party issued by such officers and employees in exchange for equity interests of Toys “R” Us Holdings, Inc. purchased by such officers or employees pursuant to a stock ownership of purchase plan or compensation plan;

(m)    other Investments in an amount not to exceed $100.0 million, in the aggregate outstanding at any time, determined without regard to any write-downs or write-offs thereof, plus the amount of cash proceeds received by the Borrower from a direct or indirect common equity contribution from Holdings;

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(n)    Investments consisting of the posting of letters of credit, guarantees or cash collateral to secure obligations of TRU (Vermont), Inc. in respect of insurance policies issued in favor of Holdings and its domestic Subsidiaries, in each case relating to or for the benefit of the Borrower and its Subsidiaries in the ordinary course of business not to exceed $250.0 million in the aggregate outstanding at any time; provided that up to $15.0 million thereof may consist of Investments consisting of the posting of letters of credit to secure obligations of TRU (Vermont), Inc. in respect of insurance policies issued in favor of Subsidiaries of Toys “R” Us Europe LLC in the ordinary course of business;and

(o)    unsubordinated intercompany loans to Non-Loan Parties in an aggregate amount not to exceed $100.0 million at any one time outstanding;

(p)    capital contributions in an aggregate amount not to exceed $5.0 million per annum required to be made pursuant to the organizational documents of SALTRU Associates JV as in effect on the Restatement Date; and

(q)    additional Investments in an amount not to exceed the Available Amount so long as after giving effect thereto, the Consolidated Fixed Charge Coverage Ratio of the Borrower is at least 2.00 to 1.00.

An Investment shall be deemed to be outstanding to the extent not returned in the same form (or (i) in assets that may be used in those businesses in which the Loan Parties and their Subsidiaries are permitted to be engaged under Section 7.04(b) and have at least the same fair market value or (ii) in Marketable Securities with at least the same fair market value; provided that such Marketable Securities are otherwise permitted by this Section 7.02 or such Marketable Securities are liquidated within 45 days) as the original Investment to such Loan Party.

7.03     Indebtedness and Disqualified Capital Stock. Create, incur, assume or suffer to exist any Indebtedness or Disqualified Capital Stock, except:

(a)    Indebtedness created under the Loan Documents; and extensions, refinancings, renewals and replacements (a “refinancing”) of any such Indebtedness, in whole or in part;

(b)    Indebtedness under any ABL Credit Agreement in an aggregate principal amount not to exceed the greater of (i) $2,500,000.02,500.0 million and (ii) the sum of (A) the Combined Borrowing Base (as defined in the ABL Credit Agreement) (B) IncrementalAvailability (as defined in the ABL Credit Agreement) outstanding at any one time, in the case of each of clauses (i) and (ii), minus the aggregate principal amount of loans underthe ABL Credit Agreementwhich are refinanced or replaced with Special Refinancing Indebtednessoutstanding at any one time;provided that, the aggregate principal amount of Indebtedness incurred under this clause (b) by the Canadian Borrower (as defined in the ABL Credit Agreement) or any borrower under the ABL Credit Agreement which is not organized under the laws of the United States, any state thereof or the District of Columbia, shall not exceed $325 million;

(c)    Indebtedness outstanding on the Restatement Date and listed on Schedule 7.03(c) and, refinancings of any such Indebtedness; provided that after giving effect thereto (i) the principal amount of such Indebtedness is not greater than the aggregate principal amount of Indebtedness being refinanced, plus (x) the amount of any interest, premiums or penalties required to be paid thereon and (y) fees and expenses associated therewith, (ii) if the final maturity date of such Indebtedness is prior to the Maturity Date, the result of such refinancing shall not be an earlier maturity date or decreased weighted average life (other than nominal

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amortization), and (iii) if the final maturity date of such Indebtedness is after the Maturity Date, the result of such extension shall not be a maturity date earlier than the Maturity Date;

(d)    guarantees by (i) any Loan Party of Indebtedness or obligations of the Loan Parties arising in the ordinary course of business of any other Loan Party and (ii) any Foreign Subsidiary of Indebtedness of any other Foreign Subsidiary;

(e)    obligations (contingent or otherwise) of a Loan Party or any Subsidiary thereof existing or arising under any Hedge Agreement; provided that such obligations are (or were) entered into by such Person in the ordinary course of business (including on behalf of another Loan Party or Non-Loan Party) and not for speculative purposes;

(f)    Indebtedness in respect of Capital Lease Obligations and purchase money obligations for fixed or capital assets in an aggregate amount outstanding at any time not to exceed $250.0300.0 million, and within the limitations set forth in Section 7.01(h) (including any such Indebtedness or purchase money obligations assumed pursuant to Section 7.02(h)) and refinancings of any such Indebtedness; provided that after giving effect thereto the principal amount of such Indebtedness is not greater than the aggregate principal amount of Indebtedness being refinanced, plus (x) the amount of any interest, premiums or penalties required to be paid thereon, and (y) fees and expenses associated therewith;

(g)    Indebtedness permitted by Section 7.02(b);

(h)    Indebtedness relating to surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

(i)    Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business;

(j)    indemnification, adjustment of purchase price, earn-out or similar obligations, in each case, incurred or assumed in connection with the acquisition or disposition of any business or assets of a Loan Party or any of its Subsidiaries or Equity Interests of a Subsidiary thereof, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Equity Interests for the purpose of financing or in contemplation of any such acquisition; provided that in the case of a disposition, the maximum aggregate liability in respect of all such obligations outstanding under this subsection (j) shall at no time exceed the gross proceeds actually received by a Loan Party and its Subsidiaries in connection with such disposition;

(k)    [reserved];

(l)    Indebtedness between the Borrower and any of its Subsidiaries or between Subsidiaries of the Borrower or between the Borrower or any of its Subsidiaries and/or a Non-Loan Party; provided that all such intercompany Indebtedness (other than any Special Refinancing Indebtedness) of a Loan Party owed to a Non-Guarantor Subsidiary or any other Non-Loan Party shall be unsecured and (subject to any limitation under laws applicable to such Non-Guarantor Subsidiary, its directors or its stockholders) subordinated in right of payment to the payment in full in cash of the Obligations solely in connection with any bankruptcy, insolvency or liquidation proceeding;

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(m)    any refinancing of the 2021 Debentures; provided that (i) the amount of such refinancing Indebtedness is not increased at the time of such refinancing except by an amount equal to a premium or other amount paid, accrued interest thereon and fees and expenses reasonably incurred, in connection with such refinancing, (ii) the final maturity of the refinancing Indebtedness shall not be earlier than six months after the Maturity Date, (iii) the board of directors of the Borrower shall have determined that such refinancing is in the best interest of the Borrower and (iv) such refinancing Indebtedness shall be unsecured and may be refinanced at the Borrower level (it being understood and agreed that any such refinancing shall include the ability to repay the 2021 Debentures with cash on hand and/or from loans under the ABL Credit Agreement);

(n)    so long as no Default or Event of Defaults shall have occurred and be continuing or would result therefrom, Indebtedness secured by Liens permitted by Section 7.01(ff) so long as after giving pro forma effect thereto, the Borrower’s Senior Secured Leverage Ratio would be no greater than 1.75 to 1.00;

(o)    without duplication, non-cash accruals of interest, accretion or amortization of original issue discount and/or pay-in-kind interest on Indebtedness otherwise permitted to be incurred under this Agreement;

(p)    Indebtedness consisting of deferred purchase price or notes issued to officers, directors and employees of Loan Parties to purchase or redeem equity interests (or option or warrants or similar instruments) of a Loan Party of an Affiliate of a Loan Party;

(q)    Indebtedness issued as consideration for the repurchase or redemption of Qualified Capital Stock of Holdings in transactions permitted pursuant to Section 7.06(d);

(r)    Indebtedness relating to letters of credit obtained (i) in the ordinary course of business or (ii) in connection with the purchase of inventory from suppliers located outside the United States and Canada;

(s)    guarantees constituting Investments permitted under Section 7.02;

(t)    Indebtedness in an aggregate principal amount not to exceed $150.0 million secured by Liens incurred pursuant to Section 7.01(l);providedthat the proceeds from such Indebtedness are appliedin accordance withSection 2.03(c);

(u)    other unsecured Indebtedness so long as, at the time of incurrence thereof, (i) after giving effect to the incurrence of such unsecured Indebtedness (as if such unsecured Indebtedness had been incurred on the first day of the most recently completed period of four consecutive fiscal quarters of the Borrower ending on or prior to such date), (A) the Consolidated Fixed Charge Coverage Ratio of the Borrower would have been at least 2.00 to 1.00, (ii) no Default or Event of Default shall have occurred and be continuing at the time of incurrence of such unsecured Indebtedness or would result therefrom and (iii) the terms of such unsecured Indebtedness do not provide for any scheduled repayment, mandatory redemption or sinking fund obligation prior to the date at least 180 days following the Maturity Date;

(v)    other Indebtedness in an aggregate principal amount not to exceed $100.0 million; and

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(w)Indebtedness represented by the Secured Notes, as amended, refinanced or replaced from time to time, in an aggregate principal amount not to exceed $350,000,000plusany additional Indebtednesssecured by the Collateral on apari passubasis withthe Secured Obligations issued after the Restatement Date in anaggregate principal amount notto exceed $700,000,000lessthe aggregate amount of any New Loans made pursuant toSection 2.12hereof.

(w)[Reserved]

(x)Permitted Unsecured Refinancing Debt;

(y)Permitted Pari Passu Refinancing Debt and Permitted Junior Refinancing Debt;

(z)Indebtedness incurred by the Borrower in an amount up to the amount of any cash equity contribution or investment of cash by Holdings to the Borrower; and

(aa)Indebtedness, in an amount up to the Special Refinancing Indebtedness Amount, directly or indirectly, repay, refinance or replace (and in the case of any commitments, terminate) all Term B-2 Loans, Term B-3 Loans, and the Tranche A-1 Loans(as defined in the ABL Credit Agreement) including any fees and expenses in connection therewith; provided that, (i) such Indebtedness does not mature earlier than or have a weighted average life to maturity shorter than the Latest Maturity Date, (ii) such Indebtedness shall only be secured by the assets securing the Term B-2 Loans, the Term B-3 Loans and the Tranche A-1 Loans (as defined in theABL Credit Agreement), (iii) such Indebtedness shall only be guaranteed by the Guarantors (iv) such Indebtedness is subject to the relevant Intercreditor Agreement(s), (v) such Indebtedness has terms and conditions (excluding pricing, interest rate margins, rate floors, discounts, fees, premiums and prepayment or redemption provisions) that are not materially more favorable (when taken as a whole) to the lenders or investors providing such Indebtedness than the terms and conditions of the Term B-2 Loans, the Term B-3 Loans and the Tranche A-1 Loans (as defined in the ABL Credit Agreement) (when taken as a whole) are to the applicable lenders (except for covenants or other provisions applicable only to periods after the Latest Maturity Date at the time of such refinancing), (vi) such Indebtedness is either (A) incurred by the Borrower or (B) owed to a Special Refinancing Subsidiary through interercompany loans, (vii) the Geoffrey Collateral can secure no more than $200 million of such Indebtedness and any Lien on the Geoffrey Collateral shall be secured on a pari passu basis with the Liens securing the Term B-4 Loans and (y)the ABL Priority Collateralcan secure no more than $200 million of such Indebtedness on a pari passu basis with the Liens securing the Term B-4 Loans, (viii) the ABL Priority Collateral can secure no more than $280 million of such Indebtedness on a senior basis to the Liens securing the Term B-4 Loans, (ix) such Indebtedness is secured by the Canadian Pledge on a junior priority basis to the Liens securing the Term B-4 Loans and (x) such Indebtedness is not secured by Liens other than those set forth in clauses (ii), (vii), (viii) and (ix) above (such Indebtedness, the “Special Refinancing Indebtedness”).

7.04     Fundamental Changes.

(a)    Merge or amalgamate into or consolidate with any other Person, or permit any other Person to merge or amalgamate into or consolidate with it, or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing or would arise therefrom, (i) any Subsidiary may liquidate, dissolve, consolidate, amalgamate or merge into a Loan Party in a transaction in which a Loan Party is the surviving corporation, (ii) any Subsidiary that is not a Loan Party may liquidate, dissolve, consolidate, amalgamate or merge into any Subsidiary that is not a Loan Party, (iii) any Loan Party may amalgamate

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or merge with or into any other Loan Party and (iv) transactions permitted by Section 7.02 or Section 7.05 may be consummated in the form of a merger, amalgamation or consolidation.

(b)    Engage, to any material extent, in any business other than businesses of the type conducted by such Loan Party on the date of execution of this Agreement and businesses reasonably related thereto and those complementary or ancillary thereto.

7.05     Asset Sales. Make any Asset Sales, except:

(a)    sales of obsolete, damaged or worn out property or, in the judgment of a Loan Party, property no longer useful or necessary in its business or that of any Subsidiary, whether now owned or hereafter acquired, in each case in the ordinary course of business;

(b)    Liens permitted under Section 7.01 and transactions permitted by Section 7.02, Section 7.04(a), Section 7.06 and Section 7.08;

(c)    licensed departments and leases, subleases, licenses and sublicenses of real or personal property, in each case in the ordinary course of business;

(d)    sales of assets by a Loan Party or any of its Subsidiaries to (i) any of such Person’s Subsidiaries or (ii) another Loan Party or its Subsidiaries; provided that if the transferor in such a transaction is a Loan Party, then the transferee must be a Loan Party;

(e)    sales of non-core assets acquired pursuant to Section 7.02(m) which are not used in the business of the Loan Parties;

(f)    sales or forgiveness of accounts in the ordinary course of business or in connection with the collection or compromise thereof;

(g)    leasing of Real Property that is no longer used in the business of the Loan Parties;

(h)    Asset Sales by a Loan Party and or any of its Subsidiaries not otherwise permitted under this Section 7.05; provided that (i) at the time of such Asset Sales, no Event of Default shall exist or would result from such Asset Sale, (ii) the consideration paid for such asset shall be paid to such Loan Party or such Subsidiary at least (x) 75% in cash or Cash Equivalents with respect to sales of Real Property and (y) 100% in cash or Cash Equivalents with respect to sales of any other assets and, (iii) 100% of the Net Cash Proceeds from such Asset Sale are applied in accordance with Section 2.03, promptly following the receipt of such Net Cash Proceeds, except with respect to any sale leaseback of assets other than Real Property which will be applied in accordance with Section 7.08;and (iv) any sales of Real Property shall be for fair market value (as determined in good faith by the Borrower).

(i)    any disposition of Real Property to a Governmental Authority as a result of a condemnation of such Real Property;

(j)    forgiveness of Investments permitted under Section 7.02(b);

(k)    issuances of equity by Foreign Subsidiaries to qualifying directors of such Foreign Subsidiaries;

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(l)    so as long as no Event of Default would arise therefrom, sales or other dispositions of Investments permitted under Section 7.02 (other than those described in clauses (b)(iii) and (iv) and (f) of Section 7.02);

(m)    the sale or other disposition of the Equity Interests or assets of the Propco Subsidiaries;

(n)    exchanges or swaps of equipment owned or leased by any Loan Party or a Subsidiary for other equipment; provided that (i) such exchange or swap shall be made for substantially equivalent fair value, (ii) the equipment so exchanged or swapped must be replaced with equipment reasonably concurrently with such exchange or swap and (iii) all Net Cash Proceeds, if any, received in connection with any such exchange or swap shall be applied to the Obligations pursuant to Section 2.03(b) hereof;

(o)    swaps or exchanges of Real Property, Stores or Store leases owned by any Loan Party or a Subsidiary for other Real Property, Stores or Store leases; provided that (i) such swap or exchange shall be made for substantially equivalent fair value; and, (ii) the Real Property, Store or Store lease swapped or exchanged shall be replaced with Real Property, Stores or Store leases reasonably concurrently with such swap or exchangeand (iii) if the swap or exchange is in respect of a Specified Real Property, the replacement property must be Real Property and such Real Property shall become a Specified Real Property; and

(p)sales of Real Property, Stores or Store leases by any Loan Party or a Subsidiary thereof for fair market value, the net proceeds of which are to be used in connection with a relocation of such Real Property, Stores or Store leases to an identified site that is under contract; provided that the net proceeds from the sale of a Specified Real Property must be used to relocate such Specified Real Property.

Notwithstanding anything contained herein to the contrary, the application of net proceeds of any sale of assets constituting a sale leaseback transaction (other than with respect to Real Property) shall be applied in accordance with Section 7.08.

7.06     Restricted Payments. Declare or make, directly or indirectly, any Restricted Payment, except:

(a)    each Subsidiary of a Loan Party may make Restricted Payments to its direct equity holders, and any Non-Guarantor Subsidiary may make Restricted Payments to another Non-Guarantor Subsidiary;

(b)    the Loan Parties and each Subsidiary thereof may declare and make dividend payments or other distributions payable (i) solely in the stock or other Equity Interests of such Person or (ii) from amounts received as dividends originating from any Propco Subsidiary or in the form of the Equity Interests issued, or assets owned, by any Propco Subsidiary;

(c)    to the extent actually used by Holdings to pay such taxes, costs and expenses, the Loan Parties and their Subsidiaries may make Restricted Payments to or on behalf of Holdings in an amount necessary to pay Permitted Holdings Expenses;

(d)    so long as no Specified Default has occurred or is continuing or would result after giving effect thereto on a pro forma basis, payments to Holdings to permit Holdings (or its direct parent company), and the subsequent use of such payments by Holdings (or its direct parent company), to repurchase or redeem Qualified Capital Stock of Holdings (or its direct parent

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company) held by officers, directors or employees or former officers, directors or employees (or their transferees, estates or beneficiaries under their estates) of Holdings or any Subsidiary thereof, upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate cash consideration paid for all such redemptions and payments shall not exceed $5.0 million;

(e)    Permitted Tax Distributions (excluding any amounts distributable under subsection (c)) to Holdings, so long as Holdings uses such distributions to pay its taxes;

(f)    so long as no Specified Default has occurred, is continuing or would result therefrom, Restricted Payments from any Loan Party or any Subsidiary to Holdings to the extent actually used by Holdings to (i) pay interest payments when due in respect of (A) Certain Holdings Indebtedness or any Indebtedness incurred by Holdings to refinance such Certain Holdings Indebtedness and (B) any Indebtedness incurred by Holdings to refinance the Loans, (ii) pay obligations owing in respect of any Specified Holdings Indebtedness or renewals and extensions thereof or (iii) so long as the Total Net Leverage Ratio of the Borrower is less than 4.75 to 1.00, repay or prepay the principal of and premium, if any, on the 2011 Notes and 2013 Notes; and

(g)    so long as no Default or Event of Default has occurred and is continuing, the Borrower may make dividends and other distributions (including in the form of loans) to Holdings in an aggregate amount not to exceed the Available Amount, so long as the Consolidated Fixed Charge Coverage Ratio of the Borrower is at least 2.00 to 1.00; and

(h)    so long as no Default or Event of Default has occurred and is continuing, other Restricted Payments in an aggregate amount not to exceed $50.0 millionfrom and after the Amendment No. 3 Effective Date.

7.07     Transactions with Affiliates. Sell, lease or otherwise transfer or license any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except that the following shall be permitted:

(a)    transactions that are at prices and on terms and conditions, taken as a whole, not less favorable to such Loan Party or such Subsidiary thereof than could be obtained on an arm’s-length basis from unrelated third parties;

(b)    transactions between or among the Loan Parties and their Subsidiaries (for the avoidance of doubt, including Special Refinancing Subsidiaries)not prohibited hereunder;

(c)    payments of indemnities, reimbursement of actual expenses and, so long as no Specified Default has occurred and is continuing or would result therefrom, payments of management fees and transaction fees, in each case, pursuant to the Management Agreement; provided that such management fees and transaction fees not paid shall accrue and be paid when the applicable Specified Default has been cured or waived and no additional Specified Default has occurred and is continuing or would arise as a result of such payment;

(d)    other transactions specifically permitted under this Agreement (including, without limitation, sale leaseback transactions and transactions permitted by Sections 7.02, 7.03, 7.04, 7.05, 7.06 and 7.08);

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(e)    payment of reasonable compensation to directors, officers and employees for services actually rendered to any such Loan Party or any of its Subsidiaries and indemnification arrangements;

(f)    stock option and compensation plans of the Loan Parties and their Subsidiaries;

(g)    employment contracts with officers and management of the Loan Parties and their Subsidiaries;

(h)    advances and loans to officers and employees of the Loan Parties and their Subsidiaries to the extent specifically permitted by Section 7.02(j);

(i)    transactions contemplated by and permitted pursuant to Sections 7.02(l) and 7.03(p);

(j)    transactions set forth on Schedule 7.07 hereto;

(k)    payment of reasonable director’s fees, expenses and indemnities; and

(l)    the payment and performance under any Master Lease to which a Loan Party is a party.

7.08     Sales and Leasebacks. Enter into any arrangement with any Person providing for the leasing by any Loan Party of property (other than Real Property) that has been or is to be sold by such Loan Party to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of such Loan Party; provided that any sale leaseback of assets (other than Real Property) shall be permitted to the extent that 100% of the Net Cash Proceeds thereof in excess of $5.0 million are applied to repay the Loans outstanding hereunder.

7.09     Clauses Restricting Subsidiary Distributions. Enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Subsidiary of a Loan Party to:

(a)    make Restricted Payments in respect of any Equity Interests of such Subsidiary held by, or pay any Indebtedness owed to, any Loan Party,

(b)    make loans or advances to, or other Investments in, any Loan Party;, or

(c)    transfer any of its assets to any Loan Party,

except for such encumbrances or restrictions existing under or by reason of:

(i)    any restrictions existing under the Loan Documents, the ABL Credit Documents or Indebtedness permitted by Sections 7.03 (e) (solely with respect to the party and its subsidiaries to such Hedge Agreement), (f), (h), (j) (solely with respect to the party and its subsidiaries to such Indebtedness), (r)and,(s) (solely with respect to clauses (b) and (c) above) and (aa) and, provided that such permitted Indebtedness contains restrictions are, taken as a whole, no more disadvantageous to the Lenders than those contained in this Agreement or the Secured Notes, clauses (v) and (w);

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(ii)    any encumbrance or restriction pursuant to applicable law or an agreement in effect at or entered into on the Restatement Date;

(iii)    any encumbrance or restriction with respect to a Loan Party or any of its Subsidiaries pursuant to an agreement relating to any Indebtedness incurred by such Subsidiary prior to the date on which such Subsidiary was acquired by a Loan Party or its Subsidiary and outstanding on such date, which encumbrance or restriction is not applicable to such Loan Party or its Subsidiaries, or the properties or assets of such Loan Party or a Subsidiary thereof, other than the Subsidiary, or the property or assets of the Subsidiary, so acquired, or any Subsidiary thereof or the property or assets of any such Subsidiary and, provided that such Indebtedness contains restrictions are, taken as a whole, no more disadvantageous to the Lenders than those contained in this Agreement or the Secured Notes;

(iv)    any encumbrance or restriction pursuant to an agreement effecting a refinancing of Indebtedness incurred pursuant to an agreement referred to in subsection (i), (ii) or (iii) of this Section or this subsection (iv) or contained in any amendment to an agreement referred to in subsection (i), (ii) or (iii) of this Section or this subsection (iv); provided that the encumbrances and restrictions contained in any such refinancing agreement or amendment are not materially less favorable taken as a whole, as determined by the Loan Party in good faith, to the Lenders than the encumbrances and restrictions contained in such predecessor agreement;

(v)    with respect to subsection (c), any encumbrance or restriction (A) that restricts the subletting, assignment, subleasing, sublicensing or transfer of any property or asset or right and is contained in any lease, license or other contract entered into in the ordinary course of business or (B) contained in security agreements securing Indebtedness of a Loan Party or a Subsidiary of a Loan Party to the extent such encumbrance or restriction restricts the transfer of the property subject to such security agreements;

(vi)    any restrictions (related to the assets being sold) imposed pursuant to an agreement that has been entered into in connection with the disposition of the Equity Interests or assets of a Loan Party or a Subsidiary thereof;

(vii)    any encumbrances or restrictions applicable solely to a Foreign Subsidiary and contained in any credit facility extended to any Foreign Subsidiary; provided that such encumbrances and restrictions do not extend to any Subsidiary that is not a Foreign Subsidiary;

(viii)    restrictions on transfers of assets pursuant to a Lien permitted by Section 7.01; and

(ix)    any encumbrance or restriction arising under or in connection with any agreement or instrument governing Equity Interests of any Person other than a wholly owned Subsidiary of a Loan Party that is acquired after the Restatement Date.

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7.10     Use of Proceeds. Use the proceeds of the Loans, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose in violation of the margin rules.

7.11     Modifications of Charter Documents and Other Documents, Etc. Directly or indirectly:

(a)    amend, modify or permit the amendment or modification of any provision of the documents governing any Subordinated Indebtedness, in each case to the extent that such amendment, modification or waiver would be reasonably likely to result in a Material Adverse Effect;

(b)    amend, modify or waive any of its rights under its Charter Documents in any manner material and adverse to the Lenders; or

(c)    make any voluntary or optional payment or prepayment on or redemption or acquisition for value of, or any prepayment or redemption as a result of any asset sale, change of control or similar event of, any Subordinated Indebtedness, except as otherwise permitted by this Agreement, including in connection with any refinancing permitted herein.

7.12     Fiscal Year. Make any change in its Fiscal Year; provided that the Borrower may, upon written notice to the Administrative Agent change its Fiscal Year in a manner reasonably acceptable to the Administrative Agent.

7.13     Anti-Terrorism Law; Anti-Money Laundering.

(a)    Directly or indirectly, (i) knowingly conduct any business or engage in making or receiving any contribution of funds, goods or services to or for the benefit of any Person described in Section 5.20, (ii) knowingly deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to the Executive Order or any other Anti-Terrorism Law, or (iii) knowingly engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law (and the Loan Parties shall deliver to the Lenders any certification or other evidence requested from time to time by any Lender in its reasonable discretion, confirming the Loan Parties’ compliance with this Section 7.13).

(b)    Knowingly cause or permit any of the funds of such Loan Party that are used to repay the Loans to be derived from any unlawful activity with the result that the making of the Loans would be in violation of any applicable law.

7.14     Embargoed Person. Knowingly cause or permit (a) any of the funds or properties of the Loan Parties that are used to repay the Loans to constitute property of, or be beneficially owned directly or indirectly by, any Person subject to sanctions or trade restrictions under United States law (“Embargoed Person” or “Embargoed Persons”) that is identified on (1) the “List of Specially Designated Nationals and Blocked Persons” maintained by OFAC and/or on any other similar list maintained by OFAC pursuant to any authorizing statute including, but not limited to, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 etseq., The Trading with the Enemy Act, 50 U.S.C. App. 1 etseq., and any Executive Order or applicable law promulgated thereunder, with the result that the investment in the Loan Parties (whether directly or indirectly) is prohibited by applicable law, or the Loans made by the Lenders would be in violation of applicable law, or (2) the Executive Order, any

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related enabling legislation or any other similar Executive Orders or (b) any Embargoed Person to have any direct or indirect interest, of any nature whatsoever in the Loan Parties, with the result that the investment in the Loan Parties (whether directly or indirectly) is prohibited by applicable law or the Loans are in violation of applicable law.

7.15     No Further Negative Pledge. Enter into any agreement, instrument, deed or lease which prohibits or limits the ability of any Loan Party or any Subsidiary thereof to create, incur, assume or suffer to exist any Lien upon any of their respective properties or revenues constituting or required to constitute Collateral under the Loan Documentsor which is subject to Section 6.10(c), whether now owned or hereafter acquired, or which requires the grant of any security in such property or revenues for an obligation if security is granted for another obligation, except the following: (1) this Agreement, the other Loan Documents, the ABL Credit Agreement Documents and the documents governing any Indebtedness incurred pursuant to Sections 7.03(c), (d), (e), (f), (h), (j), (r), and(s) and (aa); (2) any documentation governing Permitted Unsecured Refinancing Debt, Permitted Pari Passu Refinancing Debt or Permitted Junior Refinancing Debt; (3) covenants in documents creating Liens permitted by Section 7.01 prohibiting further Liens on the properties encumbered thereby; and (34) any prohibition or limitation that (a) exists pursuant to applicable Requirements of Law, (b) consists of customary restrictions and conditions contained in any agreement relating to the sale of any property permitted under Section 7.05 pending the consummation of such sale, (c) restricts sublicensing, the granting of a Lien or subletting or assignment of any contract, license or lease of a Loan Party or a Subsidiary thereof, (d) exists in any agreement in effect at the time such Subsidiary becomes a Subsidiary of a Loan Party, so long as such agreement was not entered into in contemplation of such Person becoming a Subsidiary of a Loan Party or (e) is imposed by any amendments or refinancings that are otherwise permitted by the Loan Documents of the contracts, instruments or obligations referred to in subsection (34)(d); provided that such amendments and refinancings are no more materially restrictive with respect to such prohibitions and limitations than those prior to such amendment or refinancing.

ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES

8.01     Events of Default. Any of the following shall constitute an “Event of Default”:

(a)    Non-Payment. Any Loan Party fails to pay (i) when and as required to be paid herein, any amount of principal of any Loan, or (ii) within 10 days after the same becomes due, any interest on any Loan, or (iii) within 30 days after the same becomes due, any fee due or any other amount payable hereunder or under any other Loan Document; or

(b)    Other Defaults. Holdings or any Loan Party fails to perform or observe any other covenant or agreement (not specified in subsection (a) above or (c) below) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days after notice thereof is given by the Arrangers; or

(c)    Cross-Default/Acceleration. Any Loan Party (A) fails to make any payment when due (whether by scheduled maturity, required prepayment or otherwise, and giving effect to any applicable grace period) in respect of any individual Indebtedness (other than Indebtedness hereunder or under the Guarantee) having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) equal to or greater than $100.0 million, (B) fails to observe or perform any other agreement or condition relating to any such Indebtedness or contained in any instrument or agreement evidencing, securing or relating to such Indebtedness,

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other than the failure to provide notice of a default or an event of default under such agreement or instrument, the effect of which default or other event is to cause, with the giving of notice if required, such Indebtedness to be demanded or to become due or to be repurchased, prepaid, defeased or redeemed (automatically or otherwise) prior to its stated maturity (it being understood that with respect to a Hedge Agreement, the occurrence of termination events or additional termination events pursuant to the terms of such Hedge Agreement are not defaults in the observance or performance of such Hedge Agreement) or (C) fails to observe or perform any other agreement or condition (other than financial maintenance covenants or the failure to provide notice of a default or event of default under such agreement or instrument) relating to any ABL Credit Agreement Obligations or contained in any ABL Credit Agreement Document, the effect of which default or other event is to cause, or to permit the holder or holders of any ABL Credit Agreement Obligations (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such ABL Credit Agreement Obligations to be demanded or to become due or to be repurchased, prepaid, defeased or redeemed (automatically or otherwise) prior to its stated maturity; provided that any such failure referred to in clause (C) shall constitute an Event of Default under this subsection (c) only after the expiration of a 30-day period following the commencement of such failure; or

(d)    Insolvency Proceedings, Etc. (i) An involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (a) liquidation, reorganization or other relief in respect of any Loan Party or its debts, or of a substantial part of its assets, under the Bankruptcy Code or any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (b) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Loan Party or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall be entered; or

(ii)    Any Loan Party shall (a) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under the Bankruptcy Code or any federal, state, provincial or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (b) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in Section 8.01(d), (c) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Loan Party or for a substantial part of its assets, (d) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (e) make a general assignment for the benefit of creditors or (f) take any action for the purpose of effecting any of the foregoing; or

(e)    Judgments. One or more final judgments for the payment of money in an aggregate amount in excess of (i) if ExcessAvailability (as defined in the ABL Credit Agreementas in effect on the date hereof) is then greater than $250.0 million, $100.0 million or (ii) if Excess Availability (as defined inthe ABL Credit Agreementas in effect on the date hereof) is then less than $250.0 million, $50.0 million (or in each case, such lesser amount as would reasonably be expected to result in a Material Adverse Effect)$100.0 million in excess of insurance coverage (or indemnities from indemnitors reasonably satisfactory to the Agents) shall be rendered against any Loan Party or any combination of Loan Parties and the same shall remain undischarged for a period of forty-five (45) days during which execution shall not be effectively stayed, satisfied or bonded or any action shall be legally taken by a judgment creditor to attach or levy upon any material assets of any Loan Party to enforce any such judgment; or

(f)    ERISA. An ERISA Event shall have occurred that when taken together with all other ERISA Events that have occurred, would reasonably be expected to result in a Material

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Adverse Effect and the same shall remain undischarged for a period of thirty (30) consecutive days during which period any action shall not be legally taken to attach or levy upon any material assets of any Loan Party to enforce any such liability; or

(g)    Invalidity of Loan Documents. Any provision of any Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder or satisfaction in full of all the Obligations (other than contingent indemnity obligations with respect to unasserted claims), ceases to be in full force and effect; or any Loan Party contests in any manner in writing the validity or enforceability of anyprovision of anyLoan Document; or any Loan Party denies that it has any or further liability or obligation under any Loan Document except by reason of payment in full of all Obligations (other than contingent indemnity obligations with respect to unasserted claims), or purports to revoke, terminate or rescind any provision of anyLoan Document except pursuant to the express terms thereof; or

(h)    Representations and Warranties. Any representation or warranty made by any Loan Party (or any of its Responsible Officers) under or in connection with any Loan Document shall prove to have been incorrect in any material respect when made; or

(i)    Collateral. Any security interest and Lien purported to be created by any Security Document as to any property of the Loan Parties shall cease to be in full force and effect, or shall cease to give the Collateral Agent, for the benefit of the Secured Parties, the Liens, rights, powers and privileges purported to be created and granted under such Security Document in favor of the Collateral Agent, or any security interest and Lien purported to be created by any Security Document on such property shall be asserted by any Loan Party not to be a valid,and perfected, first priority (except as otherwise expressly provided in this Agreement or such Security Document) security interest (with the priority required by the Intercreditor Agreements) in or Lien on the Collateral covered thereby, in each case which, individually or in the aggregate, materially detracts from or impairs the value of the Collateral to the Lenders, taken as a whole; or

(j)    Change of Control. There occurs any Change of Control.;

(k)Certain Prepayment Events. The Borrower fails to pay any mandatory prepayment required to be made pursuant to Section 2.03(j)(i); or

(l)Invalidity of the IntermediateCo Unsecured Guarantee. Any provision of the Intermediate Co. Unsecured Guarantee, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder prior to the satisfaction in full of the Obligations (other than contingent indemnity obligations with respect to unasserted claims) in respect of the Term B-4 Loans, ceases to be in full force and effect; or the Borrower or IntermediateCo contests in any manner in writing the validity or enforceability of any provision of the IntermediateCo Unsecured Guarantee; or IntermediateCo denies that it has any further liability or obligation under the IntermediateCo Unsecured Guarantee except by payment in full of all Obligations (other than contingent indemnity obligations with respect to unasserted claims) in respect of the Term B-4 Loans, or purports to revoke, terminate or rescind any provision of the IntermediateCo Unsecured Guarantee except pursuant to the express terms thereof.

8.02     Remedies upon Event of Default. If any Event of Default (other than an Event of Default pursuant to Section 8.01(k) or (l)) occurs and is continuing, the Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders, take any or all of the following actions; provided, that with respect to an Event of Default pursuant to Section 8.01(k) or (l), the Administrative

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Agent shall only act upon the request of the Term B-4 Required Lenders and the remedies shall be limited to the Term B-4 Loans:

(i)    declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document (or, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower; and

(ii)    exercise on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents(or, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee);

provided that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the Commitments shall automatically terminate and the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, in each case without further act of the Administrative Agent or any Lender.

For the avoidance of doubt, the occurrence and continuance of an Event of Default or acceleration shall not trigger a prepayment premium under Section 2.03(h).

8.03     Application of Funds. After the exercise of remedies provided for in Section 8.02 (or after the Loans have automatically become immediately due and payable as set forth in the proviso to Section 8.02), or after the commencement of any Liquidation, subject to the terms of the Intercreditor Agreements, any amounts received on account of the Obligations shall be applied by the Administrative Agent in the following order:

(a)    First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to the Agents and amounts payable under Article III) payable to the Administrative Agent and the Collateral Agent in their capacities as such;

(b)    Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal and interest) payable to the Lenders (including fees, charges and disbursements of counsel to the respective Lenders (including fees and time charges for attorneys who may be employees of any Lender) and amounts payable under Article III), ratably among them in proportion to the amounts described in this subsection (b) payable to them;

(c)    Third, to payment of that portion of the Obligations constituting accrued and unpaid interest on the Loans and other Obligations, ratably among the Lenders in proportion to the respective amounts described in this subsection (c) payable to them;

(d)    Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans ratably among the Lenders;

(e)    Fifth, to payment of any other Secured Obligations then outstanding ratably among the Secured Parties; and

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(f)    Last, the balance, if any, after all of the Obligations then due and owing have been paid in full in cash, to the Borrower or as otherwise required by Law.

Each Loan Party acknowledges the relative rights, priorities and agreements of the Secured Parties and the secured parties under the ABL Credit Agreement, the Secured Notes and the Additional Secured Notes, if any, in each case as set forth in the Intercreditor Agreements and this Agreement, including as set forth in this Section 8.03.

ARTICLE IX
AGENTS

9.01     Appointment and Authority. Each of the Lenders hereby irrevocably appoints Bank of America to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Administrative Agent and the Lenders, and no Loan Party shall have rights as a third party beneficiary of any of such provisions.

9.02     Rights as a Lender. Each Person serving as an Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not one of the Agents and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Persons serving as the Administrative Agent hereunder in its individual capacity. Such Persons and their Affiliates may accept deposits from, lend money to, act as financial advisor or in any other advisory capacity for and generally engage in any kind of business with Holdings, the Loan Parties or any Subsidiary thereof or other Affiliate thereof as if each such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

9.03     Exculpatory Provisions. The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee). Without limiting the generality of the foregoing, the Administrative Agent:

(a)    shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(b)shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee)); provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) or applicable law; and

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(c)    shall not, except as expressly set forth herein and in the other Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to Holdings, the Borrower or any of their Affiliates that is communicated to or obtained by the Person serving as Administrative Agent or any of its Affiliates in any capacity.

The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 8.02 and 10.01) or (ii) except to the extent of any liability imposed by law by reason of its own gross negligence or willful misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given to the Administrative Agent by the Borrower or a Lender.

The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

9.04     Reliance by the Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan that by its terms must be fulfilled to the satisfaction of a Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender unless the Administrative Agent shall have received notice to the contrary from such Lender prior to the making of such Loan. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

9.05     Delegation of Duties. The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) by or through any one or more sub‑agents appointed by the Administrative Agent. The Administrative Agent and any such sub‑agent may perform any and all of their duties and exercise their rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub‑agent and to the Related Parties of the Administrative Agent and any such sub‑agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities of the Administrative Agent.

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9.06     Resignation of the Administrative Agent. The Administrative Agent may at any time give notice of its resignation to the Lenders and the Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right to appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States, which appointment shall be subject to approval (not to be unreasonably withheld) by the Borrower. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment and shall have been approved by the Borrower (where such approval is required) within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent (which shall also be a Lender) meeting the qualifications set forth above; provided that if the Administrative Agent shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (a) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) (except that in the case of any collateral security held by the Administrative Agent on behalf of the Lenders under any of the Loan Documents, the retiring Administrative Agent shall continue to hold such collateral security until such time as a successor Administrative Agent is appointed) and (b) all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section. Upon the acceptance and approval (if applicable) of a successor’s appointment as Administrative Agent hereunder, and upon the execution and filing or recording of such financing statements or amendments thereto, and such other instruments or notices, as may be necessary, or as the Required Lenders may request, in order to continue the perfection of the Liens granted or purported to be granted by the Security Documents such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) (if not already discharged therefrom as provided above in this Section 9.06). The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee, the provisions of this Article and Section 10.04 shall continue in effect for the benefit of such retiring Administrative Agent, its sub‑agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.

9.07     Non-Reliance on the Agents and Other Lenders. Each Lender acknowledges that it has, independently and without reliance upon the Agents or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Agents or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

9.08     No Other Duties, Etc.. Anything herein to the contrary notwithstanding, none of the Collateral Agent, the Syndication Agents, the Documentation Agent or the Arrangers listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity as a Lender hereunder. Anything herein to the contrary notwithstanding, the Administrative Agent shall not have any powers, duties or responsibilities under this

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Agreement or any of the other Loan DocumentsDocuments(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), except in its capacity, as applicable, as the Administrative Agent or a Lender hereunder.

9.09     Administrative Agent May File Proofs of Claim. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on any Loan Party) shall be entitled and empowered, by intervention in such proceeding or otherwise

(a)    to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Agents and their respective agents and counsel and all other amounts due the Lenders and the Agents under Sections 2.09 and 10.04) allowed in such judicial proceeding; and

(b)    to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.03(g), 2.09 and 10.04.

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

9.10     Collateral and Guarantee Matters. The Lenders irrevocably authorize the Administrative Agentand the Collateral Agent, at its option and in its discretion,

(a)to release any Lien on any property granted to or held by the Collateral Agent under any Loan Document (i) upon termination of the Aggregate Commitments and payment in full of all Secured Obligations (other than contingent indemnity obligations with respect to unasserted claims), (ii) that is sold or to be sold as part of or in connection with any sale permitted hereunder or under any other Loan Document to a Person that is not a Loan Party, (iii) in accordance with the requirements of the Intercreditor Agreementsor, (iv) to the extent constituting Excluded Collateral (as defined in the Security Agreement) or (v) subject to Section 10.01, if approved, authorized or ratified in writing by the Required Lenders;

(b)to subordinate any Lien on any property granted to or held by the AdministrativeCollateral Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 7.01(nh);

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(c)    to release any Guarantor from its obligations under the Guarantee if such Person ceases to be a Subsidiary of a Loan Party as a result of a transaction permitted hereunder; provided that no such release shall occur if such Guarantor continues to be a guarantor in respect of any other Indebtedness of the Borrower unless and until such Guarantor is (or is being simultaneously) released from its guarantee with respect to such other Indebtedness; and

(d)    subject to the other provisions of this Article IX, to take such actions, including making filings and entering into agreements and any amendments or supplements to any Security Document or Intercreditor Agreement, as may be necessary or desirable to reflect the intent of this Agreement and the refinancing of any Indebtedness permitted hereunder; provided that upon request by the Administrative Agent or any Loan Party at any time, the Lenders will confirm in writing the Administrative Agent’s authority to enter into such agreements, amendments or supplements.

(e)Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release or subordinate its interest in particular types or items of property, or to release any Guarantor from its obligations under the Guarantee pursuant to this Section 9.10; provided that any release or subordination with respect to the Canadian Pledge must also be confirmed in writing by the Term B-4 Required Lenders.

9.11     Withholding Tax.. To the extent required by any applicable Law, the Administrative Agent may deduct or withhold from any payment to any Lender an amount equivalent to any applicable withholding Tax. If the Internal Revenue Service or any other authority of the United States or other jurisdiction asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for the account of any Lender for any reason (including, without limitation, because the appropriate form was not delivered or not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstance that rendered the exemption from, or reduction of withholding Tax ineffective, or for any other reason), such Lender shall indemnify and hold harmless the Administrative Agent (to the extent that the Administrative Agent has not already been reimbursed by Borrower pursuant to Sections 3.01 and 3.04 and without limiting any obligation of Borrower to do so pursuant to such Sections) fully for all amounts paid, directly or indirectly, by the Administrative Agent as Taxes or otherwise (including any and all related losses, claims, liabilities, penalties, and interest), together with all expenses incurred, including legal expenses and any other out-of-pocket expenses, whether or not such Tax was correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under this Agreement or any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) against any amount due to the Administrative Agent under this Section 9.11. The agreements in this Section 9.11 shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of, a Lender, the termination of this Agreement and the repayment, satisfaction or discharge of all other Obligations.

ARTICLE X
MISCELLANEOUS

10.01     Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by any Loan Party therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower or the applicable Loan Party, as the

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case may be, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided that no such amendment, waiver or consent shall:

(a)    extend or increase the Commitment of any Lender without the written consent of such Lender (it being understood that no amendment, modification, termination, waiver or consent with respect to any condition precedent, covenant or Default shall constitute an increase in the Commitment of any Lender);

(b)    (A) change the Maturity Date or waive or amend the conditions to the Loans, (B) postpone the date for payment of any interest or fees payable hereunder, (C) change the amount of, waive or excuse any payment of principal, interest or premium (other than waiver of default interest) or (D) postpone the scheduled date of expiration of any Commitment, in any case, without the written consent of each Lender directly affected thereby;

(c)    reduce the principal of, or the rate of interest (other than waiver of default interest) specified herein on, any Loan, or any fees or other amounts payable hereunder or under any other Loan Document, change the form or currency of payment or increase the maximum duration of Interest Periods, without the written consent of each Lender directly affected thereby;

(d)    change Section 2.11 or Section 8.03 in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender;

(e)    change any provision of this Section 10.01 or reduce the percentage set forth in the definition of “Required Lenders,” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender, other than to increase such percentage or number or to give any additional Lender or group of Lenders such right to waive, amend or modify or make any such determination or grant any such consent;

(f)    other than releases of Collateral in accordance with Section 9.10, release all or substantially all of the Collateral in any transaction or series of related transactions, without the written consent of each Lender; and

(g)    except for releases of a Guarantor in accordance with Section 9.10 hereof, provided herein or in any other Loan Document, release any Significant Subsidiary that is a Subsidiary Guarantor from the Guarantee without the written consent of each Lender;

provided, further, that (i) no amendment, waiver or consent shall, unless in writing and signed by any Agent in addition to the Lenders required above, affect the rights or duties of such Agent under this Agreement or any other Loan Document; (ii) Section 10.06(g) may not be amended, waived or otherwise modified without the consent of each Granting Lender all or any part of whose Loans are being funded by an SPC at the time of such amendment, waiver or other modification; and(iii) subject to Section 10.01(a), any such agreement that shall extend the Maturity Date of one or more Lenders (the “Extending Lender”)and does not amend any other provision of this Agreement or the Loan Documents other than to change the Applicable Rate of Extending Lenders shall only require the consent of Borrower, the Administrative Agent and the Extending Lenders; (iv) the IntermediateCo Unsecured Guarantee, the third sentence of Section 2.03(h), Section 2.03(j), Section 6.10(c), Section 8.01(k), Section 8.01(l) and the proviso in Section 9.10(e) and any other term or provision related to the Specified Real Properties or the Canadian Pledge to the extent such amendment, waiver or modification would materially and adversely affect the Term B-4 Lenders may not be amended, waived or otherwise modified without the consent of

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the Term B-4 Required Lenders and the Borrower; (v) the aggregate principal amount of the Term B-4 Loans shall not be increased without the consent of the Term B-4 Required Lenders and (vi) the IntermediateCo Unsecured Guarantee, any Specified Real Property that is Collateral and the Canadian Pledge in respect of the Term B-4 Loans may not be released without the consent of the Term B-4 Required Lenders. In addition, notwithstanding the foregoing, this Agreement may be amended (or amended and restated) with the written consent of Administrative Agent, the Borrower and the Lenders providing the relevant AdditionalNew Loans pursuant to Section 2.12 (i) to add one or more New Loans pursuant to Section 2.12 and to permit the extensions of credit and all related obligations and liabilities arising in connection therewith from time to time outstanding to share ratably (or on a basis subordinated to the existing facilities hereunder) in the benefits of this Agreement and the other Loan Documents with the obligations and liabilities from time to time outstanding in respect of the existing facilities hereunder and (ii) in connection with the foregoing, to permit, as deemed appropriate by the Administrative Agent and approved by the Required Lenders, the Lenders providing such New Loans to participate in any required vote or action required to be approved by the Required Lenders or by any other number or percentage hereunder.

Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of any Defaulting Lender may not be increased or extended without the consent of such Lender and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lenders shall require the consent of such Defaulting Lender.

If, in connection with any proposed change, waiver, discharge or termination of the provisions of this Agreement as contemplated by this Section 10.01, the consent of the Required Lenders is obtained but the consent of one or more of such other Lenders whose consent is required is not obtained, then the Borrower shall have the right to replace all non-consenting Lenders required to obtain such consent with one or more Eligible Assignees in accordance with Section 10.13, so long as at the time of such replacement each such new Lender consents to the proposed change, waiver, discharge or termination. Notwithstanding the foregoing, if on or prior to the first anniversary of the Restatement Date any amendment lowering the Applicable Rate becomes effective, each non-consenting Lender to such amendment removed pursuant to this paragraph shall be paid a prepayment fee equal to 1.00% of the principal amount of any portion of such Loans assigned.

Notwithstanding anything to the contrary, without the consent of any other Person, the applicable Loan Party or Parties and the Administrative Agent may (in its or their respective sole discretion, or shall, to the extent required by any Loan Document) enter into any amendment or waiver of any Loan Document, or enter into any new agreement or instrument, to effect the granting, perfection, protection, expansion or enhancement of any security interest in Collateral or additional property to become Collateral for the benefit of the Secured Parties, or as required by local law to give effect to, or protect any security interest for the benefit of the Secured Parties, in any property or so that the security interests therein comply with applicable law.

10.02     Notices; Effectiveness; Electronic Communication.

(a)    Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile as follows, and all notices and

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other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

(i)    if to the Borrower, the Administrative Agent, the Collateral Agent, the Syndication Agents or the Documentation Agents, to the address, facsimile number, electronic mail address or telephone number specified for such Person on Schedule 10.02; and

(ii)    if to any other Lender, to the address, facsimile number, electronic mail address or telephone number specified in its Administrative Questionnaire.

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b).

(b)    Electronic Communications. Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communication (including e‑mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices to any Lender pursuant to Article II if such Lender has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Borrower may, in their discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement); provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing subsection (i) of notification that such notice or communication is available and identifying the website address therefor.

(c)    The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to any Loan Party or any Lender for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of Borrower Materials or notices through the Platform, any other electronic platform or electronic messaging service, or through the Internet, except to the extent that such losses, claims, damages, liabilities or

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expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided that in no event shall any Agent Party have any liability to any Loan Party, any Lender for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

(d)    Change of Address, Etc. The Borrower and each Agent may change its address, facsimile or telephone number for notices and other communications hereunder by notice to the other parties hereto. Each other Lender may change its address, facsimile or telephone number for notices and other communications hereunder by notice to the Borrower and the Administrative Agent. In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, telecopier number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender. Furthermore, each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and applicable Law, including United States Federal and state securities Laws, to make reference to Borrower Materials that are not made available through the “Public Side Information” portion of the Platform and that may contain material non-public information with respect to the Borrower or its securities for purposes of United States Federal or state securities laws.

(e)    Reliance by Administrative Agent and Lenders. The Administrative Agent and the Lenders shall be entitled to rely and act upon any notices (including telephonic Borrowing or Conversion Notices) purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Borrower shall indemnify the Administrative Agent, each Lender and the Related Parties of each of them from all losses, liabilities, reasonable costs, and actual out-of-pocket expenses resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrower, except to the extent of gross negligence, bad faith or willful misconduct. All telephonic notices to and other telephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

10.03 No Waiver; Cumulative Remedies. No failure by any Lender or the Agents to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder or under any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided, and provided under each other Loan Document(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

10.04     Expenses; Indemnity; Damage Waiver.

(a)    Costs and Expenses. The Borrower shall, on the Restatement Date, pay (i) all reasonable out‑of‑pocket expenses incurred by each Agent and its Affiliates (including the reasonable fees, charges and disbursements of one counsel for the Agents (including one set of any special and local counsel)) in connection with the syndication of the credit facilities provided for herein, the preparation, negotiation, execution and delivery of this Agreement and the other Loan Documents Documents (and, in the case of

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the Term B-4 Loans, the IntermediateCo Unsecured Guarantee)or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not such amendments, modifications or waivers shall be consummated) and (ii) all reasonable out-of-pocket expenses incurred by the Agents and Lenders (including the reasonable out-of-pocket fees, charges and disbursements of one counsel for all Agents and Lenders)in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), including its rights under this Section 10.04 or (B) in connection with the Loans made, including all such out‑of‑pocket expenses incurred during any workout, restructuring or related negotiations in respect of such Loans.

(b)    Indemnification by the Loan Parties. The Loan Parties shall jointly and severally indemnify each Agent, each Lender and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all actual out-of-pocket losses, claims, damages, liabilities and related expenses (including the reasonable fees, charges and disbursements of one counsel for the Agents and one counsel for all Indemnitees (other than the Agents)), incurred, suffered, sustained or required to be paid by, or asserted against, any Indemnitee arising out of, in any way connected with, or as a result of (i) the execution or delivery of any Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) or any other agreement or instrument contemplated hereby or thereby, the performance by the parties to the Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) of their respective obligations thereunder or the consummation of the transactions contemplated by the Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee)or any other transactions contemplated hereby, (ii) any Loan or the use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Material on or from any property currently or formerly owned or operated by any Loan Party or any Subsidiary, or any Environmental Liability related in any way to any Loan Party or any Subsidiary, (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto or (v) any documentary taxes, assessments or similar charges made by any Governmental Authority by reason of the execution and delivery of this Agreement or any other Loan Document(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee);provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (w) are determined by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from the gross negligence, bad faith or willful misconduct of any Agent or such Indemnitee or any Affiliate of such Indemnitee (or any officer, director, employee, advisor or agent of such Indemnitee or any such Indemnitee’s Affiliates), (x) are related to disputes among Indemnitees or (y) are determined by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from a breach by such Indemnitee of its obligations to a Loan Party. In connection with any indemnified claim hereunder, the Indemnitee shall be entitled to select its own counsel and the Loan Parties shall promptly pay the reasonable fees and expenses of such counsel to the extent required hereunder.

(c)    Reimbursement by Lenders. To the extent that the Loan Parties for any reason fail to indefeasibly pay any amount required under subsection (a) or (b) of this Section 10.04 to be paid by them to each Agent (or any sub-agent thereof), or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent) or such Related Party, as the case may be, such Lender’s Pro Rata Share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent), or against any Related Party thereof acting for the Administrative Agent (or any such sub-agent) in connection with such capacity. The obligations of the Lenders under this subsection (c) are subject to the provisions of Section 2.10(d).

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(d)    Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable law, the parties hereto shall not assert, and each such party hereby waives, any claim against any other party hereto or Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) or any agreement or instrument contemplated hereby and thereby, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof except, in the case of a Loan Party, to the extent otherwise required to be indemnified by a Loan Party pursuant to Section 10.04(b). No party hereto referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee).

(e)    Payments. After the Restatement Date, all amounts due under this Section 10.04 shall be payable not later than fifteen Business Days after receipt of an invoice therefor setting forth such expenses in reasonable detail; provided that in the event the Borrower has a bona fide dispute with any such expenses, payment of such disputed amounts shall not be required until the earlier of the date such dispute is resolved to the reasonable satisfaction of the Borrower or thirty (30) days after receipt of any such invoice (and any such disputed amount which is so paid shall be subject to a reservation of the Borrower’s rights with respect thereto).

(f)    Survival. The agreements in Sections 10.04(b), (c) and (d) shall survive the resignation of the Administrative Agent, the replacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations.

10.05     Payments Set Aside. To the extent that any payment by or on behalf of the Borrower is made to any Agent or any Lender, or any Agent or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside and is required to be repaid to a trustee or receiver in connection with any proceeding under any Debtor Relief Law then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred and (b) each Lender severally agrees to pay to each Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by such Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of the Lenders under subsection (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

10.06     Successors and Assigns.

(a)    Successors and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that no Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and the Lenders (and any such attempted assignment of transfer without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

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(b)    Assignments by Lenders. Any Lender may, with the consent of (x) the Administrative Agent and (y) except in the case of any assignment to a Lender, an Affiliate of a Lender or an Approved Fund, or if an Event of Default has occurred and is continuing at the time of such assignment, the Borrower, assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) (in each case, such consent not to be unreasonably withheld or delayed); provided that:

(i)    each assignment (except in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans at the time owing to it or in the case of an assignment to a Lender or an Affiliate of a Lender, the aggregate amount of the Commitment or the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment, determined as of the date the Assignment and Assumption with respect to such assignment, is delivered to the Administrative Agent or, if “trade date” is specified in the Assignment and Assumption, as of the trade date) shall not be less than $1.0 million with respect to Commitments and Loans unless, in each case, the Administrative Agent and the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed); provided that concurrent assignments to members of an Assignee Group and concurrent assignments from members of an Assignee Group to a single Eligible Assignee (or to an Eligible Assignee and members of its Assignee Group) will be treated as a single assignment for purposes of determining whether such minimum amount has been met;

(ii)    each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loans or the Commitment assigned;

(iii)    the parties of each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee in the amount of $3,500; provided that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment. The Eligible Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire;

(iv)    no such assignment shall be made to any Defaulting Lender or any of its Subsidiaries; and

(v)    in connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon). Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

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Subject to acceptance by the Administrative Agent and obtaining of required consents and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Assumption, the Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05 and 10.04 with respect to facts and circumstances occurring prior to the effective date of such assignment. Upon request, the Borrower (at its expense) shall execute and deliver the applicable Note to the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be null and void

(c)    Register. The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Loan Parties, shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption delivered to it and a register (the “Register”) for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal and interest amounts of the Loans owing to, each Lender pursuant to the terms hereof from time to time. The entries in the Register shall be conclusive absent manifest error, and the Loan Parties, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. In addition, the Administrative Agent shall maintain on the Register information regarding the designation, and revocation of designation, of any Lender as a Defaulting Lender. The Register shall be available for inspection by the Borrower at any reasonable time and from time to time upon reasonable prior notice.

(d)    Participations. Any Lender may at any time, without the consent of, or notice to, the Loan Parties or any other Person, sell participations to any Person (other than a natural person) (each, a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it), subject to the following:

(ei)such Lender’s obligations under this Agreement and the other Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) shall remain unchanged;

(iii)    such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations;

(iii)    the Loan Parties, the Administrative Agent and the Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement;

(iiiiv)any agreement or instrument pursuant to which a Lender sells a participation in the Commitments and the Loans shall provide that such Lender shall retain the sole right to enforce the Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) and to approve any amendment, modification or waiver of any provision of the Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee); provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the proviso to Section 10.01(b), (c), (f) or (g) that affects such Participant;

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(ivv)    subject to clause (viii) of this Section 10.06(d), the Loan Parties agree that each Participant shall be entitled to the benefits of Section 3.01 and Section 3.04 (subject to the requirements and limitations of those Sections, including Section 3.01(e)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 10.06(b);

(vvi)    to the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender so long as such Participant agrees to be subject to Section 2.11 as though it were a Lender;

(vii)    each Lender, acting for this purpose as a non-fiduciary agent of the Loan Parties, shall maintain at its offices a record of each agreement or instrument effecting any participation and a register (each a “Participation Register”) meeting the requirements of 26 CFR § 5f.103-1(c) for the recordation of the names and addresses of its Participants and their rights with respect to principal amounts and related interest amounts and other Obligations from time to time. The entries in each Participation Register shall be conclusive (absent manifest error) and the Loan Parties, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in a Participant Register as a Participant for all purposes of this Agreement (including, for the avoidance of doubt, for purposes of entitlement to benefits under Section 3.01, Section 3.04 and Section 10.08) notwithstanding any notice to the contrary. The Participation Register shall be available for inspection by the Borrower and the Administrative Agent at any reasonable time and from time to time upon reasonable prior notice;

(viii)    a Participant shall not be entitled to receive any greater payment under Section 3.01 or Section 3.04 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent; and

(viiiix)    a Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Loan Parties, to comply with Section 3.01(e) as though it were a Lender and such Participant is eligible for exemption from, or reduction in, the withholding Tax referred to therein, following compliance with Section 3.01(e).

(fe)Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under its Note(s), if any) to secure obligations of such Lender, including (i) any pledge or assignment to secure obligations to a Federal Reserve Bank and (ii) any pledge or assignment to any holders of obligations owed, or securities issued, by such Lender as collateral security for such obligations or securities, or to any trustee for, or any other representative of, such holders; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

(gf)Electronic Execution of Assignments. The words “execution,” “signed,” “signature” and words of like import in any Assignment and Assumption shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

(hg)Special Purpose Funding Vehicles. Notwithstanding anything to the contrary contained herein, any Lender (a “Granting Lender”) may grant to a special purpose funding vehicle identified as

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such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower (an “SPC”) the option to provide all or any part of any Loan that such Granting Lender would otherwise be obligated to make pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to fund any Loan, and (ii) if an SPC elects not to exercise such option or otherwise fails to make all or any part of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof or, if it fails to do so, to make such payment to the Administrative Agent as is required under Section 2.10(b)(ii). Each party hereto hereby agrees that (i) an SPC shall be entitled to the benefit of Sections 3.01 and 3.04 (subject to the requirements and the limitations of such Sections) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 10.06(b), but an SPC shall not be entitled to receive any greater payment under Sections 3.01 or 3.04 than the applicable Lender would have been entitled to receive with respect to such grant, (ii) no SPC shall be liable for any indemnity or similar payment obligation under this Agreement for which a Lender would be liable and (iii) the Granting Lender shall for all purposes, including the approval of any amendment, waiver or other modification of any provision of any Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), remain the lender of record hereunder. The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Loan were made by such Granting Lender. In furtherance of the foregoing, each Lender party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other senior debt of any SPC, it will not institute against, or join any other Person in instituting against, such SPC any bankruptcy, reorganization, arrangement, insolvency, or liquidation proceeding under the laws of the United States or any State thereof. Notwithstanding anything to the contrary contained herein, any SPC may (i) with notice to, but without prior consent of, the Borrower and the Administrative Agent and with the payment of a processing fee of $2,500, assign all or any portion of its right to receive payment with respect to any Loan to the Granting Lender and (ii) disclose on a confidential basis in accordance with Section 10.07 any non-public information relating to its funding of Loans to any rating agency, commercial paper dealer or provider of any surety or guarantee or credit or liquidity enhancement to such SPC.

(ih)Notwithstanding anything to the contrary contained herein, any Lender may assign all or any portion (including, a portion of any Class or any Type on a non-pro rata basis) of its Loans hereunder (I) to any Affiliated Lender; provided that:

(i)    no Default or Event of Default has occurred or is continuing or would result therefrom;

(ii)    the Affiliated Lender shall have disclosed to the assignor its status as an Affiliated Lender;

(iii)    the Affiliated Lender will be subject to the restrictions set forth in Section 10.18;

(iv)    no Loan may be assigned to an Affiliated Lender if, after giving effect to such assignment, Affiliated Lenders in the aggregate would own more than 30% of the aggregate principal amount of the outstanding Loans; and

(v)    any such Loans acquired by an Affiliated Lender may be contributed to the Borrower and exchanged for debt or equity securities that are otherwise permitted to be issued at such time;and

and(II) to Borrower or any of its Subsidiaries; provided that:

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(vii)    Borrower or such Subsidiary shall make an offer to all Lenders to take Loans by assignment pursuant to the loan auction procedures set forth in Exhibit N;

(vii)Borrower or such Subsidiary shall make an offer to all Lenders to take Loans by assignment pursuant to the loan auction procedures set forth in Exhibit N;

(vii)upon the effectiveness of any such assignment (or contribution of Loans pursuant to clause (I)(v) above), such Loans shall be retired, and shall be deemed cancelled and not outstanding for all purposes under this Agreement;

(viii)no Default or Event of Default shall exist or be continuing; and

(ixiv)the Borrower must represent and warrant, at the time of the offer and at the time of the assignment, (x) it has no knowledge, after reasonable inquiry, of the existence of any event or circumstance, individually or in the aggregate, that will or would reasonably be expected to give rise to a mandatory prepayment of a material amount of the Loans pursuant to Section 2.03 expected to be paid in the next 30 days and (y) there is no Material Information that has not been disclosed to the Lenders. “Material Information” shall mean information relating to the occurrence of a material effect, or any event or condition that, individually or in the aggregate, has had or would reasonably be expected to have a material effect (in each case whether positive or negative), on (a) the operations, business, properties, liabilities (actual or contingent), financial condition of the Borrower and its Subsidiaries taken as a whole; (b) the ability of the Loan Parties (taken as a whole) to perform their material payment obligations under any Loan Document to which they are a party; or(c) the legality, validity, binding effect or enforceability against any Loan Party of any material Loan Document to which it is a party.; (d) the ability of IntermediateCo to perform its material payment obligations under the IntermediateCo Unsecured Guarantee to which it is a party; and (e) the legality, validity, binding effect or enforceability against IntermediateCo of the IntermediateCo Unsecured Guarantee.

10.07     Treatment of Certain Information; Confidentiality. Each of the Agents and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and agree to keep such Information confidential), (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it (including any self‑regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by Applicable Laws or any subpoena or similar legal process (the Agents and/or the Lenders agreeing to furnish the Borrower with notice of such process and an opportunity to contest such disclosure as long as furnishing such notice and opportunity would not result in the Agents’ and/or the Lenders’ violation of Applicable Law), (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee)or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement and any actual or prospective counterparty or advisors to any swap or derivative transactions relating to the Loan Parties and the Obligations so long as such Person or any of their Affiliates does not compete in the retail toy and/or infant products industry, (g) with the consent of the Loan Parties or (h) to the extent such Information (I) becomes publicly available other than as a result of a breach of this Section, or to the knowledge of such Agent or Lender, the breach of any other Person’s obligation to keep the information confidential or (II) becomes available any Agent or Lender on a nonconfidential basis from a source other than the Loan Parties.

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For purposes of this Section, “Information” means all information received from the Borrower or any Subsidiary relating to the Borrower or any Subsidiary or any of their respective businesses, other than any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by the Borrower or any Subsidiary, provided that, in the case of information received from the Borrower or any Subsidiary after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

Each Lender acknowledges that information furnished to it pursuant to this Agreement or the other Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), including conference calls or meetings with the Borrower to review its earnings and other information, may include material non-public information concerning the Borrower and its Affiliates and their related parties or their respective securities, and confirms that it has developed compliance procedures regarding the use of material non-public information and that it will handle such material non-public information in accordance with those procedures and applicable law, including Federal and state securities laws.

Accordingly, each Lender represents to the Borrower and the Administrative Agent that it has identified a credit contact who may receive information that may contain material non-public information in accordance with its compliance procedures and applicable law, including Federal and state securities laws.

10.08     Right of Setoff. If a Specified Default shall have occurred and be continuing, each Agent, Lender and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, but excluding Designated Accounts (as defined in the ABL Credit Agreement), payroll, trust and tax withholding accounts) at any time held and other obligations (in whatever currency) at any time owing by such Agent, Lender or any such Affiliate to or for the credit or the account of the Borrower or any other Loan Party against any and all of the Obligations of the Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) to such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement or any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) and although such obligations of the Borrower or such Loan Party may be contingent or unmatured or are owed to a branch or office of such Lender different from the branch or office holding such deposit or obligated on such indebtedness; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.13 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender or its respective Affiliates may have. Each Lender agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application. No Agent or Lender will or will permit its Participant to exercise its rights under this Section 10.08 without the consent of the Agents or the Required Lenders. In no event shall the provisions of this paragraph be construed to apply to any payment made by the Borrower pursuant to and in accordance

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with the express terms of this Agreement or, any payment obtained by a Lender or consideration for the assignment of sale of a participation in any of its Loans to any assignee or participant other than the Borrower or any of its Affiliates thereof (as to which the provisions of this paragraph shall apply).

10.09     Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan Document(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), the interest paid or agreed to be paid under the Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

10.10     Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee)constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by telecopy or other electronic imaging means shall be effective as delivery of a manually executed counterpart of this Agreement.

10.11     Survival of Representations and Warranties. All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Agents and each Lender, regardless of any investigation made by the Agents or any Lender or on their behalf and notwithstanding that the Agents or any Lender may have had notice or knowledge of any Default at the time of any borrowing of Loans, and shall continue in full force and effect as long as any Loan or any other Obligation (other than contingent indemnity obligations with respect to unasserted claims) hereunder shall remain unpaid or unsatisfied.

10.12     Severability. If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Without limiting the foregoing provisions of this Section 10.12, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent then such provisions shall be deemed to be in effect only to the extent not so limited

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10.13     Replacement of Lenders. If any Lender requests compensation under Section 3.04, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, and such amounts or compensation do not affect Lenders generally, or if any Lender is a Defaulting Lender or as provided in Section 10.01, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.06), all of its interests, rights and obligations under this Agreement and the related Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) to an Eligible Assignee that shall assume such obligations (which Eligible Assignee may be another Lender, if a Lender accepts such assignment); provided that:

(a)    the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 10.06(b);

(b)    such Lender shall have received payment of an amount equal to the outstanding principal of and premium (if any) on its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) (including any amounts under Section 3.05) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);

(c)    in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to be made pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter; and

(d)    such assignment does not conflict with applicable Laws.

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

10.14     Governing Law, Jurisdiction; Etc.

(a)    GOVERNING LAW. THIS AGREEMENT AND ALL ACTIONS ARISING UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(b)    SUBMISSION TO JURISDICTION. THE BORROWER AND EACH OTHER PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMIT, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF THE STATE OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW

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YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c)    WAIVER OF VENUE. THE BORROWER AND EACH OTHER PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d)    SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

10.15     Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY) AND EXCEPT AS OTHERWISE PROVIDED HEREIN AND AS REQUIRED BY LAW WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES THEREOF AS WELL AS NOTICE OF NONPAYMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

10.16     USA PATRIOT Act Notice. Each Lender that is subject to the Patriot Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Patriot Act”), it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of each Loan Party and

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other information that will allow such Lender or the Administrative Agent, as applicable, to identify each Loan Party in accordance with the Patriot Act. The Borrower shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender reasonably requests in order to comply with its ongoing obligations under applicable “know your customer” an anti-money laundering rules and regulations, including the Patriot Act.

10.17 Intercreditor Agreements. Notwithstanding anything herein to the contrary, the lien and security interest granted to the AdministrativeCollateral Agent pursuant to this Agreementthe Security Documents and the exercise of any right or remedy by the AdministrativeCollateral Agent thereunder are subject to the provisions of the Intercreditor Agreements. In the event of any conflict between the terms of this Agreementthe Security Documents and the Intercreditor Agreements, the terms of the applicable Intercreditor Agreement shall govern and control.

10.18     Affiliated Lenders.

(a)    Subject to clause (b) below, each Affiliated Lender, in connection with any (i) consent (or decision not to consent) to any amendment, modification, waiver, consent or other action with respect to any of the terms of any Loan Document(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), (ii) other action on any matter related to any Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee) or (iii) direction to the Administrative Agent or any Lender to undertake any action (or refrain from taking any action) with respect to or under any Loan Document(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee), agrees that, except with respect to any amendment, modification, waiver, consent or other action described in clause (a), (b) or (c) of the first proviso of Section 10.01 or that adversely affects such Affiliated Lender in any material respect differently than other Lenders, the Loans held by an Affiliated Lender shall be disregarded in both the numerator and denominator in the calculation of any Lender vote. Subject to clause (b) below, the Borrower and each Affiliated Lender hereby agrees that if a case under Title 11 of the United States Code is commenced against the Borrower, the Borrower, with respect to any plan of reorganization that does not adversely affect any Affiliated Lender in any material respect as compared to other Lenders, shall seek (and each Affiliated Lender shall consent) to designate the vote of any Affiliated Lender and the vote of any Affiliated Lender with respect to any such plan of reorganization of the Borrower or any Affiliate of the Borrower shall not be counted.

(b)    Notwithstanding anything to the contrary in this Agreement, no Affiliated Lender shall have any right to (i) attend (including by telephone) any meeting or discussions (or portion thereof) among the Administrative Agent or any Lender to which representatives of the Borrower are not then present, (ii) receive any information or material prepared by Administrative Agent or any Lender or any communication by or among Administrative Agent and/or one or more Lenders, except to the extent such information or materials have been made available to the Borrower or its representatives or (iii) make or bring (or participate in, other than as a passive participant in or recipient of its pro rata benefits of) any claim, in its capacity as a Lender, against Administrative Agent or any other Lender with respect to any duties or obligations or alleged duties or obligations of such Agent or any other such Lender under the Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee).

10.19     No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee)), the Borrower acknowledges and agrees that: (i) (A) the arranging and other services regarding this Agreement provided by the Administrative Agent and the Lead

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Arrangers are arm’s-length commercial transactions between the Borrower and its Affiliates, on the one hand, and the Administrative Agent and the other Lead Arrangers, on the other hand, (B) the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate and (C) the Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents (and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee); (ii) (A) the Administrative Agent and each Lead Arranger is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower or any of its Affiliates, or any other Person and (B) neither the Administrative Agent nor any Lead Arranger has any obligation to the Borrower or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents(and, in the case of the Term B-4 Loans, the IntermediateCo Unsecured Guarantee); and (iii) the Administrative Agent and the Lead Arrangers and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower and its Affiliates, and neither the Administrative Agent nor any Lead Arranger has any obligation to disclose any of such interests to the Borrower or its Affiliates. To the fullest extent permitted by law, the Borrower hereby waives and releases any claims that it may have against the Administrative Agent and the Lead Arrangers with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

10.20 Electronic Execution of Assignments and Certain Other Documents. The words “execution,” “execute,” “signed,” “signature,” and words of like import in any Assignment and Assumption or in any amendment or other modificationor related to any document to be signed in connection with this Agreement and the transactions contemplated hereofby (including without limitation Assignment and Assumptions, amendments or other Borrowing or Conversion Notices, waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by the Administrative Agent, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.; provided that notwithstanding anything contained herein to the contrary the Administrative Agent is under no obligation to agree to accept electronic signatures in any form or in any format unless expressly agreed to by the Administrative Agent pursuant to procedures approved by it.

10.21IntermediateCo Unsecured Guarantee. Notwithstanding anything to the contrary herein, (i) the parties hereto hereby agree that any payments made in respect of the IntermediateCo Unsecured Guarantee shall be paid solely to the Term B-4 Lenders and, for the avoidance of doubt, shall not be paid to any other Lenders in respect of any other Class of Loans and (ii) IntermediateCo shall guarantee the Obligations in respect of the Term B-4 Loans on an unsecured basis pursuant to the IntermediateCo Unsecured Guarantee.

10.22Incremental Joinder Covenants and Agreements.Nothwithstanding anything to the contrary herein, in Amendment No. 1, in Amendment No. 2 or any incremental joinder agreement to the contrary, the covenants and agreements of Term B-2 Lenders and Term B-3 Lenders set forth in numbered paragraph 12 in the incremental joinders executed in connection with Amendment No. 1 and Amendment No. 2, other than the covenant and agreement set forth in clause (iv) thereof shall no longer be in effect.

[Signature Pages Follow]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

TOYS “R” US-DELAWARE, INC.,

as Borrower

By:

Name:

Title:

S-1

BANK OF AMERICA, N.A.,
	as Administrative Agent, Collateral Agent and as a Lender
By:
Name:
Title:
BANC OF AMERICA SECURITIES LLC,
	as a Lead Arranger and a Bookrunning Manager
By:
Name:
Title:

S-2

GOLDMAN SACHS CREDIT PARTNERS L.P.,
	as a Syndication Agent
By:
Name:
Title:
GOLDMAN SACHS LENDING PARTNERS LLC,
	as a Lead Arranger and a Bookrunning Manager
By:
Name:
Title:

S-3

JPMORGAN CHASE BANK, N.A.,
	as a Syndication Agent
By:
Name:
Title:
J.P. MORGAN SECURITIES INC.,
	as a Lead Arranger and a Bookrunning Manager
By:
Name:
Title:

S-4

CREDIT SUISSE SECURITIES (USA) LLC,
	as a Documentation Agent and a Bookrunning Manager
By:
Name:
Title:

S-5

WELLS FARGO BANK, N.A.,
	as a Documentation Agent
By:
Name:
Title:
WELLS FARGO SECURITIES, LLC,
	as a Bookrunning Manager
By:
Name:
Title:

S-6

CITIGROUP GLOBAL MARKETS INC.,
	as a Bookrunning Manager
By:
Name:
Title:

S-7

DEUTSCHE BANK SECURITIES INC.,
	as a Bookrunning Manager
By:
Name:
Title:
By:
Name:
Title:

S-8

ANNEX 2

[SEE ATTACHED]

Annex 2

AMENDMENT NO. 1 TO AMENDED AND RESTATED INTERCREDITOR AGREEMENT

THIS AMENDMENT No. 1, dated as of October 24, 2014 (this “Amendment”), is entered into by and among BANK OF AMERICA, N.A.,in its capacities as administrative agent and collateral agent (together with its successors and assigns in such capacities, the “ABL Agent”) for the financial institutions party from time to time to the ABL Credit Agreement referred to below (such financial institutions, together with their successors, assigns and transferees, the “ABL Credit Agreement Lenders” and, together with affiliates thereof and certain other specified hedging parties, in their capacity as ABL Cash Management Affiliates or ABL Hedging Affiliates, the “ABL Lenders”) and BANK OF AMERICA, N.A., in its capacities as administrative agent and collateral agent (together with its successors and assigns in such capacities, the “Term Agent”) for the financial institutions party from time to time to the Term Credit Agreement. Capitalized terms used herein and not otherwise defined shall have the meaning given to them in the Amended and Restated Intercreditor Agreement.

W I T N E S S E T H

WHEREAS, the ABL Agent and the Term Agent entered into that certain Amended and Restated Intercreditor Agreement, dated as of August 24, 2010 (as may be further amended, supplemented or otherwise modified from time to time pursuant to the terms thereof, the “Amended and Restated Intercreditor Agreement”);

WHEREAS, the Term Borrower, the Term Guarantors, the Term Agent and certain of the Term Lenders have agreed to enter into an Amendment No. 3 to Amended and Restated Credit Agreement, dated as of the date hereof (the “Term Amendment”), which amended the Amended and Restated Credit Agreement, dated as of August 24, 2010, as amended by that certain Amendment No. 1 dated as of September 20, 2010, as further amended by that certain Incremental Joinder Agreement dated as of May 25, 2011, as further amended by that certain Incremental Joinder Agreement No. 2 dated as of April 10, 2012, as further amended by that certain Amendment No. 2 dated as of April 10, 2012 (as amended by the Term Amendment, and as further amended, restated, supplemented or otherwise modified from time to time, the “Amended and Restated Credit Agreement”);

WHEREAS, the ABL Borrowers, the ABL Guarantors, the ABL Agent and certain of the ABL Lenders have agreed to enter into the First Amendment to Third Amended and Restated Credit Agreement and to Security Agreement, dated as of the date hereof (the “ABL Amendment”), which amended the Third Amended and Restated Credit Agreement, dated as of March 21, 2014 (as amended by the ABL Amendment, and as further amended, restated, supplemented or otherwise modified from time to time, the “ABL Credit Agreement”) and certain other Loan Documents (as defined in the ABL Credit Agreement;

WHEREAS, pursuant to Section 8.4 of the Amended and Restated Intercreditor Agreement, the Amended and Restated Intercreditor Agreement may be amended by a written agreement executed by the Term Agent (as Shared Collateral Agent) and the ABL Agent;

WHEREAS, the Term Agent (as Shared Collateral Agent) and the ABL Agent hereby agree to amend certain provisions of the Amended and Restated Intercreditor Agreement as provided herein;

NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

SECTION 1

AMENDMENTS

1.1Amendment to Amended and Restated Intercreditor Agreement. Subject to the satisfaction of the conditions set forth in Section 2 below, from and after the date such conditions have been satisfied, the changes to the Amended and Restated Intercreditor Agreement shown in the redline attached as Annex 1 shall be effective.

SECTION 2

CONDITIONS

2.1Conditions Precedent to the Effectiveness of Amendment No. 3. This Amendment and the amendments to the Amended and Restated Intercreditor Agreement contemplated hereby shall become effective upon (or upon the waiver of such condition):

(a)the effectiveness of the Term Amendment and the ABL Amendment;

(b)this Amendment shall have been duly executed by the Term Agent, the ABL Agent and the Loan Parties and shall have been delivered to the Term Agent and the ABL Agent; and

(c)the representations and warranties in Section 3.4 of this Amendment shall be true and correct in all respects as of the date hereof.

SECTION 3

MISCELLANEOUS

3.1Amended Terms. The term “ABL Intercreditor Agreement” as used in each of the Loan Documents (as defined in the Term Amendment) shall hereafter mean the Amended and Restated Intercreditor Agreement as amended by this Amendment. The term “Intercreditor Agreement” as used in the Loan Documents (as defined in the ABL Amendment) shall hereafter mean the Amended and Restated Intercreditor Agreement as amended by this Amendment.

3.2Entirety. This Amendment embodies the entire agreement between the parties hereto and supersede all prior agreements and understandings, oral or written, if any, relating to the subject matter hereof.

3.3Counterparts. This Amendment may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument. Delivery of executed counterparts of this Amendment by facsimile or electronic mail shall be effective as an original and shall constitute a representation that an original shall be delivered.

3.4Representations and Warranties.

(a)The Term Agent represents and warrants to the ABL Agent and each other Shared Collateral Agent that it has the requisite power and authority under the Term Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the Term Secured Parties and that this Agreement shall be binding obligations of the Term Agent and the Term Secured Parties, enforceable against the Term Agent and the Term Secured Parties in accordance with its terms.

(b)The ABL Agent represents and warrants to the Shared Collateral Agents that it has the requisite power and authority under the ABL Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the ABL Secured Parties and that this Agreement shall be binding obligations of the ABL Agent and the ABL Secured Parties, enforceable against the ABL Agent and the ABL Secured Parties in accordance with its terms.

3.5Loan Party Acknowledgments. Each Loan Party hereby (i) expressly acknowledges the terms of the Amended and Restated Intercreditor Agreement as amended by this Amendment and (ii) further confirms that the Amended and Restated Intercreditor Agreement shall continue to be in full force and effect and is hereby ratified and confirmed in all respects.

3.6GOVERNING LAW. THIS AMENDMENT AND ALL ACTIONS ARISING UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[Signature pages follow]

IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Amendment to be duly executed and delivered as of the date first above written.

BANK OF AMERICA, N.A., as Term Agent
By:
Name:	Kelly Weaver
Title:	Assistant Vice President
BANK OF AMERICA, N.A., as ABL Agent
By:
Name:	Ronaldo Naval
Title:	Vice President

[Amendment No. 1 to Intercreditor Agreement]

ACKNOWLEDGMENT

Each ABL Loan Party and each Shared Collateral Loan Party hereby acknowledges that it has received a copy of this Amendment and consents thereto, agrees to recognize all rights granted thereby to the ABL Agent, the ABL Secured Parties, the Shared Collateral Agents, and the Shared Collateral Secured Parties and will not do any act or perform any obligation which is not in accordance with the agreements set forth in this Amendment. Each ABL Loan Party and each Shared Collateral Loan Party further acknowledges and agrees that it is not an intended beneficiary or third party beneficiary under this Amendment and (i) as between the ABL Secured Parties and the ABL Loan Parties, the ABL Documents remain in full force and effect as written and are in no way modified hereby, (ii) as between the Term Secured Parties and the Term Loan Parties, the Term Documents remain in full force and effect as written and are in no way modified hereby, and (iii) as between the Additional Pari Passu Secured Parties and the Additional Pari Passu Parties, the Additional Pari Passu Documents remain in full force and effect as written and are in no way modified hereby.

[Signature Pages Follow]

[Amendment No. 1 to Intercreditor Agreement]

TOYS “R” US-DELAWARE, INC., as the ABL Lead Borrower and the Term Borrower

By: ____________________________

Name: Chetan Bhandari

Title: Senior Vice President - Corporate

Finance and Treasurer

GEOFFREY HOLDINGS, LLC, as an ABL Guarantor, a Term Guarantor

By: TOYS “R” US-DELAWARE, INC.,

its sole member

By: ____________________________

Name: Chetan Bhandari

Title: Senior Vice President - Corporate

Finance and Treasurer

GEOFFREY, LLC, as a Term Guarantor

By: ____________________________    

Name: Chetan Bhandari

Title: Senior Vice President - Corporate

Finance and Treasurer

GEOFFREY INTERNATIONAL, LLC, as

a Term Guarantor

By: Geoffrey, LLC, its sole member

By: ____________________________

Name: Chetan Bhandari

Title: Senior Vice President - Corporate

Finance and Treasurer

[Amendment No. 1 to Intercreditor Agreement]

TRU-SVC, LLC, as an ABL Guarantor, a Term Guarantor

By: TOYS “R” US-DELAWARE, INC., its sole member

By: ____________________________

Name: Chetan Bhandari

Title: Senior Vice President - Corporate

Finance and Treasurer

TOYS ACQUISITION, LLC, as an ABL Guarantor, a Term Guarantor

By: ____________________________    

Name: Chetan Bhandari

Title: Senior Vice President - Corporate

Finance and Treasurer

TRU OF PUERTO RICO, INC., as an ABL Guarantor, a Term Guarantor

By: ____________________________

Name: Chetan Bhandari

Title: Senior Vice President - Corporate

Finance and Treasurer

[Amendment No. 1 to Intercreditor Agreement]

ANNEX 1

[SEE ATTACHED REDLINE]

[Amendment No. 1 to Intercreditor Agreement]

Annex 1 to Annex 2 of Exhibit 10.11

AMENDED AND RESTATED INTERCREDITOR AGREEMENT

by and between

BANK OF AMERICA, N.A.

as ABL Agent

and

BANK OF AMERICA, N.A.

as Term Agent

and

THE BANK OF NEW YORK MELLON

as Notes Agent

Dated as of August 24, 2010

[Amendment No. 1 to Intercreditor Agreement]

TABLE OF CONTENTS

	Page No.
ARTICLE 1
DEFINITIONS
Section 1.1	UCC Definitions	3	2
Section 1.2	Other Definitions	3	2
Section 1.3	Rules of Construction		16
ARTICLE 2
LIEN PRIORITY
Section 2.1	Priority of Liens		16
Section 2.2	Waiver of Right to Contest Liens		17
Section 2.3	Remedies Standstill		18
Section 2.4	Exercise of Rights		19
Section 2.5	No New Liens		20
Section 2.6	Waiver of Marshalling	20	21
Section 2.7	Refinancings	20	21
Section 2.8	Junior Indebtedness		21
ARTICLE 3
ACTIONS OF THE PARTIES
Section 3.1	Certain Actions Permitted		21
Section 3.2	Agent for Perfection	21	22
Section 3.3	[Reserved]		22
Section 3.4	Insurance	22	23
Section 3.5	No Additional Rights for the Loan Parties Hereunder	22	23
Section 3.6	Geoffrey Collateral	22	23
Section 3.7	Access Rights	23	24
ARTICLE 4
APPLICATION OF PROCEEDS
Section 4.1	Application of Proceeds		25
Section 4.2	Application of Proceeds In Respect of the IntermediateCo Unsecured Guarantee		27
Section 4.24.3	Specific Performance	25	27
ARTICLE 5
INTERCREDITOR ACKNOWLEDGEMENTS AND WAIVERS
Section 5.1	Notice of Acceptance and Other Waivers	26	27

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Section 5.2		Modifications to ABL Documents and Shared Collateral Documents	27	28
Section 5.3		Reinstatement and Continuation of Agreement	29	31
Section 5.4		Joinder of Authorized Representatives	30	31
ARTICLE 6
INSOLVENCY PROCEEDINGS
Section 6.1		DIP Financing	30	32
Section 6.2		Relief from Stay	30	32
Section 6.3		No Contest; Adequate Protection	31	33
Section 6.4		Asset Sales	31	34
Section 6.5		Separate Grants of Security and Separate Classification	31	34
Section 6.6		Enforceability	32	34
Section 6.7		ABL Obligations Unconditional	32	34
Section 6.8		Shared Collateral Obligations Unconditional	32	34
ARTICLE 7
CANADIAN PLEDGE COLLATERAL
Section 7.1		Canadian Pledge Collateral		35
Section 7.2		Waiver of Right to Contest Liens		36
Section 7.3		Canadian Pledge Collateral Remedies Standstill; Release of Liens		37
Section 7.4		Application of Proceeds; Turnover Provisions		38
		ARTICLE 8
		MISCELLANEOUS
Section 7.1	8.1	Rights of Subrogation	33	39
Section 7.2	8.2	Further Assurances	33	39
Section 7.3	8.3	Representations	33	39
Section 7.4	8.4	Amendments	34	40
Section 7.5	8.5	Addresses for Notices	34	40
Section 7.6	8.6	No Waiver, Remedies	35	40
Section 7.7	8.7	Continuing Agreement, Transfer of Secured Obligations	35	40
Section 7.8	8.8	Governing Law; Entire Agreement	35	41
Section 7.9	8.9	Counterparts	35	41
Section 7.1	8.10	No Third Party Beneficiaries	35	41
Section 7.1	8.11	Headings	36	41
Section 7.12	8.12	Severability	36	41
Section 7.13	8.13	Attorneys Fees	36	42
Section 7.14	8.14	VENUE; JURY TRIAL WAIVER	36	42
Section 7.16	8.15	Intercreditor Agreement	37	43
Section 7.16	8.16	No Warranties or Liability	37	43
Section 7.17	8.17	Conflicts	38	43
Section 7.18	8.18	Information Concerning Financial Condition of the Loan Parties	38	43
Section 7.19	8.19	Amendment, Restatement, Extension, Renewal and Consolidation of Existing Intercreditor Agreement	38	44
Section 7.20	8.20	Force Majeure	38	44
Section 7.21		Authority of Notes Collateral Agent		38

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-iii-

AMENDED AND RESTATED INTERCREDITOR AGREEMENT

THIS AMENDED AND RESTATED INTERCREDITOR AGREEMENT (as amended, supplemented, restated or otherwise modified from time to time pursuant to the terms hereof, this “Agreement”) is entered into as of August 24, 2010 between BANK OF AMERICA, N.A. (“Bank of America”), in its capacities as administrative agent and collateral agent (together with its successors and assigns in such capacities, the “ABL Agent”) for the financial institutions party from time to time to the ABL Credit Agreement referred to below (such financial institutions, together with their successors, assigns and transferees, the “ABL Credit Agreement Lenders” and, together with affiliates thereof and certain other specified hedging parties, in their capacity as ABL Cash Management Affiliates or ABL Hedging Affiliates (in each case, as hereinafter defined), the “ABL Lenders”)”),and BANK OF AMERICA, N.A. (as successor to Banc of America Bridge LLC) in its capacity as administrative agent (together with its successors and assigns in such capacity, the “Term Agent”) for the financial institutions party from time to time to Term Credit Agreement (as defined herein)and THE BANK OF NEW YORK MELLON, in its capacity as trustee and collateral agent (together with its successors and assigns in such capacity, the “Notes Agent”) for the financial institutions party from time to time to Notes Documents (as defined herein)..

RECITALS

A.     Pursuant to that certain Credit Agreement dated as of July 21, 2005 (as amended and restated as of June 24, 2009 and as further amended and restated as of August 10, 2010) by and among Toys “R” Us-Delaware, Inc. (the “ABL Lead Borrower”), Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltd.Ltee. (the “Canadian Borrower”) and certain other borrowers from time to time party thereto (collectively with the ABL Lead Borrower and the Canadian Borrower, the “ABL Borrowers”), the ABL Credit Agreement Lenders and the ABL Agent (as such agreement has been amended to date, and may hereafter be amended, supplemented, restated or otherwise modified from time to time in accordance with this Agreement, the “ABL Credit Agreement”), the ABL Credit Agreement Lenders made certain loans and other financial accommodations to or for the benefit of the ABL Borrowers on such date.

B.     Pursuant to a certain guaranty dated as of July 21, 2005 (as such guaranty has been amended to date and may hereafterbe amended, supplemented, restated or otherwise modified from time to time, the “ABL Guaranty”) by the ABL Guarantors (as hereinafter defined) in favor of, among others, the ABL Agent, the ABL Guarantors guaranteed the payment and performance of the ABL Borrowers’ obligations under the ABL Documents (as hereinafter defined).

C.     As a condition to the effectiveness of the ABL Credit Agreement and to secure the obligations of the ABL Borrowers and the ABL Guarantors (the ABL Borrowers, the ABL Guarantors and each other direct or indirect subsidiary or parent of the ABL Borrowers or any of their affiliates that was then or thereafter became a party to any ABL Document, collectively, the “ABL Loan Parties”) under and in connection with the ABL Documents, the ABL Loan Parties granted to the ABL Agent (for the benefit of the ABL Lenders) Liens on the ABL Collateral.

D.     Pursuant to that certain Credit Agreement dated as of July 19, 2006 by and among, Toys “R” Us-Delaware, Inc. (the “Term Borrower”), the Term Lenders and the Term Agent (as amended, the “Existing Term Credit Agreement”), the Term Lenders made certain loans to the Term Borrower on such date.

E.     Pursuant to a certain guaranty dated as of July 19, 2006 (the “Term Guaranty”) by the Term Guarantors (as hereinafter defined) in favor of the Term Agent, the Term Guarantors guaranteed the payment and performance of the Term Borrower’s obligations under the Term Documents (as hereinafter defined).

F.     As a condition to the effectiveness of the Existing Term Credit Agreement and to secure the obligations of the Term Borrower and the Term Guarantors (the Term Borrower, the Term Guarantors and each other direct or indirect subsidiary or parent of the Term Borrower or any of its affiliates that was then or thereafter became a party to any Term Document, collectively, the “Term Loan Parties”) under and in connection with the Term Documents as of such date, the Term Loan Parties granted to the Term Agent (for the benefit of the Term Lenders) Liens on the ABL Collateraland, the Geoffrey Collateraland the Canadian Pledge Collateral.

G.     Concurrently with the execution and delivery of this Agreement, the Term Loan Parties and the Term Lenders have agreed to amend and restate (i) the Existing Term Credit Agreement in its entirety (as such agreement may be amended, supplemented, restated or otherwise modified from time to time in accordance with this Agreement, the “Term Credit Agreement”) pursuant to which the Term Lenders have agreed to make certain loans and other financial accommodations to or for the benefit of the Term Borrowerand (ii) the Term Security Agreement in its entirety.

H.Concurrently with the execution and delivery of this Agreement, the Notes Parties (as defined below) and the Notes Agent, in its capacity as collateral agent for the Noteholders (as defined below), have entered into that certain Indenture dated as of the date hereof (as such agreement maybe amended, supplemented, restated or otherwise modified from time to timein accordance with this Agreement, the “Indenture”) providing for the issuance of 7 ⅜% Senior Secured Notes due 2016 (the “Notes”) by the Notes Issuer (as defined below) and the Notes Guarantees (as defined below) by the Notes Guarantors (as defined below).

IH.     Each of the ABL Agent (on behalf of the ABL Lenders) and the Term Agent (on behalf of the Term Lenders) and, by their acknowledgment hereof, the ABL Loan Parties and the Term Loan Parties, desire to amend and restate in its entirety the intercreditor agreement dated as of July 19, 2006August 24, 2010 by and among the ABL Agent, the Term Agent, the Borrower and the Guarantors (the “Existing Intercreditor Agreement”) and each of the ABL Agent (on behalf of the ABL Lenders) and each Shared Collateral Agent (on behalf of the applicable Shared Collateral Secured Parties) and, by their acknowledgment hereof, the ABL Loan Parties and the Shared Collateral Secured Parties agree to the relative priority of Liens on the ABL Collateral and certain other rights, priorities and interests as provided herein.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree as follows:

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ARTICLE 1DEFINITIONS

Section 1.1    UCC Definitions. The following terms which are defined in the Uniform Commercial Code are used herein as so defined: Accounts, Chattel Paper, Deposit Accounts, Documents, Electronic Chattel Paper, Equipment, Financial Assets, Fixtures, Instruments, Inventory, Investment Property, Letter-of-Credit Rights, Money, Payment Intangibles, Records, Security, Securities Accounts, Security Entitlements, Supporting Obligations and Tangible Chattel Paper.

Section 1.2    Other Definitions. Subject to Section 1.1 above, unless the context otherwise requires, all capitalized terms used but not defined herein shall have the meanings set forth in the ABL Credit Agreement,and the Term Credit Agreementand the Indenture, in each case as in effect on the date hereof. In addition, as used in this Agreement, the following terms shall have the meanings set forth below:

“ABL Agent” shall have the meaning assigned to that term in the introduction to this Agreement and shall include any successor thereto as well as any Person designated as the “Agent” or “Administrative Agent” under any ABL Credit Agreement.

“ABL Borrowers” shall have the meaning assigned to that term in the recitals to this Agreement.

“ABL Cash Management Affiliate” shall mean any ABL Credit Agreement Lender or any Affiliate of any ABL Credit Agreement Lender that provides Cash Management Services (as defined in the ABL Credit Agreement) to an ABL Loan Party with the obligations of such ABL Loan Party thereunder being secured by one or more ABL Collateral Documents.

“ABL Collateral” shall mean all of the following assets orand property of the ABLLoan Parties now owned or hereafter acquired, including the followingwith respect to which a Lien is granted or purported to be granted as security for any ABL Obligations and as security for any Term Obligations:

(1)    all Accounts;

(2)    all Chattel Paper (including Tangible Chattel Paper and Electronic Chattel Paper);

(3)    (x) all Deposit Accounts and Money and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein, and (y) Securities Accounts, Security Entitlements and Securities, and, in each case, all cash, checks and other property held therein or credited thereto;

(4)    all Inventory;

(5)    all Documents, General Intangibles (including Payment Intangibles and Intellectual Property (but excluding any GeoffreyNon-Shared Collateral)), Instruments and Commercial Tort Claims;

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(6)    all Supporting Obligations and Letter-of-Credit Rights;

(7)    all books, Records and information relating to the ABL Collateral (including all books, databases, customer lists, engineer drawings and Records, whether tangible or electronic);

(8)    all Equipment and Investment Property;

(9)all Credit Card Receivables (as defined in the ABL Credit Agreement);

(10)any collateral received under Section 2.5 or Section 6.3;

(911)    all Real Property located in Canada; and

(1012)    all collateral security, liens, guarantees, rights, remedies and privileges with respect to any of the foregoing and all cash, Money, policies and certificates of insurance, deposits or other property, insurance proceeds, refunds and premium rebates, including without limitation, proceeds of fire and casualty insurance, instruments, securities, financial assets and deposit accounts received as proceeds of any of the foregoing (such proceeds, “ABL Proceeds”);

provided, that for the avoidance of doubt, “ABL Collateral” shall exclude the GeoffreyNon-Shared Collateral and, solely for the purposes of this Agreement, shall be deemed to not include the Canadian Pledge Collateral.

“ABL Collateral Documents” shall mean all “Security Documents” as defined in the ABL Credit Agreement, including the ABL Security Agreement and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with the ABL Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“ABL Credit Agreement” shall mean the ABL Credit Agreement and any other agreement extending the maturity of, consolidating, restructuring, refunding, replacing or refinancing all or any portion of the ABL Obligations, whether by the same or any other agent, lender or group of lenders and whether or not increasing the amount of any Indebtedness that may be incurred thereunder.

“ABL Credit Agreement Lenders” shall have the meaning assigned to that term in the introduction to this Agreement.

“ABL Documents” shall mean the ABL Credit Agreement, the ABL Guaranty, the ABL Collateral Documents, any agreements governing Cash Management Services between any ABL Loan Party and any ABL Cash Management Affiliate, any ABL Hedging Agreements between any ABL Loan Party and any ABL Hedging Affiliate, those other ancillary agreements as to which the ABL Agent or any ABL Lender is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any ABL Loan Party or any of its respective Subsidiaries or Affiliates, and delivered to the ABL Agent, in

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connection with any of the foregoing or any ABL Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“ABL Enforcement Date” means the date which is 180 days after the occurrence of (i) an Event of Default (under and as defined in the ABL Credit Agreement) and (ii) each Shared Collateral Agent’s receipt of an Enforcement Notice from the ABL Agent, provided that the ABL Enforcement Date shall be stayed and shall not occur (or be deemed to have occurred) (A) at any time any Shared Collateral Agent or the Shared Collateral Secured Parties have commenced and are diligently pursuing enforcement action against the Canadian Pledge Collateral, (B) at any time that any Loan Party is then a debtor under or with respect to (or otherwise subject to) any Insolvency Proceeding, or (C) if the Event of Default under the ABL Credit Agreement is waived in accordance with the terms of the ABL Credit Agreement.

“ABL Guarantors” shall mean the collective reference to Geoffrey Holdings, LLC, TRU Acquisition, LLC, TRU-SVC, LLC, TRU of Puerto Rico, Inc. and any other Person who becomes a guarantor under the ABL Guaranty.

“ABL Guaranty” shall have the meaning assigned to that term in the recitals to this Agreement.

“ABL Hedging Affiliate” shall mean any ABL Credit Agreement Lender or any Affiliate of any ABL Credit Agreement Lender that has entered into an ABL Hedging Agreement with an ABL Loan Party with the obligations of such ABL Loan Party thereunder being secured by one or more ABL Collateral Documents by an ABL Loan Party.

“ABL Hedging Agreement” shall mean any “Hedge Agreement” as defined in the ABL Credit Agreement.

“ABL Lenders” shall have the meaning assigned to that term in the introduction to this Agreement and shall include all ABL Cash Management Affiliates and ABL Hedging Affiliates and all successors, assigns, transferees and replacements thereof, as well as any Person designated as a “Lender” under any ABL Credit Agreement.

“ABL Loan Parties” shall have the meaning assigned to that term in the recitals to this Agreement.

“ABL Obligations” shall mean all obligations of every nature of each ABL Loan Party from time to time owed to the ABL Agent, the ABL Lenders, or any of them, under any ABL Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such ABL Loan Party, would have accrued on any ABL Obligation, whether or not a claim is allowed against such ABL Loan Party for such interest in the related bankruptcy proceeding), reimbursement of amounts drawn under letters of credit, payments for early termination of ABL Hedging Agreements, fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the ABL Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time; provided that if the aggregate principal amount of Revolving Credit Loans andTranche A-1Loans outstanding under the ABL Credit Agreement plus the aggregate Letter of Credit Outstandings under the ABL Credit Agreement exceeds the greater of (x) $2.53.0billion in the

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aggregate and (y) the Tranchesum of (A-1) the Combined Borrowing Base (and (B) the aggregate Incremental Availability (the greater of (x) and (y),the “Cap Amount”) (provided that when calculating the amount of the Tranche A-1Borrowing BaseIncremental Availability for the purpose of the Cap Amount, the effect of any amendment, supplement or modification which expands or otherwise increases the scope of the assets that comprise the underlying borrowing base under the ABL Credit Agreementare included in the calculation of Incremental Availability to include assets other than current assets (e.g. real property (other than real property of any ABL Loan Party located in Canada)) shall be excluded from such calculation), then only (1) that portion of Revolving Credit Loans,Tranche A-1Loans and Letter of Credit Outstandings equal to the Cap Amount plus (2) interest on the Cap Amount, reimbursement obligations for Letter of Credit Outstandings included in the Cap Amount, payments for early termination of ABL Hedging Agreements, agreements governing Cash Management Services, fees, expenses, indemnification or other charges shall be included in the ABL Obligations for purposes of this Agreement until the Discharge of Term Obligations.

“ABL Recovery” shall have the meaning set forth in Section 5.3(a).

“ABL Secured Parties” shall mean “Secured Parties” as defined in the ABL Credit Agreement.

“ABL Security Agreement” shall mean the “Security Agreement” as defined in the ABL Credit Agreement.

“Access Period” means for each parcel of Real Property, the period, after the commencement of an Enforcement Period, which begins on the day that the ABL Agent provides the Shared Collateral Agents with an Enforcement Notice pursuant to Section 3.7(a) below and ends on the earliest of (i) the 120th day after the ABL Agent obtains the ability to take physical possession of, remove, or otherwise control physical access to, or actually uses, the ABL Collateral located on such Real Estate following the Enforcement Period plus such number of days, if any, after the ABL Agent obtains such access to such ABL Collateral that it is stayed or otherwise prohibited by law or court order from exercising remedies with respect to ABL Collateral located on such Real Property, (ii) the date on which all or substantially all of the ABL Collateral located on such Real Estate is sold, collected or liquidated, or (iii) the date on which the Discharge of ABL Obligations occurs; provided that in no event shall the Access Period extend later than 210 days following the date of delivery of an Enforcement Notice to the ABL Agent by the Authorized Shared Collateral Agent plus such number of days, if any, after the ABL Agent obtains such access to such ABL Collateral that it is stayed or otherwise prohibited by law or court order from exercising remedies with respect to ABL Collateral located on such Real Estate.

“Additional Pari Passu Agent” shall mean each duly authorized representative of any holders of Additional Pari Passu Obligations which agent has executed a joinder agreement to this Agreement substantially in the form of Exhibit A (appropriately completed) and which is a party to the Additional Pari Passu Documents. Upon the execution of such joinder agreement, the Additional Pari Passu Agent shall succeed to all rights, benefits and obligations of the Additional Pari Passu Agent hereunder.

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“Additional Pari Passu Agreement” shall mean the agreements, documents, joinders and instruments providing for or evidencing Additional Pari Passu Obligations and which are identified in a joinder agreement to this Agreement substantially in the form of Exhibit A executed by the relevant Additional Pari Passu Agent, whether by the same or any other agent, lender or group of lenders and whether or not increasing the amount of any Indebtedness that may be incurred thereunder as permitted by the Term Documentsand Notes Documents.

“Additional Pari Passu Security Agreement” shall mean the security agreement governing any Additional Pari Passu Obligations.

“Additional Pari Passu Collateral Documents” shall mean all “Security Documents” as defined in the Additional Pari Passu Agreement, including the Additional Pari Passu Security Agreement and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with any Additional Pari Passu Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Additional Pari Passu Documents” shall mean the Additional Pari Passu Agreement, the Additional Pari Passu Guarantees, the Additional Pari Passu Collateral Documents and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any Loan Party or any of its respective Subsidiaries or Affiliates, and delivered to the Additional Pari Passu Agent, in connection with any of the foregoing or any Additional Pari Passu CreditAgreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Additional Pari Passu Guarantees” shall mean the agreements of the Additional Pari Passu Guarantors to guarantee the payment and performance of obligations of any issuer or borrower pursuant to any Additional Pari Passu Agreement under the Additional Pari Passu Documents.

“Additional Pari Passu Guarantors” shall mean any Person who becomes a guarantor under any Additional Pari Passu Document.

“Additional Pari Passu Obligations” shall mean, to the extent permitted to be incurred by the terms of the Term Credit Agreement and the IndentureABL Credit Agreement and permitted by the terms of the Term Credit Agreement and the ABL Credit Agreement to be secured by the ABL Collateral on a pari passu basis with the Liens securing the Term Loan Obligations and secured by the Canadian Pledge Collateral on a pari passu basis with the Liens securing the Term Loan Obligations (other than Term Loan Obligations in respect of any Term B-4 Loans, which will, to the extent provided herein, be senior in priority), all obligations of every nature of each NotesTerm Loan Party from time to time owed to the Additional Pari Passu Agent, the Additional Pari Passu Secured Parties or any of them, under any Additional Pari Passu Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Additional Pari Passu Secured Party, would have accrued on any Additional Pari Passu Obligation, whether or not a claim is allowed against such NotesTerm Loan Party for such interest in the related bankruptcy proceeding), payments of fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the Additional Pari Passu

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Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time; provided that no Additional Pari Passu Obligations shall be secured by any Secured Specified Real Property.

“Additional Pari Passu Parties” shall meanshall mean, collectively,each obligor in respect of any Additional Pari Passu Obligations, the Additional Pari PassuGuarantors and each other direct or indirect subsidiary or parent ofsuch obligor or any of its affiliates that is or becomes a party to any Additional Pari Passu Document.

“Additional Pari Passu Secured Parties” shall mean the “Secured Parties” (or similar term) as defined in the Additional Pari Passu Agreement.

“Affiliate” shall mean, with respect to a specified Person, any other Person that directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with the Person specified.

“Agent(s)” means individually the ABL Agent and each Shared Collateral Agent and collectively means the ABL Agent and the Shared Collateral Agents.

“Agreement” shall have the meaning assigned to that term in the introduction to this Agreement.

“Authorized Representative” shall have the meaning set forth in Section 2.7.

“Authorized Shared Collateral Agent” has the meaning assigned to the term “Authorized Collateral Agent” in the Shared Collateral Intercreditor Agreement.

“Bank of America” shall have the meaning assigned to that term in the introduction to this Agreement.

“Bankruptcy Code” shall mean Title 11 of the United States Code.

“Borrower” shall mean the ABL Borrowers,or the Term Borroweror the Notes Issuer.

“Canadian Borrower” shall have the meaning assigned to that term in the recitals to this Agreement.

“Canadian Pledge Collateral” shall mean all of the following assets and property of the Loan Parties now owned or hereafter acquired, with respect to which a Lien is granted or purported to be granted as security for any ABL Obligations and as security for any Term Obligations:

(1) 65% of the voting Capital Stock and 100% of the non-voting Capital Stock of Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee; and

(2) all stock certificates, dividends, distributions, rights and proceeds of or relating to the foregoing.

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“Capital Stock” shall mean, as to any Person that is a corporation, the authorized shares of such Person’s capital stock, including all classes of common, preferred, voting and nonvoting capital stock, and, as to any Person that is not a corporation or an individual, the membership or other ownership interests in such Person, including the right to share in profits and losses, the right to receive distributions of cash and other property, and the right to receive allocations of items of income, gain, loss, deduction and credit and similar items from such Person, whether or not such interests include voting or similar rights entitling the holder thereof to exercise Control over such Person, collectively with, in any such case, all warrants, options and other rights to purchase or otherwise acquire, and all other instruments convertible into or exchangeable for, any of the foregoing.

“Cash Management Services” shall have the meaning provided in the ABL Credit Agreement as in effect on the date hereof.

“CombinedBorrowing Base” shall mean the “CombinedBorrowing Base” as defined in the ABL Credit Agreement.

“Control” shall mean the possession, directly or indirectly, of the power (a) to vote 50% or more of the securities having ordinary voting power for the election of directors (or any similar governing body) of a Person, or (b) to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. The terms “Controlling” and “Controlled” have meanings correlative thereto.

“Control Collateral” shall mean any Shared Collateral consisting of any Certificated Security (as defined in Section 8-102 of the Uniform Commercial Code), Investment Property, Deposit Account, Instruments and any other Shared Collateral as to which a Lien may be perfected through possession or control by the secured party, or any agent therefor.

“Credit Documents” shall mean the ABL Documents, the Term Documents, the Notes Documents and the Additional Pari Passu Documents (if any).

“Debtor Relief Laws” shall mean the Bankruptcy Code and all other liquidation, conservatorship, bankruptcy, assignment for benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect affecting the rights of creditors generally.

“DIP Financing” shall have the meaning set forth in Section 6.1(a).

“Discharge of ABL Obligations” shall mean (a) the payment in full in cash of all outstanding ABL Obligations excluding contingent indemnity obligations with respect to then unasserted claims but including, with respect to amounts available to be drawn under outstanding letters of credit issued thereunder (or indemnities or other undertakings issued pursuant thereto in respect of outstanding letters of credit), the cancellation of such letters of credit or the delivery or provision of money or backstop letters of credit in respect thereof in compliance with the terms of any ABL Credit Agreement (which shall not exceed an amount equal to 105% of the aggregate undrawn amount of such letters of credit) and (b) the termination of all commitments to extend credit under the ABL Documents.

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“Discharge of Additional Pari Passu Obligations” shall mean the payment in full in cash of all outstanding Additional Pari Passu Obligations (other than contingent indemnity obligations with respect to then unasserted claims).

“Discharge of Term Obligations” shall mean the payment in full in cash of all outstanding Term Obligations (other than contingent indemnity obligations with respect to then unasserted claims).

“Discharge of Notes Obligations” shall mean the payment in full in cash of all outstanding Notes Obligations (other than contingent indemnity obligations with respect to then unasserted claims).

“Discharge of Shared Collateral Obligations” shall mean, collectively, the Discharge of Term Obligations, Discharge of Notes Obligations and Discharge of Additional Pari Passu Obligations (if any).

“Enforcement Notice” shall mean a written notice delivered by the ABL Agent to the Shared Collateral Agents or from the Authorized Shared Collateral Agent to the ABL Agent, in either case, announcing that an Enforcement Period has commenced.

“Enforcement Period” shall mean the period of time following the receipt by either the ABL Agent or the Authorized Shared Collateral Agent of an Enforcement Notice from the other and continuing until the earliest of (a) in the case of an Enforcement Period commenced by the Authorized Shared Collateral Agent, the Discharge of Shared Collateral Obligations, (b) in the case of an Enforcement Period commenced by the ABL Agent, the Discharge of ABL Obligations, or (c) the date upon which the ABL Agent or the Authorized Shared Collateral Agent, terminate, or agree in writing to terminate, the Enforcement Period.

“Event of Default” shall mean an Event of Default under any ABL Credit Agreement, any Term Credit Agreement, any Indenture or any Additional Pari Passu Agreement (if any).

“Excluded Specified Real Property” shall have the meaning assigned to such term in the Term Credit Agreement as in effect on the date hereof.

“Exercise Any Secured Creditor Remedies” or “Exercise of Secured Creditor Remedies” shall mean, except as otherwise provided in the final sentence of this definition:

(a)    the taking by any Secured Party of any action to enforce or realize upon any Lien on ABLShared Collateral, including the institution of any foreclosure proceedings or the noticing of any public or private sale pursuant to Article 9 of the Uniform Commercial Code;

(b)    the exercise by any Secured Party of any right or remedy provided to a secured creditor on account of a Lien on ABLShared Collateral under any of the Credit Documents, under applicable law, in an Insolvency Proceeding or otherwise, including the election to retain any of the ABLShared Collateral in satisfaction of a Lien;

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(c)    the taking of any action by any Secured Party or the exercise of any right or remedy by any Secured Party in respect of the collection on, set off against, marshaling of, injunction respecting or foreclosure on the ABLShared Collateral or the Proceeds thereof;

(d)    the appointment of, or the application of a Secured Party for, a receiver, receiver and manager or interim receiver of all or part of the ABLShared Collateral;

(e)    the sale, lease, license, or other disposition of all or any portion of the ABLShared Collateral by private or public sale conducted by a Secured Party or any other means at the direction of a Secured Party permissible under applicable law;

(f)    the exercise of any other right of a secured creditor under Part 6 of Article 9 of the Uniform Commercial Code; or

(g)    the exercise by a Secured Party of any voting rights relating to any Capital Stock included in the ABLShared Collateral.

For the avoidance of doubt, none of the following shall be deemed to constitute an Exercise of Secured Creditor Remedies: (i) the filing a proof of claim in bankruptcy court or seeking adequate protection, (ii) the exercise of rights by the ABL Agent upon the occurrence of a Cash Dominion Event (as defined in the ABL Credit Agreement), including, without limitation, the notification of account debtors, depository institutions or any other Person to deliver proceeds of ABL Collateral to the ABL Agent (unless and until the ABL Lenders cease making Credit Extensions to the ABL Borrowers, in which event an Exercise of Secured Creditor Remedies shall be deemed to have occurred), (iii) the consent by a Secured Party to a sale or other disposition by any Loan Party of any of its assets or properties, (iv) the acceleration of all or a portion of the ABL Obligations or the Shared Collateral Obligations, (v) the reduction of advance rates or sub-limits by the ABL Agent and the ABL Lenders, or (vi) the imposition of reserves by the ABL Agent.

“Existing Intercreditor Agreement” shall have the meaning assigned to that term in the recitals to this Agreement.

“Foreign Subsidiary” shall have the meaning provided in the ABL Credit Agreement and the Term Credit Agreement as in effect on the date hereof.

“General Intangibles” shall have the meaning provided in the ABL Security Agreement and the Term Security Agreement as in effect on the date hereof.

“Geoffrey Collateral” means those certain assets and property of Geoffrey, LLC described in the Shared Collateralshall have the meaning provided in the Term Security Agreements as in effect on the date hereof.

“Governmental Authority” shall mean any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

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“Guarantor” shall mean any of the ABL Guarantors,or Term Guarantorsor Notes Guarantors.

“Incremental Availability” shall mean the “Incremental Availability” as defined in the ABL Credit Agreement.

“Indebtedness” shall have the meaning provided in the ABL Credit Agreement,and the Term Credit Agreement and Indentureas in effect on the date hereof.

“Indenture” shall have the meaning assigned to that term in the recitals to this Agreement.

“Insolvency Proceeding” shall mean (a) any case, action or proceeding before any court or other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors or other similar arrangement in respect of its creditors generally or any substantial portion of its creditors; in each case covered by clauses (a) and (b) undertaken under United States Federal, State or foreign law, including the Bankruptcy Code.

“Intellectual Property Rights Agreement” shall mean the “Intellectual Property Rights Agreement” as defined in the ABL Credit Agreement as in effect on the date hereof.

“IntermediateCo Unsecured Guarantee” shall have the meaning provided in the Term Credit Agreement.

“Lender(s)” means individually the ABL Lenders or the Term Lenders and collectively means all of the ABL Lenders and the Term Lenders.

“Lien” shall have the meaning provided in the ABL Credit Agreement,and the Term Credit Agreement and the Indentureas in effect on the date hereof.

“Lien Priority” shall mean with respect to any Lien of the ABL Agent, the ABL Lenders, the Shared Collateral Agents or the Shared Collateral Secured Parties (i) in the ABL Collateral, the order of priority of such Lien as specified in Section 2.1and (ii) in the Canadian Pledge Collateral, the order of priority of such Lien as specified in Section 7.2.

“Loan Parties” shall mean the ABL Loan Parties and the Shared Collateral Secured Parties.

“Noteholder” means any Person in whose name a Note is registered.

“Notes” shall have the meaning assigned to that term in the recitals to this Agreement.

“Notes Agent” shall have the meaning assigned to that term in the introduction to this Agreement.

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“Notes Collateral Documents” shall mean all “Security Documents” as defined in the Indenture, including the Notes Security Agreement and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with any Indenture, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Notes Documents” shall mean the Indenture, the Notes, the Notes Guarantees, the Notes Collateral Documents, those other ancillary agreements as to which the Notes Agent or any Noteholder is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any Noteholder or any of its respective Subsidiaries or Affiliates, and delivered to the Notes Agent in connection with any of the foregoing or the Indenture, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Notes Guarantors” shall mean the collective reference to Geoffrey Holdings, LLC, Toys Acquisition, LLC, TRU of Puerto Rico, Inc., TRU-SVC, LLC, Geoffrey, LLC, Geoffrey International, LLC and any other Person who becomes a guarantor under the Indenture.

“Notes Guarantee” shall mean the agreements of the Notes Guarantors to guarantee the payment and performance of the Notes Issuer’s obligations under the Notes Documents.

“Notes Issuer” shall mean Toys “R” Us-Delaware, Inc.

“Notes Parties” shall mean, collectively, the Notes Issuer, Notes Guarantors and each other direct or indirect subsidiary or parent of the Notes Issuer or any of its affiliates that is now or hereafter becomes a party to any Notes Document.

“Notes Obligations” shall mean all obligations of every nature of each Notes Party from time to time owed to the Notes Agent, the Noteholders or any of them, under any Notes Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Noteholder, would have accrued on any Notes Obligation, whether or not a claim is allowed against such Notes Party for such interest in the related bankruptcy proceeding), payments of fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the Notes Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.

“NotesNon-Shared Collateral” means, collectively, the Geoffrey Collateral and the Secured Parties” shall mean the “Secured Parties” as defined in the Notes Security AgreementSpecified Real Property.

“Notes Security Agreement” shall mean the “Security Agreement” as defined in the Indenture.

“Party” shall mean the ABL Agent, the Term Agent, the NotesAgent or the Additional Pari Passu Agent (if any) and “Parties” shall mean the ABL Agent, the Term Agent, the Notes Agent and the Additional Pari Passu Agent (if any).

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“Person” shall mean an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

“Proceeds” shall mean (a) all “proceeds,” as defined in Article 9 of the Uniform Commercial Code, with respect to the ABL Collateral,and (b) whatever is recoverable or recovered when any ABLShared Collateral or Non-Shared Collateral is sold, exchanged, collected, or disposed of, whether voluntarily or involuntarily.

“Property” shall mean any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.

“Real Property” shall mean any right, title or interest in and to real property, including any fee interest, leasehold interest, easement, or license and any other right to use or occupy real property.

“Secured Parties” shall mean the ABL Secured Parties, the Term Secured Parties ,the Noteholders and the Additional Pari Passu Secured Parties (if any).

“Secured Specified Real Property” shall have the meaning set forth in Section 2.1(b).

“Shared Collateral” shall mean the ABL Collateral and the Canadian Pledge Collateral.

“Shared Collateral Agents” means the Notes Agent,the Term Agent and the Additional Pari Passu Agent (if any).

“Shared Collateral Documents” means, collectively, the Term Documents, the Notes Documents and the Additional Pari Passu Documents (if any).

“Shared Collateral Enforcement Date” means the date which is 180 days after the occurrence of (i) an Event of Default (under and as defined in either the Term Credit Agreement, the Indenture or any Additional Pari Passu Agreement) and (ii) the ABL Agent’s receipt of an Enforcement Notice from the applicable Authorized Shared Collateral Agent, provided that the Shared Collateral Enforcement Date shall be stayed and shall not occur (or be deemed to have occurred) (A) at any time the ABL Agent or the ABL Secured Parties have commenced and are diligently pursuing enforcement action against the ABL Collateral, (B) at any time that any Loan Party is then a debtor under or with respect to (or otherwise subject to) any Insolvency Proceeding, or (C) if the Event of Default under the applicable Shared Collateral Agreement is waived in accordance with the terms of such Shared Collateral Agreement.

“Shared Collateral Intercreditor Agreement” means that certain first lien intercreditor agreement dated as of the date hereofAugust 24, 2010 among the Notes Agent, the Term Agent, the Additional Pari Passu Agent (if any), the Borrower and the Guarantors.

“Shared Collateral Loan Parties” shall mean, collectively, the NotesAdditional Pari Passu Parties and the Term Loan Parties.

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“Shared Collateral Obligations” means, collectively, the Term Loan Obligations, the NotesObligations and the Additional Pari Passu Obligations (if any).

“Shared Collateral Recovery” shall have the meaning set forth in Section 5.3(b).

“Shared Collateral Secured Parties” shall mean, collectively, the Term Secured Parties, the Notes Secured Parties and the Additional Pari Passu Secured Parties.

“Shared Collateral Security Agreements” means, collectively, the Notes Security Agreement, Term Security Agreement and Additional Pari Passu Security Agreement (if any).

“Special Refinancing Indebtedness” shall have the meaning assigned tosuch term in the ABL CreditAgreement.

“Specified Real Property” shall have the meaning assigned to such term in the Term Credit Agreement as in the effect on the date hereof and shall include any Proceeds thereof.

“Springing Covenant” shall have the meaning assigned to such term in the Term Credit Agreement.

“Springing Covenant Trigger Date” shall have the meaning assigned to such term in the Term Credit Agreement.

“Subsidiary” shall mean with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity (a) of which Capital Stock representing more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, Controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.

“Term Agent” shall have the meaning assigned to that term in the introduction to this Agreement.

“Term B-4 Lenders” shall have the meaning assigned to such term in the Term Credit Agreement.

“Term B-4 Loans” shall have the meaning assigned tosuch term in the Term CreditAgreement.

“Term Borrower” shall have the meaning assigned to that term in the introduction to this Agreement.

“Term Collateral Documents” shall mean all “Security Documents” as defined in the Term Credit Agreement, including the Term Security Agreement and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with any Term Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

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“Term Credit Agreement” shall mean the Term Credit Agreement and any other agreement extending the maturity of, consolidating, restructuring, refunding, replacing or refinancing all or any portion of the Term Obligations, whether by the same or any other agent, lender or group of lenders and whether or not increasing the amount of any Indebtedness that may be incurred thereunder.

“Term Documents” shall mean the Term Credit Agreement, the Term Guaranties, the Term Collateral Documents, any Term Hedging Agreements between any Term Loan Party and any Term Hedging Affiliate, those other ancillary agreements as to which the Term Agent or any Term Lender is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any Term Loan Party or any of its respective Subsidiaries or Affiliates, and delivered to the Term Agent, in connection with any of the foregoing or any Term Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Term Guarantors” shall mean the collective reference to Geoffrey Holdings, LLC, Toys Acquisition, LLC, TRU of Puerto Rico, Inc., TRU-SVC, LLC, Geoffrey, LLC, Geoffrey International, LLC and any other Person who becomes a guarantor under the Term Guaranty.

“Term Guaranty” shall have the meaning assigned to that term in the recitals to this Agreement.

“Term Hedging Affiliate” shall mean any Term Lender or any Affiliate of any Term Lender that has entered into an Term Hedging Agreement with a Term Loan Party with the obligations of such Term Loan Party thereunder being secured by one or more Term Collateral Documents by an Term Loan Party.

“Term Hedging Agreement” shall mean any “Hedging Agreement” as defined in the Term Credit Agreement.

“Term Lenders” shall have the meaning assigned to the term “Lenders” (or any similar term) in any Term Credit Agreement.

“Term Loan Parties” shall have the meaning assigned to that term in the recitals to this Agreement.

“Term Obligations” shall mean all obligations of every nature of each Term Loan Party from time to time owed to the Term Agent, the Term Lenders or any of them, under any Term Document, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Term Loan Party, would have accrued on any Term Obligation, whether or not a claim is allowed against such Term Loan Party for such interest in the related bankruptcy proceeding), payments for early termination of Term Hedging Agreements, fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the Term Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.

“Term Secured Parties” shall mean the “Secured Parties” as defined in the Term Credit Agreement.

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“Term Security Agreement” shall mean the “Security Agreement” as defined in the Term Credit Agreement.

“Tranche A Borrowing Base” shall mean the “Tranche A Borrowing Base” as defined in the ABL Credit Agreement.

“Tranche A-1 Borrowing Base” shall mean the “Tranche A-1 Borrowing Base” as defined in the ABL Credit Agreement.

“Uniform Commercial Code” shall mean the Uniform Commercial Code as the same may, from time to time, be in effect in the State of New York; provided that to the extent that the Uniform Commercial Code is used to define any term in any security document and such term is defined differently in differing Articles of the Uniform Commercial Code, the definition of such term contained in Article 9 shall govern; provided, further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, publication or priority of, or remedies with respect to, Liens of any Party is governed by the Uniform Commercial Code or foreign personal property security laws as enacted and in effect in a jurisdiction other than the State of New York, the term “Uniform Commercial Code” will mean the Uniform Commercial Code or such foreign personal property security laws as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions.

“Use Period” means the period, after the commencement of an Enforcement Period, which begins on the day that the ABL Agent provides the Term Agent with an Enforcement Notice and ends on the 210th day thereafter, plus such number of days, if any, during which any stay or other order that prohibits any of the ABL Agent or the other ABL Secured Parties (with the consent of the ABL Agent) from commencing and continuing to Exercise Any Secured Creditor Remedies or to liquidate and sell the ABL Collateral has been entered by a court of competent jurisdiction.

Section 1.3    Rules of Construction. Unless the context of this Agreement clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the term “including” is not limiting and shall be deemed to be followed by the phrase “without limitation,” and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Article, section, subsection, clause, schedule and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement to any agreement, instrument, or document shall include all alterations, amendments, changes, restatements, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, restatements, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). Any reference herein to any Person shall be construed to include such Person’s successors and assigns. Any reference herein to the repayment in full of an obligation shall mean the payment in full in cash of such obligation, or in such other manner as may be approved in writing by the requisite holders or

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representatives in respect of such obligation, or in such other manner as may be approved by the requisite holders or representatives in respect of such obligation.

ARTICLE 2
LIEN PRIORITY

Section 2.1    Priority of Liens.

(a)    Subject to the proviso in subclause (b) of Section 4.1, notwithstanding (i) the date, time, method, manner, or order of grant, attachment, or perfection of any Liens granted to the ABL Agent or the ABL Lenders in respect of all or any portion of the ABL Collateral or of any Liens granted to the Shared Collateral Agents or the Shared Collateral Secured Parties in respect of all or any portion of the ABL Collateral and regardless of how any such Lien was acquired (whether by grant, statute, operation of law, subrogation or otherwise), (ii) the order or time of filing or recordation of any document or instrument for perfecting the Liens in favor of the ABL Agent or the Shared Collateral Agents (or ABL Lenders or the Shared Collateral Secured Parties) in any ABL Collateral, (iii) any provision of the Uniform Commercial Code, the Bankruptcy Code or any other applicable law, or of the ABL Documents or the Shared Collateral Documents, or (iv) whether the ABL Agent or the Shared Collateral Agents, in each case, either directly or through agents, hold possession of, or have control over, all or any part of the ABL Collateral, the ABL Agent, on behalf of itself and the ABL Lenders, and the Shared Collateral Agent, on behalf of the applicable Shared Collateral Secured Parties, hereby agrees that prior to the Discharge of ABL Obligations:

(1)    any Lien in respect of all or any portion of the ABL Collateral now or hereafter held by or on behalf of the Shared Collateral Agents or any Shared Collateral Secured Party that secures all or any portion of the Shared Collateral Obligations shall in all respects be junior and subordinate to all Liens granted to the ABL Agent and the ABL Lenders on the ABL Collateral;and

(2)    any Lien in respect of all or any portion of the ABL Collateral now or hereafter held by or on behalf of the ABL Agent or any ABL Lender that secures all or any portion of the ABL Obligations shall in all respects be senior and prior to all Liens granted to the Shared Collateral Agents or any Shared Collateral Secured Party on the ABL Collateral.; and

(b)    The ABL Agent, for and on behalf of itself and the ABL Secured Parties, acknowledges and agrees that, (i) the Shared Collateral Agents, for the benefit of the Shared Collateral Secured Parties, have been granted Liens upon all of the ABLShared Collateral in which the ABL Agent has been granted Liens and the ABL Agent hereby consents theretoand, (ii) the Shared Collateral Agents, for and on behalf of themselves and the Shared Collateral Secured Parties, have been granted first priority Liens in the Geoffrey Collateral and neither the ABL Agent nor the ABL Secured Parties shall have a Lien on or a security interest in the Geoffrey Collateraland (iii) after the Springing Covenant Trigger Date, pursuant to the terms of the Springing Covenant, the Term Agent, for the benefit of the Term B-4 Lenders, will be granted a first priority Lien upon the Specified Real Property (other than any Excluded Specified Real Property) (after the Springing Covenant Trigger Date, such Specified Real Property on which a

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Lien has been granted to the Term Agent for the benefit of the Term B-4 Lenders, the “Secured Specified Real Property”) and neither the ABL Agent, the ABL Secured Parties or any other Shared Collateral Secured Parties shall have a Lien on or a security interest in the Secured Specified Real Properties. The subordination of Liens by the Shared Collateral Agents in favor of the ABL Agent as set forth herein shall not be deemed to subordinate the Shared Collateral Agents’ respective Liens on the ABL Collateral to the Liens of any other Person.

(c)The relative rights and obligations of the ABL Agent and the Shared Collateral Agents (or the ABL Lenders and the Shared Collateral Secured Parties) under this Agreement with respect to the Liens on the Canadian Pledge Collateral shall be determined in accordance with Article 7 of this Agreement.

Section 2.2    Waiver of Right to Contest Liens. Each of ABL Agent, on behalf of the ABL Secured Parties and the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agrees that it and they shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the ABL Agent and the ABL Secured Parties in respect of the ABL Collateral or Liens of the Shared Collateral Agents and the Shared Collateral Secured Parties in respect of the ABLShared Collateral or the provisions of this Agreement. Except to the extent expressly set forth in this Agreement, the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agrees that none of the Shared Collateral Agents or the Shared Collateral Secured Parties will take any action that would interfere with any Exercise of Secured Creditor Remedies undertaken by the ABL Agent or any ABL Secured Party under the ABL Documents with respect to the ABL Collateral. Except to the extent expressly set forth in this Agreement, the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, hereby waive any and all rights they or the Shared Collateral Secured Parties may have as a junior lien creditor or otherwise to contest, protest, object to, or interfere with the manner in which the ABL Agent or any ABL Secured Party seeks to enforce its Liens in any ABL Collateral. The foregoing shall not be construed to prohibit the Shared Collateral Agents from enforcing the provisions of this Agreement as to the relative priority of the parties hereto. In addition, for the avoidance of doubt, the ABL Agent, on behalf of the ABL Secured Parties, further agrees that it has no, and will not have, Liens on any of the GeoffreyNon-Shared Collateral and as such, it shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the Shared Collateral Agents and the Shared Collateral Secured Parties in respect of the GeoffreyNon-Shared Collateral.

Section 2.3    Remedies Standstill.

(a)    The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree that, from the date hereof until the earlier of (i) the Shared Collateral Enforcement Date, or (ii) the date upon which the Discharge of ABL Obligations shall have occurred, neither the Shared Collateral Agents nor any Shared Collateral Secured Party will Exercise Any Secured

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Creditor Remedies with respect to any of the ABL Collateral without the written consent of the ABL Agent and the Required Lenders (as defined in the ABL Credit Agreement), and will not take, receive or accept any Proceeds of the ABL Collateral. From and after the earlier of (i) the Shared Collateral Enforcement Date or (ii) the date upon which the Discharge of ABL Obligations shall have occurred, the Shared Collateral Agents or any Shared Collateral Secured Party may Exercise Any Secured Creditor Remedies under the Shared Collateral Documents or applicable law as to any ABL Collateral; provided, however, that any Exercise of Secured Creditor Remedies with respect to any ABL Collateral by the Shared Collateral Agents is at all times subject to the provisions of this Agreement, including Section 4.1 hereof.

(b)    Notwithstanding the provisions of Sections 2.3(a) or any other provision of this Agreement, prior to the Discharge of ABL Obligations, nothing contained herein shall be construed to prevent (i) the Shared Collateral Agents or any Shared Collateral Secured Party from filing a claim or statement of interest with respect to the Shared Collateral Obligations owed to it in any Insolvency Proceeding commenced by or against any Loan Party, (ii) take any action (not adverse to the priority status of the Liens of the ABL Agent or ABL Secured Parties on the ABL Collateral in which the ABL Agent or ABL Secured Parties have a priority Lien or the rights of the ABL Agent or any of the ABL Secured Parties to exercise remedies in respect thereof) in order to create, perfect, preserve or protect (but not enforce) its Lien on any ABL Collateral, (iii) file any necessary or responsive pleadings in opposition to any motion, adversary proceeding or other pleading filed by any Person objecting to or otherwise seeking disallowance of the claim or Lien of the Shared Collateral Agents or Shared Collateral Secured Parties, (iv) file any pleadings, objections, motions, or agreements which assert rights available to unsecured creditors of the Loan Parties arising under any Insolvency Proceeding or applicable non-bankruptcy law, (v) vote on any plan of reorganization or file any proof of claim in any Insolvency Proceeding of any Loan Party, or (vi) object to the proposed retention of ABL Collateral by the ABL Agent or any ABL Secured Party in full or partial satisfaction of any ABL Obligations due to the ABL Agent or ABL Secured Parties, in each case (i) through (iv) and (vi) above to the extent not inconsistent with, or could not result in a resolution inconsistent with, the terms of this Agreement. Notwithstanding the foregoing, nothing in this Agreement shall prevent the Authorized Shared Collateral Agent, on behalf of the Shared Collateral Secured Parties, from the Exercise of Secured Creditor Remedies with respect to the GeoffreyNon-Shared Collateral, other thansubject to the provisions set forth in Sections 3.6and 3.7.

Section 2.4    Exercise of Rights.

(a)    No Other Restrictions. Except as expressly set forth in this Agreement, each of the Shared Collateral Agents, each Shared Collateral Secured Party, the ABL Agent and each ABL Secured Party shall have any and all rights and remedies it may have as a creditor under applicable law, including the right to the Exercise of Secured Creditor Remedies; provided, however, that the Exercise of Secured Creditor Remedies with respect to the ABLShared Collateral shall be subject to the Lien Priority and to the provisions of this Agreement, including Sections 2.3and, 4.1, 7.3 and 7.4 hereof. The ABL Agent may enforce the provisions of the ABL Documents, the Shared Collateral Agents may enforce the provisions of the Shared Collateral Documents and each may Exercise Any Secured Creditor Remedies, all in such order and in such manner as each may determine in the exercise of its sole discretion, consistent with the terms of this Agreement and mandatory provisions of applicable law; provided, however, that (i) prior to the Discharge of ABL Obligationsand solely in the case of an

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Exercise of Secured Creditor Remedies with respect to any ABL Collateral, the ABL Agent, and in the event of a Shared Collateral Enforcement Date, the Shared Collateral Agents, agree to provide to the other (x) an Enforcement Notice prior to the commencement of an Exercise Any Secured Creditor Remedies with respect to the ABL Collateral and (y) copies of any notices that it is required under applicable law to deliver to any Loan Party; provided, further, however, that the ABL Agent’s failure to provide any such copies to the Shared Collateral Agents (but not the Enforcement Notice) shall not impair any of the ABL Agent’s rights hereunder or under any of the ABL Documents and the Shared Collateral Agents’ failure to provide any such copies to the ABL Agent (but not the Enforcement Notice) shall not impair any of the Shared Collateral Agents’ rights hereunder or under any of the Shared Collateral Documents and (ii) prior to the Discharge of Shared Collateral Obligations and solely in the case of an Exercise of Secured Creditor Remedies with respect to any Canadian Pledge Collateral, the Shared Collateral Agents, and in the event of an ABL Enforcement Date, the ABL Agent, agree to provide to the other (x) an Enforcement Notice prior to the commencement of an Exercise Any Secured Creditor Remedies with respect to the Canadian Pledge Collateral and (y) copies of any notices that it is required under applicable law to deliver to any Loan Party; provided, further, however, that any Shared Collateral Agent’s failure to provide any such copies to the ABL Agent (but not the Enforcement Notice) shall not impair any of such Shared Collateral Agent’s rights hereunder or under any of the Shared Collateral Documents and the ABL Agent’s failure to provide any such copies to the Shared Collateral Agents (but not the Enforcement Notice) shall not impair any of the ABL Agent’s rights hereunder or under any of the ABL Documents. Each of the Shared Collateral Agents, each Shared Collateral Secured Party, the ABL Agent and each ABL Secured Party agrees (i) that it will not institute any suit or other proceeding or assert in any suit, Insolvency Proceeding or other proceeding, or any other claim, in the case of the Shared Collateral Agents and each Shared Collateral Secured Party, against either the ABL Agent or any other ABL Secured Party, and in the case of the ABL Agent and each other ABL Secured Party, against either the Shared Collateral Agents or any other Shared Collateral Secured Party, seeking damages from or other relief by way of specific performance, instructions or otherwise, with respect to, any action taken or omitted to be taken by such Person with respect to the ABLShared Collateral which is consistent with the terms of this Agreement, and none of such Parties shall be liable for any such action taken or omitted to be taken, or (ii) it will not be a petitioning creditor or otherwise assist in the filing of an involuntary Insolvency Proceeding.

(b)    Release of Liens. In the event of any private or public sale of all or any portion of the ABL Collateral (other than in connection with a refinancing as described in Section 5.2(d)) permitted by the ABL Documents or consented to by the requisite ABL Lenders, the Shared Collateral Agents agree, on behalf of the Shared Collateral Secured Parties that such sale will be free and clear of the Liens on such ABL Collateral securing the Shared Collateral Obligations, and the Shared Collateral Agents’ and the Shared Collateral Secured Parties’ Liens with respect to the ABL Collateral so sold, transferred, disposed or released shall terminate and be automatically released without further action concurrently with, and to the same extent as, the release of the ABL Secured Parties’ Liens on such ABL Collateral; provided that in the case of a disposition in connection with an Exercise of Secured Creditor Remedieswith respect to ABL Collateral, any Proceeds thereof not applied to repay ABL Obligations shall be subject to the Liens securing the Shared Collateral Obligations and shall be applied pursuant to this Agreement and the Shared Collateral Intercreditor Agreement. In furtherance of, and subject to, the foregoing, the Shared Collateral Agents agree that they will promptly execute any and all Lien

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releases or other documents reasonably requested by the ABL Agent in connection therewith. Each Shared Collateral Agent hereby appoints the ABL Agent and any officer or duly authorized person of the ABL Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power of attorney in the place and stead of such Shared Collateral Agent and in the name of such Shared Collateral Agent or in the ABL Agent’s own name, from time to time, in the ABL Agent’s sole discretion, for the purposes of carrying out the terms of this paragraph, to take any and all appropriate action and to execute and deliver any and all documents and instruments as may be necessary or desirable to accomplish the purposes of this paragraph, including any financing statements, endorsements, assignments, releases or other documents or instruments of transfer (which appointment, being coupled with an interest, is irrevocable).

Section 2.5    No New Liens. Prior to the Discharge of ABL Obligations, the parties hereto agree that the Borrower shall not, and shall not permit any other Loan Party to grant or permit any additional Liens on any ABLProperty (other than Non-Shared Collateral) to secure the Shared CollateralTerm Obligations unless it has granted or concurrently grants a Lien on such ABLProperty (other than Non-Shared Collateral) to secure the ABL Obligations or grant or permit any additional Liens on any asset or pProperty to secure any ABL Obligations (other than assets or pProperty owned by any ABL Loan Party organized in Canada) unless it has granted or concurrently grants a Lien on such ABL CollateralProperty to secure the Shared CollateralTerm Obligations. If any Loan Party shall (nonetheless and in breach hereof) permit any Lien on any ABL Collateralsecuring any ABL ObligationProperty (other than assets or pProperty owned by any ABL Loan Party organized in Canada) securing any ABL Obligationwhich assets are not also subject to the Lien of the Shared Collateral Agents under the Shared Collateral Documents, subject to the Lien Priority set forth herein, then the ABL Agent (or the relevant ABL Secured Party) shall, without the need for any further consent of any other ABL Secured Party, any ABL Borrower or any ABL Guarantor, and notwithstanding anything to the contrary in any other ABL Document, be deemed to also hold and have held such Lien as agent or bailee for the benefit of the Shared Collateral Agents as security for the Shared Collateral Obligations (subject to the Lien Priority and other terms hereof) and shall promptly notify the Shared Collateral Agents in writing of the existence of such Lien.

Section 2.6    Waiver of Marshalling. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree not to assert and hereby waive, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the ABL Collateral or any other similar rights a junior secured creditor may have under applicable law.with respect to the ABL Collateral. Prior to the Discharge of Term Obligations, the ABL Agent, on behalf of the ABL Secured Parties, agrees not to assert and hereby waive, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the Canadian Pledge Collateral or any other similar rights a junior secured creditor may have under applicable law with respect to the Canadian Pledge Collateral.

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Section 2.7    Refinancings. The ABL Obligations and any series of Shared Collateral Obligations may be refinanced, in whole or in part, in each case, in accordance with the terms of the ABL Documents and the Shared Collateral Documents, as applicable, including a refinancing with the incurrence of Special Refinancing Indebtedness, and without notice to, or the consent (except to the extent a consent is otherwise required to permit the refinancing transaction under any ABL Document or Shared Collateral Document) of the ABL Secured Parties or any Shared Collateral Secured Parties, all without affecting the priorities provided for herein or the other provisions hereof; provided that (i) the authorized representative of the holders of any such refinancing indebtedness (the “Authorized Representative”) shall have executed a joinder agreement on behalf of the holders of such refinancing indebtedness substantially in the form of Exhibit A heretoand (ii) such refinancing indebtedness may provide for a lien that is junior in priority to the Lien Priorities provided for herein.

Section 2.8Junior Indebtedness. The Parties hereto hereby agree that the Borrower may incur Indebtedness that is junior in priority to the Lien Priorities provided for herein (in accordance with the terms of the ABL Documents and the Shared Collateral Documents, as applicable), to the extent permitted in the ABL Credit Agreement, without notice to, or the consent of the ABL Agent, the ABL Lenders, the Shared Collateral Agents or the Shared Collateral Secured Parties, as the case may be, and upon any such incurrence, the Parties hereto hereby authorize the Agents to make technical amendments to this Agreement in order to effectuate the foregoing.

ARTICLE 3
ACTIONS OF THE PARTIES

Section 3.1    Certain Actions Permitted. The Shared Collateral Agents and the ABL Agent may make such demands or file such claims in respect of the Shared Collateral Obligations or the ABL Obligations, as applicable, as are necessary to prevent the waiver or bar of such claims under applicable statutes of limitations or other statutes, court orders, or rules of procedure at any time. Except as provided in Section 5.2, nothing in this Agreement shall prohibit the receipt by the Shared Collateral Agents or any Shared Collateral Secured Party of the required payments of interest, principal and other amounts owed in respect of the Shared Collateral Obligations so long as such receipt is not the direct or indirect result of the exercise by the Shared Collateral Agents or any Shared Collateral Secured Party of rights or remedies as a secured creditor (including set-off with respect to the ABL Collateral) or enforcement, in each case with respect to ABL Collateral, in contravention of this Agreement of any Lien held by any of them.

Section 3.2    Agent for Perfection. Prior to the Discharge of ABL Obligations, the ABL Agent, for and on behalf of itself and each ABL Secured Party, and the Shared Collateral Agents, for and on behalf of themselves and each Shared Collateral Secured Party, as applicable, each agree to hold all ABLControl Collateral in their respective possession, custody, or control (or in the possession, custody, or control of agents or bailees for either) as agent for the other solely for the purpose of perfecting the security interest granted to each in such ABLControl Collateral, subject to the terms and conditions of this Section 3.2. In addition, the ABL Agent expressly agrees to act as agent for the benefit of the Shared Collateral Agents and the Shared Collateral Secured Parties under each control agreement or blocked account agreement with

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respect to any Deposit Accounts and Securities Accounts of a Loan Partyconstituting ABL Collateral. None of the ABL Agent, the ABL Secured Parties, the Shared Collaterals Agent, or the Shared Collateral Secured Parties, as applicable, shall have any obligation whatsoever to the others to assure that the ABLControl Collateral is genuine or owned by any Loan Party or any other Person or to preserve rights or benefits of any Person. The duties or responsibilities of the ABL Agent and the Shared Collateral Agents under this Section 3.2 are and shall be limited solely to holding or maintaining control of the ABLControl Collateral as agent for the other Party for purposes of perfecting the Lien held by the Shared Collateral Agents or the ABL Agent, as applicable. The ABL Agent is not and shall not be deemed to be a fiduciary of any kind for the Shared Collateral Agents, the Shared Collateral Secured Parties, or any other Person. The Shared Collateral Agents are not and shall not be deemed to be a fiduciary of any kind for the ABL Agent, the ABL Secured Parties, or any other Person. Prior to the Discharge of ABL Obligations, in the event that any Shared Collateral Agent or any Shared Collateral Secured Party receives any ABL Collateral or Proceeds of the ABL Collateral in violation of the terms of this Agreement, then such Shared Collateral Agent or such Shared Collateral Secured Party shall promptly pay over such Proceeds or ABL Collateral to the ABL Agent, in the same form as received with any necessary endorsements, for application in accordance with the provisions of Section 4.1 of this Agreement.Prior to the Discharge of Term Obligations, in the event that the ABL Agent or any ABL Secured Party or any Additional Pari Passu Agent or any Additional Pari Passu Secured Party receives any Canadian Pledge Collateral or Proceeds of the Canadian Pledge Collateral in violation of the terms of this Agreement, then the ABL Agent or such ABL Secured Party or the Additional Pari Passu Agent or such Additional Pari Passu Secured Party, as applicable, shall promptly pay over such Proceeds or Canadian Pledge Collateral to the Term Agent, in the same form as received with any necessary endorsements, for application in accordance with the provisions of Section 7.4 of this Agreement.

Section 3.3    [Reserved].

Section 3.4    Insurance. Proceeds of ABL Collateral include insurance proceeds of such ABL Collateral and, therefore, the Lien Priority shall govern the ultimate disposition of casualty insurance proceeds. The ABL Agent and the Shared Collateral Agents shall each be named as additional insured or loss payee, as applicable, with respect to all insurance policies relating to the ABLShared Collateral. Prior to the Discharge of ABL Obligationsand solely with respect to insurance proceeds of ABL Collateral, the ABL Agent shall have the sole and exclusive right, as against the Shared Collateral Agents, to adjust settlement of insurance claims in the event of any covered loss, theft or destruction of the ABL Collateral. Prior to the Discharge of ABL Obligations, all proceeds of such insurance shall be remitted for application in accordance with the provisions of Section 4.1 of this Agreement.Prior to the Discharge of Term Obligations and solely with respect to insurance proceeds of Canadian Pledge Collateral, the Term Agent shall have the sole and exclusive right, as against the ABL Agent and any Additional Pari Passu Agent, to adjust settlement of insurance claims in the event of any covered loss, theft or destruction of the Canadian Pledge Collateral. Prior to the Discharge of Term Obligations, all proceeds of such insurance shall be remitted for application in accordance with the provisions of Section 7.4 of this Agreement.

Section 3.5    No Additional Rights for the Loan Parties Hereunder. Except as provided in Section 3.6, if any ABL Secured Party or Shared Collateral Secured Party shall enforce its rights or remedies in violation of the terms of this Agreement, the Loan Parties shall

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not be entitled to use such violation as a defense to any action by any ABL Secured Party or Shared Collateral Secured Party, nor to assert such violation as a counterclaim or basis for set off or recoupment against any ABL Secured Party or Shared Collateral Secured Party.

Section 3.6    Geoffrey Collateral.

(a)    Without limiting any rights the ABL Agent or any other ABL Secured Party may otherwise have under applicable law or by agreement, in the event of any liquidation of the ABL Collateral (or any other Exercise of Secured Creditor Remedies by the ABL Agent) and whether or not the Shared Collateral Agents or any other Shared Collateral Secured Party has commenced and is continuing to Exercise Any Secured Creditor Remedies of the Shared Collateral Agents, the ABL Agent or any other Person (including any Loan Party) acting with the consent, or on behalf, of the ABL Agent, shall have the right to use the Geoffrey Collateral in order to complete a production run of Inventory involving, take possession of, move, prepare and advertise for sale, to sell (by public auction, private sale or a “store closing”, “going out of business” or similar sale, whether in bulk, in lots or to customers in the ordinary course of business or otherwise and which sale may include augmented Inventory of the same type sold in the Borrowers’ and Guarantors’ business), store or otherwise deal with the ABL Collateral, in each case without notice to, the involvement of or interference by any Shared Collateral Secured Party or liability to any Shared Collateral Secured Party for a period, (i) in the case of Geoffrey Collateral that is subject to a license agreement (including the Intellectual Property Rights Agreement), the period described in such license agreement and (ii) otherwise, the Use Period. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents agree not sell, assign or otherwise transfer the Geoffrey Collateral, (i) in the case of Geoffrey Collateral that is subject to a license agreement (including the Intellectual Property Rights Agreement), prior to the expiration of the period described in such license agreement and (ii) otherwise, prior to the expiration of the Use Period, unless the purchaser, assignee or transferee thereof agrees to be bound by the provisions of this Section 3.6. Subject only to the foregoing provisions of this Section 3.6, nothing in this Agreement shall impair the Shared Collateral Agents’ and the Shared Collateral Secured Parties’ rights and Liens on the Geoffrey Collateral.

(b)    The ABL Agent and the ABL Secured Parties shall not be obligated to pay any amounts to the Shared Collateral Agents or the Shared Collateral Secured Parties (or any person claiming by, through or under the Shared Collateral Secured Parties, including any purchaser of the Geoffrey Collateral) or to the Loan Parties, for or in respect of the use by the ABL Agent and the ABL Secured Parties of the Geoffrey Collateral and none of the ABL Agent or the ABL Secured Parties shall be obligated to secure, protect, insure or repair any such Geoffrey Collateral (other than for damages caused by the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives). The ABL Agent and the ABL Secured Parties shall not have any liability to the Shared Collateral Agents or the Shared Collateral Secured Parties (or any person claiming by, through or under the Shared Collateral Agents or the Shared Collateral Secured Parties, including any purchaser of the Geoffrey Collateral) as a result of any condition on or with respect to the Geoffrey Collateral other than those arising from the gross negligence or willful misconduct of the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives, and the ABL Agent and the ABL Secured Parties shall have no duty or liability to maintain the Geoffrey Collateral in a condition or

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manner better than that in which it was maintained prior to the use thereof by the ABL Agent and the ABL Secured Parties.

Section 3.7    Access Rights.

(a)    Without limiting any rights the ABL Agent or any other ABL Secured Party may otherwise have under applicable law or by agreement, (i) in the event of any liquidation of the ABL Collateral (or any other Exercise Any Secured Creditor Remedies by the ABL Agent) and whether or not the Authorized Shared Collateral Agent or any other Shared Collateral Secured Party has commenced and is continuing to Exercise Any Secured Creditor Remedies of the Shared Collateral Agents, and (ii) if the Shared Collateral Agents have obtained a first priority Lien on or control of any Real Property where any ABL Collateral is located, then the ABL Agent or any other Person (including any Loan Party) acting with the consent, or on behalf, of the ABL Agent, shall have the right to access such Real Property in order to assemble, inspect, copy or download information stored on, take actions to perfect its Lien on, complete a production run of Inventory involving, take possession of, move, prepare and advertise for sale, sell (by public auction, private sale or a “store closing”, “going out of business” or similar sale, whether in bulk, in lots or to customers in the ordinary course of business or otherwise and which sale may include augmented Inventory of the same type sold in the Borrowers’ and Guarantors’ business), store or otherwise deal with the ABL Collateral, in each case without notice to, the involvement of or interference by any Shared Collateral Secured Party or liability to any Shared Collateral Secured Party for a period not to exceed the Access Period. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents agree not sell, assign or otherwise transfer such Real Property prior to the Access Period, unless the purchaser, assignee or transferee thereof agrees to be bound by the provisions of this Section 3.7. Subject only to the foregoing provisions of this Section 3.7, nothing in this Agreement shall impair the Shared Collateral Agents’ and the Shared Collateral Secured Parties’ rights and Liens on such Real Property.

(b)    The ABL Agent and the ABL Secured Parties shall not be obligated to pay any amounts to the Shared Collateral Agent or the Shared Collateral Secured Parties (or any person claiming by, through or under the Shared Collateral Secured Parties, including any purchaser of such Real Property) or to the Loan Parties, for or in respect of the use by the ABL Agent and the ABL Secured Parties of the Real Property and none of the ABL Agent or the ABL Secured Parties shall be obligated to secure, protect, insure or repair any such Real Property (other than for damages caused by the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives). The ABL Agent and the ABL Secured Parties shall not have any liability to the Shared Collateral Agents or the Shared Collateral Secured Parties (or any person claiming by, through or under the Shared Collateral Agents or the Shared Collateral Secured Parties, including any purchaser of the Real Property) as a result of any condition on or with respect to such Real Property other than those arising from the gross negligence or willful misconduct of the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives, and the ABL Agent and the ABL Secured Parties shall have no duty or liability to maintain the Real Property in a condition or manner better than that in which it was maintained prior to the use thereof by the ABL Agent and the ABL Secured Parties.

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ARTICLE 4
APPLICATION OF PROCEEDS

Section 4.1    Application of Proceeds.

(a)    Revolving Nature of ABL Obligations. The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, expressly acknowledge and agree that (i) the ABL Credit Agreement includes a revolving commitment, that in the ordinary course of business the ABL Agent and the ABL Lenders will apply payments and make advances thereunder, and that no application of any ABL Collateral or the release of any Lien by the ABL Agent upon any portion of the ABL Collateral in connection with a permitted disposition by the ABL Loan Parties under any ABL Credit Agreement shall constitute the Exercise of Secured Creditor Remedies under this Agreement; (ii) the amount of the ABL Obligations that may be outstanding at any time or from time to time may be increased or reduced and subsequently reborrowed, and that the terms of the ABL Obligations may be modified, extended or amended from time to time, and that the aggregate amount of the ABL Obligations may be increased, replaced or refinanced, in each event, without notice to or consent by the Shared Collateral Secured Parties and without affecting the provisions hereof; and (iii) all ABL Collateral received by the ABL Agent may be applied, reversed, reapplied, credited, or reborrowed, in whole or in part, to the ABL Obligations at any time; provided, however, that from and after the date on which the ABL Agent (or any ABL Lender) commences the Exercise of Secured Creditor Remedies, all amounts received by the ABL Agent or any ABL Lender in respect of any ABL Collateral shall be applied as specified in this Section 4.1. The Lien Priority shall not be altered or otherwise affected by any such amendment, modification, supplement, extension, repayment, reborrowing, increase, replacement, renewal, restatement or refinancing of either the ABL Obligations or the Shared Collateral Obligations, or any portion thereof.

(b)    Application of Proceeds of ABL Collateral. Prior to the Discharge of ABL Obligations, the ABL Agent and the Shared Collateral Agents hereby agree that all ABL Collateral and all Proceeds thereof, received by either of them in connection with any Exercise of Secured Creditor Remedies with respect to the ABL Collateral shall be applied,

first, to the payment of costs and expenses of the ABL Agent in connection with such Exercise of Secured Creditor Remedies,

second, to the payment of the ABL Obligations in accordance with the ABL Documents until the Discharge of ABL Obligations shall have occurred,

third, to the payment of the Shared CollateralTerm Obligations in accordance with the Shared CollateralTerm Documentsuntil the Discharge of Term Obligations shall have occurred, and

fourth, the balance, if any, to the Loan Parties or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct;

provided that in the event any Shared Collateral Agent receives, in connection with an Insolvency Proceeding, any Proceeds of any ABL Collateral and the Lien granted in favor of the ABL Agent or the ABL Secured Parties in respect of such ABL Collateral has been voided, avoided, subordinated, or otherwise invalidated by a court of competent jurisdiction and the

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provisions of Section 5.3 would not be effective, the such proceeds received by such Shared Collateral Agent with respect to the ABL Collateral subject to avoidance, subordination or invalidation shall be applied, to the extent permitted under applicable law, to the payment of the Shared Collateral Obligations in accordance with the Shared Collateral Documents.

(c)    Limited Obligation or Liability. In exercising remedies, whether as a secured creditor or otherwise, the ABL Agent shall have no obligation or liability to the Shared Collateral Agents or to any Shared Collateral Secured Party, regarding the adequacy of any Proceeds of ABL Collateral or for any action or omission, save and except solely for an action or omission that breaches the express obligations undertaken by each Party under the terms of this Agreement. Notwithstanding anything to the contrary herein contained, none of the Parties hereto waives any claim that it may have against a Secured Party on the grounds that and sale, transfer or other disposition by the Secured Party was not commercially reasonable in every respect as required by the Uniform Commercial Code.

(d)    Turnover ofABLSharedCollateral After Discharge. Upon the Discharge of ABL Obligations, the ABL Agent shall deliver to the Shared Collateral Agents or shall execute such documents as the Shared Collateral Agents may reasonably request (at the expense of the Term Borrowerand Notes Issuer) to enable the Shared Collateral Agents to have control over any ABL Collateral still in the ABL Agent’s possession, custody, or control in the same form as received with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct. Upon the Discharge of Shared Collateral Obligations, the applicable Shared Collateral Agent shall deliver to the ABL Agent or shall execute such documents as the ABL Agent may reasonably request (at the expense of the Term Borrower) to enable the ABL Agent to have control over any Canadian Pledge Collateral still in such Shared Collateral Agent’s possession, custody, or control in the same form as received with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct.

Section 4.2Application of ProceedsIn Respect of the IntermediateCo Unsecured Guarantee. Notwithstanding anything to the contrary in this Agreement, any Additional Pari Passu Document, any ABL Document or the Term Credit Agreement, the parties hereto hereby agree (other than clauses (ii) and (iii) solely with respect to the ABL Agent for which such clauses shall not apply) that any payments made by the Term Borrower to the Term Agent in respect of (i) the IntermediateCo Unsecured Guarantee, (ii) any mandatory prepayment events set forth in Section 2.03(j) of the Term Credit Agreement (including a sale of Secured Specified Real Property after the Springing Covenant Trigger Date), (iii) remedies pursuant to the proviso to Section 8.02 of the Term Credit Agreement, or (iv) remedy event interest payments set forth in the Term B-4 Joinder Agreement, in each case, shall be paid solely to the Term B-4 Lenders to repay the Term B-4 Loans and, for the avoidance of doubt, shall not be paid to any other Term Secured Parties or any ABL Secured Party or any Additional Pari Passu Secured Party.

Section 4.24.3Specific Performance. Each of the ABL Agent and each Shared Collateral Agent is hereby authorized to demand specific performance of this Agreement, whether or not any Loan Party shall have complied with any of the provisions of any of the Credit Documents, at any time when the other Party shall have failed to comply with any of the provisions of this Agreement applicable to it. Each of the ABL Agent, on behalf of the ABL Secured Parties, and the Shared Collateral Agents, on behalf of the applicable Shared Collateral

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Secured Parties, hereby irrevocably waives any defense based on the adequacy of a remedy at law that might be asserted as a bar to such remedy of specific performance.

ARTICLE 5
INTERCREDITOR ACKNOWLEDGEMENTS AND WAIVERS

Section 5.1    Notice of Acceptance and Other Waivers.

(a)    All ABL Obligations at any time made or incurred by any ABL Loan Party shall be deemed to have been made or incurred in reliance upon this Agreement, and the Term Agent, on behalf of the Term Secured Parties, hereby waives notice of acceptance, or proof of reliance by the ABL Agent or any ABL Secured Parties of this Agreement, and notice of the existence, increase, renewal, extension, accrual, creation, or non-payment of all or any part of the ABL Obligations. All Shared Collateral Obligations at any time made or incurred by any Shared Collateral Loan Party shall be deemed to have been made or incurred in reliance upon this Agreement, and the ABL Agent, on behalf of the ABL Secured Parties, hereby waives notice of acceptance, or proof of reliance, by the Shared Collateral Agents or any Shared Collateral Secured Party of this Agreement, and notice of the existence, increase, renewal, extension, accrual, creation, or non-payment of all or any part of the Shared Collateral Obligations.

(b)    None of the ABL Agent, any ABL Secured Party, or any of their respective Affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, or realize upon any of the ABL Collateral or any Proceeds, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any ABL Collateral or Proceeds thereof or to take any other action whatsoever with regard to the ABL Collateral or any part or Proceeds thereof, except as specifically provided in this Agreement. If the ABL Agent or any ABL Secured Party honors (or fails to honor) a request by any ABL Borrower for an extension of credit pursuant to any ABL Credit Agreement or any of the other ABL Documents, whether or not the ABL Agent or any ABL Secured Party has knowledge that the honoring of (or failure to honor) any such request would constitute a default under the terms of any Shared Collateral Document (but not a default under this Agreement) or an act, condition, or event that, with the giving of notice or the passage of time, or both, would constitute such a default, or if the ABL Agent or any ABL Secured Party otherwise should exercise any of its contractual rights or remedies under any ABL Documents (subject to the express terms and conditions hereof), neither the ABL Agent nor any ABL Secured Party shall have any liability whatsoever to the Shared Collateral Agents or any Shared Collateral Secured Party as a result of such action, omission, or exercise (so long as any such exercise does not breach the express terms and provisions of this Agreement). The ABL Agent and the ABL Secured Party shall be entitled to manage and supervise their loans and extensions of credit under any ABL Credit Agreement and any of the other ABL Documents as they may, in their sole discretion, deem appropriate, and may manage their loans and extensions of credit without regard to any rights or interests that the Shared Collateral Agents or any of the Shared Collateral Secured Parties have in the ABL Collateral, except as otherwise expressly set forth in this Agreement. The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree that neither the ABL Agent nor any ABL Secured Party shall incur any liability as a result of a sale, lease, license, application, or other disposition of all or any portion of the ABL Collateral or Proceeds thereof, pursuant to the ABL Documents, so long as such disposition is conducted in accordance with mandatory provisions of applicable law and does not breach the provisions of this Agreement.

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(c)None of the Shared Collateral Agents, any Shared Collateral Secured Party, or any of their respective Affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, or realize upon any of the Canadian Pledge Collateral or any Proceeds, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any Canadian Pledge Collateral or Proceeds thereof or to take any other action whatsoever with regard to the Canadian Pledge Collateral or any part or Proceeds thereof, except as specifically provided in this Agreement. The Shared Collateral Agent and the Shared Collateral Secured Parties shall be entitled to manage and supervise their loans and extensions of credit under any Shared Collateral Documents as they may, in their sole discretion, deem appropriate, and may manage their loans and extensions of credit without regard to any rights or interests that the ABL Agent or any of the ABL Secured Parties have in the Canadian Pledge Collateral, except as otherwise expressly set forth in this Agreement. The ABL Agent, on behalf of the ABL Secured Parties, agrees that no Shared Collateral Agent nor any Shared Collateral Secured Party shall incur any liability as a result of a sale, lease, license, application, or other disposition of all or any portion of the Canadian Pledge Collateral or Proceeds thereof, pursuant to the Shared Collateral Documents, so long as such disposition is conducted in accordance with mandatory provisions of applicable law and does not breach the provisions of this Agreement.

Section 5.2    Modifications to ABL Documents and Shared Collateral Documents.

(a)    The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, hereby agree that, without affecting the obligations of the Shared Collateral Agent and the Shared Collateral Secured Parties hereunder, the ABL Agent and the ABL Lenders may, at any time and from time to time, in their sole discretion without the consent of or notice to the Shared Collateral Agents or any Shared Collateral Secured Party (except to the extent such notice or consent is required pursuant to the express provisions of this Agreement), and without incurring any liability to the Shared Collateral Agent or any Shared Collateral Secured Party or impairing or releasing the subordination provided for herein, amend, restate, supplement, replace, refinance, extend, consolidate, restructure, or otherwise modify any of the ABL Documents in any manner whatsoever, including, without limitation, to:

(i)    change the manner, place, time, or terms of payment or renew, alter or increase, all or any of the ABL Obligations or otherwise amend, restate, supplement, or otherwise modify in any manner, or grant any waiver or release with respect to, all or any part of the ABL Obligations or any of the ABL Documents;

(ii)    subject to Section 2.5, retain or obtain a Lien on any Property of any Person to secure any of the ABL Obligations, and in connection therewith to enter into any additional ABL Documents;

(iii)    amend, or grant any waiver, compromise, or release with respect to, or consent to any departure from, any guaranty or other obligations of any Person obligated in any manner under or in respect of the ABL Obligations;

(iv)    release its Lien on any ABLShared Collateral or other Property;

(v)    exercise or refrain from exercising any rights against any Loan Party or any other Person;

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(vi)    subject to Section 2.5, retain or obtain the primary or secondary obligation of any other Person with respect to any of the ABL Obligations; and

(vii)    otherwise manage and supervise the ABL Obligations as the ABL Agent shall deem appropriate;

provided, however, that no such amendment, supplement or modification shall (x) in the case of the Tranche A Borrowing Base, result in increasing the “Inventory Advance Rate” thereunder to more than 95% and (y) in the case of the Tranche A-1 Borrowing BaseIncremental Availability, result in increasing the “Inventory Advance Rate” thereunder to more than 100%.

(b)    The ABL Agent, on behalf of the ABL Secured Parties, hereby agrees that, without affecting the obligations of the ABL Agent and the ABL Secured Parties hereunder, the Shared Collateral Agents and the Shared Collateral Secured Parties may, at any time and from time to time, in their sole discretion without the consent of or notice to the ABL Agent or any ABL Secured Party (except to the extent such notice or consent is required pursuant to the express provisions of this Agreement), and without incurring any liability to the ABL Agent or any ABL Secured Party or impairing or releasing the subordination provided for herein, amend, restate, supplement, replace, refinance, extend, consolidate, restructure, or otherwise modify any of the Shared Collateral Documents in any manner whatsoever, including, without limitation, to:

(i)    change the manner, place, time, or terms of payment or renew, alter or increase, all or any of the Shared Collateral Obligations or otherwise amend, restate, supplement, or otherwise modify in any manner, or grant any waiver or release with respect to, all or any part of the Shared Collateral Obligations or any of the Shared Collateral Documents;

(ii)    subject to Section 2.5, retain or obtain a Lien on any Property of any Person to secure any of the Shared Collateral Obligations, and in connection therewith to enter into any additional Shared Collateral Documents;

(iii)    amend, or grant any waiver, compromise, or release with respect to, or consent to any departure from, any guaranty or other obligations of any Person obligated in any manner under or in respect of the Shared Collateral Obligations;

(iv)    exercise or refrain from exercising any rights against Loan Party or any other Person;

(v)    subject to Section 2.5, retain or obtain the primary or secondary obligation of any other Person with respect to any of the Shared Collateral Obligations;

(vi)    release its Lien on any ABLShared Collateral, Non-Shared Collateral or other Propertyand take any action in respect of any of the Non-Shared Collateral; and

(vii)    otherwise manage and supervise the Shared Collateral Obligations as the Shared Collateral Agents shall deem appropriate.

(c)    No consent furnished by the ABL Agent or the Shared Collateral Agents pursuant to Sections 5.2(a) or 5.2(b) hereof shall be deemed to constitute the modification or

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waiver of any provisions of the ABL Documents or the Shared Collateral Documents, each of which remain in full force and effect as written.

(d)    The ABL Obligations and each of the Shared Collateral Obligations may be refinancedor replaced, in whole or in part, in each case, without notice to, or the consent (except to the extent a consent is required to permit the refinancing transaction under any ABL Document or any Shared Collateral Document) of the ABL Agent, the ABL Lenders, the Shared Collateral Agents or the Shared Collateral Secured Parties, as the case may be, all without affecting the Lien Priorities provided for herein or the other provisions hereofand the terms of this Agreement would apply to such refinancing Indebtedness and the holders thereof, mutatis mutandis, provided, however, that (i) the holders of such refinancing Indebtedness (or an authorized agent or trustee on their behalf) bind themselves in writing to the terms of this Agreement pursuant to such documents or agreements (including amendments or supplements to this Agreement) as the ABL Agent or the applicable Shared Collateral Agent, as the case may be, shall reasonably request and in form and substance reasonably acceptable to the ABL Agent or the applicable Shared Collateral Agent, as the case may be, and any such refinancing transaction shall be in accordance with any applicable provisions of both the ABL Documents and the Shared Collateral Documents, and(ii) no such refinancing shall have any effect prohibited by Section 5.2(a) or 5.2(b), as applicable.and (iii) such refinancing Indebtedness may provide for a lien that is junior in priority to the Lien Priorities provided for herein. The Parties hereto hereby authorize the Agents to make technical amendments to this Agreement in order to effectuate any of the foregoing.

Section 5.3    Reinstatement and Continuation of Agreement.

(a)    If the ABL Agent or any ABL Lender is required in any Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate of any Loan Party or any other Person any payment made in satisfaction of all or any portion of the ABL Obligations (an “ABL Recovery”), then the ABL Obligations shall be reinstated to the extent of such ABL Recovery. If this Agreement shall have been terminated prior to such ABL Recovery, this Agreement shall be reinstated in full force and effect in the event of such ABL Recovery, and such prior termination shall not diminish, release, discharge, impair, or otherwise affect the obligations of the Parties from such date of reinstatement. All rights, interests, agreements, and obligations of the ABL Agent, the Shared Collateral Agents, the ABL Secured Parties, and the Shared Collateral Secured Parties under this Agreement shall remain in full force and effect and shall continue irrespective of the commencement of, or any discharge, confirmation, conversion, or dismissal of, any Insolvency Proceeding by or against any Loan Party or any other circumstance which otherwise might constitute a defense available to, or a discharge of any Loan Party in respect of the ABL Obligations or the Shared Collateral Obligations. No priority or right of the ABL Agent or any ABL Secured Party shall at any time be prejudiced or impaired in any way by any act or failure to act on the part of any ABL Loan Party or by the noncompliance by any Person with the terms, provisions, or covenants of any of the ABL Documents, regardless of any knowledge thereof which the ABL Agent or any ABL Secured Party may have.

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(b)    If any Shared Collateral Agent or any Shared Collateral Secured Party is required in any Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate of any Shared Collateral Loan Party or any other Person any payment made in satisfaction of all or any portion of the Shared Collateral Obligations (a “Shared Collateral Recovery”), then the Shared Collateral Obligations shall be reinstated to the extent of such Shared Collateral Recovery. If this Agreement shall have been terminated prior to such Shared Collateral Recovery, this Agreement shall be reinstated in full force and effect in the event of such Shared Collateral Recovery, and such prior termination shall not diminish, release, discharge, impair, or otherwise affect the obligations of the Parties from such date of reinstatement. All rights, interests, agreements, and obligations of the ABL Agent, the Shared Collateral Agents, the ABL Secured Parties, and the Shared Collateral Secured Parties under this Agreement shall remain in full force and effect and shall continue irrespective of the commencement of, or any discharge, confirmation, conversion, or dismissal of, any Insolvency Proceeding by or against any Loan Party or any other circumstance which otherwise might constitute a defense available to, or a discharge of any Loan Party in respect of the ABL Obligations or the Shared Collateral Obligations. No priority or right of the Shared Collateral Agents or any Shared Collateral Secured Party shall at any time be prejudiced or impaired in any way by any act or failure to act on the part of any Loan Party or by the noncompliance by any Person with the terms, provisions, or covenants of any of the Shared Collateral Documents, regardless of any knowledge thereof which the Shared Collateral Agents or any Shared Collateral Secured Party may have.

Section 5.4    Joinder of Authorized Representatives. Notwithstanding anything contained in this Agreement to the contrary, without the consent of any ABL Secured Party or any Shared Collateral Secured Party, any Authorized Representative may become a party to this Agreement by execution and delivery of a joinder agreement substantially in the form of Exhibit A hereto and upon such execution and delivery, such Authorized Representative and the Secured Parties for which such Authorized Representative is acting shall be subject to the terms of this Agreement as an Additional Pari Passu Agent and Additional Pari Passu Secured Parties, respectively.

ARTICLE 6
INSOLVENCY PROCEEDINGS

Section 6.1    DIP Financing.

(a)    If any Loan Party shall be subject to any Insolvency Proceeding in the United States at any time prior to the Discharge of ABL Obligations, and the ABL Agent or the ABL Secured Parties shall seek to provide any Loan Party with, or consent to a third party providing, any financing under Section 364 of the Bankruptcy Code or consent to any order for the use of cash collateral constituting ABL Collateral under Section 363 of the Bankruptcy Code (each, a “DIP Financing”), with such DIP Financing to be secured by all or any portion of the ABL Collateral (including assets that, but for the application of Section 552 of the Bankruptcy Code would be ABL Collateral), then the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree that they will raise no objection and will not support any objection to such DIP Financing or use of cash collateral or to the Liens securing the same on the grounds of a failure to provide “adequate protection” for the Liens of the Shared Collateral Agents securing the Shared Collateral Obligations or on any other grounds (and will not request any adequate protection solely as a result of such DIP Financing or use of cash collateral that is

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ABL Collateral except as permitted by Section 6.3(b)), so long as (i) the Shared Collateral Agents retain their Lien on the ABL Collateral to secure the Shared Collateral Obligations (in each case, including Proceeds thereof arising after the commencement of the case under the Bankruptcy Code), (ii) the terms of the DIP Financing do not compel the applicable Loan Party to seek confirmation of a specific plan of reorganization for which all or substantially all of the material terms of such plan are set forth in the DIP Financing documentation or related document; (iii) all Liens on the ABL Collateral securing any such DIP Financing shall be senior to or on a parity with the Liens of the ABL Agent and the ABL Secured Parties securing the ABL Obligations on the ABL Collateral, and (iv) the amount of ABL Obligations as a result of such DIP Financing may be increased but in no event by no more than $50.0 million in excess of the maximum commitments under the ABL Credit Agreement prior to the commencement of the applicable Insolvency Proceeding.

(b)    All Liens granted to the ABL Agent or the Shared Collateral Agents in any Insolvency Proceeding, whether as adequate protection or otherwise, are intended by the Parties to be and shall be deemed to be subject to the Lien Priority and the other terms and conditions of this Agreement.

Section 6.2    Relief from Stay. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree not to seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of any portion of the ABL Collateral without the ABL Agent’s express written consent. Prior to the Discharge of Shared Collateral Obligations, the ABL Agent, on behalf of the ABL Secured Parties, agrees not to seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of any portion of the Canadian Pledge Collateral without each Shared Collateral Agent’s express written consent. In addition, the ABL Agent and Shared Collateral Agents shall not seek any relief from the automatic stay with respect to any ABLShared Collateral without providing 3 days’ prior written notice to the other, unless such period is agreed by each of the ABL Agent and the Shared Collateral Agents to be modified or unless (i) in the case of ABL Collateral, the ABL Agent makes a good faith determination that either (A) the ABL Collateral will decline speedily in value or (B) the failure to take any action will have a reasonable likelihood of endangering the ABL Agent’s or the Shared Collateral Agents’ ability to realize upon the ABL Collateral.and (ii) in the case of Canadian Pledge Collateral, the Term Agent (prior to the Discharge of Term Obligations in respect of Term B-4 Loans and thereafter the Authorized Shared Collateral Agent) makes a good faith determination that either (A) the Canadian Pledge Collateral will decline speedily in value or (B) the failure to take any action will have a reasonable likelihood of endangering the Term Agent’s, any other Shared Collateral Agent’s or the ABL Agent’s ability to realize upon the Canadian Pledge Collateral

Section 6.3    No Contest; Adequate Protection.

(a)    The Shared Collateral Agents’, on behalf of the Shared Collateral Secured Parties, agrees that, prior to the Discharge of ABL Obligations, none of them shall contest (or

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support any other Person contesting) (a) any request by the ABL Agent or any ABL Secured Party for adequate protection of its interest in the ABL Collateral, (b) any proposed provision of DIP Financing by the ABL Agent and the ABL Secured Parties (or any other Person proposing to provide DIP Financing with the consent of the ABL Agent) or (c) any objection by the ABL Agent or any ABL Secured Party to any motion, relief, action, or proceeding based on a claim by the ABL Agent or any ABL Secured Party that its interests in the ABL Collateral are not adequately protected (or any other similar request under any law applicable to an Insolvency Proceeding), so long as any Liens granted to the ABL Agent as adequate protection of its interests are subject to this Agreement.The ABL Agent, on behalf of the ABL Secured Parties, agrees that, prior to the Discharge of Shared Collateral Obligations, none of them shall contest (or support any other Person contesting) (a) any request by a Shared Collateral Agent or any Shared Collateral Secured Party for adequate protection of its interest in the Canadian Pledge Collateral or (b) any objection by a Shared Collateral Agent or any Shared Collateral Secured Party to any motion, relief, action, or proceeding based on a claim by a Shared Collateral Agent or any Shared Collateral Secured Party that its interests in the Canadian Pledge Collateral are not adequately protected (or any other similar request under any law applicable to an Insolvency Proceeding), so long as any Liens granted to a Shared Collateral Agent as adequate protection of its interests are subject to this Agreement.

(b)    Notwithstanding the foregoing provisions in this Section 6.3, in any Insolvency Proceeding if the ABL Secured Parties (or any subset thereof) are granted adequate protection with respect to the ABL Collateral in the form of additional collateral (even if such collateral is not of a type which would otherwise have constituted ABL Collateral), then the ABL Agent, on behalf of itself and the ABL Lenders, agrees that the Shared Collateral Agents, on behalf of itself or any of the Shared Collateral Secured Parties, may seek or request (and the ABL Secured Parties will not oppose such request) adequate protection with respect to its interests in such ABL Collateral in the form of a Lien on the same additional collateral, which Lien will be subordinated to the Liens securing the ABL Obligations on the same basis as the other Liens of the Shared Collateral Agents on the ABL Collateral.

Section 6.4    Asset Sales. Prior to the Discharge of ABL Obligations, the Shared Collateral Agents agree, on behalf of themselves and the Shared Collateral Secured Parties, that they will not oppose any sale consented to by the ABL Agent of any ABL Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any Insolvency Proceeding) so long as the proceeds of such sale are applied in accordance with this Agreement. Prior to the Discharge of Shared Collateral Obligations, the ABL Agent agrees, on behalf of itself and the ABL Secured Parties, that they will not oppose any sale consented to by the Shared Collateral Agents of any Canadian Pledge Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any Insolvency Proceeding) so long as the proceeds of such sale are applied in accordance with this Agreement.

Section 6.5    Separate Grants of Security and Separate Classification. Each Shared Collateral Secured Party, the Shared Collateral Agents, each ABL Secured Party and the ABL Agent acknowledges and agrees that (i) the grants of Liens pursuant to the ABL Documents, the Term Documents, the Notes Documents and the Additional Pari Passu Documents constitute separate and distinct grants of Liens and (ii) because of, among other things, their differing rights in the ABLShared Collateral, each of the TermABL Obligations, the NotesTerm Obligations and

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the Additional Pari Passu Obligations are fundamentally different from the ABL Obligationsone another and must be separately classified in any plan of reorganization proposed or adopted in an Insolvency Proceeding.

Section 6.6    Enforceability. The provisions of this Agreement are intended to be and shall be enforceable under Section 510(a) of the Bankruptcy Code.

Section 6.7    ABL Obligations Unconditional. All rights of the ABL Agent hereunder, and all agreements and obligations of the Shared Collateral Agents and the Loan Parties (to the extent applicable) hereunder, shall remain in full force and effect irrespective of:

(i)    any lack of validity or enforceability of any ABL Document;

(ii)    any change in the time, place or manner of payment of, or in any other term of, all or any portion of the ABL Obligations, or any amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of any ABL Document;

(iii)    any exchange, release, voiding, avoidance or non perfection of any security interest in any ABLShared Collateral or any other collateral, or any release, amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding, restatement or increase of all or any portion of the ABL Obligations or any guarantee or guaranty thereof; or

(iv)    any other circumstances that otherwise might constitute a defense available to, or a discharge of, any Loan Party in respect of the ABL Obligations, or of any of the Shared Collateral Agents or any Loan Party, to the extent applicable, in respect of this Agreement.

Section 6.8    Shared Collateral Obligations Unconditional. All rights of the Shared Collateral Agents hereunder, all agreements and obligations of the ABL Agent and the Loan Parties (to the extent applicable) hereunder, shall remain in full force and effect irrespective of:

(i)    any lack of validity or enforceability of any Shared Collateral Document;

(ii)    any change in the time, place or manner of payment of, or in any other term of, all or any portion of the Shared Collateral Obligations, or any amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of any Shared Collateral Document;

(iii)    any exchange, release, voiding, avoidance or non perfection of any security interest in any ABLShared Collateral, or any other collateral, or any release, amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding, restatement or increase of all or any portion of the Shared Collateral Obligations or any guarantee or guaranty thereof; or

(iv)    any other circumstances that otherwise might constitute a defense available to, or a discharge of, any Loan Party in respect of the Shared Collateral

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Obligations, or of any of the ABL Agent or any Loan Party, to the extent applicable, in respect of this Agreement.

ARTICLE 7CANADIAN PLEDGE COLLATERAL

Section 7.1Canadian Pledge Collateral. Notwithstanding (i) the date, time, method, manner, or order of grant, attachment, or perfection of any Liens granted to any Shared Collateral Agent or the Shared Collateral Secured Parties in respect of all or any portion of the Canadian Pledge Collateral or of any Liens granted to the ABL Agent or the ABL Secured Parties in respect of all or any portion of the Canadian Pledge Collateral and regardless of how any such Lien was acquired (whether by grant, statute, operation of law, subrogation or otherwise), (ii) the order or time of filing or recordation of any document or instrument for perfecting the Liens in favor of the Shared Collateral Agents or the ABL Agent (or Shared Collateral Secured Parties or the ABL Secured Parties) in any Canadian Pledge Collateral, (iii) any provision of the Uniform Commercial Code, the Bankruptcy Code or any other applicable law, or of the Shared Collateral Documents or the ABL Documents, or (iv) whether any Shared Collateral Agent or the ABL Agent, in each case, either directly or through agents, hold possession of, or have control over, all or any part of the Canadian Pledge Collateral, the Term Agent, on behalf of itself and the Term Secured Parties, each Additional Pari Passu Agent, on behalf of itself and the Additional Pari Passu Secured Parties it represents, and the ABL Agent, on behalf of itself and the ABL Secured Parties, hereby agrees that prior to the Discharge of Shared Collateral Obligations:

(1)any Lien in respect of all or any portion of the Canadian Pledge Collateral now or hereafter held by or on behalf of the ABL Agent or any ABL Secured Party that secures all or any portion of the ABL Obligations shall in all respects be junior and subordinate to all Liens granted to the Shared Collateral Agents for the benefit of their respective Shared Collateral Secured Parties on the Canadian Pledge Collateral;

(2)any Lien in respect of all or any portion of the Canadian Pledge Collateral now or hereafter held by or on behalf of (a) the Term Agent or any Term Secured Party (other than a Term B-4 Lender) that secures all or any portion of the Term Obligations (other than Term Obligations in respect of Term B-4 Loans payable to the Term B-4 Lenders) or (b) any Additional Pari Passu Agent or any Additional Pari Passu Secured Parties represented by such Additional Pari Passu Agent that secures all or any portion of the Additional Pari Passu Obligations, in each case shall in all respect be junior and subordinate to all Liens granted to the Term Agent for the benefit of the Term B-4 Lenders on the Canadian Pledge Collateral;

(3)any Lien in respect of all or any portion of the Canadian Pledge Collateral now or hereafter held by or on behalf of the Term Agent (acting on behalf of any Term B-4 Lender) or any Term B-4 Lender that secures all or any portion of the Term Obligations in respect of Term B-4 Loans payable to the Term B-4 Lenders shall in all respects be senior and prior to all Liens granted to the ABL Agent or any ABL Secured Party, any Additional Par Passu Agent or any Additional Pari Passu Secured Party or the

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Term Agent (acting on behalf of any Term Secured Party that is not a Term B-4 Lender) or any such Term Secured Party that is not a Term B-4 Lender on the ABL Collateral; and

The TermAgent, for and on behalf of itself and theTermSecured Parties, acknowledges and agrees that, the ABL Agent, for the benefit of the ABL Secured Parties, has been granted Liens upon all of the Canadian Pledge Collateral in which the Term Agent has been granted Liens and the Term Agent hereby consents thereto. The subordination of Liens by the ABL Agent, Additional Pari Passu Secured Parties and the Term Secured Parties (other than the Term B-4 Lenders) in favor of the Term Agent for the benefit of the Term B-4 Lenders or the Term Secured Parties, as applicable, as set forth herein shall not be deemed to subordinate the ABL Agent’s, Additional Pari Passu Agent’s or the Term Agent’s respective Liens on the Canadian Pledge Collateral to the Liens of any other Person. Notwithstanding any provision to the contrary contained herein, this Article 7 shall not apply to any of the ABL Collateral.

Section 7.2Waiver of Right to Contest Liens. Each of ABL Agent, on behalf of the ABL Secured Parties and the Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties represented by such Shared Collateral Agent, agrees that it and they shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the Shared Collateral Agents and the Shared Collateral Secured Parties in respect of the Canadian Pledge Collateral or Liens of the ABL Agent and the ABL Secured Parties in respect of the Canadian Pledge Collateral or the provisions of this Agreement. Except to the extent expressly set forth in this Agreement, the ABL Agent, on behalf of the ABL Secured Parties, agrees that none of the ABL Agent or the ABL Secured Parties will take any action that would interfere with any Exercise of Secured Creditor Remedies undertaken by the Term Agent or any Term Secured Party under the Term Documents, or by any Additional Pari Passu Agent or Additional Par Passu Secured Party under any Additional Par Passu Document, with respect to the Canadian Pledge Collateral. Except to the extent expressly set forth in this Agreement, the ABL Agent, on behalf of the ABL Secured Parties, hereby waive any and all rights they or the ABL Secured Parties may have as a junior lien creditor or otherwise to contest, protest, object to, or interfere with the manner in which any Shared Collateral Agent or any Shared Collateral Secured Party seeks to enforce its Liens in any Canadian Pledge Collateral. Except to the extent expressly set forth in this Agreement, each Additional Pari Passu Agent, on behalf of the Additional Pari Passu Secured Parties represented by it, hereby waive any and all rights they or the Additional Pari Passu Secured Parties may have as a junior lien creditor or otherwise to contest, protest, object to, or interfere with the manner in which the Term Agent (acting on behalf of the Term B-4 Lenders) or any Term B-4 Lender seeks to enforce its Liens in any Canadian Pledge Collateral. The foregoing shall not be construed to prohibit the ABL Agent from enforcing the provisions of this Agreement as to the relative priority of the parties hereto.

Section 7.3Canadian Pledge Collateral Remedies Standstill; Release of Liens.

(b)The ABL Agent, on behalf of the ABL Secured Parties, agrees that, from the date hereof until the earlier of (i) the ABL Enforcement Date or (ii) the date upon which the Discharge of the Shared Collateral Obligations shall have occurred, they will not Exercise Any

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Secured Creditor Remedies with respect to any of the Canadian Pledge Collateral without the written consent of (i) the Term Agent and, to the extent such consent is required under the Term Credit Agreement, the Required Lenders (as defined in the Term Credit Agreement) and/or the Term B-4 Required Lenders (as defined in the Term Credit Agreement) and (ii) each Additional Pari Passu Agent and, to the extent such consent is required under the Additional Pari Passu Documents with respect to such Additional Pari Passu Agent, the required holders of such Additional Pari Passu Obligations, and will not take, receive or accept any Proceeds of the Canadian Pledge Collateral. From and after the earlier of (i) the ABL Enforcement Date or (ii) the date upon which the Discharge of the Shared Collateral Obligations shall have occurred, the ABL Agent or any ABL Secured Party may Exercise Any Secured Creditor Remedies under the ABL Collateral Documents or applicable law as to any Canadian Pledge Collateral.

(c)Notwithstanding the provisions of Sections 7.3(a) or any other provision of this Agreement, prior to the Discharge of the Shared Collateral Obligations, nothing contained herein shall be construed to prevent (i) the ABL Agent or any ABL Secured Party from filing a claim or statement of interest with respect to the ABL Obligations owed to them in any Insolvency Proceeding commenced by or against any Loan Party, (ii) take any action (not adverse to the priority status of the Liens of the Shared Collateral Agents or Shared Collateral Secured Parties on the Canadian Pledge Collateral in which the Shared Collateral Agents or Shared Collateral Secured Parties have a priority Lien or the rights of the Shared Collateral Agents or any of the Shared Collateral Secured Parties to exercise remedies in respect thereof) in order to create, perfect, preserve or protect (but not enforce) its Lien on any Canadian Pledge Collateral, (iii) file any necessary or responsive pleadings in opposition to any motion, adversary proceeding or other pleading filed by any Person objecting to or otherwise seeking disallowance of the claim or Lien of the ABL Agent or ABL Secured Parties, (iv) file any pleadings, objections, motions, or agreements which assert rights available to unsecured creditors of the Loan Parties arising under any Insolvency Proceeding or applicable non-bankruptcy law, (v) vote on any plan of reorganization or file any proof of claim in any Insolvency Proceeding of any Loan Party, or (vi) object to the proposed retention of Canadian Pledge Collateral by any Shared Collateral Agent or any Shared Collateral Secured Party in full or partial satisfaction of any Shared Collateral Obligations due to such Shared Collateral Agent or Shared Collateral Secured Parties, in each case (i) through (iv) and (vi) above to the extent not inconsistent with, or could not result in a resolution inconsistent with, the terms of this Agreement.

(d)In the event of any private or public sale of all or any portion of the Canadian Pledge Collateral (other than in connection with a refinancing as described in Section 5.2(d)) permitted by the Term Documents or consented to by the Required Lenders (as defined in the Term Credit Agreement) or, to the extent required by the Term Credit Agreement, the Term B-4 Required Lenders (as defined in the Term Credit Agreement), the ABL Agent agrees, on behalf of the ABL Secured Parties, that such sale will be free and clear of the Liens on such Canadian Pledge Collateral securing the ABL Obligations, and the ABL Agent’s and the ABL Secured Parties’ Liens with respect to the Canadian Pledge Collateral so sold, transferred, disposed or released shall terminate and be automatically released without further action concurrently with, and to the same extent as, the release of the Term Secured Parties’ Liens on such Canadian Pledge Collateral; provided that in the case of a disposition in connection with an Exercise of Secured Creditor Remedies with respect to any Canadian Pledge Collateral, any Proceeds thereof not applied to repay Shared Collateral Obligations shall be subject to the Liens

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securing the ABL Obligations and shall be applied pursuant to this Agreement. In furtherance of, and subject to, the foregoing, the ABL Agent agrees that it will promptly execute any and all Lien releases or other documents reasonably requested by the Term Agent in connection therewith. The ABL Agent hereby appoints the Term Agent and any officer or duly authorized person of the Term Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power of attorney in the place and stead of the ABL Agent and in the name of such ABL Agent or in the Term Agent’s own name, from time to time, in the Term Agent’s sole discretion, for the purposes of carrying out the terms of this paragraph, to take any and all appropriate action and to execute and deliver any and all documents and instruments as may be necessary or desirable to accomplish the purposes of this paragraph, including any financing statements, endorsements, assignments, releases or other documents or instruments of transfer (which appointment, being coupled with an interest, is irrevocable)..

Section 7.4Application of Proceeds; Turnover Provisions. Prior to the Discharge of Shared Collateral Obligations, the ABL Agent, each Additional Pari Passu Agent and the Term Agent hereby agree that all Canadian Pledge Collateral and all Proceeds thereof received by either of them or any ABL Secured Party, Additional Pari Passu Secured Party or Term Secured Party, respectively, in connection with any Exercise of Secured Creditor Remedies with respect to Canadian Pledge Collateral, whether or not pursuant to an Insolvency Proceeding, shall be distributed as follows: first, to the Term Agent on behalf of the Term B-4 Lenders for application to the Term Obligations with respect to the Term B-4 Loans in accordance with the terms of the Term Documents, until the Discharge of Term Obligations with respect to the Term B-4 Loans has occurred, second, ratably, to the Shared Collateral Agents on behalf of the Shared Collateral Secured Parties (other than the Term B-4 Lenders) for application to the Shared Collateral Obligations in accordance with the terms of the Shared Collateral Documents, until the Discharge of the Shared Collateral Obligations, third, to the ABL Agent on behalf of the ABL Secured Parties in accordance with the ABL Documents, until the Discharge of ABL Obligations has occurred and fourth the balance, if any, to the Loan Parties or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct; provided that in the event the ABL Agent receives, in connection with an Insolvency Proceeding, any Proceeds of any Canadian Pledge Collateral and the Lien granted in favor of each Shared Collateral Agent or the Shared Collateral Secured Parties in respect of such Canadian Pledge Collateral has been voided, avoided, subordinated, or otherwise invalidated by a court of competent jurisdiction and the provisions of Section 5.3 would not be effective, then such Proceeds received ABL Agent with respect to the Canadian Pledge Collateral subject to such avoidance, subordination or invalidation shall be applied, to the extent permitted under applicable law, to the payment of the ABL Obligations in accordance with the ABL Documents.

ARTICLE 8MISCELLANEOUS

Section 7.18.1Rights of Subrogation. The Shared Collateral Agents, on behalf of the Shared Collateral Secured Parties, agree that no payment to the ABL Agent or any ABL Secured Parties pursuant to the provisions of this Agreement in respect of ABL Collateral shall entitle the Shared Collateral Agents or any Shared Collateral Secured Party to exercise any rights of subrogation in respect thereof prior to the Discharge of ABL Obligations. Following the

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Discharge of ABL Obligations, the ABL Agent agrees to execute such documents, agreements, and instruments as the Shared Collateral Agents or any Shared Collateral Secured Party may reasonably request to evidence the transfer by subrogation to any such Person of an interest in the ABL Obligations resulting from payments to the ABL Agent by such Person, so long as all costs and expenses (including all reasonable legal fees and disbursements) incurred in connection therewith by the ABL Agent are paid by such Person upon request for payment thereof. The ABL Agent, on behalf of the ABL Secured Parties, agree that no payment to a Shared Collateral Agent or any Shared Collateral Secured Parties pursuant to the provisions of this Agreement in respect of Canadian Pledge Collateral shall entitle the ABL Agent or any ABL Secured Party to exercise any rights of subrogation in respect thereof prior to the Discharge of Shared Collateral Obligations.

Section 7.28.2Further Assurances. The Parties will, at their own expense and at any time and from time to time, promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or desirable, or that any Party may reasonably request, in order to protect any right or interest granted or purported to be granted hereby or to enable the ABL Agent or the Shared Collateral Agents to exercise and enforce its rights and remedies hereunder; provided, however, that no Party shall be required to pay over any payment or distribution, execute any instruments or documents, or take any other action referred to in this Section 7.28.2, to the extent that such action would contravene any law, order or other legal requirement or any of the terms or provisions of this Agreement, and in the event of a controversy or dispute, such Party may interplead any payment or distribution in any court of competent jurisdiction, without further responsibility in respect of such payment or distribution under this Section 7.28.2.

Section 7.38.3Representations. The Term Agent represents and warrants to the ABL Agent and each other Shared Collateral Agent that it has the requisite power and authority under the Term Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the Term Secured Parties and that this Agreement shall be binding obligations of the Term Agent and the Term Secured Parties, enforceable against the Term Agent and the Term Secured Parties in accordance with its terms. The ABL Agent represents and warrants to the Shared Collateral Agents that it has the requisite power and authority under the ABL Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the ABL Secured Parties and that this Agreement shall be binding obligations of the ABL Agent and the ABL Secured Parties, enforceable against the ABL Agent and the ABL Secured Parties in accordance with its terms. The Notes Agent represents and warrants to the ABL Agent and each other Shared Collateral Agent that pursuant to authority granted in Article 11 of the Indenture it has the requisite power and authority under the Notes Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the Notes Secured Parties and that this Agreement shall be binding obligations of the Notes Agent and the Notes Secured Parties, enforceable against the Notes Agent and the Notes Secured Parties in accordance with its terms.By executing a joinder agreement in the form of Exhibit A hereto, the Additional Pari Passu Agent represents and warrants to the ABL Agent and each other Shared Collateral Agent that it has the requisite power and authority under the Additional Pari Passu Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of the Additional Pari Passu Secured Parties and that this Agreement shall be binding obligations of the Additional Pari Passu

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Agent and the Additional Pari Passu Secured Parties, enforceable against the Additional Pari Passu Agent and the Additional Pari Passu Secured Parties in accordance with its terms

Section 7.48.4Amendments. No amendment or waiver of any provision of this Agreement nor consent to any departure by any Party hereto shall be effective unless it is in a written agreement executed by each Shared Collateral Agent and the ABL Agent and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

Section 7.58.5Addresses for Notices. Unless otherwise specifically provided herein, any notice or other communication herein required or permitted to be given shall be in writing and may be personally served, faxed, or sent by overnight express courier service or United States mail and shall be deemed to have been given when delivered in person or by courier service, upon receipt of a telecopy or five (5) days after deposit in the United States mail (certified, with postage prepaid and properly addressed). For the purposes hereof, the addresses of the parties hereto (until notice of a change thereof is delivered as provided in this Section) shall be as set forth below or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties.

ABL Agent: Bank of America, N.A.
40 Broad Street
Boston, Massachusetts 02109
Attention: Betsy Ratto

Term Agent: Bank of America, N.A.
101 South Tryon Street
Charlotte, North Carolina 28255
Tel: (980) 387-5452
Fax: (704) 208-2871
Attn: Kelly T. Weaver

Notes Agent: The Bank of New York Mellonc/o The Bank of New York Mellon Trust Company, N.A.525 William Penn Place38th FloorPittsburgh, PA 15259Tel: (412) 236-1196Fax: (412) 234-7571Attn: Global Corporate Trust - Toys “R” US - Delaware

Section 7.68.6No Waiver, Remedies. No failure on the part of any Party to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.

Section 7.78.7Continuing Agreement, Transfer of Secured Obligations. This Agreement is a continuing agreement and shall (a) remain in full force and effect until the Discharge of ABL Obligations and the Discharge of the Shared Collateral Obligations shall have

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occurred, (b) be binding upon the Parties and their successors and assigns, and (c) inure to the benefit of and be enforceable by the Parties and their respective successors, transferees and assigns. Nothing herein is intended, or shall be construed to give, any other Person any right, remedy or claim under, to or in respect of this Agreement or any ABLShared Collateral. All references to any Loan Party shall include any Loan Party as debtor-in-possession and any receiver or trustee for such Loan Party in any Insolvency Proceeding. Without limiting the generality of the foregoing clause (c), the ABL Agent, any ABL Lender, the Term Agent, or any Term Lender, the Notes Agent or any Notes Secured Party and theand any Additional Pari Passu Agent or any Additional Pari Passu Secured Party may assign or otherwise transfer all or any portion of the ABL Obligations, the Term Obligations, NotesObligations or the Additional Pari Passu Obligations, as applicable, to any other Person (other than any Loan Party or any Affiliate of a Loan Party and any Subsidiary of a Loan Party), and such other Person shall thereupon become vested with all the rights and obligations in respect thereof granted to the ABL Agent, the Term Agent, the Notes Agent, theAdditional Pari Passu Agent, any ABL Lender, any Term Lender, any Notes Secured Partyor any Additional Pari Passu Secured Party, as the case may be, herein or otherwise. The ABL Secured Parties, the Term Secured Parties, the Notes Secured Partyand the Additional Pari Passu Secured Parties (if any) may continue, at any time and without notice to the other parties hereto, to extend credit and other financial accommodations, lend monies and provide Indebtedness to, or for the benefit of, any Loan Party on the faith hereof.

Section 7.88.8Governing Law; Entire Agreement. The validity, performance, and enforcement of this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. This Agreement constitutes the entire agreement and understanding among the Parties with respect to the subject matter hereof and supersedes any prior agreements, written or oral, with respect thereto.

Section 7.98.9Counterparts. This Agreement may be executed in any number of counterparts, including by means of facsimile or “pdf”’ file thereof, and it is not necessary that the signatures of all Parties be contained on any one counterpart hereof, each counterpart will be deemed to be an original, and all together shall constitute one and the same document.

Section 7.108.10No Third Party Beneficiaries. This Agreement is solely for the benefit of the ABL Agent, ABL Secured Parties, the Term Agent, Term Secured Parties, the Notes Agent and the Notes Secured Partiesand the Additional Pari Passu Agent and the Additional Pari Passu Secured Parties (if any). No other Person (including any Loan Party or any Affiliate of a Loan Party, or any Subsidiary of a Loan Party) shall be deemed to be a third party beneficiary of this Agreement.

Section 7.118.11Headings. The headings of the articles and sections of this Agreement are inserted for purposes of convenience only and shall not be construed to affect the meaning or construction of any of the provisions hereof.

Section 7.128.12Severability. If any of the provisions in this Agreement shall, for any reason, be held invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Agreement and shall not invalidate

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the Lien Priority or the application of Proceeds and other priorities set forth in this Agreement. The Parties hereto shall endeavor in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions, the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

Section 7.138.13Attorneys Fees. The Parties agree that if any dispute, arbitration, litigation, or other proceeding is brought with respect to the enforcement of this Agreement or any provision hereof, the prevailing party in such dispute, arbitration, litigation, or other proceeding shall be entitled to recover its reasonable attorneys’ fees and all other costs and expenses incurred in the enforcement of this Agreement, irrespective of whether suit is brought.

Section 7.148.14VENUE; JURY TRIAL WAIVER.

(a)    EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

(b)    EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF SUCH STATE, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OR ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY ABL SECURED PARTY OR ANY SHARED COLLATERAL SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, ANY ABL DOCUMENTS OR ANY TERM DOCUMENTS AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

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(c)    EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OR ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT. EACH PARTY HERETO REPRESENTS THAT IT HAS REVIEWED THIS WAIVER AND IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

(d)    EACH PARTY HERETO HEREBY IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 7.58.5. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

Section 7.158.15Intercreditor Agreement. This Agreement is the Intercreditor Agreement or the Shared Collateral Intercreditor Agreement, as the case may be, referred to in the ABL Credit Agreement, the Term Credit Agreement, the Indenture and the Additional Pari Passu Agreement (if any). Nothing in this Agreement shall be deemed to subordinate the obligations due to (i) any ABL Secured Party to the obligations due to any Shared Collateral Secured Party or (ii) any Shared Collateral Secured Party to the obligations due to any ABL Secured Party (in each case, whether before or after the occurrence of an Insolvency Proceeding), it being the intent of the Parties that this Agreement shall effectuate a subordination of Liens but not a subordination of Indebtedness.

Section 7.168.16No Warranties or Liability. The Term Agent, the NotesAgent, the Additional Pari Passu Agent (if any) and the ABL Agent acknowledge and agree that none of them have made any representation or warranty with respect to the execution, validity, legality, completeness, collectibility or enforceability of any other ABL Document, Term Document, Notes Documentor Additional Pari Passu Document. Except as otherwise provided in this Agreement, the Term Agent, the NotesAgent, the Additional Pari Passu Agent and the ABL Agent will be entitled to manage and supervise their respective extensions of credit to any Loan Party in accordance with law and their usual practices, modified from time to time as they deem appropriate.

Section 7.178.17Conflicts. In the event of any conflict between the provisions of this Agreement and the provisions of any ABL Document, any Term Document, any Notes Document or any Additional Pari Passu Document, the provisions of this Agreement shall govern.

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Section 7.188.18Information Concerning Financial Condition of the Loan Parties. The Term Agent, the NotesAgent, Additional Pari Passu Agent (if any) and the ABL Agent hereby agree that no party shall have any duty to advise any other party of information known to it regarding such condition or any such circumstances. In the event the Term Agent, the NotesAgent, the Additional Pari Passu Agent (if any) or the ABL Agent, in its sole discretion, undertakes at any time or from time to time to provide any information to any other party to this Agreement, (a) it shall be under no obligation (i) to provide any such information to such other party or any other party on any subsequent occasion, (ii) to undertake any investigation not a part of its regular business routine, or (iii) to disclose any other information, or (b) it makes no representation as to the accuracy or completeness of any such information and shall not be liable for any information contained therein, and (c) the Party receiving such information hereby to hold the other Party harmless from any action the receiving Party may take or conclusion the receiving Party may reach or draw from any such information, as well as from and against any and all losses, claims, damages, liabilities, and expenses to which such receiving Party may become subject arising out of or in connection with the use of such information.

Section 7.198.19Amendment, Restatement, Extension, Renewal and Consolidation of Existing Intercreditor Agreement. This Agreement shall be deemed to amend and restate the Existing Intercreditor Agreement and all terms and provisions of this Agreement supersede in their entirety the terms and provisions of the Existing Intercreditor Agreement.

Section 7.208.20Force Majeure. In no event shall the Term Agent, NotesAgent, the Additional Pari Passu Agent (if any) and the ABL Agent be responsible or liable for any failure or delay in the performance of their obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services, it being understood that the Term Agent, Notes Agent,the Additional Pari Passu Agent (if any) and the ABL Agent shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

Section 7.21    Authority of Notes Collateral Agent. The Bank of New York Mellon has been appointed by the Notes Agent for the Notes Secured Parties pursuant to Article 11 of the Indenture. It is expressly understood and agreed by the parties to this Agreement that any authority conferred upon the Notes Agent hereunder is subject to the terms of the delegation of authority made by the holders of the Notes Secured Party to the Notes Collateral Agent pursuant to the Indenture, and that the Notes Agent has agreed to act (and any successor Notes Agent shall act) as such hereunder only on the express conditions contained in such Article 11. Any successor Notes Agent appointed pursuant to Article 11 of the Indenture shall be entitled to all rights, interests and benefits of the Notes Agent hereunder.

[Signature pages follow]

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IN WITNESS WHEREOF, the ABL Agent, for and on behalf of itself and the ABL Lenders, and the Term Agent, for and on behalf of itself and the Term Lendersand the NotesAgent, for and on behalf of itself and theNotesSecured Parties, have caused this Agreement to be duly executed and delivered as of the date first above written.

BANK OF AMERICA, N.A., in its capacity as the ABL Agent

By: ______________________________________

Name:
Title:

BANK OF AMERICA, NA.A., in its capacity as the Term Agent

By: ______________________________________

Name: Title:

THE BANK OF NEW YORK MELLON, in its capacity as the Notes Agent

By: ______________________________________

Name:
Title:

[Signature Page to Intercreditor Agreement]

[Signature Page to Intercreditor Agreement]

ACKNOWLEDGMENT

Each ABL Loan Party and each Shared Collateral Loan Party hereby acknowledge that it has received a copy of this Agreement and consents thereto, agrees to recognize all rights granted thereby to the ABL Agent, the ABL Secured Parties, the Shared Collateral Agents, and the Shared Collateral Secured Parties and will not do any act or perform any obligation which is not in accordance with the agreements set forth in this Agreement. Each ABL Loan Party and each Shared Collateral Loan Party further acknowledge and agrees that it is not an intended beneficiary or third party beneficiary under this Agreement and (i) as between the ABL Secured Parties and the ABL Loan Parties, the ABL Documents remain in full force and effect as written and are in no way modified hereby, (ii) as between the Term Secured Parties and the Term Loan Parties, the Term Documents remain in full force and effect as written and are in no way modified hereby, and (iii) as between the Notes Secured Parties and the Notes Parties, the Notes Documents remain in full force and effect as written and are in no way modified hereby and (iv) as between the Additional Pari Passu Secured Parties and the NotesAdditional Pari Passu Parties, the Additional Pari Passu Documents remain in full force and effect as written and are in no way modified hereby.

[Signature Pages Follow]

TOYS “R” US-DELAWARE, INC., as the ABL Lead Borrower,and the Term Borrower and Notes Issuer

By:______________________________________

Name:
Title:

GEOFFREY, LLC, as a Term Guarantor and a Notes Guarantor

By: ______________________________________

Name:
Title:

GEOFFREY HOLDINGS, LLC, as an ABL Guarantor,and a Term Guarantor and a Notes Guarantor

By: TOYS “R” US-DELAWARE, INC.,
its sole member

By: ______________________________________

Name:
Title:

TOYS ACQUISITIONGEOFFREY, LLC,, as an ABL Guarantor,a Term Guarantor and a Notes Guarantor

By: ______________________________________

Name:
Title:

GEOFFREY INTERNATIONAL, LLC, as a Term Guarantor and a Notes Guarantor

By: Geoffrey, LLC, its sole member

By: ______________________________________

Name:
Title:

TRU OF PUERTO RICO, INC.TRU-SVC, LLC, as an ABL Guarantor,and a Term Guarantor and a Notes Guarantor

By: ______________________________________

Name:
Title:

TRU-SVCTOYS ACQUISITION, LLC, as an ABL Guarantor,and a Term Guarantor and a Notes Guarantor

By: ______________________________________

Name:
Title:

TRU OF PUERTO RICO, INC., as an ABL Guarantor and a Term Guarantor

By:______________________________________

Name:
Title:

EXHIBIT A

JOINDER

Reference is hereby made to the Intercreditor Agreement, dated as of August 24, 2010 (as amended, restated, supplemented or otherwise modified from time to time, the “Agreement”), among the agents referred to therein, to which this Joinder is attached. All capitalized terms not otherwise defined herein shall have the meanings assigned to such terms in the Agreement when used herein. The undersigned, in its capacity as [ABL Agent] [Notes Agent] [Term Agent] [Additional Pari Passu Agent] hereby acknowledges the terms and conditions of the Agreement and agrees to be bound thereby. [For all purposes of the Agreement, [identify agreement] shall be an Additional Pari Passu Agreement thereunder.]

[ABL Agent] [NotesAgent] [Term Agent] [Additional Pari Passu Agent]

By:________________________________Name:_____________________________Title:_______________________________

By: _________________________________

Name:_______________________________

Title:________________________________

ANNEX 3

[SEE ATTACHED]

Annex 3

AMENDED AND RESTATED SECURITY AGREEMENT

AMENDED AND RESTATED SECURITY AGREEMENT (this “Agreement”), dated as of August 24, 2010, by and among:

Toys “R” Us-Delaware, Inc., a Delaware corporation (the “Borrower”);

the other Grantors identified on the signature pages hereto (each such Person, individually, a “Grantor; (the Borrower and each Guarantor are hereinafter referred to individually as a “Grantor” and the Borrower and the other Grantors are hereinafter referred to collectively as the “Grantors”); and

BANK OF AMERICA, N.A., having a place of business at One Independence Center, 101 North Tryon Street, Charlotte, North Carolina 28255,as administrative agent and as collateral agent for its own benefit and the benefit of the other Secured Parties (in such capacityiesand together with its permitted successors and assigns, the “Administrative Agent”).

WITNESSETH:

WHEREAS, reference is made to that certain Credit Agreement, dated as of July 19, 2006 (the “Existing Credit Agreement”), as amended and restated as of the date hereof (as may be further modified, amended, supplemented or restated and in effect from time to time, the “Credit Agreement”), by and among (i) Toys “R” Us-Delaware, Inc., as the Borrower, (ii) the Administrative Agent, (iii) the Lenders party thereto (the “Lenders”) and (iv) the other agents and parties thereto, pursuant to which the Lenders have agreed to make Loans to the Borrower upon the terms and subject to the conditions specified therein; and

WHEREAS, the Credit Agreement shall provide for, among other things, the addition thereunder of one or more tranches of New Loans pursuant to Section 2.12 thereto, and on any Increased Amount Date on which New Loan Commitments are effective, each New Loan Lender with such a New Loan Commitment shall become a Lender with New Loans ranking pari passu in right of payment and security with the Initial Loans including, without limitation, by each such new Lender being automatically deemed a Secured Party for purposes of this Agreement; and

WHEREAS, reference is made to that certain Guarantee, dated as of July 19, 2006, in favor of the Administrative Agent and the other Secured Parties (as modified, amended, supplemented or restated and in effect from time to time, the “Guarantee”), pursuant to which each Guarantor guarantees the Secured Obligations (as defined in the Credit Agreement); and

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WHEREAS, reference is made to that certain Security Agreement, dated as of July 19, 2006 (as modified, amended, supplemented or restated and in effect from time to time, the “Existing Security Agreement”), pursuant to which each Grantor thereunder granted security interests to Banc of America Bridge, LLC (as predecessor to Bank of America, N.A., in its capacity as administrative agent for the Lendersand collateral agent for the Secured Parties) and its successors and assigns, for its own benefit and for the benefit of the Secured Parties; and

WHEREAS, the obligations of the Lenders to make Loans are each conditioned on, among other things, the execution and delivery by the Grantors of an agreement in the form hereof to secure the Secured Obligations; and

WHEREAS, the parties hereto wish to amend and restate the Existing Security Agreement in its entirety to allow for the Amendment Transactions, (a) this Agreement shall be deemed to amend, restate and supersede the Existing Security Agreement, except that (1) the grants of security interests and Liens under and pursuant to the Existing Security Agreement shall continue unaltered, and each other Security Document shall continue in full force and effect in accordance with its terms, and the parties hereto hereby ratify and confirm the terms thereof as being in full force and effect and unaltered by this Agreement except to the extent expressly amended or modified by amendments thereto entered into in connection with the Amendment Transactions to provide for, among other things, the Secured Notes and (2) all schedules, annexes, appendices and exhibits to the Existing Security Agreement shall be incorporated by reference herein, mutatis mutandis, except for, and to the extent expressly amended and restated in connection herewith; (b) all Existing Obligations (including all indemnities) under the Existing Credit Agreement and the other Credit Documents shall continue to be outstanding except as expressly modified by the Credit Agreement and shall be governed in all respects by the Credit Agreement, this Agreement and the other Credit Documents; and (c) all references to the Existing Security Agreement in this Agreement or other document or instrument delivered in connection therewith shall be deemed to refer to this Agreement and the provisions hereof.

NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in this Agreement, and for good and valuable consideration, the receipt of which is hereby acknowledged, the Grantors and the Administrative Agent hereby agree as follows:

ARTICLE I.Definitions

SECTION 1.1.    Generally. All references herein to the UCC shall mean the Uniform Commercial Code as in effect from time to time in the State of New York; provided, however, that if a term is defined in Article 9 of the UCC differently than in another Article thereof, the term shall have the meaning set forth in Article 9; providedfurther that if by reason of mandatory provisions of law, perfection, or the effect of perfection or non-perfection, of the

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Security Interest in any Collateral or the availability of any remedy hereunder is governed by the Uniform Commercial Code as in effect in a jurisdiction other than New York, “UCC” means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or effect of perfection or non-perfection or availability of such remedy, as the case may be.

SECTION 1.2.    Definition of Certain Terms Used Herein. Unless the context otherwise requires, all capitalized terms used but not defined herein shall have the meanings set forth in the Credit Agreement. In addition, the following terms shall have the following meanings:

“ABL Agent” shall mean Bank of America, N.A., in its capacity as Collateral Agent under the ABL Credit Agreement and its successors and assigns.

“ABL Collateral” shall have the meaning given that term in the ABL Intercreditor Agreement.

“ABL Credit Agreement” shall mean that certain Third Amended and Restated Credit Agreement, dated as of JulyMarch 21, 2005, as amended and restated as of June 24, 2009 and as further amended and restated as of August 10, 20102014 (as modified, amended, supplemented, restated or replaced and in effect from time to time), by and among (i) Toys “R” Us-Delaware, Inc., as the Lead Borrower for the borrowers party thereto, (ii) the facility guarantors party thereto, (iii) Bank of America, N.A., as administrative agent, (iv) Bank of America, N.A. (acting through its Canada branch), as Canadian agent for its own benefit and the benefit of the other “Secured Parties” thereunder (and as defined therein), (v) the lenders party thereto and (vi) the other agents and parties thereto.

“ABL Intercreditor Agreement” shall have the meaning given that term in the Credit Agreement.

“Accessions” shall have the meaning given that term in the UCC.

“Account Debtor” shall have the meaning given that term in the UCC and shall include any Person who is or who may become obligated to any Grantor under, with respect to or on account of an Account.

“Accounts” shall mean “accounts” as defined in the UCC, and also means a right to payment of a monetary obligation, whether or not earned by performance, (a) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (b) for services rendered or to be rendered, or (c) arising out of the use of a credit or charge card or information contained on or for use with the card.

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“Agent’s Rights and Remedies” shall have the meaning provided in Section 8.8.

“Amendment Transactions” shall have the meaning given that term in the Credit Agreement.

“Blue Sky Laws” shall have the meaning provided in Section 6.1.

“Borrower” shall have the meaning provided in the preliminary statement of this Agreement.

“Canadian Pledge Collateral” shall mean all of the following Collateral of each Grantor (other than Geoffrey) now owned or hereafter acquired: (a) 65% of the voting Equity Interest and 100% of the non-voting Equity Interest in Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee; and (b) all stock certificates, dividends, distributions, rights and proceeds of or relating to the foregoing.

“Chattel Paper” shall have the meaning given that term in the UCC.

“Collateral” shall mean all of the following personal property of each Grantor (other than Geoffrey)now owned or hereafter acquired: (a) Accounts, (b) Chattel Paper, (c) Commercial Tort Claims, (d) Deposit Accounts, (e) Documents, (f) Equipment, (g) General Intangibles (including Payment Intangibles and Intellectual Property), (h) Goods, (i) Instruments, (j) Inventory, (k) Investment Property, (l) Letter-of-Credit Rights, (m) Software, (n) Supporting Obligations, (o) money, policies and certificates of insurance, deposits, cash or other property, (p) all books, records, and information relating to any of the foregoing and/or to the operation of any Grantor’s business, and all rights of access to such books, records, and information, and all property in which such books, records, and information are stored, recorded and maintained, (q) all insurance proceeds, refunds, and premium rebates, including, without limitation, proceeds of fire and credit insurance, whether any of such proceeds, refunds, and premium rebates arise out of any of the foregoing ((a) through (p)) or otherwise, (r) all liens, guaranties, rights, remedies, and privileges pertaining to any of the foregoing ((a) through (q)), including the right of stoppage in transit, (s) all other personal property of every kind and nature of each Grantor, and (t) any of the foregoing whether now owned or now due, or in which any Grantor has an interest, or hereafter acquired, arising, or to become due, or in which any Grantor obtains an interest, and all products, Proceeds, substitutions, and Accessions of or to any of the foregoing; provided, however, that the Collateral shall not include the Excluded Collateral.

“Commercial Tort Claim” shall have the meaning given that term in the UCC.

“Control” shall have the meaning given that term in the UCC.

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“Credit Agreement” shall have the meaning given that term in the preliminary statement of this Agreement.

“Deposit Account” shall have the meaning given that term in the UCC.

“Discharge of ABL Obligations” shall have the meaning given that term in the ABL Intercreditor Agreement.

“Documents” shall have the meaning given that term in the UCC.

“Domestic Subsidiary” shall mean “Domestic Subsidiary” as such term is used and defined in the Indentures.

“Electronic Chattel Paper” shall have the meaning given that term in the UCC.

“Equipment” shall mean “equipment” as defined in the UCC, and any and all Accessions or additions thereto or substitutions therefor. The term “Equipment” shall not include Fixtures.

“Excluded Collateral” shall mean (a) any rights or property acquired under a lease, contract, property rights agreement or license, the grant of a security interest in which shall constitute or result in (i) the abandonment, invalidation or unenforceability of any right, title or interest of any Grantor therein or (ii) a breach or termination pursuant to the terms of, or a default under, any lease, contract, property rights agreement or license (other than to the extent that any restriction on such assignment would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other Applicable Law or principles of equity); provided that the proceeds therefrom shall not be excluded from the definition of Collateral to the extent that the assignment of such proceeds is not prohibited, (b) any governmental permit or franchise that prohibits Liens on or collateral assignments of such permit or franchise, (c) any Instrument evidencing indebtedness (defined consistently with such term as used in the Indentures) of any Domestic Subsidiary, (d) any Security or other equity interest representing more than 65% of the outstanding voting stock of any Foreign Subsidiary, (e) any Security or other equity interest representing any ownership interest in any Domestic Subsidiary, (f) any Security or other equity interest representing any ownership interest in TRU of Puerto Rico, Inc., SALTRU Associates JV or ZT-Winston-Salem Associates, (g) the Designated Account (as defined in the ABL Credit Agreement) and any and all deposits, cash or other property in such account and (h) Fixtures.

“Excluded Geoffrey Collateral” shall mean (a) any rights or property acquired under a lease, contract, property rights agreement or license, the grant of a security interest in which shall constitute or result in (i) the abandonment, invalidation or

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unenforceability of any right, title or interest of any Grantor therein or (ii) a breach or termination pursuant to the terms of, or a default under, any lease, contract, property rights agreement or license (other than to the extent that any restriction on such assignment would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other Applicable Law or principles of equity); provided that the proceeds therefrom shall not be excluded from the definition of Collateral to the extent that the assignment of such proceeds is not prohibited, (b) any governmental permit or franchise that prohibits Liens on or collateral assignments of such permit or franchise, (c) any Instrument evidencing indebtedness (it being understood such term is defined consistently with such term as used in the Indentures) of any Domestic Subsidiary, (d) any Security or other equity interest representing more than 65% of the outstanding voting stock of any Foreign Subsidiary, (e) any Security or other equity interest representing any ownership interest in any Domestic Subsidiary, (f) any Security or other equity interest representing any ownership interest in TRU of Puerto Rico, Inc., SALTRU Associates JV or ZT-Winston-Salem Associates and (g) Fixtures.

“Existing Credit Agreement” shall have the meaning given that term in the preliminary statement of this Agreement.

“Existing Security Agreement” shall have the meaning given that term in the preliminary statement of this Agreement.

“Financing Statement” shall have the meaning given that term in the UCC.

“Fixtures” shall have the meaning given that term in the UCC.

“Foreign Subsidiary” shall mean, as to any Grantor, a Subsidiary that is organized under the laws of any jurisdiction other than the United States of America or any state thereof or the District of Columbia.

“General Intangibles” shall have the meaning given that term in the UCC, and shall also include, without limitation, all: Intellectual Property; Payment Intangibles; rights to payment for credit extended; deposits; amounts due to any Grantor; credit memoranda in favor of any Grantor; warranty claims; tax refunds and abatements; insurance refunds and premium rebates; all means and vehicles of investment or hedging, including, without limitation, options, warrants, and futures contracts; records; customer lists; telephone numbers; goodwill; causes of action; judgments; payments under any settlement or other agreement; literary rights; rights to performance; royalties; license and/or franchise fees; rights of admission; licenses; franchises; license agreements, including all rights of any Grantor to enforce same; permits, certificates of convenience and necessity, and similar rights granted by any governmental authority; internet addresses and domain names; developmental ideas and concepts; proprietary processes;

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blueprints, drawings, designs, diagrams, plans, reports, and charts; catalogs; technical data; computer software programs (including the source and object codes therefor), computer records, computer software, rights of access to computer record service bureaus, service bureau computer contracts, and computer data; tapes, disks, semi conductors chips and printouts; user, technical reference, and other manuals and materials; proposals; cost estimates, and reproductions on paper, or otherwise, of any and all concepts or ideas, and any matter related to, or connected with, the design, development, manufacture, sale, marketing, leasing, or use of any or all property produced, sold, or leased, by or credit extended or services performed, by any Grantor, whether intended for an individual customer or the general business of any Grantor, or used or useful in connection with research by any Grantor; provided that “General Intangibles” shall not include any indebtedness (defined consistently with such term as used in the Indentures) of any Domestic Subsidiary.

“Geoffrey” shall mean Geoffrey, LLC, a Delaware corporationlimited liability company.

“Geoffrey Collateral” shall mean all of the following personal property of Geoffreynow owned or hereafter acquired: (a) General Intangibles comprised of Intellectual Property, (b) all books, records, and information relating to any of the foregoing and all rights of access to such books, records, and information, and all property in which such books, records, and information are stored, recorded and maintained, (c) all liens, guaranties, rights, remedies, and privileges pertaining to any of the foregoing ((a) through ((b)), and (d) any of the foregoing whether now owned or now due, or in which Geoffrey has an interest, or hereafter acquired, arising, or to become due, or in which Geoffrey obtains an interest, and all products, Proceeds, substitutions, and Accessions of or to any of the foregoing; provided, however, that the Geoffrey Collateral shall not include the Excluded Geoffrey Collateral.

“Goods” shall have the meaning given that term in the UCC.

“Grantor” shall have the meaning given that term in the preliminary statement of this Agreement.

“Guarantee” shall have the meaning given that term in the preliminary statement of this Agreement.

“Indemnitee” shall have the meaning given that term in Section 8.6.

“Instruments” shall have the meaning given that term in the UCC; provided that “Instruments” shall not include any Instrument evidencing indebtedness of any Domestic Subsidiary.

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“Intellectual Property” shall mean (a) the Intercompany Licenses and (b) all of the following owned by any Grantor (including Geoffrey): all (i) patents, patent applications and patents pending; (ii) trade secret rights; (iii) copyrights and copyright applications, including mask work rights and derivative works; (iv) trade names, trademarks, trademark applications, service marks, and service mark applications; (v) Proprietary Marks and (vi) all other general intangible property in the nature of intellectual property recognized by the laws of the United States; provided that any “intent to use” trademark applications for which a statement of use has not been filed with the United States Patent and Trademark Office pursuant to Section 1(c) or Section 1(d) of the Lanham Act (15 U.S.C. 1051, et seq.) (but only until such statement is filed and accepted by the United States Patent and Trademark Office) are excluded from this definition.

“Intercompany Licenses” shall mean the license agreements described on Exhibit A hereto between certain of the Grantors and Geoffrey, pursuant to which Geoffrey has granted to such Grantors licenses of the Proprietary Marks.

“Intercreditor Agreements” shall have the meaning given that term in the Credit Agreement.

“Inventory” shall have the meaning given that term in the UCC, and shall also include, without limitation, all (a) Goods which (i) are leased by a Person as lessor, (ii) are held by a Person for sale or lease or to be furnished under a contract of service, (iii) are furnished by a Person under a contract of service, or (iv) consist of raw materials, work in process, or materials used or consumed in a business; (b) Goods of said description in transit; (c) Goods of said description which are returned, repossessed or rejected; (d) packaging, advertising, and shipping materials related to any of the foregoing; (e) all names, marks, and General Intangibles affixed or to be affixed thereto or associated therewith; and (f) Documents which represent any of the foregoing.

“Investment Property” shall have the meaning given that term in the UCC; provided that “Investment Property” (a) shall not include any Security representing more than 65% of the outstanding voting stock of any Foreign Subsidiary, (b) shall not include any Security representing any ownership interest in any Domestic Subsidiary and (c) shall not include any Security or other equity interest representing any ownership interest in TRU of Puerto Rico, Inc., SALTRU Associates JV or ZT-Winston-Salem Associates.

“Lenders” shall have the meaning provided in the preliminary statement of this Agreement.

“Letter-of-Credit Right” shall have the meaning given that term in the UCC.

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“Liquidation” means the exercise by the Agents of those rights and remedies accorded to the Agents under the Loan Documents and Applicable Law as a creditor of the Loan Parties, including (after the occurrence and during the continuation of an Event of Default) the conduct by the Borrower, acting with the consent of the Administrative Agent, of any public, private or “Going-Out-Of-Business Sale” or other disposition of Collateral for the purpose of liquidating the Collateral. Derivations of the word “Liquidation” (such as “Liquidate”) are used with like meaning in this Agreement.

“Non-Term B-4 Obligations” shall mean the Obligations whether now existing or hereafter arising, other than the Term B-4 Obligations.

“Non-Term B-4 Secured Parties” shall mean the Secured Parties other than the Term B-4 Lenders.

“Obligations” shall mean collectively, the “Secured Obligations” (as defined in the Credit Agreement).

“Payment Intangible” shall have the meaning given that term in the UCC.

“Perfection Certificate” shall mean a certificate substantially in the form of Annex 1 hereto, dated the date hereof, completed and supplemented with the schedules and attachments contemplated thereby, and duly executed by a Responsible Officer of each of the Grantors.

“Proceeds” shall include, without limitation, “Proceeds” as defined in the UCC and each type of property described in the definition of Collateral.

“Proprietary Marks” shall mean any and all United States trademarks (including any copyrights that exist in such trademarks, but excluding all other copyrights), service marks, trade names, corporate names, company names, business names, fictitious business names, trade dress, trade styles, designs, logos and other source or business identifiers, whether registered or unregistered, which are owned or licensed, now or in the future, by Geoffrey, including, but not limited to, as of the date hereof, the United States Proprietary Marks set forth on Exhibit B annexed hereto.

“Securities Act” shall have the meaning provided in Section 6.1.

“Security” shall have the meaning given that term in the UCC.

“Security Interest” shall have the meaning provided in Section 2.1.

“Software” shall have the meaning given that term in the UCC.

“Supporting Obligation” shall have the meaning given that term in the UCC .

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“Term B-4 Obligations” shall mean all Obligations whether now existing or hereafter arising payable to the Term B-4 Lenders in respect of the Term B-4 Loans.

SECTION 1.3.    Rules of Interpretation. The rules of interpretation specified in Section 1.02 of the Credit Agreement shall be applicable to this Agreement.

ARTICLE II.Security Interest

SECTION 2.1.    Security Interest. As security for the payment or performance, as the case may be, in full of their respective Obligations, (a) Geoffrey hereby grants to the Administrative Agent, its successors and assigns, for the benefit of the Secured Parties, a first prioritysecurity interest in all of Geoffrey’s right, title and interest in, to and under the Geoffrey Collateral and (b) each other Grantor hereby grants to the Administrative Agent, its successors and assigns, for the benefit of the Secured Parties, a second prioritysecurity interest in all of such Grantor’s right, title and interest in, to and under the Collateral, in each case of clauses (a) and (b), wherever located, whether now owned or hereafter acquired or arising (the “Security Interest”); provided that the sSecurity iInterest granted to the Administrative Agent in, to and under Intercompany Licenses shall be limited to the non-exclusive right to use the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with a Liquidation. For the avoidance of doubt, as security for the payment or performance, as the case may be, in full of their respective Term B-4 Obligations, each Grantor (other than Geoffrey) hereby grants to the Administrative Agent, its successors and assigns, for the benefit of the Term B-4 Lenders, a security interest in all of such Grantor’s right, title and interest in, to and under the Canadian Pledge Collateral, wherever located, whether now owned or hereafter acquired or arising. Without limiting the foregoing, each Grantor hereby designates the Administrative Agent as such Grantor’s true and lawful attorney, exercisable by the Administrative Agent whether or not an Event of Default exists, with full power of substitution, at the Administrative Agent’s option, to file one or more Financing Statements, continuation statements, or to sign other documents for the purpose of perfecting, confirming or continuing the Security Interest granted by each Grantor, without the signature of any Grantor (each Grantor hereby appointing the Administrative Agent as such Person’s attorney to sign such Person’s name to any such instrument or document, whether or not an Event of Default exists), and naming any Grantor or the Grantors as debtors and the Administrative Agent as secured party.Notwithstanding anything herein to the contrary, in no event shall the Collateral or the Geoffrey Collateral include, and no Grantor shall be deemed to have assigned, pledged or granted a Security Interest in, any of such Grantor’s right, title or interest (A) in any asset where the grant of a Lien over such asset as reasonably determined by the Borrower (in consultation with the Administrative Agent) would result in material adverse tax consequences to any Grantor, (B) in any motor vehicles and other assets subject to certificate of title or (C) any Commercial Tort Claim with a value of less than $1,000,000.

SECTION 2.2.    No Assumption of Liability. The Security Interest is granted as security

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only and shall not subject the Administrative Agent or any other Secured Party to, or in any way alter or modify, any obligation or liability of, any Grantor with respect to or arising out of the Collateral or the Geoffrey Collateral.

ARTICLE III.Representations and Warranties

The Grantors jointly and severally represent and warrant to the Administrative Agent and the Secured Parties that:

SECTION 3.1.    Filings. The Perfection Certificate has been duly prepared, completed and executed, and the information set forth therein is correct and complete in all material respects as of the date hereof. Subject to the proviso to Section 4.3, UCC Financing Statements or other appropriate filings, recordings or registrations containing a description of the Collateral and the Geoffrey Collateral (including, without limitation, the UCC Financing Statements identified on Schedule 3.2 hereto) have been or will be timely filed in each United States governmental, municipal or other office as is necessary to publish notice of and protect the validity of and to establish a legal, valid and perfected security interest in favor of the Administrative Agent (for the benefit of the Secured Parties) in respect of all Collateral and all Geoffrey Collateral in which the Security Interest may be perfected by filing, recording or registration in the United States (or any political subdivision thereof) and no further or subsequent filing, refiling, recording, rerecording, registration or re-registration is necessary in any such jurisdiction, except as provided under Applicable Law with respect to the filing of continuation statements or as a result of any change in a Grantor’s name or jurisdiction of incorporation or formation or under any other circumstances under which, pursuant to the UCC, filings previously made have become misleading or ineffective in whole or in part.

SECTION 3.2.    Validity and Priority of Security Interest. The Security Interest constitutes (a) a legal and valid security interest in all of the Collateral and all of the Geoffrey Collateral securing the payment and performance of the Secured Obligations, (b) subject to the filings described on Schedule 3.2 or other requisite filings or registrations described in Section 3.2, a perfected security interest in all of the Collateral and the Geoffrey Collateral (in each case to the extent perfection in such collateral and can be accomplished by such filing) and (c) subject to the obtaining of Control, a perfected security interest in all of the Collateral and all of the Geoffrey Collateral (in each case to the extent perfection in such collateral can be accomplished by Control and perfection of the Security Interest in such collateral is required by the terms hereof). The Security Interest is and shall be prior to any other Lien on any of the Collateral, subject only to (i) with respect to Collateral (other than the Canadian Pledge Collateral) that constitutes ABL Collateral only, Liens securing the obligations of the Grantors with respect to the ABL Credit Agreement, and (ii) Permitted Liens having priority by operation of Applicable Law. The Security Interest is and shall be prior to any other Lien on any of the Geoffrey Collateral, subject only to Permitted Liens having priority by operation of Applicable Law.Notwithstanding anything to the contrary in this Agreement, the Security Interests set forth in Section 2.1 shall have the priority required by the Intercreditor Agreements.

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SECTION 3.3.    Absence of Other Liens. The Collateral and the Geoffrey Collateral is owned by the Grantors free and clear of any Lien, except for (i) Permitted Liens or (ii) Liens for which termination statements have been delivered to the Administrative Agent. Except as provided in the Loan Documents, the Grantors have not filed or consented to the filing of (a) any Financing Statement or analogous document under the UCC or any other Applicable Law covering any Collateral or any Geoffrey Collateral, or (b) any assignment in which any Grantor assigns any Collateral, any Geoffrey Collateral or any security agreement or similar instrument covering any Collateral or any Geoffrey Collateral with any foreign governmental, municipal or other office, which Financing Statement or analogous document, assignment, security agreement or similar instrument is still in effect, except, in each case, for Permitted Liens.

SECTION 3.4.    Bailees, Warehousemen, Etc. Schedule 3.4 hereto sets forth a list, as of the Closing Date, of each bailee, warehouseman and other third party in possession or control of any Inventory of any Loan Party and specifies as to each bailee, warehouseman or other third party whether the value of the Inventory, at Cost (as defined in the ABL Credit Agreement), possessed or controlled by such bailee, warehouse-man or other third party exceeds $20,000,000.

SECTION 3.5.    Consignments. No Grantor has, and none shall have, possession of any property on consignment from any consignor having a value greater than $10,000,000 unless a lien waiver or other agreement in favor of the Administrative Agent reasonably satisfactory to the Administrative Agent is delivered to the Administrative Agent by such consignor.

SECTION 3.6.    Intercompany Licenses. The Intercompany Licenses have not been terminated and, to each Grantor’s knowledge, no breach, default or other circumstances exist in respect thereof which would reasonably likely materially impair or restrict the ability of the Administrative Agent to utilize the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with any Liquidation.

SECTION 3.7.    Commercial Tort Claims. Except as set forth on Schedule 3.7 hereof, as of the Closing Date, no Grantor owns any rights in, to or under any Commercial Tort Claim having a value in excess of $1,000,000.

ARTICLE IV.Covenants

The Grantors jointly and severally covenant and agree with the Administrative Agent and the Secured Parties as follows:

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SECTION 4.1Change of Name; Location of Collateral; Records; Place of Business.

(a)Each Grantor agrees to furnish to the Administrative Agent prompt written notice of any change in: (i) any Loan Party’s name; (ii) the location of any Loan Party’s chief executive office or, its principal place of business; (iii) any Loan Party’s organizational legal entity designation or jurisdiction of incorporation or formation; (iv) any Loan Party’s Federal Taxpayer Identification Number or organizational identification number assigned to it by its jurisdiction of incorporation or formation; or (v) the acquisition by any Grantor of any material property for which additional filings or recordings are necessary to perfect and maintain the Administrative Agent’s Security Interest therein (to the extent perfection of the Security Interest in such property is required by the terms hereof). Each Grantor agrees not to effect or permit any change referred to in the preceding sentence unless all filings have been made under the UCC or other Applicable Law that are required in order for the Administrative Agent to continue at all times following such change to have a valid, legal and perfected (to the extent perfection of the Security Interest in such property is required by the terms hereof), a first prioritysecurity interest in all of the Geoffrey Collateral (subject only to Permitted Liens having priority by operation of Applicable Law) and a second priority security interest inall of the Collateral, in each case with the priority required by the Intercreditor Agreements (subject only to (i) with respect to the Collateral (other than Canadian Pledge Collateral) constituting ABL Collateral only, Liens securing the obligations of the Grantors with respect to the ABL Credit Agreement, and (ii) Permitted Liens having priority by operation of Applicable Law) for its benefit and the benefit of the other Secured Parties.

(b)Each Grantor agrees to maintain, at its own cost and expense, such complete and accurate records with respect to the Collateral and the Geoffrey Collateral owned by it as is consistent with its current practices or in accordance with such prudent and standard practices used in industries that are the same as, or similar to, those in which such Grantor is engaged, but in any event to include materially complete accounting records indicating all payments and proceeds received with respect to any part of the Collateral or the Geoffrey Collateral, and, at such time or times as the Administrative Agent may reasonably request in writing, promptly to prepare and deliver to the Administrative Agent a duly certified schedule or schedules in form and detail reasonably satisfactory to the Administrative Agent showing the identity, amount and location of any and all Collateral and Geoffrey Collateral.

SECTION 4.2Protection of Security. Each Grantor shall, at its own cost and expense, take any and all actions reasonably necessary to defend the Security Interest of the Administrative Agent in the Collateral and the Geoffrey Collateral against any Lien (other than

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Permitted Liens) and the priority thereof (except for Permitted Liens having priority by operation of Applicable Lawand, with respect to the Collateral(other than Canadian Pledge Collateral) constituting ABL Collateral only, Liens securing the obligations of the Grantors with respect to the ABL Credit Agreement).

SECTION 4.3Further Assurances. Each Grantor agrees, at its own expense, to execute, acknowledge, deliver and cause to be duly filed all such further documents, financing statements, agreements and instruments and take all such further actions as the Administrative Agent may from time to time reasonably request to better assure, preserve, protect and perfect the Security Interest and the rights and remedies created or intended to be created hereby or the validity or priority of such Security Interest, including the payment of any fees and taxes required in connection with the execution and delivery of this Agreement, the granting of the Security Interest and the filing of any Financing Statements or other documents in connection herewith or therewith; provided, however that, prior to the Discharge of ABL Obligations, solely with respect to Collateral (other than the Canadian Pledge Collateral) constituting the ABL Collateral each such Grantor shall not be required to take any actions hereunder that the ABL Agent has not required such Grantors to take under the ABL Collateral Documents (as defined in the ABL Intercreditor Agreement). Without limiting the foregoing, each Grantor, at its own expense, shall execute, acknowledge, deliver and cause to be duly filed all such further documents, financing statements, agreements and instruments and take all such further actions as the Administrative Agent may from time to time reasonably request to perfect the Administrative Agent’s Security Interest in all Accounts, Inventory, Deposit Accounts, and the proceeds therefromCollateral and Geoffrey Collateral (including causing the Administrative Agent to have Control of any such Collateral or such Geoffrey Collateral to the extent perfection in such Collateral or such Geoffrey Collateral can be accomplished by Control to the extent required hereunder). If any amount payable under or in connection with any of the Collateral or the Geoffrey Collateral shall be or become evidenced by any promissory note or other instrument with an individual face value in excess of $1,000,000, such note or instrument shall be promptly pledged to the Administrative Agent and delivered to the Administrative Agent, duly endorsed in a manner satisfactory to the Administrative Agent.

SECTION 4.4Taxes; Encumbrances. At its option, the Administrative Agent may discharge past due taxes, assessments, charges, fees, Liens, security interests or other encumbrances at any time levied or placed on the Collateral or the Geoffrey Collateral (other than Permitted Liens), and may take any other action which the Administrative Agent may reasonably deem necessary or desirable to repair, maintain or preserve any of the Collateral or any of the Geoffrey Collateral to the extent any Grantor fails to do so as required by the Credit Agreement or this Agreement, and each Grantor jointly and severally agrees to reimburse the Administrative Agent for any payment made or any reasonable out-of-pocket expense incurred by the Administrative Agent pursuant to the foregoing authorization within fifteen (15) Business

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Days after receipt of an invoice therefore setting forth such payments or expenses in reasonable detail; provided, however, that nothing in this Section 4.4 shall be interpreted as excusing any Grantor from the performance of, or imposing any obligation on the Administrative Agent or any Secured Party to cure or perform, any covenants or other promises of any Grantor with respect to taxes, assessments, charges, fees, Liens, security interests or other encumbrances and maintenance as set forth herein or in the other Loan Documents; and providedfurther that the making of any such payments or the taking of any such action by the Administrative Agent shall not be deemed to constitute a waiver of any Default or Event of Default arising from any Grantor’s failure to have made such payments or taken such action.

SECTION 4.5Assignment of Security Interest.

a.If at any time any Grantor shall take a security interest in any property of an Account Debtor or any other Person to secure payment and performance of an Accountconstituting Collateral or Geoffrey Collateral, such Grantor shall promptly assign such security interest to the Administrative Agent. Such assignment need not be filed of public record unless necessary to continue the perfected status of the security interest against creditors of, and transferees from, the Account Debtor or other Person granting the security interest.

b.To the extent that any Grantor is a beneficiary under any written letter of credit constituting Collateral or Geoffrey Collateral now or hereafter issued in favor of such Grantor having a face amount in excess of $1,000,000, such Grantor shall deliver such letter of credit to the Administrative Agent. The Administrative Agent shall from time to time, at the request and expense of such Grantor, promptly make such arrangements with such Grantor as are in the Administrative Agent’s reasonable judgment necessary and appropriate so that such Grantor may make any drawing to which such Grantor is entitled under such letter of credit, without impairment of the Administrative Agent’s perfected security interest in such Grantor’s rights to proceeds of such letter of credit or in the actual proceeds of such drawing. At the Administrative Agent’s request, such Grantor shall, for any such letter of credit now or hereafter issued in favor of such Grantor as beneficiary, execute and deliver to the issuer and any confirmer of such letter of credit an assignment of proceeds form, in favor of the Administrative Agent and reasonably satisfactory to the Administrative Agent and such issuer or (as the case may be) such confirmer, requiring, after the occurrence of an Event of Default, the proceeds of any drawing under such letter of credit to be paid directly to the Administrative Agent.

SECTION 4.6Continuing Obligations of the Grantors. Each Grantor hereby acknowledges and agrees that the Administrative Agent shall have no obligation or duty to perform any obligation of any Grantor under the contracts, agreements or instruments constituting or relating to the Collateral or the Geoffrey Collateral (including, without limitation,

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the Intercompany Licenses and the payment of royalties thereunder) and that each Grantor shall at all times remain solely and exclusively liable to observe and perform all the conditions and obligations to be observed and performed by it under each contract, agreement or instrument constituting or relating to the Collateral and/or the Geoffrey Collateral (including, without limitation, the Intercompany Licenses and the payment of royalties thereunder).

SECTION 4.7Use and Disposition of Collateral and/or Geoffrey Collateral. None of the Grantors shall make or permit to be made any collateral assignment, pledge or hypothecation of the Collateral,or the Geoffrey Collateral or shall grant any other Lien in respect of the Collateral or the Geoffrey Collateral or shall grant Control (for purposes of security) of any Collateral or the Geoffrey Collateral to any Person, except for Permitted Liens. Except for Asset Sales expressly permitted in the Credit Agreement, none of the Grantors shall make or permit to be made any sale or transfer of the Collateral and/or the Geoffrey Collateral, and, except as expressly permitted in the Credit Agreement with respect to Eligible In-Transit Inventory (as defined in the ABL Credit Agreement) and Eligible Letter of Credit Inventory (as defined in the ABL Credit Agreement), each Grantor shall remain at all times in possession of the Collateral and/or the Geoffrey Collateral, owned by it. The Grantors shall not permit any expiration, termination, modification, amendment or waiver of any Intercompany License that would reasonably likely materially impair or restrict the ability of the Administrative Agent to utilize the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with any Liquidation.

SECTION 4.8Limitation on Modification of Accounts. None of the Grantors will, without the Administrative Agent’s prior written consent, grant any extension of the time of payment of any of the Accounts, compromise, compound or settle the same for less than the full amount thereof, release, wholly or partly, any Person liable for the payment thereof or allow any credit or discount whatsoever thereon, other than extensions, releases, credits, discounts, compromises or settlements granted or made in the ordinary course of business and consistent with its current practices or in accordance with such prudent business practices as determined by the Responsible Officers of the Loan Parties acting reasonably in their business judgment.

SECTION 4.9Insurance.

(a)The Grantors shall maintain insurance on the Collateral and the Geoffrey Collateral as required by Section 6.06 of the Credit Agreement, which insurance shall include the endorsements and provisions required by Section 6.06 of the Credit Agreement.

(b)Each Grantor hereby irrevocably makes, constitutes and appoints the Administrative Agent (and all officers, employees or agents designated by the Administrative Agent) as such Grantor’s true and lawful agent and attorney-in-fact,

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exercisable only after the occurrence and during the continuance of an Event of Default, for the purpose of making, settling and adjusting claims in respect of Collateral and the Geoffrey Collateral under policies of insurance, endorsing the name of such Grantor on any check, draft, instrument or other item of payment for the proceeds of such policies of insurance and for making all determinations and decisions with respect thereto. In the event that any Grantor at any time or times shall fail to obtain or maintain any of the policies of insurance required hereby or to pay any premium in whole or part relating thereto, the Administrative Agent may, without waiving or releasing any obligation or liability of the Grantors hereunder or any Default or Event of Default, in its sole discretion, obtain and maintain such policies of insurance and pay such premium and take any other actions with respect thereto as the Administrative Agent deems reasonably advisable. All sums reasonably disbursed by the Administrative Agent in connection with this Section 4.9, including reasonable attorneys’ fees, court costs, out-of-pocket expenses and other charges relating thereto, shall be payable, upon demand, by the Grantors to the Administrative Agent and shall be additional Secured Obligations secured hereby.

SECTION 4.10Commercial Tort Claims. If any Grantor shall at any time acquire a Commercial Tort Claim constituting Collateral or Geoffrey Collateral having a value in excess of $1,000,000, such Grantor shall promptly notify the Administrative Agent in writing of the details thereof and thesuch Grantors shall take such actions as the Administrative Agent shall reasonably request in order to grant to the Administrative Agent, for the benefit of the Secured Parties, a perfected and first prioritysecurity interest therein and in the Proceeds thereofwith the priority required by the Intercreditor Agreements.

SECTION 4.11Legend. At the request of the Administrative Agent, each Grantor shall legend, in form and manner reasonably satisfactory to the Administrative Agent, its Accounts constituting Collateral or Geoffrey Collateral and its books, records and documents evidencing or pertaining thereto with an appropriate reference to the fact that such Accounts have been assigned to the Administrative Agent for the benefit of the Secured Parties and that the Administrative Agent has a security interest therein.

SECTION 4.12Notices and Reports Pertaining to Intercompany Licenses. In addition to any other notice or reporting requirement imposed on the Grantors under this Agreement and the Credit Agreement, the Grantors will promptly notify the Administrative Agent of any breach, default or other circumstance in respect of any Intercompany License which would reasonably likely materially impair or restrict the ability of the Administrative Agent to utilize the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with any Liquidation.

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ARTICLE V.Collections

SECTION 5.1Deposit Accounts. Subject to the terms of the Intercreditor Agreements, until the occurrence of the Discharge of ABL Obligations, the Grantors acknowledge and agree that the ABL Agent has expressly agreed to act as agent for the benefit of the Administrative Agent and the Secured Parties under each control agreement or blocked account agreement with respect to any Deposit Accounts and Securities Accounts of a Grantorthat constitute Collateral. Following the Discharge of ABL Obligations, the Grantors shall cause the Administrative Agent to have Control over each Deposit Account and Securities Accounts of a Grantor that constitute Collateral (other than the Designated Account).

SECTION 5.2Power of Attorney. Each Grantor irrevocably makes, constitutes and appoints the Administrative Agent (and all officers, employees or agents designated by the Administrative Agent) as such Grantor’s true and lawful agent and attorney-in-fact, and in such capacity the Administrative Agent shall have the right, with power of substitution for each Grantor and in each Grantor’s name or otherwise, for the use and benefit of the Administrative Agent and the Secured Parties, (a) at any time, whether or not a Default or Event of Default has occurred, to take actions required to be taken by the Grantors under Section 2.1 of this Agreement, (b) upon the occurrence and during the continuance of an Event of Default or as otherwise permitted under the Credit Agreement, (i) to take actions required to be taken by the Grantors under Section 5.1 of this Agreement; (ii) to receive, endorse, assign and/or deliver any and all notes, acceptances, checks, drafts, money orders or other evidences of payment relating to the Collateral and/or the Geoffrey Collateral or any part thereof; (iii) to demand, collect, receive payment of, give receipt for and give discharges and releases of all or any of the Collateral and/or any of the Geoffrey Collateral; (iv) to sign the name of any Grantor on any invoices, schedules of Collateral, freight or express receipts, or bills of lading storage receipts, warehouse receipts or other documents of title relating to any of the Collateral and/or the Geoffrey Collateral; (v) to sign the name of any Grantor on any notice to such Grantor’s Account Debtors; (vi) to sign the name of any Grantor on any proof of claim in bankruptcy against Account Debtors, and on notices of lien, claims of mechanic’s liens, or assignments or releases of mechanic’s liens securing the Accounts; (vii) to sign change of address forms to change the address to which each Grantor’s mail is to be sent to such address as the Administrative Agent shall designate; (viii) to receive and open each Grantor’s mail, remove any Proceeds of Collateral and/or Geoffrey Collateral therefrom and turn over the balance of such mail either to the Borrower or to any trustee in bankruptcy or receiver of a Grantor, or other legal representative of a Grantor whom the Administrative Agent reasonably determines to be the appropriate person to whom to so turn over such mail; (ix) to commence and prosecute any and all suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect or otherwise realize on all or any of

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the Collateral or the Geoffrey Collateral to enforce any rights in respect of any Collateral and/or any Geoffrey Collateral; (x) to settle, compromise, compound, adjust or defend any actions, suits or proceedings relating to all or any of the Collateral and/or any Geoffrey Collateral; (xi) to take all such action as may be reasonably necessary to obtain the payment of any letter of credit and/or banker’s acceptance of which any Grantor is a beneficiary; (xii) to repair, manufacture, assemble, complete, package, deliver, alter or supply goods, if any, necessary to fulfill in whole or in part the purchase order of any customer of any Grantor; (xiii) to use, license or transfer any or all General Intangibles of any Grantor; and (xiv) to use, sell, assign, transfer, pledge, make any agreement with respect to or otherwise deal with all or any of the Collateral and/or any Geoffrey Collateral, and to do all other acts and things reasonably necessary to carry out the purposes of this Agreement, as fully and completely as though the Administrative Agent was the absolute owner of the Collateral and/or the Geoffrey Collateral for all purposes; provided, however, that nothing herein contained shall be construed as requiring or obligating the Administrative Agent or any other Secured Party to make any inquiry as to the nature or sufficiency of any payment received by the Administrative Agent or any other Secured Party, or to present or file any claim or notice. It is understood and agreed that the appointment of the Administrative Agent as the agent and attorney-in-fact of the Grantors for the purposes set forth above is coupled with an interest and

is irrevocable. The appointment of the Administrative Agent as the agent and attorney-in-fact of the Grantors for the purposes set forth above shall terminate when (a) the Aggregate Commitments have expired or been terminated and (b) the principal of and interest on each Loan and all fees and other Secured Obligations (which for purposes of this clause shall include the obligations in respect of Hedge Agreements only if the Secured Obligations (as defined in the Credit Agreement) have been accelerated and Liquidation has commenced and then only to the extent then due and payable) (other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full).

SECTION 5.3No Obligation to Act. The Administrative Agent shall not be obligated to do any of the acts or to exercise any of the powers authorized by Section 5.2, but if the Administrative Agent elects to do any such act or to exercise any of such powers, it shall not be accountable for more than it actually receives as a result of such exercise of power, and shall not be responsible to any Grantor for any act or omission to act except for any act or omission to act as to which there is a determination by a court of competent jurisdiction or another independent tribunal having jurisdiction that (i) the subject act or omission to act by the Administrative Agent or any Affiliate of the Administrative Agent or any officer, director, employee, advisor or agent of the Administrative Agent or such Affiliate constituted gross negligence, was in bad faith, or constituted willful misconduct or (ii) constituted a breach by the Administrative Agent or any Affiliate of the Administrative Agent or any officer, director, employee, advisor or agent of the Administrative Agent or such Affiliate of its obligations to such Grantor. The provisions of Section 5.2 shall in no event relieve any Grantor of any of its

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obligations hereunder or under any other Loan Document with respect to the Collateral and/or the Geoffrey Collateral or any part thereof or impose any obligation on the Administrative Agent or any other Secured Party to proceed in any particular manner with respect to the Collateral and/or the Geoffrey Collateral or any part thereof, or in any way limit the exercise by the Administrative Agent or any other Secured Party of any other or further right which it may have on the date of this Agreement or hereafter, whether hereunder, under any other Loan Document, by law or otherwise.

ARTICLE VI.Remedies

SECTION 6.1Remedies upon Default. Upon the occurrence and during the continuance of an Event of Default, it is agreed that the Administrative Agent shall have in any jurisdiction in which enforcement hereof is sought, in addition to all other rights and remedies, the rights and remedies of a secured party under the UCC or other Applicable Law. The Agent’s Rights and Remedies shall include, without limitation, the right to take any of or all of the following actions at the same or different times as directed by the Administrative Agent or the Required Lenders:

(a)With respect to any Collateral and/or any Geoffrey Collateral consisting of Accounts, General Intangibles (including Payment Intangibles and Intellectual Property), Letter-of-Credit Rights, Instruments, Chattel Paper, Documents, and Investment Property, the Administrative Agent may collect the Collateral and/or the Geoffrey Collateral with or without

the taking of possession of any of the Collateral and/or the Geoffrey Collateral.

(b)With respect to any Collateral and/or any Geoffrey Collateral consisting of Accounts, the Administrative Agent may (i) demand, collect and receive any amounts relating thereto, as the Administrative Agent may determine; (ii) commence and prosecute any actions in any court for the purposes of collecting any such Accounts and enforcing any other rights in respect thereof; (iii) defend, settle or compromise any action brought and, in connection therewith, give such discharges or releases as the Administrative Agent may reasonably deem appropriate; (iv) without limiting the rights of the Administrative Agent set forth in Section 5.2 hereof, receive, open and dispose of mail addressed to any Grantor and endorse checks, notes, drafts, acceptances, money orders, bills of lading, warehouse receipts or other instruments or documents evidencing payment, shipment or storage of the goods giving rise to such Accounts or securing or relating to such Accounts, on behalf of and in the name of such Grantor; and (v) sell, assign, transfer, make any agreement in respect of, or otherwise deal with or exercise rights in respect of, any such Accounts or the goods or services which have given rise

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thereto, as fully and completely as though the Administrative Agent was the absolute owner thereof for all purposes.

(c)With respect to any Collateral consisting of Investment Property, the Administrative Agent may (i) exercise all rights of any Grantor with respect thereto, including without limitation, the right to exercise all voting and corporate rights at any meeting of the shareholders of the issuer of any Investment Property and to exercise any and all rights of conversion, exchange, subscription or any other rights, privileges or options pertaining to any Investment Property as if the Administrative Agent was the absolute owner thereof, including the right to exchange, at its discretion, any and all of any Investment Property upon the merger, consolidation, reorganization, recapitalization or other readjustment of the issuer thereof, all without liability except to account for property actually received as provided in Section 5.3 hereof; (ii) transfer such Collateral at any time to itself, or to its nominee, and receive the income thereon and hold the same as Collateral hereunder or apply it to the Secured Obligations; and (iii) demand, sue for, collect or make any compromise or settlement it deems desirable. The Grantors recognize that (a) the Administrative Agent may be unable to effect a public sale of all or a part of the Investment Property by reason of certain prohibitions contained in the Securities Act of 1933, 15 U.S.C. § 77, (as amended and in effect, the “Securities Act”) or the Securities laws of various states (the “Blue Sky Laws”), but may be compelled to resort to one or more private sales to a restricted group of purchasers who will be obliged to agree, among other things, to acquire the Investment Property for their own account, for investment and not with a view to the distribution or resale thereof, (b) that private sales so made may be at prices and upon other terms less favorable to the seller than if the Investment Property were sold at public sales, (c) that neither the Administrative Agent nor any Secured Party has any obligation to delay sale of any of the Investment Property for the period of time necessary to permit the Investment Property to be registered for public sale under the Securities Act or the Blue Sky Laws, and (d) that private sales made under the foregoing circumstances shall be deemed to have been made in a commercially

reasonable manner. Notwithstanding anything herein to the contrary, no Grantor shall be required to register, or cause the registration of, any Investment Property under the Securities Act or any or Blue Sky Laws.

(d)With respect to any Collateral consisting of Inventory, Goods, and Equipment, the Administrative Agent may conduct one or more going out of business sales, in the Administrative Agent’s own right or by one or more agents and contractors. Such sale(s) may be conducted upon any premises owned, leased, or occupied by any Grantor. The Administrative Agent and any such agent or contractor, in conjunction with any such sale, may augment the Inventory with other goods (all of which other goods shall remain the sole property of the Administrative Agent or such agent or contractor). Any amounts realized from the sale of such goods which constitute augmentations to the

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Inventory (net of an allocable share of the costs and expenses incurred in their disposition) shall be the sole property of the Administrative Agent or such agent or contractor and neither any Grantor nor any Person claiming under or in right of any Grantor shall have any interest therein. Each purchaser at any such going out of business sale shall hold the property sold absolutely, free from any claim or right on the part of any Grantor.

(e)With respect to any Proprietary Marks, the Administrative Agent may exercise all of the rights granted to the Grantors under the Intercompany Licenses (for the limited purpose of allowing the Administrative Agent to utilize the Proprietary Marks in exercising the Agent’s Rights and Remedies in connection with any Liquidation of any Grantor’s Inventory or other Collateral).

(f)With or without legal process and with or without prior notice or demand for performance, the Administrative Agent may enter upon, occupy, and use any premises owned or occupied by each Grantor, and may exclude the Grantors from such premises or portion thereof as may have been so entered upon, occupied, or used by the Administrative Agent to the extent the Administrative Agent deems such exclusion reasonably necessary to preserve and protect the Collateral and/or the Geoffrey Collateral. The Administrative Agent shall not be required to remove any of the Collateral from any such premises upon the Administrative Agent’s taking possession thereof, and may render any Collateral and/or Geoffrey Collateral unusable to the Grantors. In no event shall the Administrative Agent be liable to any Grantor for use or occupancy by the Administrative Agent of any premises pursuant to this Section 6.1, nor for any royalties or any other amounts due under, or any other obligations in respect of, the Intercompany Licenses, nor for any charge (such as wages for the Grantors’ employees and utilities) incurred in connection with the Administrative Agent’s exercise of the Agents’ Rights and Remedies.

(g)The Administrative Agent may require any Grantor to assemble the Collateral and make it available to the Administrative Agent at the Grantor’s sole risk and expense at a place or places which are reasonably convenient to both the Administrative Agent and such Grantor.

(h)Each Grantor agrees that the Administrative Agent shall have the right, subject to Applicable Law, to sell or otherwise dispose of all or any part of the Collateral and/or the Geoffrey Collateral, at public or private sale, for cash, upon credit or for future delivery as the Administrative Agent shall deem appropriate. Each purchaser at any such sale shall hold the property sold absolutely, free from any claim or right on the part of any Grantor.

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(i)Unless the Collateral and/or Geoffrey Collateral is perishable or threatens to decline speedily in value, or is of a type customarily sold on a recognized market (in which event the Administrative Agent shall provide the Grantors such notice as may be practicable under the circumstances), the Administrative Agent shall give the Grantors at least ten (10) days’ prior written notice, by authenticated record, of the date, time and place of any proposed public sale, and of the date after which any private sale or other disposition of the Collateral and/or Geoffrey Collateral may be made. Each Grantor agrees that such written notice shall satisfy all requirements for notice to that Grantor which are imposed under the UCC or other Applicable Law with respect to the exercise of the Agent’s Rights and Remedies upon default. The Administrative Agent shall not be obligated to make any sale or other disposition of any Collateral and/or Geoffrey Collateral if it shall determine not to do so, regardless of the fact that notice of sale or other disposition of such Collateral and/or such Geoffrey Collateral shall have been given. The Administrative Agent may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for sale, and such sale may, without further notice, be made at the time and place to which the same was so adjourned.

(j)Any public sale shall be held at such time or times within ordinary business hours and at such place or places as the Administrative Agent may fix and state in the notice of such sale. At any sale or other disposition, the Collateral and/or the Geoffrey Collateral, or portion thereof, to be sold may be sold in one lot as an entirety or in separate parcels, as the Administrative Agent may (in its sole and absolute discretion) determine. If any of the Collateral and/or the Geoffrey Collateral is sold, leased, or otherwise disposed of by the Administrative Agent on credit, the Secured Obligations shall not be deemed to have been reduced as a result thereof unless and until payment is received thereon by the Administrative Agent.

(k)At any public (or, to the extent permitted by Applicable Law, private) sale made pursuant to this Section 6.1, the Administrative Agent or any other Secured Party may bid for or purchase, free (to the extent permitted by Applicable Law) from any right of redemption, stay, valuation or appraisal on the part of any Grantor, the Collateral, the Geoffrey Collateral or any part thereof offered for sale and may make payment on account thereof by using any claim then due and payable to the Administrative Agent or such other Secured Party from any Grantor on account of the Secured Obligations as a credit against the purchase price, and the Administrative Agent or such other Secured Party may, upon compliance with the terms of sale, hold, retain and dispose of such property without further accountability to any Grantor therefor.

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(l)For purposes hereof, a written agreement to purchase the Collateral, the Geoffrey Collateral or any portion thereof shall be treated as a sale thereof. The Administrative Agent shall be free to carry out such sale pursuant to such agreement and no Grantor shall be entitled to the return of the Collateral, the Geoffrey Collateral or any portion thereof subject thereto, notwithstanding the fact that after the Administrative Agent shall have entered into such an agreement all Events of Default shall have been remedied and the Secured Obligations paid in full.

(m)As an alternative to exercising the power of sale herein conferred upon it, the Administrative Agent may proceed by a suit or suits at law or in equity to foreclose upon the Collateral and/or the Geoffrey Collateral and to sell the Collateral and/or the Geoffrey Collateral or any portion thereof pursuant to a judgment or decree of a court or courts having competent jurisdiction or pursuant to a proceeding by a court-appointed receiver.

(n)To the extent permitted by Applicable Law, each Grantor hereby waives all rights of redemption, stay, valuation and appraisal which such Grantor now has or may at any time in the future have under any rule of law or statute now existing or hereafter enacted.

(o)In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting the Borrower or the creditors or property of the Borrower, the Administrative Agent and Secured Parties, to the extent permitted by Applicable Law, shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of the Administrative Agent and the other Secured Parties allowed in such proceedings for the entire amount of the Secured Obligations at the date of the institution of such proceedings and for any additional portion of the Secured Obligations accruing after such date.

Notwithstanding the foregoing to the contrary, prior to the occurrence of an Event of Default pursuant to Section 8.01(a) of the Credit Agreement, the Agent’s exercise of any Rights and Remedies in respect of the Geoffrey Collateral shall be subject to the rights of any third party under any international license and/or franchise agreements as in effect on such date.

SECTION 6.2Application of Proceeds. After the occurrence and during the continuance of any Event of Default and acceleration of the Secured Obligations pursuant to Section 8.01 of the Credit Agreement, the Administrative Agent shall promptly apply the proceeds of any collection or sale of the Collateral and/or the Geoffrey Collateral, as well as any Collateral consisting of cash, or any Collateral and/or Geoffrey Collateral granted under any other of the Security Documents, in accordance with Section 8.03 of the Credit Agreementand, in the case of Canadian Pledge Collateral, in accordance with Section 7.4 of the ABL Intercreditor Agreement, subject to the terms of the Non-ABLIntercreditor Agreements.

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Subject to the right of the Required Lenders to direct the exercise of the Agent’s Rights and Remedies upon the occurrence of an Event of Default and subject to the terms of the Non-ABLIntercreditor Agreements, the Administrative Agent shall have absolute discretion as to the time of

application of any such proceeds, moneys or balances in accordance with this Agreement. Upon any sale or other disposition of the Collateral and/or the Geoffrey Collateral by the Administrative Agent (including pursuant to a power of sale granted by statute or under a judicial proceeding), the receipt of the purchase money by the Administrative Agent or of the officer making the sale or other disposition shall be a sufficient discharge to the purchaser or purchasers of the Collateral and/or the Geoffrey Collateral so sold or otherwise disposed of and such purchaser or purchasers shall not be obligated to see to the application of any part of the purchase money paid over to the Administrative Agent or such officer or be answerable in any way for the misapplication thereof.

ARTICLE VII.Perfection of Security Interest

SECTION 7.1Perfection by Filing. This Agreement constitutes an authenticated record, and each Grantor hereby authorizes the Administrative Agent, pursuant to the provisions of Sections 2.1 and 5.2, to file one or more financing or continuation statements, and amendments thereto, relative to all or any part of the Collateral and/or the Geoffrey Collateral, in such filing offices as the Administrative Agent shall reasonably deem appropriate, and the Grantors shall pay the Administrative Agent’s reasonable costs and expenses incurred in connection therewith. Each Grantor hereby further agrees that a carbon, photographic, or other reproduction of this Agreement shall be sufficient as a Financing Statement and may be filed as a Financing Statement in any and all jurisdictions.

SECTION 7.2Other Perfection, Etc. The Grantors shall at any time and from time to time take such steps as the Administrative Agent may reasonably request for the Administrative Agent (a) to obtain Control of any Deposit Accounts constituting Collateral to the extent required by Section 2.18 of the ABL Credit Agreement(whether or not the ABL Credit Agreement is then in effect and which Section 2.18 is hereby incorporated by reference; provided that each reference to “Administrative Agent” therein shall be deemed a reference to the Administrative Agent), with any agreements establishing control to be in form and substance reasonably satisfactory to the Administrative Agent; provided that prior to the Discharge of ABL Obligations, the requirement of this Section 7.02(a) with respect to the delivery of any control agreement to the Administrative Agent shall be deemed satisfied by the delivery of such control agreement to the ABL Agent, (b) to obtain Control of any Investment Property, Letter-of-Credit Rights or Electronic Chattel Paper, in each case constituting Collateral or Geoffrey Collateral, with any agreements establishing control to be in form and substance reasonably satisfactory to the Administrative Agent and (c) otherwise to insure the continued perfection of the Administrative Agent’s security interest in any of the Collateral and/or the Geoffrey Collateral with the priority described in Section 3.2 and of the preservation of its rights therein.

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SECTION 7.3Savings Clause. Nothing contained in this Article VII shall be construed to narrow the scope of the Administrative Agent’s Security Interest in any of the Collateral,or the Geoffrey Collateral or the perfection or priority thereof or to impair or otherwise limit any of the Agent’s Rights and Remedies hereunder except (and then only to the extent) as mandated by the UCC.

ARTICLE VIII.Miscellaneous

SECTION 8.1Notices. All communications and notices hereunder shall (except as otherwise expressly permitted herein) be in writing and given as provided in Section 10.02 of the Credit Agreement.

SECTION 8.2Grant of Non-Exclusive License. Without limiting the rights of the Administrative Agent under the assignment of the Intercompany Licenses provided herein, each Grantor hereby grants to the Administrative Agent a royalty free, non-exclusive, irrevocable license, which license shall be exercisable upon the existence and during the continuance of an Event of Default, to use, apply, and affix any Intellectual Property (other than Intellectual Property licensed pursuant to the Intercompany Licenses, including the Proprietary Marks) in which any Grantor now or hereafter has rights, such license being with respect to the Administrative Agent’s exercise of the Agent’s Rights and Remedies hereunder including, without limitation, in connection with any Liquidation of Inventory; provided, however, that the Administrative Agent’s exercise of the foregoing license shall be conditioned upon the Administrative Agent not violating any obligations (excluding the payment of royalties) or restrictions to which the Grantor of the related Intellectual Property is subject (except those obligations or restrictions which would reasonably likely materially impair or restrict the ability of the Administrative Agent to utilize the Intellectual Property in exercising the Agent’s Rights and Remedies). Nothing in this Section 8.2 shall require Geoffrey to grant any license that is prohibited by any rule of law, statute or regulation or is prohibited by, or constitutes a breach or default under or results in the termination of or gives rise to any right of acceleration, modification or cancellation under any contract, license, agreement, instrument or other document evidencing, giving rise to a right to use or theretofore granted with respect to such property; providedfurther that such licenses to be granted hereunder with respect to trademarks and Proprietary Marks shall be subject to the maintenance of quality standards with respect to the goods and services on which such trademarks are used sufficient to preserve the validity of such trademarks and Proprietary Marks.

SECTION 8.3Security Interest Absolute. All rights of the Administrative Agent hereunder, the Security Interest and all obligations of the Grantors hereunder shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of the Credit Agreement, any other Loan Document, any agreement with respect to any of the Secured Obligations or any other agreement or instrument relating to any of the foregoing, (b) any change

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in the time, manner or place of payment of, or in any other term of, all or any of the Secured Obligations, or any other amendment or waiver of or any consent to any departure from the Credit Agreement, any other Loan Document, or any other agreement or instrument, (c) any exchange, release or non-perfection of any Lien on other collateral, or any release or amendment or waiver of or consent under or departure from the Guarantee or any other guarantee, securing or guaranteeing all or any of the Obligations, or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, any Grantor in respect of the Secured Obligations or this Agreement (other than circumstances under which (i) the Commitments have expired or been terminated and (ii) the principal of and interest on each Loan and all fees and other

Secured Obligations (which for purposes of this clause shall include the obligations in respect of Hedge Agreements only if the Secured Obligations (each as defined in the Credit Agreement) have been accelerated and Liquidation has commenced and then only to the extent then due and payable) (other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full).

SECTION 8.4Survival of Agreement. All covenants, agreements, representations and warranties made by the Grantors herein and in any other Loan Document and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the Administrative Agent and the other Secured Parties and shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans and the issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Secured Party may have had notice or knowledge of any Default or Event of Default or incorrect representation or warranty at the time any credit is extended under the Loan Agreement, and shall continue in full force and effect unless terminated in accordance with Section 8.15 hereof. In connection with the termination of this Agreement and the release and termination of the security interests in the Collateral and/or the Geoffrey Collateral, the Administrative Agent, on behalf of itself and the other Secured Parties, may require such indemnities as it shall reasonably deem necessary or appropriate to protect the Secured Parties against (x) loss on account of credits previously applied to the Secured Obligations that may subsequently be reversed or revoked, and (y) any obligations that may thereafter arise with respect to obligations in respect of Hedge Agreements.

SECTION 8.5Binding Effect; Several Agreement; Assignments. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and assigns of such party, and all covenants, promises and agreements by or on behalf of the Grantors that are contained in this Agreement shall bind and inure to the benefit of each Grantor and its respective successors and assigns. This Agreement shall be binding upon each Grantor and the Administrative Agent and its successors and permitted assigns, and shall inure to the benefit of each Grantor, the Administrative Agent and the other Secured Parties and

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their respective successors and permitted assigns, except that no Grantor shall have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral and/or the Geoffrey Collateral (and any such attempted assignment or transfer shall be void) except as expressly permitted by this Agreement or the Credit Agreement. This Agreement shall be construed as a separate agreement with respect to each Grantor and may be amended, modified, supplemented, waived or released with respect to any Grantor without the approval of any other Grantor and without affecting the obligations of any other Grantor hereunder.

SECTION 8.6Fees and Expenses; Indemnification.

(a)Without limiting any of their obligations under the Credit Agreement or the other Loan Documents, and without duplication of any fees, expenses or indemnification provided for under the Credit Agreement and the other Loan Documents, the Grantors jointly and severally shall pay all reasonable out-of-pocket expenses incurred by the Administrative Agent, including

the reasonable fees, charges and disbursements of any counsel and outside consultants for the Administrative Agent, within fifteen (15) Business Days after receipt of an invoice therefore setting forth such expenses in reasonable detail, in connection with (i) the administration of this Agreement, (ii) the custody or preservation of, or the sale of, collection from or other realization upon any of the Collateral and/or the Geoffrey Collateral, (iii) the exercise, enforcement or protection of any of the Agent’s Rights and Remedies hereunder or (iv) the failure of any Grantor to perform or observe any of the provisions hereof; provided that in the event the Grantors have a bona fide dispute with any such expenses, payment of such disputed amounts shall not be required until the earlier of the date such dispute is resolved to the reasonable satisfaction of the Grantors or thirty (30) days after receipt of any such invoice (and any such disputed amount which is so paid shall be subject to a reservation of the Grantors’ rights with respect thereto).

(b)Without limiting any of their indemnification obligations under the Credit Agreement or the other Loan Documents, and without duplication of any fees, expenses or indemnification provided for under the Credit Agreement and the other Loan Documents, each Grantor, shall, jointly and severally, indemnify the Secured Parties and each of their Subsidiaries and Affiliates, and each of the respective stockholders, directors, officers, employees, agents, attorneys, and advisors of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all damages, actual out-of-pocket losses, claims, actions, causes of action, settlement payments, obligations, liabilities and related expenses, including the reasonable fees, charges and disbursements of one counsel for the Agents and one counsel for all other Indemnitees (other than the Agents), incurred, suffered, sustained or required to be paid by, or asserted against, any Indemnitee arising out of, in any way connected with, or as a result of (i) the execution or delivery of this

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Agreement or any other Loan Document, the performance by any Grantor of its obligations under this Agreement or any other Loan Document, or the consummation of the transactions contemplated by the Loan Documents or any other transactions contemplated hereby, or (ii) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing or to the Collateral, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided, however, that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (w) are determined by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from the gross negligence, bad faith or willful misconduct of any Agent or such Indemnitee or any Affiliate of such Indemnitee (or any officer, director, employee, advisor or agent of such Indemnitee or any such Indemnitee’s Affiliates), (x) are relating to disputes among Indemnitees, or (y) are determined by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from a breach by such Indemnitee of its obligations to a Loan Party. No party hereto shall be liable to any other party hereto for any indirect, consequential, special or punitive damages except, in the case of any Grantor, to the extent such Grantor is otherwise required to provide indemnification pursuant to this Section 8.6(b). In connection with any indemnified claim hereunder, the Indemnitee shall be

entitled to select its own counsel and the Grantors shall promptly pay the reasonable fees and expenses of such counsel.

(c)Any such amounts payable as provided hereunder shall be additional Secured Obligations secured hereby and by the other Security Documents. The provisions of this Section 8.6 shall remain operative and in full force and effect regardless of the termination of this Agreement or any other Loan Document, the consummation of the transactions contemplated hereby or thereby, the repayment of the Loans and the termination of the Commitments, the payment of all fees and other Secured Obligations, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan Document, or any investigation made by or on behalf of any Secured Party. All amounts due under this Section 8.6 shall be payable promptly after written demand therefor.

SECTION 8.7Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

SECTION8.8Waivers; Amendment.

(a)The rights, remedies, powers, privileges, and discretions of the Administrative Agent hereunder (herein, the “Agent’s Rights and Remedies”) shall be cumulative and not exclusive of any rights or remedies which it would otherwise have.

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No delay or omission by the Administrative Agent in exercising or enforcing any of the Agent’s Rights and Remedies shall operate as, or constitute, a waiver thereof. No waiver by the Administrative Agent of any Event of Default or of any Default under any other agreement shall operate as a waiver of any other Event of Default or other Default hereunder or under any other agreement. No single or partial exercise of any of the Agent’s Rights or Remedies, and no express or implied agreement or transaction of whatever nature entered into between the Administrative Agent and any Person, at any time, shall preclude the other or further exercise of the Agent’s Rights and Remedies. No waiver by the Administrative Agent of any of the Agent’s Rights and Remedies on any one occasion shall be deemed a waiver on any subsequent occasion, nor shall it be deemed a continuing waiver. Subject to the right of the Administrative Agent and the Required Lenders to direct the exercise of the Agent’s Rights and Remedies upon the occurrence and during the continuance of an Event of Default, the Agent’s Rights and Remedies may be exercised at such time or times and in such order of preference as the Administrative Agent may determine. The Agent’s Rights and Remedies may be exercised without resort or regard to any other source of satisfaction of the Secured Obligations. No waiver of any provisions of this Agreement or any other Loan Document or consent to any departure by any Grantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice to or demand on any Grantor in any case shall entitle such Grantor or any other Grantor to any other or further notice or demand in similar or other circumstances.

(b)Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to a written agreement entered into between the Administrative Agent and the Grantor or Grantors with respect to whom such waiver, amendment or modification is to apply, subject to any consent required in accordance with Section 10.01 of the Credit Agreement.

SECTION 8.9WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY); AND WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES THEREOF AS WELL AS NOTICE OF NONPAYMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD

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NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.9.

SECTION 8.10Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement shall not be so affected or impaired thereby and (b) the parties hereto shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provision. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

SECTION 8.11Counterparts. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement by telecopy or other electronic transmission shall be effective as delivery of a manually executed counterpart of this Agreement.

SECTION 8.12Headings. Section headings used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

SECTION 8.13Jurisdiction; Consent to Service of Process. The Grantors agree that any suit for the enforcement of this Agreement or any other Loan Document may be brought in the courts of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consent to the non-exclusive jurisdiction of such courts. The Grantors hereby waive any objection which they may now or hereafter have to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum and agrees

that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Administrative Agent may otherwise have to bring any action or proceeding relating to this Agreement against a Grantor or its properties in the courts of any jurisdiction. The Grantors agree that any action commenced by any Grantor asserting any claim or counterclaim arising under or in connection with this Agreement or any other Loan Document shall be brought solely in a court sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consent to the exclusive jurisdiction of such courts with respect to any such action. Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 8.1. Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

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SECTION 8.14Joinder to Security Agreement. As contemplated in the Credit Agreement, additional Subsidiaries may from time to time become parties hereto and additional Grantors hereunder by execution and delivery of a Joinder to Security Agreement. Such Joinder to Security Agreement shall be effective upon delivery by such additional Grantor, without further action or consent or notice to any party hereto. Upon delivery of such Joinder to Security Agreement, all obligations of eachsuch additional Grantor hereunder shall be joint and several with the obligations of each other Grantor hereunder.

SECTION 8.15Termination; Release of Collateral.

(a)Any Lien upon any Collateral and/or Geoffrey Collateral will be released automatically if the Collateral and/or Geoffrey Collateral constitutes property being sold, transferred or disposed of to a Person that is not a Grantor in an Asset Sale permitted under the Credit Agreement upon receipt by the Administrative Agent of the Net Proceeds thereof to the extent required by the Credit Agreement and in the other circumstances contemplated in Section 9.10 of the Credit Agreement.

(b)Upon at least two (2) Business Days’ prior written request by the Borrower, the Administrative Agent shall execute such documents as may be necessary to evidence the release of the Liens upon any Collateral and/or any Geoffrey Collateral described in Section 8.15(a); provided, however, that (i) the Administrative Agent shall not be required to execute any such document on terms which, in its reasonable opinion, would, under Applicable Law, expose the Administrative Agent to liability or create any obligation or entail any adverse consequence other than the release of such Liens without recourse or warranty, and (ii) such release shall not in any manner discharge, affect or impair the Secured Obligations or any Liens (other than those expressly being released) upon (or obligations of any Loan Party in respect of) all interests retained by any Loan Party, including (without limitation) the proceeds of any sale, all of which shall continue to constitute part of the Collateral and/or the Geoffrey Collateral.

(c)Except for those provisions which expressly survive the termination thereof, this Agreement and the Security Interest granted herein shall terminate when (i) the Commitments

have expired or been terminated and (ii) the principal of and interest on each Loan and all fees and other Secured Obligations (which for purposes of this clause shall include the obligations in respect of Hedge Agreements only if the Secured Obligations (each as defined in the Credit Agreement) have been accelerated and Liquidation has commenced and then only to the extent then due and payable)(other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full, at which time the Administrative Agent shall execute and deliver to the Grantors, at the Grantors’ expense, all UCC termination statements and similar documents that the Grantors shall reasonably request to evidence such termination; provided, however, that the Credit

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Agreement, this Agreement, and the Security Interest granted herein shall be reinstated if at any time payment, or any part thereof, of any Secured Obligation is rescinded or must otherwise be restored by any Secured Party upon the bankruptcy or reorganization of the Borrower, Grantor or other Loan Party. Any execution and delivery of termination statements or documents pursuant to this Section 8.15 shall be without recourse to, or warranty by, the Administrative Agent or any other Secured Party.

SECTION 8.16Intercreditor Agreements. Notwithstanding anything herein to the contrary, the lien and Security Interest granted to the Administrative Agent pursuant to this Agreement and the exercise of any right or remedy by the Administrative Agent hereunder are subject to the provisions of the Intercreditor Agreements. In the event of any conflict between the terms of the Intercreditor Agreements and the terms of this Agreement, the terms of the Intercreditor Agreements shall govern and control. Without limiting the generality of the foregoing, and notwithstanding anything herein to the contrary, all rights and remedies of the Administrative Agent (and the Secured Parties) shall be subject to the terms of the Intercreditor Agreements, and any obligation of any Grantor hereunder or under any other Security Document to deliver to the Administrative Agent, or establish the Administrative Agent’s control (within the meaning of the UCC) with respect tothe delivery or control of, any Collateral, the novation of any lien on any certificate of title, bill of lading or other document, the giving of any notice to any bailee or other Person, the provision of voting rights or the obtaining of any consent of any Person, in each case in connection with anythat constitutes ABL Collateral, shall be deemed to be satisfied if such Grantor, as applicable,delivers such Collateral tothe ABL Agent orestablishes such control in favor of the ABL Agent, in each case as bailee for the Administrative Agent pursuant to the ABLIntercreditor Agreementand otherwise complies with the requirements of the similar provision of the applicable document with respect to the ABL Credit Agreement Obligations or the NotesObligations (as defined in the ABL Intercreditor Agreement).The delivery of any Collateral to or the control of any Collateral by to eitherthe ABL Agent orthe collateral agent under the Secured Notes as required by the applicableIntercreditor Agreementshall satisfy any delivery or control requirement hereunder or under any other Security Document, with respect to the Collateral.

SECTION 8.17.Acknowledgement of Liens. The Grantors (other than Geoffrey), the Administrative Agent and each Secured Party agrees and acknowledges that (i) the grants of Liens pursuant to this Agreement or any other Loan Document in the Canadian Pledge Collateral as security for the Term B-4 Obligations and the Non-Term B-4 Obligations constitute two separate and distinct grants of Liens and (ii) because of, among other things, their differing rights in the Canadian Pledge

Collateral, the Term B-4 Obligations are fundamentally different from the Non-Term B-4 Obligations and must be separately classified in any plan of reorganization proposed or adopted in any proceeding under any Debtor Relief Law. To further effectuate the intent of the parties as provided in the immediately preceding sentence, if it is held that the claims of the Term B-4

33

Lenders and the Non-Term B-4 Secured Parties in respect of the Canadian Pledge Collateral constitute only one secured claim (rather than separate classes of senior and junior secured claims), then the Term B-4 Lenders shall be entitled to receive, in addition to amounts distributed to them from, or in respect of, the Canadian Pledge Collateral in respect of principal, prepetition interest and other claims, all amounts owing in respect of post-petition interest, fees, costs, expenses, premiums, and other charges, irrespective of whether a claim for such amounts is allowed or allowable in such proceeding under any Debtor Relief Law, before any distribution from, or in respect of, any Canadian Pledge Collateral is made in respect of the claims held by the Non-Term B-4 Secured Parties, with the Non-Term B-4 Secured Parties’ hereby acknowledging and agreeing to turn over to the Term B-4 Lenders amounts otherwise received or receivable by them to the extent necessary to effectuate the intent of this sentence, even if such turnover has the effect of reducing the claim or recovery of the Non-Term B-4 Secured Parties.

[SIGNATURE PAGES FOLLOW]

34

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement under seal as of the day and year first above written.

GRANTORS:
TOYS “R” US-DELAWARE, INC.,
as the Borrower and as a Grantor
By:
	Name:
	Title:

GEOFFREY, LLC,
as a Grantor
By:
	Name:
	Title:

GEOFFREY INTERNATIONAL, LLC,
as a Grantor
By:
	Name:
	Title:

GEOFFREY HOLDINGS, LLC,
as a Grantor
By:	TOYS “R” US- DELAWARE, INC.
	its Managing Member
By:
	Name:
	Title:

TRU-SVC, LLC,
as a Grantor
By:
	Name:
	Title:

TOYS ACQUISITION, LLC,
as a Grantor
By:
	Name:
	Title:

TRU OF PUERTO RICO, INC.,
as a Grantor
By:
	Name:
	Title:

ADMINISTRATIVE AGENT:	BANK OF AMERICA, N.A.
	By: ____________________________
		Name:
		Title:

ANNEX 4

[SEE ATTACHED]

Annex 4

GUARANTEE

GUARANTEE AGREEMENT (this “Agreement”)dated as of July 19, 2006, among the Borrower (as defined), the guarantors party hereto (each an “Initial Guarantor” and collectively, the “Initial Guarantors”), each Person (as defined in the Credit Agreement (as defined)) which may become a Guarantor hereunder pursuant to a duly executed joinder agreement in the form attached as Exhibit A hereto (each a “New Guarantor” and collectively with the Initial Guarantors, the “Guarantors”)and Banc of America Bridge LLC,as administrative agent (together with its permitted successors and assigns in such capacity, the “Administrative Agent”) for the Secured Parties (as defined in the Credit Agreement referred to below).

Reference is made to that certain Amended and Restated Credit Agreement, dated as of July 19August 24, 20062010 (as amended, amended and restated, extended, supplemented, waived or otherwise modified in writing from time to time, the “Credit Agreement,” the terms defined therein being used herein as therein defined), among Toys “R” Us-Delaware, Inc., a Delaware corporation (the “Borrower”), each lender from time to time party thereto (the “Lenders”), Banc of America Bridge LLC, as administrative agent for the Lenders (together with its permitted successors and assigns in such capacity, the “Administrative Agent”), Citicorp North America, Inc. ("CNAI") as collateral agent for the Lenders (together with its permitted successors and assigns in such capacity, the “Collateral Agent”), Deutsche Bank Securities Inc. (“DBSI”), as Syndication Agent, Credit Suisse as Documentation Agent, Banc of America Securities LLC ("BAS") and DBSI, as Joint Lead Arrangers, and BAS, DBSI and Citigroup Global Markets Inc. ("CGMI"), as Joint Bookrunning Managers.

The Lenders have agreed to make Loans to the Borrower pursuant to and upon the terms and subject to the conditions specified in, the Credit Agreement. Each Guarantor is a Subsidiary of the Borrower and acknowledges that it has derived and will derive substantial benefit from the making of the Loans by the Lenders to the Borrower. As consideration therefor and in order to induce the Lenders to make Loans, each Guarantor is willing to execute this Agreement.

Accordingly, the parties hereto agree as follows:

SECTION 1.Definitions.

“Qualified ECP Guarantor” shall mean, at any time, each Guarantor with total assets exceeding $10,000,000 or that otherwise qualifies at such time in respect of any Swap Obligation as an “eligible contract participant” under the Commodity Exchange Act and can cause another person to qualify as an “eligible contract participant” with respect to such Swap Obligation at such time under §1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Specified Guarantor” means any Guarantor that is not an “eligible contract participant” under the Commodity Exchange Act (determined prior to giving effect to Section 24).

SECTION 12.    Guarantee. Each Guarantor unconditionally guarantees, jointly with any other Guarantors of the Secured Obligations under the Credit Agreement and the other Loan Documents and severally, as a primary obligor and not merely as a surety, the due and punctual payment of the Secured Obligations. To the fullest extent permitted by applicable law and except as otherwise provided in the Loan Documents, each Guarantor waives notice of, or any requirement for further assent to, any agreements or arrangements whatsoever by the Secured Parties with any other person pertaining to the Secured Obligations, including agreements and arrangements for payment, extension, renewal, subordination, composition, arrangement, discharge or release of the whole or any part of the Secured

Obligations, or for the discharge or surrender of any or all security, or for the compromise, whether by way of acceptance of part payment or otherwise, and, to the fullest extent permitted by applicable law, the same shall in no way impair each Guarantor’s liability hereunder..As used herein, “Secured Obligations” means (x) (a) obligations of the Borrower and the other Loan Partiesfrom time to timearising under or in respect of the due and punctual payment of (i) the principal of and premium, if any, and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, and (ii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise, of the Borrower and the other Loan Parties under the CreditAgreement and the other Loan Documentsand (b) the due and punctual performance of all covenants, agreements, obligations and liabilities of the Borrower and the other Loan Parties under or pursuant to the Credit Agreement and the other Loan Documents and (y) the due and punctual payment and performance of all obligations of the Borrower and the other Loan Parties under each Hedge Agreement permitted pursuant to Section 7.03(e) of the Credit Agreement entered into with any counter party that is a Secured Party.

SECTION 23.Obligations Not Waived. To the fullest extent permitted by applicable law and except as otherwise provided for herein or in the other Loan Documents, each Guarantor waives presentment to, demand of payment from and protest to the Borrower or any other person of any of the Secured Obligations, and also to the extent permitted by law and except as otherwise provided for herein or in the other Loan Documents waives notice of acceptance of its guarantee, notice of protest for nonpayment and all other formalities. To the fullest extent permitted by applicable law and except as otherwise provided for herein or in the other Loan Documents, the Guarantee of each Guarantor hereunder shall not be affected by (a) the failure of any Loan Party to assert any claim or demand or to enforce or exercise any right or remedy against the Borrower or any Guarantor under the provisions of the Credit Agreement, any other Loan Document or otherwise; (b) any extension, renewal or increase of or in any of the Secured Obligations; (c) any rescission, waiver, amendment or modification of, or any release from, any of the terms or provisions of this Agreement, the Credit Agreement, any other Loan Document, any guarantee or any other agreement or instrument, including with respect to any Guarantor under the Loan Documents; (d) the release of (or the failure to perfect a security interest in) any of the security held by or on behalf of the Administrative Agent or any other Secured Party; or (e) the failure or delay of any Secured Party to exercise any right or remedy against the Borrower or any Guarantor of the Secured Obligations.

SECTION 34.    Security. Each Guarantor authorizes the Administrative Agent to (a) take and hold security (to the extent such Guarantor has executed a Security Agreement in favor of the Administrative Agent) for the payment of this Guarantee and the Secured Obligations and exchange, enforce, waive and release any such security pursuant to the terms of any other Loan Documents; (b) apply such security and direct the order or manner of sale thereof as it in its sole discretion may determine subject to the terms of any other Loan Documents; and (c) release or substitute any one or more endorsees, other Guarantors or other obligors pursuant to the terms of any other Loan Documents. In no event shall this Section 34 require any Guarantor to grant security, except as required by the terms of the Loan Documents.

SECTION 45.    Guarantee of Payment. Each Guarantor further agrees that its guarantee constitutes a guarantee of payment when due and not of collection, and, to the fullest extent permitted by applicable law, waives any right to require that any resort be had by the Administrative Agent or any other Secured Party to any of the security held for payment of the Secured Obligations or to any balance of any deposit account or credit on the books of the Administrative Agent or any other Secured Party in favor of the Borrower or any other person.

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SECTION 56.    No Discharge or Diminishment of Guarantee. To the fullest extent permitted by applicable law and except as otherwise expressly provided in this Agreement, the Secured Obligations of each Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason (other than the payment in full in cash of the Secured Obligations (other than contingent indemnity obligations with respect to then unasserted claims)), including any claim of waiver, release, surrender, alteration or compromise of any of the Secured Obligations, and shall not be subject to any defense (other than a defense of payment) or setoff, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or unenforceability of the Secured Obligations or otherwise. Without limiting the generality of the foregoing, the obligations of each Guarantor hereunder shall, to the fullest extent permitted by applicable law, not be discharged or impaired or otherwise affected by the failure of the Administrative Agent or any other Secured Party to assert any claim or demand or to enforce any remedy under the Credit Agreement, any other Loan Document, any guarantee or any other agreement or instrument, by any amendment, waiver or modification of any provision of the Credit Agreement or any other Loan Document or other agreement or instrument, by any default, failure or delay, willful or otherwise, in the performance of the Secured Obligations, or by any other act, omission or delay to do any other act that may or might in any manner or to any extent vary the risk of any Guarantor or that would otherwise operate as a discharge of any Guarantor as a matter of law or equity (other than the payment in full in cash of all the Secured Obligations (other than contingent indemnity obligations with respect to then unasserted claims)) or which would impair or eliminate any right of any Guarantor to subrogation.

SECTION 67.    Defenses Waived. To the fullest extent permitted by applicable law, each Guarantor waives any defense based on or arising out of the unenforceability of the Secured Obligations or any part thereof from any cause or the cessation from any cause of the liability (other than the payment in full in cash of the Secured Obligations) of the Borrower or any other person. Subject to the terms of the other Loan Documents, the Administrative Agent and the other Secured Parties may, at their election, foreclose on any security held by one or more of them by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or adjust any part of the Secured Obligations, make any other accommodation with the Borrower or any other Guarantor or exercise any other right or remedy available to them against the Borrower or any other Guarantor, without affecting or impairing in any way the liability of each Guarantor hereunder except to the extent the Secured Obligations have been paid in cash. Pursuant to and to the fullest extent permitted by applicable law, each Guarantor waives any defense arising out of any such election even though such election operates, pursuant to applicable law, to impair or to extinguish any right of reimbursement or subrogation or other right or remedy of each Guarantor against the Borrower or any other Guarantor or any security.

SECTION 78.    Agreement to Pay; Subordination. In furtherance of the foregoing and not in limitation of any other right that the Administrative Agent or any other Secured Party has at law or in equity against each Guarantor by virtue hereof, upon the failure of the Borrower or any other Loan Party to pay any Secured Obligation when and as the same shall become due, whether at maturity, by acceleration, after notice of prepayment or otherwise, each Guarantor hereby promises to and will forthwith pay, or cause to be paid, to the Administrative Agent or such other Secured Party as designated thereby in cash an amount equal to the unpaid principal amount of such Secured Obligations then due, together with accrued and unpaid interest and fees on such Secured Obligations. Upon payment by each Guarantor of any sums to the Administrative Agent or any Secured Party as provided above, all rights of each Guarantor against the Borrower arising as a result thereof by way of right of subrogation, contribution, reimbursement, indemnity or otherwise shall in all respects be subordinate and junior in right of payment to the prior payment in full in cash of all the Secured Obligations (other than contingent indemnity obligations with respect to then unasserted claims). In addition, any indebtedness of the Borrower or any Subsidiary now or hereafter held by each Guarantor that is required by the Credit Agreement to be subordinated to the Secured Obligations is hereby subordinated in right of payment to

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the prior payment in full of the Secured Obligations. If any amount shall be paid to any Guarantor on account of (i) such subrogation, contribution, reimbursement, indemnity or similar right or (ii) any such indebtedness at any time when any Secured Obligation then due and owing has not been paid, such amount shall be held in trust for the benefit of the Secured Parties and shall forthwith be paid to the Administrative Agent (or to the First Lien Administrative Agent, to the extent provided in the Intercreditor Agreement) to be credited against the payment of the Secured Obligations, whether matured or unmatured, in accordance with the terms of the Loan Documents (including the Intercreditor Agreement).

SECTION 89.    General Limitation on Guarantee Obligations. In any action or proceeding involving any state corporate law, or any state, Federal or foreign bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if the obligations of any Guarantor under this Agreement would otherwise be held or determined to be void, voidable, invalid or unenforceable, or subordinated to the claims of any other creditors, on account of the amount of its liability under this Agreement, then, notwithstanding any other provision to the contrary, the amount of such liability shall, without any further action by any Guarantor, any creditor or any other Person, be automatically limited and reduced to the highest amount that is valid and enforceable and not subordinated to the claims of other creditors as determined in such action or proceeding.

SECTION 910.    Information. Each Guarantor assumes all responsibility for being and keeping itself informed of the Borrower’s financial condition and assets, all other circumstances bearing upon the risk of nonpayment of the Secured Obligations and the nature, scope and extent of the risks that each Guarantor assumes and incurs hereunder and agrees that none of the Administrative Agent or the other Secured Parties will have any duty to advise such Guarantor of information known to it or any of them regarding such circumstances or risks.

SECTION 1011. Covenant; Representations and Warranties. Each Guarantor agrees and covenants to, and to cause its Subsidiary to, take, or refrain from taking, each action that is necessary to be taken or not taken, so that no breach of the agreements and covenants contained in the Credit Agreement pertaining to actions to be taken, or not taken, by such Guarantor or its Subsidiary will result. Each Guarantor represents and warrants as to itself that all representations and warranties relating to it contained in the Credit Agreement are true and correct in all material respects on and as of the date hereof; provided that each reference in any such representation and warranty to the knowledge of Holdings or the Borrower shall, for the purposes of this Section 1011, be deemed to be a reference to Guarantor’s knowledge.

SECTION 1112. Termination. Except as otherwise set forth in the Credit Agreement, the Guarantees made hereunder shall terminate without further action on the part of any Person on the earliest of (i) the payment in full of the principal of and premium, if any, and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on all Loans; and (ii) all other Secured Obligations then due and owing, have in each case been paid in full and the Lenders have no further commitment in respect of the Loans under the Credit Agreement; provided that any such Guarantee shall continue to be effective or be reinstated, as the case may be, if at any time any payment, or any part thereof, on any Secured Obligation is rescinded or must otherwise be restored by any Secured Party upon the bankruptcy or reorganization of the Borrower, the Guarantors or otherwise.

SECTION 1213. Counterparts; Effectiveness; Assignment. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and permitted assigns of such party; and all covenants, promises and agreements by or on behalf of each Guarantor that are contained in this Agreement shall bind and inure to the benefit of each party hereto and

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their respective successors and permitted assigns (except that neither the Borrower nor the Guarantors shall have the right to assign its rights or obligations hereunder or any interest herein (and any such attempted assignment shall be void) without the prior written consent of the Required Lenders). The Administrative Agent is hereby expressly authorized to, and agrees upon request of the Borrower it will, release any Guarantor from its obligations hereunder (including its Guarantee) in the event that all the Equity Interests of such Guarantor shall be sold, transferred or otherwise disposed of to a person other than Holdings or any of its Subsidiaries in a transaction permitted by the Credit Agreement. This Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto.

SECTION 1314.    Waivers; Cumulative Remedies; Amendment. (a) No failure of the Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and are not exclusive of any rights, remedies, powers and privileges provided at law. No waiver of any provision of this Agreement or consent to any departure by any Guarantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice or demand on any Guarantor in any case shall entitle such Guarantor to any other or further notice or demand in similar or other circumstances.

(b)    Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to a written agreement entered into between the Borrower, the Guarantors and the Administrative Agent (with the consent of the Lenders if required under the Credit Agreement).

SECTION 1415.    GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

SECTION 1516.    Notices. All communications and notices hereunder shall be in writing and given as provided in Section 10.02 of the Credit Agreement.

SECTION 1617.    Survival of Representations and Warranties; Severability. (a) All covenants, representations and warranties made hereunder or in the Credit Agreement or other documents delivered pursuant hereto or thereto or in connection herewith of therewith shall survive the execution and delivery hereof and thereof until terminated in accordance with the terms hereof. Such representations and warranties have been or will be relied upon by the Secured Parties, regardless of any investigation made by the Secured Parties or on their behalf and shall continue in full force and effect until terminated in accordance with the terms hereof.

(b)    If any provision of this Agreement or the Credit Agreement is held to be illegal, invalid or unenforceable, (i) the legality, validity and enforceability of the remaining provisions contained herein and therein shall not be affected or impaired thereby and (ii) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

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SECTION 1718.    Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which when taken together shall constitute a single contract, and shall become effective as provided in Section 12. Delivery of an executed signature page to this Agreement by facsimile transmission shall be as effective as delivery of a manually executed counterpart of this Agreement.

SECTION 1819.    Rules of Interpretation. The rules of interpretation specified in Section 1.02 of the Credit Agreement shall be applicable to this Agreement.

SECTION 1920.    Jurisdiction; Consent to Service of Process. (a) Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the courts of The State of New York sitting in New York County and of the United States District Court of the Southern District of such state, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or the other Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State court or, to the extent permitted by applicable law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or in any other Loan Document shall affect any right that the Administrative Agent or any other Secured Party may otherwise have to bring any action or proceeding relating to this Agreement or the other Loan Documents against any Guarantor or its properties in the courts of any jurisdiction.

(b)    Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Agreement or the other Loan Documents in any court referred to in paragraph (a) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(c)    Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 15. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by applicable law.

SECTION 2021.    Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY) AND EXCEPT AS OTHERWISE PROVIDED HEREIN AND AS REQUIRED BY LAW WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES THEREOF AS WELL AS NOTICE OF NONPAYMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

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SECTION 2122.    Right of Setoff. The Secured Parties and their respective Affiliates shall have the right of setoff against each Guarantor to the same extent as such Persons have against the Borrower under the Credit Agreement.

SECTION 2223.    Beneficial Effect. Each Secured Party, along with its respective beneficiaries, if any, agrees to be bound by the terms of this agreement in order to receive the rights and benefits provided for in this Agreement.

SECTION 24.Keepwell. Each Guarantor that is a Qualified ECP Guarantor at the time this Agreement or the grant of the security interest under the Loan Documents, in each case, by any Specified Guarantor, becomes effective with respect to any Swap Obligation, hereby jointly and severally, absolutely, unconditionally and irrevocably undertakes to provide such funds or other support to each Specified Guarantor with respect to such Swap Obligation as may be needed by such Specified Guarantorfrom time to time to honor all of its obligations under thisAgreement and the other Loan Documents in respect of such Swap Obligation (but, in each case, only up to the maximum amount of such liability that can be hereby incurred without rendering such Qualified ECP Guarantor’s obligations and undertakings under this Section 24 voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations and undertakings of each Qualified ECP Guarantor under this Section shall remain in full force and effect until the Secured Obligations have been indefeasibly paid and performed in full. Each Qualified ECP Guarantor intends this Section to constitute, and this Section shall be deemed to constitute, a guarantee of the obligations of, and a “keepwell, support, or other agreement” for the benefit of, each Specified Guarantor for all purposes of the Commodity Exchange Act.

[Signature Pages Follow]

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written.

TOYS “R” US-DELAWARE, INC.,
as the Borrower
By:
	Name:
	Title:
GEOFFREY, INC., as a Guarantor
By:
	Name:
	Title:
GEOFFREY HOLDINGS, LLC, as a Guarantor
	By: Toys “R” Us-Delaware, Inc.
	Its: Managing Member
By:
	Name:
	Title:
TRU-SVC, LLC, as a Guarantor
	By: Toys “R” Us-Delaware, Inc.
	Its: Managing Member
By:
	Name:
	Title:
BABIESRUS.COM, as a Guarantor
By:
	Name:
	Title:

7

TOYSRUS.COM, LLC, as a Guarantor
By:
	Name:
	Title:

8

BANC OF AMERICA BRIDGE LLC, as Administrative Agent
By:
	Name:
	Title:

9

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ANNEX 5

[SEE ATTACHED]

Annex 5

EXHIBIT K

to Credit Agreement

FORM OF PREPAYMENT OPTION NOTICE

[Relevant Lender] [address]

Re: Toys “R” Us-Delaware, Inc.

[Date]

Ladies and Gentlemen:

Reference is made to the Amended and Restated Credit Agreement, dated as of August 24, 2010 (as amended, amended and restated, extended, supplemented, waived or otherwise modified in writing from time to time, the "Credit Agreement," the terms defined therein being used herein as therein defined), among Toys "R" Us-Delaware, Inc., a Delaware corporation (the "Borrower"), each lender from time to time party thereto (the "Lenders"), Bank of America, N.A., as administrative agent for the Lenders (together with its permitted successors

and assigns in such capacity, the "Administrative Agent"), [    ], as collateral agent for the
Lenders, Goldman Sachs Lending Partners LLC ("GS") and J.P. Morgan Securities Inc. ("JPM"), as Syndication Agents, Credit Suisse ("CS") and Wells Fargo Securities, LLC ("Wells"), as Documentation Agents, Banc of America Securities LLC ("BAS"), JPM and GS, as Joint Lead Arrangers, and BAS, JPM, Wells, GS, CS, Citigroup Global Markets, Inc. ("CGMI") and Deutsche Bank Securities Inc. ("DBSI"), as Joint Bookrunning Managers.

The Administrative Agent hereby gives you notice pursuant to Section 2.03(i) of the Credit Agreement as follows:

The Borrower has made an offer to prepay the Loans pursuant to Section

2.03[(b)][(c)][(d)][(e)]of the Credit Agreement on []¹ (the "Mandatory Prepayment

Date").

The aggregate Prepayment Amount is $[];the amount applicable to you is $[

]you will be paid a Pro Rata Share of the aggregate Prepayment Amount (your "Mandatory Prepayment Amount").

By acknowledging and accepting this Prepayment Option Notice as provided for herein, on the Mandatory Prepayment Date, the Borrower shall pay to you your Mandatory

¹ The Mandatory Prepayment Date shall be a date which date is 5 Business Days after the date of this Prepayment Option Notice.

Prepayment Amount (it being understood that a failure to respond to a Prepayment Option Notice shall be deemed an acceptance of your Mandatory Prepayment Amount referenced herein).

[Signature Page Follows]

	BANK OF AMERICA, N.A., as Administrative Agent
	By:
	Name:
	Title:
Acknowledged and Accepted:
[Lender]
By:
Name:
Title:

ANNEX 6

[SEE ATTACHED]

Annex 6

Toys "R" Us - Delaware, Inc.
Specified Real Property
Loc #	Type	Location Name	Street	City	State	Zip	Type	Square Footage
5672	Store	Brea, CA	2575 E. Imperial Highway	Brea	CA	92621	Ground Lease	38,406
5857	Store	Brentwood, CA	Lone Tree Plaza	Brentwood	CA	94513	Ground Lease	30,243
5858	Store	Salinas, CA	Boronda Crossing	Salinas	CA	93907	Ground Lease	31,114
6379	Store	Cherry Hill, NJ	Hillview Retail Center	Cherry Hill	NJ	08002	Ground Lease	37,397
6426	Store	Winston-Salem, NC	Hanes Mall Boulevard	Winston-Salem	NC	27103	Ground Lease	30,708
6429	Store	Manchester, CT	169 Hale Road	Manchester	CT	06040	Ground Lease	30,667
6431	Store	Union City, CA	31250 Court House Drive	Union City	CA	94587	Ground Lease	38,487
6447	Store	Folsom, CA	2785 E. Bidwell Street	Folsom	CA	95630	Ground Lease	30,714
6448	Store	Hickory, NC	1856 Catawba Boulevard	Hickory	NC	28602	Ground Lease	25,226
6465	Store	Scottsdale, AZ	7000 East Mayo Boulevard	Phoenix	AZ	85050	Ground Lease	37,997
6492	Store	Nashua, NH	10 Coliseum Avenue	Nashua	NH	03063	Ground Lease	37,092
6502	Store	Springfield, IL	White Oaks Plaza	Springfield	IL	62704	Ground Lease	23,379
6510	Store	North Miami, FL	2745 N.E. 193rd Street	North Miami	FL	33180	Ground Lease	22,422
6512	Store	Murrieta, CA	Village Walk Center	Murrieta	CA	92563	Ground Lease	30,622
6518	Store	Danbury, CT	19 Backus Avenue	Danbury	CT	06810	Ground Lease	20,674
6533	Store	West Windsor, NJ	500 Nassau Boulevard	West Windsor	NJ	08550	Ground Lease	37,259
6536	Store	Ft. Meyers, FL	10002 Gulf Center Drive	Ft. Myers	FL	33913	Ground Lease	30,526
6557	Store	Mira Mesa, CA	Mira Mesa Shopping Center	Mira Mesa	CA	92126	Ground Lease	48,200
6561	Store	Mesa, AZ	Superstition Gateway West Shopping Center	Mesa	AZ	85205	Ground Lease	30,567
6562	Store	Duram, NC	Renaissance Center @ Southpoint	Durham	NC	27713	Ground Lease	30,567
6570	Store	S. Richmond, VA	Village At Swift Creek	Midlothian	VA	23112	Ground Lease	31,448
6577	Store	Port St. Lucie, FL	The Landing at Tradition	Port St. Lucie	FL	34953	Ground Lease	30,633

7707	Store	Jackson, MS	260 Ridge Way	Flowood	MS	39232	Ground Lease	24,723
8855	Store	Martinez, GA	Mullins Crossing Shopping Center	Evans	GA	30809	Ground Lease	30,523
8881	Store	Charlotte (Sardis), NC	8062 Concord Mills Boulevard	Concord	NC	28026	Ground Lease	31,084
8885	Store	Woodridge (Potomac Mills), VA	East Horner Road & Prince William Parkway	Woodbridge	VA	22192	Ground Lease	29,695
9281	Store	Henrietta, NY	Marketplace Center	Henrietta	NY	14624	Ground Lease	29,476
9285	Store	Niles, IL	5660 Touhy Avenue	Niles	IL	60714	Ground Lease	37,336
9293	Store	Vernon Hills, IL	295 Center Drive	Vernon Hills	IL	60061	Ground Lease	37,397
9577	Store	Oklahoma City, OK	1731 Bell Isle Avenue	Oklahoma City	OK	73118	Ground Lease	37,327
9583	Store	Kansas City, MO	8640 North Madison Avenue	Kansas City	MO	64155	Ground Lease	30,688
5654	Store	Montebello, CA	Montebello Town Center	Montebello	CA	91706	Ground Lease	45,170
6338	Store	Long Is City, NY	3540 48th Street	Long Island City	NY	11101	Ground Lease	39,933
5693	Store	Ontario, CA	I-10 & Milken Avenue	Ontario	CA	91764	Ground Lease	37,363
6534	Store	Chula Vista, CA	1860 Main Court	Chula Vista	CA	91911	Ground Lease	37,700
9580	Store	Roseville, CA	Creekside Town Center	Roseville	CA	95678	Ground Lease	37,322
5645	Store	Paradise Valley, AZ	12799 North Tatum Boulevard	Phoenix	AZ	85253	Ground Lease	45,367
6304	Store	Totowa, NJ	445 U.S. Highway #46	Totowa	NJ	07511	Ground Lease	50,475
7016	Store	Metairie, LA	3609 Veterans Memorial Highway	Metairie	LA	70002	Ground Lease	45,315
7804	Store	Oklahoma City, OK	Crossroads Mall	Oklahoma City	OK	73149	Ground Lease	44,164
8373	Store	S.Greenboro, NC	3728 High Point Road	Greensboro	NC	27407	Ground Lease	45,177
8376	Store	Winston-Salem, NC	3200 Silas Creek Parkway	Winston-Salem	NC	27103	Owned	45,183
9227	Store	Henrietta, NY	654 Hylan Drive	Henrietta	NY	14623	Ground Lease	46,698
6554	Store	Emeryville, CA	3938 Horton	Emeryville	CA	94608	Owned	44,666
5646	Store	E. Tucson, AZ	5355 Broadway	East Tucson	AZ	85711	Ground Lease	45,218
5667	Store	Glendale CA	2901 Los Feliz Boulevard	Glendale	CA	90039	Ground Lease	44,904
5806	Store	S. Sacramento, CA	8507 Bond Road - Building A	Elk Grove	CA	95624	Ground Lease	49,970
5843	Store	Santa Cruz, CA	Commercial Way & 17th Avenue	Santa Cruz	CA	95060	Ground Lease	46,509

6019	Store	Riverview, IL	Riverview Plaza Shopping Center	Chicago	IL	60618	Ground Lease	39,104
6335	Store	Rockaway, NJ	Rockaway Square Mall	Rockaway	NJ	07866	Ground Lease	33,306
7002	Store	Pasadena, TX	5651 Fairmont	Pasadena	TX	77501	Ground Lease	47,834
7518	Store	Utica, NY	4505 Commercial Drive	New Hartford	NY	13413	Ground Lease	47,044
7803	Store	Frisco, TX	Shafer Plaza	Frisco	TX	75034	Ground Lease	49,259
8330	Store	Vineland, NJ	100 Cumberland Mall	Vineland	NJ	08360	Ground Lease	30,806
8348	Store	Belair, MD	Tollgate Market Place	Bel Air	MD	21014	Ground Lease	31,129
8357	Store	Virginia Beach, VA	Lynnhaven East Shopping Center	Virginai Beach	VA	23452	Ground Lease	44,962
8358	Store	Roanoke, VA	4943 Valley View Boulevard North	Roanoke	VA	21012	Ground Lease	45,491
8818	Store	Columbus, GA	555 Whittlesey Boulevard	Columbus	GA	31909	Ground Lease	49,203
9223	Store	Amherst, NY	3030 Sheridan Drive	Amherst	NY	14226	Ground Lease	46,698
9504	Store	Topeka, KS	Westridge Plaza	Topeka	KS	66614	Ground Lease	45,783
9512	Store	Springfield, MO	1425 E. Battlefield Road	Springfield	MO	65804	Ground Lease	44,970
9537	Store	Sioux Falls, SD	4401 West Empire Place	Sioux Falls	SD	57116	Ground Lease	30,515
9062	Store	Rossmoor, CA	The Shops at Rossmoor	Seal Beach	CA	90740	Ground Lease	47,027
5633	Store	Escondido, CA	1240 Auto Parkway South	Escondido	CA	92025	Ground Lease	45,764
5639	Store	Pearl Ridge, HI	Pearl Ridge Shopping Center	Aiea	HI	96701	Ground Lease	37,051
5652	Store	Scottsdale, AZ	9139 E. Indian Bend Road	Scottsdale	AZ	85251	Ground Lease	45,460
5653	Store	National City, CA	1100 E. 30th Street	National City	CA	92050	Ground Lease	45,460
5682	Store	Chandler,AZ	I-10 & Ray Road	Chandler	AZ	85006	Ground Lease	31,982
5683	Store	Ontario,CA	4460 Ontario Mills Parkway	Ontario	CA	91764	Ground Lease	47,806
5802	Store	Fresno, CA	3520 W. Shaw Avenue	Fresno	CA	93726	Ground Lease	45,041
5810	Store	Stockton, CA	718 West Hammer Lane	Stockton	CA	95210	Ground Lease	49,966
6310	Store	Valley Stream, NY	300 Sunrise Highway	Valley Stream	NY	11580	Owned	46,448
6003	Store	Springfield, IL	2701 Veteran's Parkway	Springfield	IL	62704	Ground Lease	45,177
6005	Store	Melrose Park, IL	9200 West North Avenue	Melrose	IL	60160	Owned	39,513
6012	Store	Woodridge, IL	1500 75Tth Street	Downers Grove	IL	60516	Owned	41,916
6026	Store	Highland Park, IL	1610 Deerfield Road	Highland Park	IL	60035	Owned	47,923

6033	Store	Madison, WI	7309 West Town Way	Madison	WI	53719	Ground Lease	49,262
6306	Store	Paramus Rt.4, NJ	250 Route #4 East	Paramus	NJ	07652	Ground Lease	38,399
6308	Store	Brooklyn, NY	2875 Flatbush Avenue	Brooklyn	NY	11234	Owned	45,980
6332	Store	Danbury, CT	Danbury Square	Danbury	CT	06810	Ground Lease	45,208
7043	Store	Lake Charles, LA	3405 Gerstner Memorial Drive	Lake Charles	LA	70607	Owned	22,514
7044	Store	Slidell, LA	137 Northshore Boulevard	Slidell	LA	70459	Ground Lease	30,766
7046	Store	Sugarland, TX	16618 SW Freeway	Sugar Land	TX	77478	Ground Lease	31,940
7532	Store	Buckland Hills, CT	Plaza at Buckland Hills	Manchester	CT	06040	Ground Lease	44,850
7834	Store	Norman, OK	I-35 & Main Street	Norman	OK	73072	Ground Lease	29,807
8314	Store	Christiana, DE	10 Geoffrey Drive	Newark	DE	19702	Owned	46,844
8331	Store	Colonial Heights, VA	1869 South Park Boulevard	Colonial Heights	VA	23834	Ground Lease	43,669
8381	Store	Durham, NC	Westgate Shopping Center	Durham	NC	27707	Ground Lease	46,698
8706	Store	Plantation, FL	8109 Broward Boulevard	Plantation	FL	33324	Owned	39,973
8710	Store	Ft. Meyers, FL	4983 S. Cleveland Avenue	Fort Myers	FL	33901	Ground Lease	49,262
8715	Store	Kendall, FL	North Kendall Drive -S.W. 117th Avenue	Kendall	FL	33256	Ground Lease	45,187
8732	Store	Orange Park, FL	1972 Wells Road	Orange Park	FL	32073	Ground Lease	42,004
8825	Store	Charlotte II, NC	8050 Concord Mills Boulevard	Concord	NC	28027	Ground Lease	49,262
8827	Store	Mobile, AL	Bel Aire Boulevard	Mobile	AL	36606	Owned	49,271
8918	Store	Evansville, IN	318 N. Green River Road	Evansville	IN	47715	Ground Lease	45,183
9517	Store	Des Moines, IA	1211 East Army Post Road	Des Moines	IA	63074	Ground Lease	45,460
9520	Store	Kansas City, MO	8330 North Broadway	Kansas City	MO	64118	Ground Lease	41,968
9526	Store	Tulsa II, OK	14303 21st Street South	Tulsa	OK	74106	Ground Lease	45,460
9536	Store	Rapid City, SD	405 E. Disk Drive	Rapid City	SD	57701	Ground Lease	30,808
9501	DC	Lee's Summit, MO	420 S.E. Thompson Road	Lee Summit	MO	64082	Owned	691,000
7701	DC	Midlothian, TX	3800 Railport Parkway	Midlothian	TX	76065	Owned	835,000
6301	DC	Mt. Olive, NJ	703 Bartley Chester Road	Flanders	NJ	07836	Owned	1,364,215
5601	DC	Rialto, CA	1110 W. Merrill Avenue	Rialto	CA	92376	Owned	1,107,000
								7,903,359

ANNEX 7

[SEE ATTACHED]

Annex 7

TERM B-4 JOINDER AGREEMENT

TERM B-4 JOINDER AGREEMENT (this “Joinder Agreement”), dated as of October 24, 2014, by and among TOYS “R” US-DELAWARE, INC., a Delaware corporation (the “Borrower”), BANK OF AMERICA, N.A., as Administrative Agent (the “Administrative Agent”) under the Credit Agreement (as defined below) and each of the other Loan Parties that is a party hereto.

RECITALS:

WHEREAS, reference is hereby made to the Amendzazed and Restated Credit Agreement, dated as of August 24, 2010 (as amended by that certain Amendment No. 1 dated as of September 20, 2010, as further amended by that certain Incremental Joinder Agreement dated as of May 25, 2011, as further amended by that certain Incremental Joinder Agreement No. 2 dated as of April 10, 2012, as further amended by that certain Amendment No. 2 dated as of April 10, 2012, as further amended by that certain Amendment No. 3 dated as of the date hereof (“Amendment No. 3”), and as may be further amended, supplemented or otherwise modified from time to time pursuant to the terms thereof, the “Credit Agreement”), among the Borrower, the Administrative Agent and each Lender from time to time party thereto (capitalized terms used but not defined herein having the meaning provided in the Credit Agreement);

WHEREAS, the Borrower has notified the Administrative Agent that it is requesting the establishment of Term B-4 Loans pursuant to Amendment No. 3, in an aggregate principal amount of $1,025,726,000;

WHEREAS, pursuant to Amendment No. 3 and the Credit Agreement, the Term B-4 Lenders (including the Fronting Term B-4 Lender (as defined in Amendment No. 3)) (and any assignees thereof) will provide, subject to the satisfaction of certain conditions precedent set forth in Amendment No. 3, Term B-4 Loans to the Borrower either through: (i) funding the Term B-4 Commitment (as defined in Amendment No. 3), (ii) an extension of Term B-2 Loans and/or Term B-3 Loans into Term B-4 Loans and/or (iii) a conversion of Initial Loans into Term B-4 Loans, in each case pursuant to the terms set forth in Amendment No. 3; and

WHEREAS, this Joinder Agreement sets forth certain terms of the Term B-4 Loans;

NOW, THEREFORE, in consideration of the premises and agreements, provisions and covenants herein contained, the parties hereto agree as follows:

In addition to the terms set forth in the Credit Agreement, the Term B-4 Loans shall have the following terms:

1. Applicable Rate. The Applicable Rate with respect to the Term B-4 Loans shall mean a percentage per annum equal to (i) for Eurodollar Rate Loans, 8.75% and (ii) for Base Rate Loans, 7.75%.

-1-

2. Eurodollar Rate. With respect to the Term B-4 Loans only, the Eurodollar Rate shall be deemed to be the greater of (i) the Eurodollar Rate as defined in the Credit Agreement and (ii) 1.00% per annum.

3. Base Rate. With respect to the Term B-4 Loans only, the Base Rate shall be deemed to be the greater of (i) the Base Rate as defined in the Credit Agreement and (ii) 2.00% per annum.

4. Remedy Event Interest. Upon the occurrence of any Remedy Event (as defined in the IntermediateCo Unsecured Guarantee), the Term B-4 Loans will be subject to additional interest equal to 2.00% per annum, which will accrue from the date of such Remedy Event until the date such Remedy Event is cured or waived (the “IntermediateCo Additional Interest”). Such IntermediateCo Additional Interest shall be due and payable on each Interest Payment Date by the Borrower to the Administrative Agent (which will be distributed to the Term B-4 Lenders) if such InteremediateCo Additional Interest has accrued during the applicable Interest Period.

5. Amortization and Maturity Date. The Borrower shall repay to the Administrative Agent in dollars for the ratable account of the Term B-4 Lenders on February 28, May 31, August 31 and November 30 of each year, commencing on February 28, 2015, an aggregate amount equal to 0.25% of the aggregate principal amount of the Term B-4 Loans outstanding on the Term B-4 Closing Date (which payments in each case shall be reduced as a result of the application of prepayments in accordance with the Credit Agreement). To the extent not previously paid, all Term B-4 Loans shall be due and payable on the Term B-4 Maturity Date (which is five and one-half years after the Term B-4 Closing Date) together with accrued and unpaid interest on the principal amount, to but excluding the date of payment.

6. Fees. The Borrower agrees to pay on the Term B-4 Closing Date to (A) the Fronting Term B-4 Lender, as fee compensation for the funding of Term B-4 Loans (other than, for the avoidance of doubt, (i) any Initial Loans that are cashlessly rolled into Term B-4 Loans and (ii) any Term B-2 Loans and Term B-3 Loans that are extended into Term B-4 Loans), a non-refundable funding fee in an amount equal to 3.00% of the stated principal amount of such funded Term B-4 Loans (other than, for the avoidance of doubt, (i) any Initial Loans that are cashlessly rolled into Term B-4 Loans and (ii) any Term B-2 Loans and Term B-3 Loans that are extended into Term B-4 Loans), which fee may be paid with the proceeds of the funded Term B-4 Loans and (B) each Initial Loan Lender that has converted its Initial Loans (via a cashless roll) into Term B-4 Loans, as fee compensation for the conversion of its Initial Loans (via a cashless roll) into Term B-4 Loans, a non-refundable conversion fee in an amount equal to 3.00% of the stated principal amount of such Initial Term Loan Lender’s Term B-4 Loans that are converted into Term B-4 Loans via a cashless roll and are outstanding on the Term B-4 Closing Date, which fee may be paid with the proceeds of the funded Term B-4 Loans. For the avoidance of doubt, no fees shall be payable hereunder in connection with the exchange (whether or not in cash) of Term B-2 Loans and/or Term B-3 Loans into Term B-4 Loans.

-2-

7. Credit Agreement Governs. Except as set forth in this Joinder Agreement, the Term B-4 Loans shall be subject to the provisions, including any provisions restricting the rights, or regarding the obligations, of the Loan Parties or any provisions regarding the rights of the Term Lenders, of the Credit Agreement and the other Loan Documents (including Amendment No. 3) and each reference to a “Loan”, “Loans” or “Term B-4 Loans” in the Credit Agreement shall be deemed to include the Term B-4 Loans and other related terms will have correlative meanings mutatis mutandis.

8. Acknowledgments. Each Loan Party hereby expressly acknowledges the terms of this Joinder Agreement and reaffirms, as of the date hereof, (i) the covenants and agreements contained in each Loan Document (including Amendment No. 3) to which it is a party, including, in each case, such covenants and agreements as in effect immediately after giving effect to this Joinder Agreement and the transactions contemplated hereby and (ii) its guarantee of the Secured Obligations (including, without limitation, the Term B-4 Loans) under the Security Documents and its grant of Liens on the Collateral to secure the Secured Obligations (including, without limitation, the Obligations with respect to the Term B-4 Loans) pursuant to the Security Documents.

9. Amendment, Modification and Waiver. This Joinder Agreement may not be amended, modified or waived except in accordance with Section 10.01 of the Credit Agreement.

10. Liens Unimpaired. After giving effect to this Joinder Agreement, neither the modification of the Credit Agreement effected pursuant to this Joinder Agreement nor the execution, delivery, performance or effectiveness of this Joinder Agreement:

(a) impairs the validity, effectiveness or priority of the Liens granted pursuant to any Loan Document (including Amendment No. 3), and such Liens continue unimpaired with the same priority to secure repayment of all Secured Obligations, whether heretofore or hereafter incurred; or

(b) requires that any new filings be made or other action taken to perfect or to maintain the perfection of such Liens.

11. Entire Agreement. This Joinder Agreement, the Credit Agreement and the other Loan Documents (including Amendment No. 3) constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof and supersede all other prior agreements and understandings, both written and verbal, among the parties hereto with respect to the subject matter hereof. Except as expressly set forth herein, this Joinder Agreement shall not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of any party under, the Credit Agreement, nor alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement, all of which are ratified and affirmed in all respects and shall continue in full force and effect. It is understood and agreed that each reference in each Loan Document (including Amendment No. 3) to the Credit Agreement, whether direct or indirect, shall hereafter be deemed to be a reference to the Credit Agreement as amended hereby and that this Joinder Agreement is a Loan Document.

-3-

12. GOVERNING LAW. THIS JOINDER AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. SECTIONS 10.14 AND 10.15 OF THE CREDIT AGREEMENT ARE HEREBY INCORPORATED BY REFERENCE INTO THIS JOINDER AGREEMENT AND SHALL APPLY HERETO.

13. Severability. If any provision of this Joinder Agreement is held to be illegal, invalid or unenforceable, the legality, validity and enforceability of the remaining provisions of this Joinder Agreement shall not be affected or impaired thereby. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

14. Counterparts. This Joinder Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery by telecopier or other electronic means of an executed counterpart of a signature page to this Joinder Agreement shall be effective as delivery of an original executed counterpart of this Joinder Agreement.

-4-

IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to execute and deliver this Joinder Agreement as of the date first written above.

BANK OF AMERICA, N.A.,
as Administrative Agent
By:
	Name:
	Title:

[Term B-4 Joinder Agreement]

TOYS “R” US-DELAWARE, INC.
By:
	Name:
	Title:
GEOFFREY HOLDINGS, LLC
By:	TOYS “R” US-DELAWARE, INC., its sole member
By:
	Name:
	Title:
TOYS ACQUISITION, LLC
By:
	Name:
	Title:
GEOFFREY, LLC
By:
	Name:
	Title:
GEOFFREY INTERNATIONAL, LLC
By:	GEOFFREY, LLC, its sole member
By:
	Name:
	Title:

[Term B-4 Joinder Agreement]

TRU-SVC, LLC
By:	TOYS “R” US-DELAWARE, INC., its sole member
By:
	Name:
	Title:
TRU OF PUERTO RICO, INC.
By:
	Name:
	Title:

[Term B-4 Joinder Agreement]

EX-12

Exhibit 12

Toys “R” Us, Inc.

Computation of Historical Ratios of Earnings to Fixed Charges ^(a) 

(In Millions, Except Ratio Data)

	Fiscal Years Ended
($ In millions)	January 31, 2015			February 1, 2014			February 2, 2013			January 28, 2012			January 29, 2011
Consolidated pretax (loss) earnings from continuing operations	(256		)	$	(867	)	$	92		$	150		$	132
Noncontrolling interest	4			3			1			2			(1		)
Interest capitalized during period	—			—			(1		)	(1		)	(1		)
Total fixed charges	631			714			716			688			756
Adjusted earnings (loss) from continuing operations	$	379		$	(150	)	$	808		$	839		$	886
Fixed Charges
Interest expense	451			$	524		$	480		$	442		$	521
Interest capitalized during period	—			—			1			1			1
Interest portion of rental expense	180			190			235			245			234
Total Fixed Charges	$	631		$	714		$	716		$	688		$	756
Ratio of Earnings to Fixed Charges	0.60			(0.21		)	1.13			1.22			1.17

(a) For purposes of calculating the ratio of earnings to fixed charges, earnings (loss) were calculated by adding (i) earnings (loss) from continuing operations before noncontrolling interest and income taxes, (ii) interest expense, including the portion of rents representative of an interest factor and (iii) amortization of debt issuance costs. Fixed charges consist of interest expense, amortization of debt issuance costs and the portions of rents representative of an interest factor.

Rent expense, net of sublease income	$	601		$	609		$	628		$	588		$	570
Capitalization factor	3.7			4.4			4.6			5.2			5.0
Weighted average cost of long-term debt	8.1		%	7.1		%	8.1		%	8.0		%	8.2		%
Interest in rent expense	$	180		$	190		$	235		$	245		$	234
% of interest to rent expense	30		%	31		%	37		%	42		%	41		%

EX-21

Exhibit 21 Subsidiaries of the Registrant as of January 31, 2015

Name	Jurisdiction
Geoffrey Funds, Inc.	Delaware
Geoffrey Holdings, LLC	Delaware
Geoffrey International, LLC	Delaware
Geoffrey, LLC	Delaware
Giraffe Holdings, LLC	Delaware
Giraffe Junior Holdings, LLC	Delaware
MAP Real Estate, LLC	Delaware
MAP 2005 Real Estate, LLC	Delaware
Toys “R” Us Children’s Fund	Delaware
Toys Acquisition, LLC	Delaware
Toys “R” Us − Delaware, Inc.	Delaware
Toys “R” Us Europe, LLC	Delaware
Toys “R” Us Property Company I, LLC	Delaware
Toys “R” Us Property Company II, LLC	Delaware
Toys “R” Us − Value, Inc.	Virginia
TRU 2005 RE I, LLC	Delaware
TRU 2005 RE II Trust	Delaware
TRU Asia, LLC	Delaware
TRU Australia Holdings, LLC	Delaware
TRU China Holdings, LLC	Delaware
TRU Global Tooling, LLC	Delaware
TRU Guam, LLC	Delaware
TRU Japan Holdings, Inc.	Delaware
TRU Japan Holdings 2, LLC	Delaware
TRU Mobility, LLC	Delaware
TRU (UK) H6, LLC	Delaware
TRU of Puerto Rico, Inc.	Puerto Rico
TRU – SVC, Inc.	Virginia
TRU Thailand, LLC	Delaware
TRU (Vermont), Inc.	Vermont
Wayne Real Estate Company, LLC	Delaware
Wayne Real Estate Holding Company, LLC	Delaware
Wayne Real Estate Parent Company, LLC	Delaware
Babies “R” Us (Australia) Pty Ltd	Australia
Toys “R” Us (Australia) Pty Ltd	Australia
Toys “R” Us Handelsgesellschaft m.b.H.	Austria
TRU (BVI) Asia 1 Ltd.	British Virgin Islands
TRU (BVI) Asia 2 Ltd.	British Virgin Islands
TRU (BVI) Finance II, Ltd.	British Virgin Islands
TRU Global Sourcing Limited	British Virgin Islands
TRU Thailand Limited	British Virgin Islands
Toys (Labuan) Holding Limited	British Virgin Islands
Magic Group Investments Limited	British Virgin Islands

Name	Jurisdiction
Toys “R” Us (Canada) Ltd./Toys “R” Us (Canada) Ltee	Canada
Toys “R” Us SARL	France
Toys “R” Us France Real Estate SAS	France
Toys “R” Us GmbH	Germany
Toys “R” Us (Asia) Limited	Hong Kong
Toys “R” Us (Hong Kong) Limited	Hong Kong
Toys “R” Us Holdings (China) Limited	Hong Kong
Toys “R” Us – Japan, Ltd.	Japan
Y.K. Babiesrus Internet Japan	Japan
Y.K. Toysrus Internet Japan	Japan
Toys (Labuan) Ltd.	Labuan
Toys‘R’Us (Malaysia) Sdn. Bhd.	Malaysia
TRU Netherlands Holdings B.V.	Netherlands
TRU Global Imports B.V.	Netherlands
Toys “R” Us (China) Limited dba Fan Dou Cheng Commercial Consulting (Shenzhen) Co., Ltd.	People’s Republic of China
Toys “R” Us Retailing (China) Limited	People’s Republic of China
Toys “R” Us Poland sp. zo.o	Poland
Toys “R” Us Sklep Internetowy sp. zo.o	Poland
Toys “R” Us Sklep Internetowy sp. zo.o sp. k	Poland
Toys R Us Portugal, Limitada	Portugal
Toys‘R’Us (Singapore) Pte. Ltd.	Singapore
Toys R Us Iberia, S.A.	Spain
Toys R Us Madrid, S.L.	Spain
Toys R Us Iberia Real Estate, S.L.	Spain
Toys “R” Us, Inc. Sucursal en Espaῆa	Spain
Toys “R” Us AG	Switzerland
Toys “R” Us (Taiwan) Trading Limited	Taiwan
Toys Retailing (Thailand) Limited	Thailand
Toys “R” Us Financial Services Limited	United Kingdom
Toys “R” Us Holdings Limited	United Kingdom
Toys “R” Us Limited	United Kingdom
Toys “R” Us (UK) Limited	United Kingdom
Toys “R” Us Properties (UK) Limited	United Kingdom
TRU (UK) Asia Limited	United Kingdom
TRU (France) Holdings Ltd.	United Kingdom
TRU (France) Finance Ltd.	United Kingdom
TRU (UK) H4 Limited	United Kingdom
TRU (UK) H5 Limited	United Kingdom
TRU (UK) Noteholder Limited	United Kingdom

EX-24

Exhibit 24

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Antonio Urcelay, Michael Short and Charles D. Knight and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign the Annual Report on Form 10-K of Toys “R” Us, Inc. for the fiscal year ended January 31, 2015, and any amendments thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform such and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

This Power of Attorney may be executed in separate counterparts, each of which shall be deemed an original, but all such counterparts shall together constitute one and the same instrument.

IN WITNESS WHEREOF, each of the undersigned has executed this Power of Attorney as of the 17^th day of March, 2015.

Name	Title	Signature
Joshua Bekenstein	Director	/s/ Joshua Bekenstein
Richard Goodman	Director	/s/ Richard Goodman
Daniel Guglielmone	Director	/s/ Daniel Guglielmone
Matthew S. Levin	Director	/s/ Matthew S, Levin
Joseph Macnow	Director	/s/ Joseph Macnow
Richard L. Markee	Director	/s/ Richard L. Markee
Wayne C. Sales	Director	/s/ Wayne C. Sales
Wendy Silverstein	Director	/s/ Wendy Silverstein
Nathaniel H. Taylor	Director	/s/ Nathaniel H. Taylor
Adam Waglay	Director	/s/ Adam Waglay
Gregory R. Why	Director	/s/ Gregory R. Why

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Antonio Urcelay, certify that:

1. I have reviewed this Annual Report on Form 10-K of Toys “R” Us, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting, to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 26, 2015

/s/    Antonio Urcelay

Antonio Urcelay

Chairman and Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Michael J. Short, certify that:

1. I have reviewed this Annual Report on Form 10-K of Toys “R” Us, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting, to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 26, 2015

/s/    Michael J. Short

Michael J. Short

Executive Vice President -

Chief Financial Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

Certification Pursuant To 18 U.S.C. Section 1350 By The Chief Executive Officer,

As Adopted Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002.

I, Antonio Urcelay, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

1. The Annual Report on Form 10-K of Toys “R” Us, Inc. (the “Company”) for the annual period ended January 31, 2015 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78m); and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 26, 2015

/s/    Antonio Urcelay

Antonio Urcelay

Chairman and Chief Executive Officer

(Principal Executive Officer)

EX-32.2

Exhibit 32.2

Certification Pursuant To 18 U.S.C. Section 1350 By The Chief Financial Officer,

As Adopted Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002.

I, Michael J. Short, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

1. The Annual Report on Form 10-K of Toys “R” Us, Inc. (the “Company”) for the annual period ended January 31, 2015 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78m); and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 26, 2015

/s/    Michael J. Short        

Michael J. Short

Executive Vice President -

Chief Financial Officer

(Principal Financial Officer)

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SEGMENTS (Tables)

12 Months Ended

Jan. 31, 2015

Depreciation and amortization

Reconciliation Schedule of Operating Profit (Loss) from Segments to Consolidated

A summary of financial results by reportable segment is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Net sales
Domestic	$	7,524		$	7,638		$	8,149
International	4,837			4,905			5,394
Total Net sales	$	12,361		$	12,543		$	13,543
Operating earnings (loss)
Domestic (1) (2)	$	332		$	(197	)	$	571
International (1)	229			203			309
Corporate and other	(370		)	(356		)	(324		)
Operating earnings (loss)	191			(350		)	556
Interest expense	(451		)	(524		)	(480		)
Interest income	4			7			16
(Loss) earnings before income taxes	$	(256	)	$	(867	)	$	92

(1) Fiscal 2013 includes full impairments of the Toys-Domestic and Toys-Japan reporting unit’s goodwill balances of $361 million and $17 million, respectively. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

(2) Includes incremental expense related to the write-down of excess and obsolete inventory of $51 million for fiscal 2013.

Summary of Depreciation, Amortization and Capital Expenditure

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
Depreciation and amortization
Domestic	$	210	$	216	$	225
International	116		123		136
Corporate	51		49		46
Total Depreciation and amortization	$	377	$	388	$	407
Capital expenditures
Domestic	$	67	$	113	$	148
International	83		86		95
Corporate	57		39		43
Total Capital expenditures	$	207	$	238	$	286

Total Merchandise Inventories And Total Assets Table

(In millions)	January 31, 2015		February 1, 2014
Merchandise inventories
Domestic	$	1,353	$	1,375
International	711		796
Total Merchandise inventories	$	2,064	$	2,171
Total Assets
Domestic	$	3,633	$	3,812
International	2,122		2,442
Corporate and other (1)	1,360		1,295
Total Assets	$	7,115	$	7,549

(1) Includes cash and cash equivalents, deferred tax assets and other corporate assets.

Total Long Lived Assets

Depreciation and amortization

Net Sales and Long Lived Assets by Country or Region

(In millions)	January 31, 2015		February 1, 2014
Long-lived assets
United States (1)	$	2,372	$	2,521
Europe (2)	352		417
Japan	306		383
UK	281		312
Canada	180		212
China and Southeast Asia	41		32
Australia	14		16
Total Long-lived assets	$	3,546	$	3,893

(1) Includes our wholly-owned operations in Puerto Rico and Guam.

(2) Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

Net Sales

Depreciation and amortization

Net Sales and Long Lived Assets by Country or Region

Our Net sales, inclusive of each country’s respective Internet operations, and long-lived assets by country or region are as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
Net sales
United States (1)	$	7,524	$	7,638	$	8,149
Europe (2)	1,405		1,447		1,439
Japan	1,308		1,374		1,795
Canada	834		883		928
UK	710		680		735
China and Southeast Asia	333		277		233
Australia	230		228		248
Other (3)	17		16		16
Total Net sales	$	12,361	$	12,543	$	13,543

(1) Includes our wholly-owned operations in Puerto Rico and Guam.

(2) Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

(3) Represents licensing fees from unaffiliated third parties.

Domestic

Depreciation and amortization

Percentage of Consolidated Net Sales from Product Category

The following tables show our percentage of Net sales by product category:

	Fiscal Years Ended
Domestic:	January 31, 2015		February 1, 2014		February 2, 2013
Baby	38.0	%	37.7	%	37.9	%
Core Toy	17.4	%	16.2	%	16.0	%
Entertainment	10.2	%	11.3	%	11.7	%
Learning	22.7	%	22.8	%	22.4	%
Seasonal	11.2	%	11.3	%	11.3	%
Other (1)	0.5	%	0.7	%	0.7	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues.

International

Depreciation and amortization

Percentage of Consolidated Net Sales from Product Category

	Fiscal Years Ended
International:	January 31, 2015		February 1, 2014		February 2, 2013
Baby	20.2	%	20.4	%	21.6	%
Core Toy	23.5	%	22.7	%	21.9	%
Entertainment	8.5	%	10.0	%	11.4	%
Learning	31.1	%	30.8	%	29.2	%
Seasonal	15.9	%	15.3	%	15.2	%
Other (1)	0.8	%	0.8	%	0.7	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues, including licensing fees from unaffiliated third parties.

From time to time, we may make revisions to our prior period Net sales by product category to conform to the current period allocation. These revisions did not have a significant impact to our prior year disclosure.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Notional Amounts and Related Fair Values of Derivatives (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Derivative [Line Items]
Derivative Asset, Notional Amount	$ 2,406	[1]	$ 2,822	[1]
Derivative Asset, Fair Value	0	[1]	13	[1]
Derivative Liability, Notional Amount	132	[1]	143	[1]
Derivative Liability, Fair Value	(2)	[1]	(1)	[1]
Other assets
Derivative [Line Items]
Derivative Asset, Notional Amount	53		2,796
Derivative Asset, Fair Value	0		13
Accrued expenses and other current liabilities (1)
Derivative [Line Items]
Derivative Liability, Notional Amount	132		78
Derivative Liability, Fair Value	2		0
Other non-current liabilities
Derivative [Line Items]
Derivative Liability, Notional Amount	0		65
Derivative Liability, Fair Value	0		(1)
Prepaid expenses and other current assets
Derivative [Line Items]
Derivative Asset, Notional Amount	2,353		26
Derivative Asset, Fair Value	0		0
Derivatives not designated for hedge accounting: | Interest Rate Contract [Member] | Other assets
Derivative [Line Items]
Derivative Asset, Notional Amount	0		1,611
Derivative Asset, Fair Value	0		0
Derivatives not designated for hedge accounting: | Interest Rate Contract [Member] | Prepaid expenses and other current assets
Derivative [Line Items]
Derivative Asset, Notional Amount	1,611	[2]	0	[2]
Derivative Asset, Fair Value	0	[2]	0	[2]
Derivatives not designated for hedge accounting: | Foreign-Exchange Forwards | Accrued expenses and other current liabilities (1)
Derivative [Line Items]
Derivative Liability, Notional Amount	90		78
Derivative Liability, Fair Value	2		0
Derivatives not designated for hedge accounting: | Foreign-Exchange Forwards | Prepaid expenses and other current assets
Derivative [Line Items]
Derivative Asset, Notional Amount	8		26
Derivative Asset, Fair Value	0		0
Derivatives designated as cash flow hedges: | Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | Other assets
Derivative [Line Items]
Derivative Asset, Notional Amount	53		835
Derivative Asset, Fair Value	0		0
Derivatives designated as cash flow hedges: | Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | Accrued expenses and other current liabilities (1)
Derivative [Line Items]
Derivative Liability, Notional Amount	42	[2]	0	[2]
Derivative Liability, Fair Value	0	[2]	0	[2]
Derivatives designated as cash flow hedges: | Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | Other non-current liabilities
Derivative [Line Items]
Derivative Liability, Notional Amount	0		65
Derivative Liability, Fair Value	0		(1)
Derivatives designated as cash flow hedges: | Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | Prepaid expenses and other current assets
Derivative [Line Items]
Derivative Asset, Notional Amount	734	[2]	0	[2]
Derivative Asset, Fair Value	0	[2]	0	[2]
Interest Rate Contract designated as a fair value hedge: | Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | Other assets
Derivative [Line Items]
Derivative Asset, Notional Amount	0		350
Derivative Asset, Fair Value	$ 0		$ 13

[1] Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the fair value of our derivative instruments classified within the fair value hierarchy.

[2] Amounts as of January 31, 2015 includes reclassifications of contracts scheduled to mature within the next 12 months, which were previously included within Other assets or Other non-current liabilities as of February 1, 2014.

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Annual Maturities of Short-term borrowings and Long-term debt (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015
Debt Disclosure [Abstract]
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months	$ 176
Long-term Debt, Maturities, Repayments of Principal in Year Two	34
Long-term Debt, Maturities, Repayments of Principal in Year Three	1,207
Long-term Debt, Maturities, Repayments of Principal in Year Four	658
Long-term Debt, Maturities, Repayments of Principal in Year Five	1,180
Long-term Debt, Maturities, Repayments of Principal after Year Five	1,571
Debt Instrument, Face Amount	$ 4,826

XML

LEASES - Narrative (Details) (USD $)	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Operating Leased Assets [Line Items]
Future Minimum Payments of Lease Extended Amount	$ 1,700,000,000
Capital Leases, Future Minimum Payments, Interest Included in Payments	20,000,000
Operating Leases, Rent Expense, Net	601,000,000	609,000,000	628,000,000
Operating Leases, Income Statement, Sublease Revenue	18,000,000	19,000,000	19,000,000
Deferred rent liabilities	359,000,000	374,000,000
Deferred rent liabilities, current, recorded in Accrued expenses and other current liabilities	12,000,000	12,000,000
Operating Leases, Rent Expense, Contingent Rentals	10,000,000	10,000,000	12,000,000
Long-term debt	4,788,000,000	5,007,000,000
Finance obligations associated with capital projects [Member]
Operating Leased Assets [Line Items]
Long-term debt	$ 189,000,000	$ 174,000,000

XML

FAIR VALUE MEASUREMENTS - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Feb. 01, 2014
International
Fair Value Assets And Liablities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Goodwill, Translation Adjustments	$ 3
Fair Value, Measurements, Nonrecurring [Member] | Significant Other Observable Inputs (Level 2)
Fair Value Assets And Liablities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Long-lived assets held and used	$ 11

XML

INCOME TAXES - Reconciliation of Beginning and Ending Amount of Gross Unrecognized Tax Benefits (Excluding Interest and Penalties) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Income Tax Disclosure [Abstract]
Beginning balance	$ 37		$ 32		$ 42
Additions for tax positions of the current year	4		4		5
Additions for tax positions of prior years	5		6		3
Reductions for tax positions of prior years	(11)	[1]	(1)	[1]	(12)	[1]
Settlements	0		0		(5)
Currency translation adjustment	(4)		0		0
Lapse of statute of limitations	(1)		(4)		(1)
Ending balance	$ 30		$ 37		$ 32

[1] Reductions for tax positions of prior years include amounts related to the resolution of issues in connection with resolving tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations.

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SCHEDULE I - PARENT COMPANY INFORMATION - Long-term Notes Payable by Parent (Parent Company [Member], Toys R Us - Delaware [Member], USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties	$ 840	[1]	$ 783	[1]
Note Issued by Parent FY 2005 [Member]
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties	299		286
Note Issued by Parent FY 2009 [Member]
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties	222		201
Senior Subordinated Note Issued by Parent in FY 2012 [Member]
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties	229	[2]	206	[2]
Note Issued by Parent FY 2012 [Member]
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties	$ 90		$ 90

[1] Includes accrued and unpaid interest.

[2] Note is expressly subordinated in right of payment to the senior obligations of the Parent.

XML

SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Narrative (Details)	12 Months Ended								0 Months Ended	12 Months Ended					12 Months Ended	0 Months Ended	12 Months Ended			0 Months Ended		0 Months Ended	12 Months Ended										0 Months Ended	12 Months Ended					12 Months Ended			0 Months Ended	12 Months Ended					12 Months Ended	0 Months Ended	12 Months Ended							0 Months Ended		12 Months Ended							0 Months Ended		12 Months Ended							0 Months Ended		12 Months Ended								0 Months Ended									0 Months Ended							0 Months Ended																	12 Months Ended						12 Months Ended	0 Months Ended	12 Months Ended					0 Months Ended																					12 Months Ended							0 Months Ended			12 Months Ended					12 Months Ended		12 Months Ended		0 Months Ended				0 Months Ended			12 Months Ended			12 Months Ended				12 Months Ended				12 Months Ended		12 Months Ended				12 Months Ended						12 Months Ended						12 Months Ended		12 Months Ended			12 Months Ended						12 Months Ended
	Jan. 31, 2015 USD ($)	Feb. 01, 2014 USD ($)	Feb. 02, 2013 USD ($)	Jan. 31, 2015 Debussy [Member] USD ($)	Jan. 31, 2015 Debussy [Member] GBP (£)	Mar. 28, 2013 Debussy [Member] USD ($)	Mar. 28, 2013 Debussy [Member] GBP (£)	Feb. 01, 2014 KKR [Member] USD ($)	Oct. 25, 2014 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] USD ($)	Jan. 31, 2015 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] USD ($)		Oct. 24, 2014 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] USD ($)	Feb. 01, 2014 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] USD ($)		Jan. 31, 2015 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] Secured Term B-four Loan Facility, option (i) [Member]	Oct. 25, 2014 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] Secured Term B-four Loan Facility, option (ii) [Member]	Jan. 31, 2015 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] Secured Term B-four Loan Facility, option (ii) [Member]	Jan. 31, 2015 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] Secured Term B-four Loan Facility, option (iii) [Member]	Oct. 24, 2014 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] Secured Term B-four Loan Facility, option (iii) [Member]	Oct. 25, 2014 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] Additional Guarantor Covenant Failure, Additional Interest Penalty [Member] Toys R Us - Delaware [Member]	Jan. 31, 2015 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] KKR [Member] USD ($)	Oct. 25, 2014 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] USD ($)	Jan. 31, 2015 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] USD ($)		Oct. 24, 2014 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] USD ($)	Feb. 01, 2014 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] USD ($)		Oct. 24, 2014 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] Toys R Us - Canada [Member] USD ($)	Jan. 31, 2015 Seven point three seven five percent senior secured notes, due fiscal two thousand sixteen [Member] USD ($)		Feb. 01, 2014 Seven point three seven five percent senior secured notes, due fiscal two thousand sixteen [Member] USD ($)		Jan. 30, 2013 Spanish real estate credit facility, due fiscal two thousand fifteen [Member]	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] EUR (€)	Feb. 01, 2014 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] EUR (€)	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] USD ($)	Feb. 01, 2014 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] USD ($)	Jan. 29, 2013 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] EUR (€) Properties	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] Occuring During First Year [Member]	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] Occuring During Second Year [Member]	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] Occuring During Third Year [Member]	Feb. 28, 2013 French real estate credit facility, due fiscal two thousand eighteen [Member]	Jan. 31, 2015 French real estate credit facility, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 French real estate credit facility, due fiscal two thousand eighteen [Member] EUR (€)	Feb. 01, 2014 French real estate credit facility, due fiscal two thousand eighteen [Member] USD ($)	Feb. 27, 2013 French real estate credit facility, due fiscal two thousand eighteen [Member] EUR (€)	Jan. 31, 2015 French real estate credit facility, due fiscal two thousand thirteen [Member] Properties	Jan. 31, 2015 European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member]	Aug. 22, 2013 Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] USD ($)	Jan. 31, 2015 Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] USD ($)		Feb. 01, 2014 Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] USD ($)		Aug. 21, 2013 Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] USD ($)	Jan. 31, 2015 Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] KKR [Member] USD ($)	Feb. 01, 2014 Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] KKR [Member] USD ($)	Oct. 25, 2014 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)	May 26, 2011 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)		Feb. 01, 2014 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)		May 25, 2011 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] KKR [Member] USD ($)	Feb. 01, 2014 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] KKR [Member] USD ($)	Oct. 25, 2014 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)	Apr. 11, 2012 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)		Feb. 01, 2014 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)		Apr. 10, 2012 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] KKR [Member] USD ($)	Feb. 01, 2014 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] KKR [Member] USD ($)	Aug. 22, 2013 Ten point seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)	Aug. 21, 2013 Ten point seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)	Feb. 01, 2014 Secured term loan facility, due fiscal two thousand sixteen [Member] USD ($)		Jan. 31, 2015 Secured term loan facility, due fiscal two thousand sixteen [Member] USD ($)		Apr. 10, 2012 Secured term loan facility, due fiscal two thousand sixteen [Member] USD ($)	Feb. 01, 2014 Secured term loan facility, due fiscal two thousand sixteen [Member] KKR [Member] USD ($)	Jan. 31, 2015 New UK Propco Loan [Member] Properties	Mar. 28, 2013 New UK Propco Loan [Member] GBP (£)	Aug. 02, 2012 Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)	Jan. 31, 2015 Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)		Feb. 01, 2014 Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)		Aug. 01, 2012 Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)		Jan. 31, 2015 Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] KKR [Member] USD ($)	Feb. 01, 2014 Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] KKR [Member] USD ($)	Nov. 21, 2009 Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] USD ($)	Jan. 31, 2015 Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] USD ($)		Feb. 01, 2014 Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] USD ($)		Nov. 20, 2009 Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] USD ($)	Feb. 01, 2014 Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] KKR [Member] USD ($)	Sep. 23, 2003 Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member] USD ($)		Feb. 01, 2014 Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member] USD ($)		Sep. 22, 2003 Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 U.K. real estate credit facility, due fiscal two thousand twenty [Member] USD ($)	Jan. 31, 2015 U.K. real estate credit facility, due fiscal two thousand twenty [Member] GBP (£)	Feb. 01, 2014 U.K. real estate credit facility, due fiscal two thousand twenty [Member] USD ($)	Jan. 31, 2015 Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Feb. 01, 2014 Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Jan. 31, 2015 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] USD ($)		Feb. 01, 2014 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] USD ($)		Dec. 01, 2006 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] USD ($)	Aug. 29, 1991 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] USD ($)	Jan. 31, 2015 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] Toys R Us - Delaware [Member] USD ($)	Feb. 01, 2014 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] Toys R Us - Delaware [Member] USD ($)	Feb. 02, 2013 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] Toys R Us - Delaware [Member] USD ($)	Mar. 28, 2013 Occuring During First Year [Member] New UK Propco Loan [Member]	Mar. 28, 2013 Occuring During Second Year [Member] New UK Propco Loan [Member]	Mar. 28, 2013 Occuring During Third Year [Member] New UK Propco Loan [Member]	Jan. 31, 2015 Fixed Charge Ratio [Member] Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]	Aug. 22, 2013 London Interbank Offered Rate (LIBOR) [Member] Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]	Jan. 31, 2015 London Interbank Offered Rate (LIBOR) [Member] Incremental secured term loan facility, due fiscal two thousand eighteen [Member]	Jan. 31, 2015 London Interbank Offered Rate (LIBOR) [Member] Second incremental secured term loan facility, due fiscal two thousand eighteen [Member]	Jan. 31, 2015 Euro Interbank Offered Rate (EURIBOR) [Member] Spanish real estate credit facility, due fiscal two thousand fifteen [Member]	Jan. 31, 2015 Euro Interbank Offered Rate (EURIBOR) [Member] French real estate credit facility, due fiscal two thousand eighteen [Member]	Feb. 27, 2013 Euro Interbank Offered Rate (EURIBOR) [Member] French real estate credit facility, due fiscal two thousand eighteen [Member]	Aug. 22, 2013 TRU Propco I Term Loan Facility, option (i) [Member] London Interbank Offered Rate (LIBOR) [Member] Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]	Aug. 22, 2013 TRU Propco I Term Loan Facility, option (ii)(x) [Member] Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]	Aug. 22, 2013 TRU Propco I Term Loan Facility, option (ii)(z) [Member] Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]	Aug. 22, 2013 TRU Propco I Term Loan Facility, option (ii)(z) [Member] London Interbank Offered Rate (LIBOR) [Member] Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]	Oct. 25, 2014 Tranche A-one Loan Facility, option (i) [Member] Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]	Oct. 25, 2014 Tranche A-one Loan Facility, option (i) [Member] London Interbank Offered Rate (LIBOR) [Member] Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]	Oct. 25, 2014 Tranche A-one Loan Facility, option (ii) (y) [Member] Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]	Oct. 25, 2014 Tranche A-one Loan Facility, option (ii) (z) [Member] Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]	Oct. 25, 2014 Tranche A-one Loan Facility, option (ii) (z) [Member] London Interbank Offered Rate (LIBOR) [Member] Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]	Oct. 25, 2014 Tranche A-one Loan Facility, option (ii) [Member] Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]	Oct. 25, 2014 Secured Term B-four Loan Facility, option (i) [Member] Secured term B-four loan facility, due fiscal two thousand and twenty [Member]	Oct. 25, 2014 Secured Term B-four Loan Facility, option (i) [Member] London Interbank Offered Rate (LIBOR) [Member] Secured term B-four loan facility, due fiscal two thousand and twenty [Member]	Oct. 25, 2014 Secured Term B-four Loan Facility, option (ii) (x) [Member] Secured term B-four loan facility, due fiscal two thousand and twenty [Member]	Oct. 25, 2014 Secured Term B-four Loan Facility, option (ii) (z) [Member] Secured term B-four loan facility, due fiscal two thousand and twenty [Member]	Oct. 25, 2014 Secured Term B-four Loan Facility, option (ii) (z) [Member] London Interbank Offered Rate (LIBOR) [Member] Secured term B-four loan facility, due fiscal two thousand and twenty [Member]	Oct. 25, 2014 Secured Term B-four Loan Facility, option (ii) [Member] Secured term B-four loan facility, due fiscal two thousand and twenty [Member]	Oct. 25, 2014 Secured Term B-four Loan Facility, option (ii) [Member] London Interbank Offered Rate (LIBOR) [Member] Secured term B-four loan facility, due fiscal two thousand and twenty [Member]	Jan. 31, 2015 Line of Credit [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] USD ($)		Feb. 01, 2014 Line of Credit [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] USD ($)		Jan. 31, 2015 Line of Credit [Member] Secured revolving credit facility, expires fiscal two thousand nineteen [Member] USD ($)		Feb. 01, 2014 Line of Credit [Member] Secured revolving credit facility, expires fiscal two thousand nineteen [Member] USD ($)		Mar. 21, 2014 Line of Credit [Member] Secured revolving credit facility, expires fiscal two thousand fifteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] USD ($)	Feb. 01, 2014 Line of Credit [Member] European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] USD ($)	Nov. 21, 2009 Maximum [Member] Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member]	Jan. 31, 2015 Maximum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Feb. 01, 2014 Maximum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Jan. 31, 2015 Maximum [Member] Line of Credit [Member] Secured revolving credit facility, expires fiscal two thousand nineteen [Member]	Jan. 31, 2015 Maximum [Member] Line of Credit [Member] London Interbank Offered Rate (LIBOR) [Member] Secured revolving credit facility, expires fiscal two thousand nineteen [Member]	Jan. 31, 2015 Maximum [Member] Line of Credit [Member] Prime Rate [Member] Secured revolving credit facility, expires fiscal two thousand nineteen [Member]	Jan. 31, 2015 Minimum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Feb. 01, 2014 Minimum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Jan. 31, 2015 Minimum [Member] Fixed Charge Ratio [Member] Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]	Jan. 31, 2015 Minimum [Member] Line of Credit [Member] Secured revolving credit facility, expires fiscal two thousand nineteen [Member] USD ($)	Jan. 31, 2015 Minimum [Member] Line of Credit [Member] London Interbank Offered Rate (LIBOR) [Member] Secured revolving credit facility, expires fiscal two thousand nineteen [Member]	Jan. 31, 2015 Minimum [Member] Line of Credit [Member] Prime Rate [Member] Secured revolving credit facility, expires fiscal two thousand nineteen [Member]	Jul. 16, 2014 Tranche 1 [Member] Line of Credit [Member] Toys-Japan Uncommitted Line of Credit [Member]	Jan. 31, 2015 Tranche 1 [Member] Line of Credit [Member] Toys-Japan Uncommitted Line of Credit [Member] USD ($)	Jul. 15, 2014 Tranche 1 [Member] Line of Credit [Member] Toys-Japan Uncommitted Line of Credit [Member] JPY (¥)	Sep. 17, 2014 Tranche 1 [Member] Line of Credit [Member] Toys-Japan Committed Line of Credit [Member] JPY (¥)	Sep. 18, 2014 Tranche 2 [Member] Line of Credit [Member] Toys-Japan Uncommitted Line of Credit [Member]	Jan. 31, 2015 Tranche 2 [Member] Line of Credit [Member] Toys-Japan Uncommitted Line of Credit [Member] USD ($)	Sep. 17, 2014 Tranche 2 [Member] Line of Credit [Member] Toys-Japan Uncommitted Line of Credit [Member] JPY (¥)	Jan. 31, 2015 Toys-Japan loan maturing January two thousand sixteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] JPY (¥)	Jan. 31, 2015 Toys-Japan loan maturing January two thousand sixteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Jan. 17, 2011 Toys-Japan loan maturing January two thousand sixteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Jan. 31, 2015 Toys-Japan loan maturing January two thousand sixteen [Member] Tokyo Interbank Offered Rate (TIBOR) [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Jan. 31, 2015 Toys-Japan loan maturing February two thousand sixteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] JPY (¥)	Jan. 31, 2015 Toys-Japan loan maturing February two thousand sixteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Feb. 28, 2011 Toys-Japan loan maturing February two thousand sixteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] JPY (¥)	Jan. 31, 2015 Toys-Japan loan maturing February two thousand sixteen [Member] Maximum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Jan. 31, 2015 Toys-Japan loan maturing October two thousand nineteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] JPY (¥)	Jan. 31, 2015 Toys-Japan loan maturing October two thousand nineteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Oct. 31, 2014 Toys-Japan loan maturing October two thousand nineteen [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] JPY (¥)	Jan. 31, 2015 Toys-Japan loan maturing October two thousand nineteen [Member] Maximum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Jan. 31, 2015 Toys-Japan loan maturing October two thousand nineteen [Member] Minimum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Jan. 31, 2015 Toys-Japan loan maturing February two thousand twenty one [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Jan. 31, 2015 Toys-Japan loan maturing February two thousand twenty one [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] JPY (¥)	Feb. 28, 2013 Toys-Japan loan maturing February two thousand twenty one [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] JPY (¥)	Mar. 25, 2013 Toys Japan remaining loans [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Jan. 31, 2015 Line of Credit [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member]	Jan. 31, 2015 Line of Credit [Member] Secured revolving credit facility, expires fiscal two thousand fifteen [Member] USD ($)	Feb. 01, 2014 Line of Credit [Member] Secured revolving credit facility, expires fiscal two thousand fifteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] GBP (£)	Feb. 01, 2014 Line of Credit [Member] European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] Mid European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member]	Jan. 31, 2015 Line of Credit [Member] Maximum [Member] European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member]	Jan. 31, 2015 Line of Credit [Member] Minimum [Member] European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member]	Jan. 31, 2015 Line of Credit [Member] Tranche 1 [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] Tranche 1 [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] JPY (¥)	Feb. 01, 2014 Line of Credit [Member] Tranche 1 [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] Tranche 1 [Member] Tokyo Interbank Offered Rate (TIBOR) [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member]	Jan. 31, 2015 Line of Credit [Member] Tranche 1 [Member] Maximum [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] Tranche 1 [Member] Minimum [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member]	Jan. 31, 2015 Line of Credit [Member] Tranche 2 [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] Tranche 2 [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] JPY (¥)	Jan. 31, 2015 Line of Credit [Member] Tranche 2 [Member] Tokyo Interbank Offered Rate (TIBOR) [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member]	Jan. 31, 2015 Line of Credit [Member] Tranche 2 [Member] Maximum [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] USD ($)	Feb. 01, 2014 Line of Credit [Member] Tranche 2 [Member] Maximum [Member] Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] Labuan uncommitted lines of credit [Member] USD ($)	Jan. 31, 2015 Line of Credit [Member] Labuan uncommitted lines of credit [Member] HKD	Feb. 01, 2014 Line of Credit [Member] Labuan uncommitted lines of credit [Member] USD ($)	Jan. 30, 2016 Scenario, Forecast [Member] Spanish real estate credit facility, due fiscal two thousand fifteen [Member] EUR (€)
Short-term Debt [Line Items]
Number of Unsecured Loan Commitment Lines of Credit																																																																																																																																																																																																			2
Debt Instrument, Face Amount	$ 4,826,000,000					$ 20,000,000	£ 13,000,000					$ 1,026,000,000													$ 280,000,000			$ 125,000,000										€ 75,000,000								€ 48,000,000								$ 985,000,000									$ 400,000,000													$ 950,000,000					$ 225,000,000			£ 263,000,000						$ 450,000,000	[1]								$ 725,000,000							$ 400,000,000											$ 200,000,000																																																															$ 11,500,000,000				¥ 1,000,000,000				¥ 500,000,000					¥ 2,000,000,000
Line of Credit Facility, Maximum Borrowing Capacity																																																																																																																																																								1,850,000,000																				13,000,000	1,500,000,000	1,500,000,000		4,000,000	500,000,000																					208,000,000	138,000,000					111,000,000	13,000,000,000					30,000,000	3,500,000,000				35,000,000	275,000,000
Long-term Debt, Refinanced, Amount									380,000,000																																																237,000,000									143,000,000
Debt Instrument, Interest Rate, Stated Percentage																													7.375%		7.375%																																													10.75%										10.375%		10.375%							8.50%		8.50%					7.375%		7.375%								8.75%		8.75%																																														2.45%	2.45%				1.85%	1.85%																	1.85%							1.85%	2.18%	2.18%
Long-term debt	4,788,000,000	5,007,000,000								1,010,000,000	[2],[3]		0	[2],[3]									272,000,000	[2],[3]		0	[2],[3]		0	[2],[3]	357,000,000	[2],[3]		30,000,000		34,000,000	71,000,000						53,000,000	47,000,000	64,000,000					965,000,000	[4]	973,000,000	[4]						133,000,000	[2],[3]	372,000,000	[2],[3]						67,000,000	[2],[3]	210,000,000	[2],[3]						646,000,000	[2],[3]	0	[2],[3]						448,000,000	[1]	447,000,000	[1]						721,000,000	[5]	719,000,000	[5]				402,000,000	[1]	403,000,000	[1]		396,000,000	263,000,000	433,000,000	63,000,000	91,000,000	22,000,000	[6]	22,000,000	[6]																																	0	[7]	5,000,000	[7]	0	[2],[3],[8]	0	[2],[3],[8]		0	0																								310,000,000	3,000,000			500,000,000	4,000,000				14,000,000	1,600,000,000
Secured Debt	2,700,000,000
Amount of Restricted Net Assets for Consolidated and Unconsolidated Subsidiaries	582,000,000
Short-term Debt																																																																																																																																																																																																																							0		12,000,000
Guarantor Obligations, Current Carrying Value																																																																																																																																																																																																																							3,000,000
Line of Credit Facility, Remaining Borrowing Capacity																																																																																																																																																													86,000,000																																							848,000,000								111,000,000						30,000,000					32,000,000
Line of Credit Facility, Interest Rate at Period End																																																																																																																																																																																																																									2.36%
Debt Instrument, Basis Spread on Variable Rate										8.75%													7.25%											6.00%	6.00%								4.50%	4.50%	4.50%					5.00%		5.00%							3.75%		3.75%							3.75%		3.75%							4.50%																																																	3.75%	3.75%	6.00%	4.50%		5.00%	0.50%	4.00%	1.00%	7.25%		0.50%	1.00%		6.25%	8.75%		0.50%	1.00%		7.75%																	1.75%	0.75%					1.50%	0.50%	0.50%				1.00%						1.50%																				2.50%	2.75%	2.25%				0.80%					0.80%
Unamortized Debt Issuance Expense	139,000,000	127,000,000								26,000,000		19,000,000											7,000,000		8,000,000											3,000,000	5,000,000						2,000,000		4,000,000					23,000,000		27,000,000		10,000,000					1,000,000		4,000,000		4,000,000					1,000,000		3,000,000		5,000,000														8,000,000		10,000,000		4,000,000					10,000,000		14,000,000		10,000,000			1,000,000		1,000,000		2,000,000	16,000,000		21,000,000		1,000,000																																													1,000,000				1,000,000																																				38,000,000	19,000,000	2,000,000		4,000,000						1,000,000		1,000,000					1,000,000	1,000,000
Covenant Term of Profitability																																																																																																																																																																					2 years																																												2 years
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage																																																																																																																																																								0.25%																																																		0.50%	0.375%
Line of Credit Facility, Potential Increase to Maximum Borrowing Capacity																																																																																																																																																								1,150,000,000
ABL Facility Springing Maturity Period																																																																																																																																																								30 days
Letters of Credit Outstanding, Amount																																																																																																																																																																																																				99,000,000
Line of Credit Facility, Current Borrowing Capacity																																																																																																																																																																																																				973,000,000
Debt Instrument, Covenant, Minimum Excess Availability																									125,000,000																																																																																																																															125,000,000																																												125,000,000
Debt Instrument, Covenant Excess Availability Prepayment																																																																																																																																																																								150,000,000
Debt Instrument, Covenant Repayment, Minimum Excess Availability																																																																																																																																																								130,000,000
ABL Facility Excess Availability Days																																																																																																																																																																		3 days
Fixed Charge Coverage Ratio																																																																																																																																																																																																										1.00	1.00
Debt Instrument, Term																																	3 years									5 years						5 years
Number of Real Estate Properties																																						26									9																																				31
Debt Instrument, Periodic Payment, Principal																																		22,500,000	22,500,000																								4,000,000									2,000,000																																																																																																														1,600,000,000				115,000,000			1,000,000	50,000,000			1,000,000		1,000,000	125,000,000																										30,000,000
Debt Instrument, Periodic Payment, Interest																				2.00%
Derivative, Cap Interest Rate																																																																																																																																2.00%		2.50%
Changes of Control Percentage of Principal Amount																																																																																						101.00%									101.00%
Debt instrument, Periodic Prepayment Percent, Principal																2.00%
Proceeds from Issuance of Secured Debt																																																										396,000,000									220,000,000																											715,000,000
Debt Instrument, Payment Terms																																							1	2	3
Debt Instrument, Step-Down Percentage																																																											0.25%									0.25%
Debt Instrument, Periodic Payment Percent, Principal									1.00%																																		1.25%	1.25%						1.00%									0.25%									0.25%
Redemption Percentage of Principal Amount																																																																																						100.00%
Redeemable Percentage of Debt Instrument																																																																																						40.00%
Current portion of long-term debt	176,000,000	89,000,000								10,000,000																										34,000,000							1,000,000							57,000,000																																																												5,000,000																																																																				4,900,000,000	42,000,000
Long-term debt borrowings	2,866,000,000	3,159,000,000	1,972,000,000																																																																																																		398,000,000
Debt Issuance Cost									27,000,000													8,000,000
Debt, Weighted Average Interest Rate																																																																																			6.85%
Number of Bank Loans with Financial Institutions																																																																																																														4																																																																																				2
Derivative, Fixed Interest Rate																																																																																																																																																																																			2.45%
Payment Received from Termination of Interest Rate Swaps																																																																																																						10,000,000
Percentage of Consolidated Net Tangible Assets																																																																																																						10.00%
Percentage of Consolidated Capitalization																																																																																																						15.00%
Proceeds from Issuance of Debt																																																	975,000,000																																				446,000,000
TRU Propco II Master Lease Rent Increase																																																																																																			10.00%
Financial Instruments, Owned, Corporate Debt, at Fair Value				20,000,000	13,000,000			9,000,000													96,000,000																																		17,000,000	17,000,000								12,000,000	50,000,000								2,000,000	9,000,000								70,000,000										9,000,000	9,000,000							5,000,000
TRU Propco II Master Lease Period																																																																																														5 years																																																																	20 years
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum																																																																																																																													1.00%	1.50%	1.50%									1.00%						1.00%					2.00%
Refinancing Anniversary															1 year 183 days		2 years 183 days	3 years 183 days				1 year
Interest Expense	451,000,000	524,000,000	480,000,000																																																																								77,000,000																																											2,000,000	2,000,000	2,000,000
Redemption Premium									6,000,000																																																																		51,000,000
Excess Annual Cash Flow Repayment Percentage																																																		25.00%
Appraised Property Value Repayment Percentage																																																		65.00%
Excess Cash Flow Distribution Percentage																																																		75.00%																																																																										50.00%
Debt Instrument, Redemption Price, Percentage									101.844%
Maximum Length of Time, Interbank Offered Rate																																																																																																																																											1 month						1 month
Interest Expense, Debt									35,000,000
Fixed Charge Ratio																																																																																																																												1.0																																											2.0
Prepayment Premium on Debt Principal Prepaid																			1.00%						1.00%																																																																																																3.00%	2.00%	1.00%
Debt Instrument, Tender Offer, Aggregate Amount																																																																																																																				178,000,000
Tender Offer, Percentage of Debt Instrument Purchased																																																																																																																				89.00%
Debt Issuance Costs Incurred During Noncash or Partial Noncash Transaction																																																																																																																																																								31,000,000
Debt Instrument, Unamortized Discount																																																																																																																																																												$ 17,000,000

[1] Represents obligations of Toys “R” Us, Inc. (the “Parent Company”) legal entity. For further details on Parent Company information, refer to Schedule I — Parent Company Condensed Financial Statements and Notes to the Condensed Financial Statements.

[2] On October 24, 2014, Toys-Delaware amended the credit agreement for its secured term loan facilities (the “Secured Term Loan Credit Agreement”) to provide for, among other things, a new tranche of term loans in an aggregate principal amount of $1,026 million due fiscal 2020 (the “Secured Term B-4 Loan”). Additionally, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the $1.85 billion secured revolving credit facility (“ABL Facility”) to provide for, among other things, a new tranche of loans in an aggregate principal amount of $280 million due fiscal 2019. The Secured Term B-4 Loan and the Tranche A-1 Loan, together with other sources and funds available to Toys-Delaware, were used to (i) refinance in full the Secured term loan facility due fiscal 2016, (ii) extend $380 million of the term loans due fiscal 2018 under the Incremental secured term loan facility and the Second incremental secured term loan facility into the Secured Term B-4 Loan and (iii) redeem all of the 7.375% senior secured notes due fiscal 2016 (“Toys-Delaware Secured Notes”), plus accrued interest, premiums and fees. The Secured Term B-4 Loan is guaranteed by Wayne Real Estate Parent Company, LLC, a wholly-owned subsidiary of the Company and an indirect parent of Toys “R” Us Property Company I, LLC.

[3] Represents obligations of Toys “R” Us - Delaware, Inc. (“Toys-Delaware”).

[4] Represents obligations of Toys “R” Us Property Company I, LLC and its subsidiaries (“TRU Propco I”).

[5] Represents obligations of Toys “R” Us Property Company II, LLC (“TRU Propco II”).

[6] (8)Represents obligations of the Parent Company and Toys-Delaware.

[7] Toys “R” Us - Japan, Ltd. (“Toys-Japan”) currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit (“Tranche 1” due fiscal 2015 and “Tranche 2” due fiscal 2016). On July 15, 2014, Toys-Japan entered into an agreement to refinance Tranche 2 of its committed lines of credit.

[8] On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for the ABL Facility in order to extend the maturity date of the facility and amend certain other provisions.

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PROPERTY AND EQUIPMENT (Tables)

12 Months Ended

Jan. 31, 2015

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

The following detail of property and equipment includes estimated useful lives which are generally used to depreciate the assets on a straight-line basis:

($ In millions)	Useful life (in years)	January 31, 2015		February 1, 2014
Land		$	695	$	733
Buildings	45-50	1,967		2,059
Furniture and equipment	3-20	1,639		1,733
Property and leasehold improvements	5-25	2,500		2,594
Costs of computer software	5	210		212
Construction in progress		32		20
Leased equipment under capital lease	3-5	51		57
		7,094		7,408
Less: accumulated depreciation and amortization		3,759		3,770
Total		$	3,335	$	3,638

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SEGMENTS - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015 stores countries	Feb. 01, 2014	Feb. 02, 2013	Jan. 31, 1994 countries
Depreciation and amortization
Number of Stores	1,602
Licenses Revenue	$ 17	$ 16	$ 16
Number of Reportable Segments	2
Number of Licensed Stores	212
Number of Countries in which Entity Operates	37			17
Goodwill impairment	0	378	0
Inventory Write-down		51
Domestic
Depreciation and amortization
Number of Stores	872
Number of States in which Entity Operates	49
Lessee Leasing Arrangements, Operating Leases, Term of Contract	2 years
Goodwill impairment		361
International
Depreciation and amortization
Percentage of Operated Stores	77.00%
Number of Stores	942
Lessee Leasing Arrangements, Operating Leases, Term of Contract	2 years
Number of Licensed Stores	212
Number of Countries in which Entity Operates	36
Goodwill impairment		$ 17
International | Wholly Owned Properties [Member]
Depreciation and amortization
Number of Stores	730

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INCOME TAXES - Earnings before Income Taxes (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Income Tax Disclosure [Abstract]
U.S.	$ (263)	$ (851)	$ (18)
Foreign	7	(16)	110
(Loss) earnings before income taxes	$ (256)	$ (867)	$ 92

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DEFINED BENEFIT PENSION PLANS - Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015	Feb. 01, 2014
Compensation and Retirement Disclosure [Abstract]
Projected benefit obligation	$ 174	$ 137
Accumulated benefit obligation	150	118
Fair value of plan assets	$ 123	$ 118

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FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis (Details) (Fair Value, Measurements, Nonrecurring [Member], USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets held and used			$ 11
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets held and used	7		24	[1]
Goodwill			64	[1],[2]
Total assets	7		88	[1]
Impairment Losses
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets held and used	13	[3]	44	[3]
Goodwill			378	[2],[3]
Total assets	13	[3]	422	[3]
Carrying Value Prior to Impairment
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets held and used	20		68
Goodwill			445	[2]
Total assets	$ 20		$ 513

[1] (2)Includes fair values based on offers received of $11 million as of February 1, 2014 which were previously classified as Level 2 and should have been Level 3.

[2] (3)Includes foreign currency translation of $3 million.

[3] (1)Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details

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SCHEDULE I - PARENT COMPANY INFORMATION - Impact of Derivatives on Interest Expense (Details) (Interest Expense [Member], USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Derivatives previously designated as cash flow hedges:
Total Interest expense (related to derivatives)	$ (4)		$ (1)		$ 8
Derivatives not designated for hedge accounting:
Derivatives previously designated as cash flow hedges:
Total Interest expense (related to derivatives)	(2)		1		4
Intercompany Loan Foreign Exchange Contracts [Member] | Derivatives not designated for hedge accounting:
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value	(9)	[1]	(1)	[1]	(2)	[1]
Interest Rate Contract [Member] | Derivatives not designated for hedge accounting:
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value	(2)		0		7
Parent Company [Member]
Derivatives previously designated as cash flow hedges:
Total Interest expense (related to derivatives)	1		(1)		0
Parent Company [Member] | Derivatives not designated for hedge accounting:
Derivatives previously designated as cash flow hedges:
Total Interest expense (related to derivatives)	0		(1)		0
Parent Company [Member] | Intercompany Loan Foreign Exchange Contracts [Member] | Derivatives not designated for hedge accounting:
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value	0	[2]	(1)	[2]	0	[2]
Parent Company [Member] | Derivatives designated as cash flow hedges: | Previously Designated as Hedging Instrument [Member]
Derivatives previously designated as cash flow hedges:
Total Interest expense (related to derivatives)	1		0		0
Parent Company [Member] | Derivatives designated as cash flow hedges: | Interest Rate Contract [Member] | Previously Designated as Hedging Instrument [Member]
Derivatives previously designated as cash flow hedges:
Amortization of hedged caps	$ 1		$ 0		$ 0

[1] Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

[2] Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, net, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

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INCOME TAXES - Summary of Deferred Tax Assets and Liabilities (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Deferred tax assets:
U.S. Federal tax loss and other carryforwards	$ 385		$ 398
State tax loss and other carryforwards	84		75
Foreign tax loss and other carryforwards	169		197
Straight line rent	127		137
Inventory	52		75
Insurance loss reserve	35		36
Restructuring charges	7		10
Other	158		119
Gross deferred tax assets before valuation allowance	1,017		1,047
Valuation allowance	(621)		(511)
Total deferred tax assets	396		536
Deferred tax liabilities:
Fixed assets (1)	(67)	[1]	(131)	[1]
Undistributed earnings of foreign subsidiaries	(222)		(291)
Foreign currency translation	(24)		(26)
Other	(21)		(14)
Total deferred tax liabilities	(334)		(462)
Net deferred tax assets	$ 62		$ 74

[1] Includes deferred impact of finance obligations associated with capital projects.

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DEFINED BENEFIT PENSION PLANS - Changes in Projected Benefit Obligations (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Compensation and Retirement Disclosure [Abstract]
Projected benefit obligation at beginning of year	$ 137	$ 128
Service cost	5	5	5
Interest cost	5	5	5
Employee contributions	0	1
Benefits paid	(6)	(2)
Actuarial loss (gain)	52	(1)
Foreign currency impact	(19)	1
Projected benefit obligation at end of year	$ 174	$ 137	$ 128

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SEGMENTS - Reconciliation Schedule of Operating Profit (Loss) from Segments to Consolidated (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Depreciation and amortization
Net sales	$ 12,361		$ 12,543		$ 13,543
Operating earnings (loss)	191		(350)		556
Interest expense	(451)		(524)		(480)
Interest income	4		7		16
(Loss) earnings before income taxes	(256)		(867)		92
Domestic
Depreciation and amortization
Net sales	7,524		7,638		8,149
Operating earnings (loss)	332	[1],[2]	(197)	[1],[2]	571	[1],[2]
International
Depreciation and amortization
Net sales	4,837		4,905		5,394
Operating earnings (loss)	229	[1]	203	[1]	309	[1]
Corporate and other
Depreciation and amortization
Operating earnings (loss)	$ (370)		$ (356)		$ (324)

[1] Fiscal 2013 includes full impairments of the Toys-Domestic and Toys-Japan reporting unit’s goodwill balances of $361 million and $17 million, respectively. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

[2] Includes incremental expense related to the write-down of excess and obsolete inventory of $51 million for fiscal 2013.

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DEFINED BENEFIT PENSION PLANS - Changes in Fair Value of Plan Assets (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014
Compensation and Retirement Disclosure [Abstract]
Fair value of plan assets at beginning of year	$ 118	$ 105
Actual return on plan assets	17	5
Employer contributions	7	7
Employee contributions	0	1
Benefits paid	(6)	(2)
Foreign currency impact	(13)	2
Fair value of plan assets at end of year	$ 123	$ 118

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INCOME TAXES - Summary of Deferred Tax Assets and Liabilities Reflected in Consolidated Balance Sheets (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Income Tax Disclosure [Abstract]
Current deferred tax assets	$ 45		$ 31
Current deferred tax liabilities	(4)	[1]	(13)	[1]
Non-current deferred tax assets	133		152
Non-current deferred tax liabilities	(112)		(96)
Net deferred tax assets	$ 62		$ 74

[1] The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities in the Consolidated Balance Sheets.

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LEASES - Schedule of Future Minimum Rental Payments for Operating Leases and Capital Leases (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015
Leases [Abstract]
Operating Leases, Future Minimum Payments Due, Next Twelve Months	$ 561	[1]
Operating Leases, Sublease Income Due, Next Twelve Months	15	[1]
Operating Leases, Net Future Minimum Payments Due, Next Twelve Months	546	[1]
Capital Leases, Future Minimum Payments Due, Next Twelve Months	31	[2]
Operating Leases, Future Minimum Payments, Due in Rolling Year Two	488	[1]
Operating Leases, Sublease Income Due, Due in Rolling Year Two	13	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling Year Two	475	[1]
Capital Leases, Future Minimum Payments, Due in Rolling Year Two	27	[2]
Operating Leases, Future Minimum Payments, Due in Rolling Year Three	399	[1]
Operating Leases, Sublease Income Due, Due in Rolling Year Three	10	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling Year Three	389	[1]
Capital Leases, Future Minimum Payments, Due in Rolling Year Three	24	[2]
Operating Leases, Future Minimum Payments, Due in Rolling Year Four	333	[1]
Operating Leases, Sublease Income Due, Due in Rolling Year Four	9	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling Year Four	324	[1]
Capital Leases, Future Minimum Payments, Due in Rolling Year Four	24	[2]
Operating Leases, Future Minimum Payments, Due in Rolling Year Five	272	[1]
Operating Leases, Sublease Income Due, Due in Rolling Year Five	8	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling Year Five	264	[1]
Capital Leases, Future Minimum Payments, Due in Rolling Year Five	20	[2]
Operating Leases, Future Minimum Payments, Due in Rolling after Year Five	1,055	[1]
Operating Leases, Sublease Income Due, Due in Rolling after Year Five	24	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling after Year Five	1,031	[1]
Capital Leases, Future Minimum Payments, Due in Rolling after Year Five	96	[2]
Operating Leases, Gross Minimum Rentals	3,108	[1]
Operating Leases, Sublease Income Due	79	[1]
Operating Leases, Net Minimum Rentals	3,029	[1]
Capital Leases and Financing Obligations, Lease Obligation	$ 222	[2]

[1] Excluded from the minimum rental commitments displayed above are $1.7 billion related to options to extend ground lease terms that are reasonably assured of being exercised, the balance of which is predominantly related to fiscals 2020 and thereafter.

[2] Included in Capital Leases and Financing Obligations displayed above is $20 million of interest.

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ACQUISITIONS

12 Months Ended

Jan. 31, 2015

Business Combination, Description [Abstract]

ACQUISITIONS

ACQUISITIONS

On October 31, 2011, the Company acquired a 70% ownership interest in Labuan from Li & Fung for a purchase price of $79 million (including a $10 million hold back) plus $8 million of contingent consideration. The terms of the agreement provide us with the future option to acquire Li & Fung’s 30% interest in the business and also provide Li & Fung the option to require us to buy their 30% interest in the business at the end of three years from the acquisition date. During fiscal 2014, we amended the terms of the agreement with Li & Fung to extend the future call option and put option to commence four years from the acquisition date.

The Company paid $1 million and $5 million of contingent consideration related to the Labuan acquisition during fiscal 2014 and 2012, respectively. The Company did not make any payments during fiscal 2013. In accordance with the purchase agreement, the remaining $2 million of contingent consideration is expected to be paid out during fiscal 2015 based on the financial performance of Labuan and is included within Accrued expenses and other current liabilities in our Consolidated Balance Sheet as of January 31, 2015.

In addition, during fiscal 2012, in accordance with the purchase agreement, the Company paid $10 million of the purchase price related to the Labuan acquisition to Li & Fung as it was determined that the business had been appropriately delivered in the agreed upon financial condition.

As a result of the acquisition, the Company recognized Noncontrolling interest in the amount of $24 million which was measured at fair value at the acquisition date. In accordance with the terms of the agreement, the Noncontrolling interest is redeemable for cash or common stock of the Company at the option of the holder. As such, the Noncontrolling interest has been recorded in Temporary equity. See Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for a reconciliation of the change in Noncontrolling interest to redemption value as of January 31, 2015 and February 1, 2014.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Outstanding Interest Rate Contracts (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014
Interest Rate Swaps | Three Month Usd Libor Fixed to Float [Member]
Derivative [Line Items]
Effective Date	September 2010	[1]
Maturity Date	September 2016	[1]
Notional Amount	$ 0	[1]	$ 350	[1]
Interest Rate Swaps | Six Month Jpy Tibor Float to Fixed [Member]
Derivative [Line Items]
Effective Date	January 2011	[2]
Maturity Date	January 2016	[2]
Notional Amount	42	[2]	65	[2]
Interest Rate Caps | One Month Usd Libor Designated [Member]
Derivative [Line Items]
Effective Date	January 2011	[2]
Maturity Date	April 2015	[2]
Notional Amount	500	[3]	500	[2]
Interest Rate Caps | One Month Usd Libor Not Designated, Two Thousand Eleven [Member]
Derivative [Line Items]
Effective Date	January 2011
Maturity Date	April 2015
Notional Amount	500		500
Interest Rate Caps | One Month Usd Libor De-designated [Member]
Derivative [Line Items]
Effective Date	January 2012	[4]
Maturity Date	April 2015	[4]
Notional Amount	500	[4]	500	[4]
Interest Rate Caps | One Month Usd Libor Not Designated, Two Thousand Twelve [Member]
Derivative [Line Items]
Effective Date	January 2012
Maturity Date	April 2015
Notional Amount	500		500
Interest Rate Caps | Three Month Euribor [Member]
Derivative [Line Items]
Effective Date	January 2013	[2]
Maturity Date	January 2016	[2]
Notional Amount	34	[3]	71	[2]
Interest Rate Caps | Three Month Euribor [Member] | French real estate credit facility, due fiscal two thousand eighteen [Member]
Derivative [Line Items]
Effective Date	February 2013	[2]
Maturity Date	February 2018	[2]
Notional Amount	53	[2]	64	[2]
Interest Rate Caps | One Month Usd Libor Not Designated, Two Thousand Fourteen [Member]
Derivative [Line Items]
Effective Date	January 2014
Maturity Date	April 2015
Notional Amount	$ 311		$ 311

[1] As of January 31, 2015, these derivatives were designated for hedge accounting.

[2] On November 26, 2014, we terminated this interest rate swap. As a result, we received cash proceeds of $10 million, which included $1 million of accrued interest receivable as described above.

[3] These interest rate caps are not designated as cash flow hedges in accordance with ASC 815.

[4] The Company de-designated a portion of this interest rate cap in fiscal 2010. As of January 31, 2015 and February 1, 2014, 40% of the $500 million interest rate cap is designated as a cash flow hedge.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fiscal Years (Details)	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of Weeks	52	52	53
Ended	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013

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INCOME TAXES - Effective Tax Rate Reconciliation (Details)	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Income Tax Disclosure [Abstract]
U.S. Federal statutory tax rate	35.00%		35.00%		35.00%
State taxes, net of U.S. Federal benefit	0.00%		(1.20%)		23.90%
Foreign operations	(13.50%)	[1]	(12.30%)	[1]	3.70%	[1]
U.S. Federal valuation allowance	(36.60%)		(27.90%)		0.80%
Unrecognized tax benefits	3.00%	[2]	0.00%	[2]	(3.60%)	[2]
Goodwill Impairment	0.00%	[3]	(13.40%)	[3]	0.00%	[3]
Other	(0.40%)		0.30%		(2.20%)
Effective tax rate	(12.50%)		(19.50%)		57.60%

[1] Foreign operations include the net impact of: differences between local statutory rates and the U.S. Federal statutory rate; the impact of changes to foreign valuation allowances; the net cost of foreign unrecognized tax benefits; the cost of repatriating foreign earnings, net of foreign tax credits; changes to our assertion regarding the permanent reinvestment of foreign earnings related to certain foreign entities; permanent items related to foreign operations; as well as changes in the tax status of foreign entities.

[2] Unrecognized tax benefits include benefits related to the resolution of issues in connection with resolving tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations. See “Unrecognized Tax Benefits” in this footnote.

[3] Goodwill impairment represents the U.S. Federal tax cost associated with the amount of Goodwill that was impaired for which we did not have tax basis, and therefore for which we could not take a tax benefit.

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COMMITMENTS AND CONTINGENCIES - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015
Loss Contingencies [Line Items]
Leases assigned to third parties, potential future lease related payments	63
Minimum [Member]
Loss Contingencies [Line Items]
Lessee Leasing Arrangements, Operating Leases, Term of Contract	1 year

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LEASES (Tables)

12 Months Ended

Jan. 31, 2015

Leases [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases, Capital Leases and Financing Obligations [Table Text Block]

Minimum rental commitments under non-cancelable operating leases, capital leases and lease financing obligations as of January 31, 2015 are as follows:

	Operating Leases (1)						Capital Leases and Financing Obligations (2)
(In millions)	Gross Minimum Rentals		Sublease Income		Net Minimum Rentals		Lease Obligation
2015	$	561	$	15	$	546	$	31
2016	488		13		475		27
2017	399		10		389		24
2018	333		9		324		24
2019	272		8		264		20
2020 and subsequent	1,055		24		1,031		96
Total	$	3,108	$	79	$	3,029	$	222

(1) Excluded from the minimum rental commitments displayed above are $1.7 billion related to options to extend ground lease terms that are reasonably assured of being exercised, the balance of which is predominantly related to fiscals 2020 and thereafter.

(2) Included in Capital Leases and Financing Obligations displayed above is $20 million of interest.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Net Impact of the Effective Portion of Derivatives Designated as Cash Flow Hedges on Accumulated Other Comprehensive Income (Loss) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Derivative [Line Items]
Balance, Unrealized (loss) gain on hedged transactions, net of tax	$ (1)	$ (2)	$ (2)
Unrealized (loss) gain on hedged transactions	1	1	0
Balance, Unrealized (loss) gain on hedged transactions, net of tax	0	(1)	(2)
Derivatives designated as cash flow hedges: | Interest Rate Contract [Member]
Derivative [Line Items]
Change in fair value recognized in Accumulated other comprehensive (loss) income - Interest Rate Contracts	0	0	0
Designated as Hedging Instrument [Member] | Derivatives designated as cash flow hedges: | Interest Rate Contract [Member]
Derivative [Line Items]
Balance, Unrealized (loss) gain on hedged transactions, net of tax	(1)	(2)	(2)
Reclassifications from Accumulated other comprehensive (loss) income - Interest Rate Contracts	1	1	0
Unrealized (loss) gain on hedged transactions	1	1	0
Balance, Unrealized (loss) gain on hedged transactions, net of tax	$ 0	$ (1)	$ (2)

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STOCK-BASED COMPENSATION - Summary of Performance Based Share and Unit Activity (Details) (Performance-Based Units [Member], USD $)	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Performance-Based Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested shares / Outstanding units at beginning of fiscal year	39,370	175,104	25,863
Granted	0	0	160,187
Shares vested / Units converted	0	(1,677)	0
Forfeited/Canceled	(9,761)	(134,057)	(10,946)
Nonvested shares / Outstanding units at end of fiscal year	29,609	39,370	175,104
Nonvested shares / Outstanding units at beginning of fiscal year	$ 45.34	$ 46.24	$ 60.00
Granted	$ 0.00	$ 0.00	$ 44.00
Shares vested / Units converted	$ 0.00	$ 50.36	$ 0.00
Forfeited/Canceled	$ 49.42	$ 46.45	$ 45.95
Nonvested shares / Outstanding units at end of fiscal year	$ 44.00	$ 45.34	$ 46.24

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ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Narrative (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015	Feb. 01, 2014
Accrued and Other Current Liabilities [Line Items]
Individual Current Liabilities Maximum Percentage	5.00%
Merchandise accounts payable [Member]
Accrued and Other Current Liabilities [Line Items]
Bank Overdrafts	$ 36	$ 51
Non-merchandise accounts payable [Member]
Accrued and Other Current Liabilities [Line Items]
Bank Overdrafts	$ 84	$ 107

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Consolidated Short-term borrowings and Long-term debt (Details) In Millions, unless otherwise specified								12 Months Ended									12 Months Ended																12 Months Ended																			12 Months Ended								12 Months Ended
	Jan. 31, 2015 USD ($)		Feb. 01, 2014 USD ($)		Jan. 31, 2015 Labuan uncommitted lines of credit [Member] Line of Credit [Member] USD ($)	Jan. 31, 2015 Labuan uncommitted lines of credit [Member] Line of Credit [Member] HKD	Feb. 01, 2014 Labuan uncommitted lines of credit [Member] Line of Credit [Member] USD ($)	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] USD ($)	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] EUR (€)	Feb. 01, 2014 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] USD ($)	Jan. 31, 2015 Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] Line of Credit [Member] USD ($)		Feb. 01, 2014 Toys-Japan unsecured credit lines, expire fiscals two thousand fifteen two sixteen fifteen [Member] Line of Credit [Member] USD ($)		Jan. 31, 2015 European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] Line of Credit [Member] USD ($)	Feb. 01, 2014 European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] Line of Credit [Member] USD ($)	Feb. 01, 2014 Secured term loan facility, due fiscal two thousand sixteen [Member] USD ($)		Jan. 31, 2015 Secured term loan facility, due fiscal two thousand sixteen [Member] USD ($)		Jan. 31, 2015 Seven point three seven five percent senior secured notes, due fiscal two thousand sixteen [Member] USD ($)		Feb. 01, 2014 Seven point three seven five percent senior secured notes, due fiscal two thousand sixteen [Member] USD ($)		Jan. 31, 2015 Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)		Feb. 01, 2014 Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)		Jan. 31, 2015 Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] USD ($)		Feb. 01, 2014 Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] USD ($)		Jan. 31, 2015 French real estate credit facility, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 French real estate credit facility, due fiscal two thousand eighteen [Member] EUR (€)	Feb. 01, 2014 French real estate credit facility, due fiscal two thousand eighteen [Member] USD ($)	Jan. 31, 2015 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)		Feb. 01, 2014 Incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)		Jan. 31, 2015 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)		Feb. 01, 2014 Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] USD ($)		Jan. 31, 2015 Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member] USD ($)		Feb. 01, 2014 Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member] USD ($)		Jan. 31, 2015 Secured revolving credit facility, expires fiscal two thousand nineteen [Member] Line of Credit [Member] USD ($)		Feb. 01, 2014 Secured revolving credit facility, expires fiscal two thousand nineteen [Member] Line of Credit [Member] USD ($)		Jan. 31, 2015 Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] USD ($)		Feb. 01, 2014 Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] USD ($)		Jan. 31, 2015 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] USD ($)		Feb. 01, 2014 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] USD ($)		Jan. 31, 2015 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] USD ($)		Feb. 01, 2014 Secured term B-four loan facility, due fiscal two thousand and twenty [Member] USD ($)		Jan. 31, 2015 U.K. real estate credit facility, due fiscal two thousand twenty [Member] USD ($)	Jan. 31, 2015 U.K. real estate credit facility, due fiscal two thousand twenty [Member] GBP (£)	Feb. 01, 2014 U.K. real estate credit facility, due fiscal two thousand twenty [Member] USD ($)	Jan. 31, 2015 Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Feb. 01, 2014 Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member] USD ($)	Jan. 31, 2015 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] USD ($)		Feb. 01, 2014 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] USD ($)		Jan. 31, 2015 Finance obligations associated with capital projects [Member] USD ($)	Feb. 01, 2014 Finance obligations associated with capital projects [Member] USD ($)	Jan. 31, 2015 Capital lease obligations [Member] USD ($)	Feb. 01, 2014 Capital lease obligations [Member] USD ($)	Jan. 31, 2015 Minimum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Feb. 01, 2014 Minimum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Jan. 31, 2015 Maximum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]	Feb. 01, 2014 Maximum [Member] Toys-Japan one point eight five percent two point eight five percent loans due fiscals two thousand fifteen two thousand twenty one [Member]
Debt Instrument [Line Items]
Debt Instrument, Basis Spread on Variable Rate								6.00%	6.00%	6.00%							4.50%																4.50%	4.50%	4.50%	3.75%		3.75%		3.75%		3.75%										5.00%		5.00%		7.25%				8.75%
Debt Instrument, Interest Rate, Effective Percentage																																																																6.85%	6.85%	6.85%
Short-term Debt					$ 0		$ 12
Long-term debt	4,788		5,007					34	30	71	0	[1]	5	[1]	0	0	646	[2],[3]	0	[2],[3]	0	[2],[3]	357	[2],[3]	448	[4]	447	[4]	721	[5]	719	[5]	53	47	64	133	[2],[3]	372	[2],[3]	67	[2],[3]	210	[2],[3]	402	[4]	403	[4]	0	[2],[3],[6]	0	[2],[3],[6]	965	[7]	973	[7]	272	[2],[3]	0	[2],[3]	1,010	[2],[3]	0	[2],[3]	396	263	433	63	91	22	[8]	22	[8]	189	174
Capital Lease Obligations																																																																											13	20
Long-term Debt and Capital Lease Obligations, Current	176		89					34																									1																			57								10							5
Long-term Debt and Capital Lease Obligations	4,612	[9]	4,918	[9]
Debt Instrument, Interest Rate, Stated Percentage																					7.375%		7.375%		10.375%		10.375%		8.50%		8.50%													7.375%		7.375%																							8.75%		8.75%						1.85%	1.85%	2.45%	2.45%
Line of Credit Facility, Maximum Borrowing Capacity					$ 35	275																																										$ 1,850

[1] Toys “R” Us - Japan, Ltd. (“Toys-Japan”) currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit (“Tranche 1” due fiscal 2015 and “Tranche 2” due fiscal 2016). On July 15, 2014, Toys-Japan entered into an agreement to refinance Tranche 2 of its committed lines of credit.

[2] On October 24, 2014, Toys-Delaware amended the credit agreement for its secured term loan facilities (the “Secured Term Loan Credit Agreement”) to provide for, among other things, a new tranche of term loans in an aggregate principal amount of $1,026 million due fiscal 2020 (the “Secured Term B-4 Loan”). Additionally, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the $1.85 billion secured revolving credit facility (“ABL Facility”) to provide for, among other things, a new tranche of loans in an aggregate principal amount of $280 million due fiscal 2019. The Secured Term B-4 Loan and the Tranche A-1 Loan, together with other sources and funds available to Toys-Delaware, were used to (i) refinance in full the Secured term loan facility due fiscal 2016, (ii) extend $380 million of the term loans due fiscal 2018 under the Incremental secured term loan facility and the Second incremental secured term loan facility into the Secured Term B-4 Loan and (iii) redeem all of the 7.375% senior secured notes due fiscal 2016 (“Toys-Delaware Secured Notes”), plus accrued interest, premiums and fees. The Secured Term B-4 Loan is guaranteed by Wayne Real Estate Parent Company, LLC, a wholly-owned subsidiary of the Company and an indirect parent of Toys “R” Us Property Company I, LLC.

[3] Represents obligations of Toys “R” Us - Delaware, Inc. (“Toys-Delaware”).

[4] Represents obligations of Toys “R” Us, Inc. (the “Parent Company”) legal entity. For further details on Parent Company information, refer to Schedule I — Parent Company Condensed Financial Statements and Notes to the Condensed Financial Statements.

[5] Represents obligations of Toys “R” Us Property Company II, LLC (“TRU Propco II”).

[6] On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for the ABL Facility in order to extend the maturity date of the facility and amend certain other provisions.

[7] Represents obligations of Toys “R” Us Property Company I, LLC and its subsidiaries (“TRU Propco I”).

[8] (8)Represents obligations of the Parent Company and Toys-Delaware.

[9] (9)We maintain derivative instruments on certain of our long-term debt, which impact our effective interest rates. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Jan. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

As used herein, the “Company,” “we,” “us,” or “our” means Toys “R” Us, Inc., and its consolidated subsidiaries, except as expressly indicated or unless the context otherwise requires. We sell a variety of products in the baby, core toy, entertainment, learning and seasonal categories through our retail locations and the Internet. As of January 31, 2015, we operated 1,602 stores and licensed an additional 212 stores. These stores are located in 37 countries and jurisdictions around the world under the Toys “R” Us, Babies “R” Us and FAO Schwarz banners. In addition, we operate Toys “R” Us Express stores (“Express stores”), smaller format stores primarily open on a short-term basis during the holiday season. We also own and operate websites including Toysrus.com, Babiesrus.com, eToys.com, FAO.com and toys.com, as well as other Internet sites we operate in our international markets.

Our Company was founded in Washingtonfcred D.C. in 1948 when Charles Lazarus opened a baby furniture store, Children’s Bargain Town. The Toys “R” Us name made its debut in 1957. In 1978, we completed an initial public offering of our common stock. When Charles Lazarus retired as our Chief Executive Officer (“CEO”) in 1994, we operated or licensed over 1,000 stores in 17 countries and jurisdictions. In 1996, we established the Babies “R” Us brand, further solidifying our reputation as a leading consumer destination for children and their families.

On July 21, 2005, we were acquired through a $6.6 billion merger (the “Merger”) by an investment group led by entities advised by or affiliated with Bain Capital Partners, LLC, Kohlberg Kravis Roberts & Co. L.P. and Vornado Realty Trust (collectively, the “Sponsors”). Upon the completion of this acquisition, we became a private company.

Fiscal Year

Our fiscal year ends on the Saturday nearest to January 31 of each calendar year. Unless otherwise stated, references to years in this report relate to the fiscal years below:

Fiscal Year	Number of Weeks	Ended
2014	52	January 31, 2015
2013	52	February 1, 2014
2012	53	February 2, 2013

Basis of Presentation

The accompanying consolidated financial statements as of January 31, 2015 and February 1, 2014 and for each of the three year periods ended January 31, 2015, February 1, 2014 and February 2, 2013, have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).

Principles of Consolidation

The Consolidated Financial Statements include the accounts of the Company. We eliminate all inter-company balances and transactions.

Variable Interest Entities

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, “Consolidation” (“ASC 810”), requires the consolidation of entities that are controlled by a company through interests other than voting interests. We evaluate our lending vehicles, including our commercial mortgage-backed securities, structured loans and any joint venture interests to determine whether we are the primary beneficiary of a variable interest entity (“VIE”). The primary beneficiary will have a controlling financial interest in a VIE if it has (1) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance and (2) the obligation to absorb losses of the entity that could potentially be significant to the VIE or the right to receive benefits from the entity that could potentially be significant to the VIE.

On March 25, 2013, our indirect wholly-owned subsidiary, Toys “R” Us Properties (UK) Limited (“UK Propco”) entered into a facility agreement (the “UK Propco Facility Agreement”) with Debussy DTC Plc (“Debussy”), pursuant to which Debussy made loans (collectively, the “UK Propco Loan”) to UK Propco on March 28, 2013 in the aggregate principal amount of £263 million. Debussy is a special purpose entity established with the limited purpose of making loans and issuing the £263 million of multiple classes of commercial mortgage backed fixed rate notes (the “Debussy Notes”) to third party investors and the Company. Refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

In accordance with ASC 810, we identified Debussy as a VIE because Debussy, by design, has insufficient equity investment at risk and its equity investment holders at risk lack the ability, through voting or similar rights, to direct the activities that most significantly impact Debussy’s economic performance.  Additionally, we evaluated our variable interests in Debussy and third party investors’ involvement in Debussy and concluded that the Company is not the primary beneficiary and therefore should not consolidate Debussy as we do not hold the power to direct the activities that most significantly impact Debussy’s economic performance. The Company has not identified any subsequent changes to Debussy’s governing documents or contractual arrangements that would change the characteristics or adequacy of the entity’s equity investment at risk in accordance with ASC 810.

Use of Estimates

The preparation of our Consolidated Financial Statements requires us to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and the related disclosures of contingent assets and liabilities as of the date of the Consolidated Financial Statements and during the applicable periods. We base these estimates on historical experience and other factors that we believe are reasonable under the circumstances. Actual results may differ materially from these estimates and such differences could have a material impact on our Consolidated Financial Statements.

Cash and Cash Equivalents

We consider our highly liquid investments with original maturities of three months or less at acquisition to be cash equivalents. These investments primarily consist of money market funds, bank deposits, term deposits or certificates of deposit. Cash equivalents are stated at cost, which approximates fair value. Book cash overdrafts are reclassified to accounts payable.

Restricted Cash

Restricted cash represents collateral and other cash that is restricted from withdrawal. As of January 31, 2015 and February 1, 2014, we had restricted cash of $53 million, respectively.

Accounts and Other Receivables

Accounts and other receivables consist primarily of receivables from vendors and consumer credit card and debit card transactions.

Merchandise Inventories

We value our merchandise inventories at the lower of cost or market, as determined by the weighted average cost method. Cost of sales represents the weighted average cost of the individual items sold and is affected by adjustments to reflect current market conditions, merchandise allowances from vendors, estimated inventory shortages and estimated losses from obsolete and slow-moving inventory.

Property and Equipment, Net

We record property and equipment at cost. Property and leasehold improvements represent capital improvements made to our owned and leased properties. We record depreciation and amortization using the straight-line method over the shorter of the estimated useful lives of the assets or the terms of the respective leases, if applicable.

We capitalize interest for new store construction-in-progress in accordance with ASC Topic 835, “Interest.” Capitalized interest amounts are immaterial.

Asset Retirement Obligations

We account for asset retirement obligations (“ARO”) in accordance with ASC Topic 410, “Asset Retirement and Environmental Obligations,” which requires us to recognize a liability for the fair value of obligations to retire tangible long-lived assets when there is a legal obligation to incur such costs. As a result of certain leasehold improvements we have undertaken in our stores, we may be obligated to restore the retail space to its original configuration as per the terms of the lease. We recognize a liability for ARO, capitalize asset retirement costs and amortize these costs over the life of the assets. As of January 31, 2015 and February 1, 2014, we had $63 million and $66 million, respectively, recorded for ARO.

Goodwill

At January 31, 2015 and February 1, 2014 our Toys-China and Southeast Asia reporting unit (included in our International segment) had $64 million of Goodwill, respectively. As a result of our fourth quarter fiscal 2013 goodwill impairment test, we recorded full impairments of the Toys-Domestic and Toys-Japan reporting unit’s goodwill balances of $361 million and $17 million, respectively, which were recorded in our Consolidated Statement of Operations for the fiscal year ended February 1, 2014. These impairment charges were a result of significant declines in the projected financial performance of the Toys-Domestic and Toys-Japan reporting units compared to the projections used in goodwill impairment tests of prior years. The decrease in financial projections was primarily due to the fiscal 2013 decline in operating results, due in large part to the holiday selling season. Refer to below and “CRITICAL ACCOUNTING POLICIES” within Item 7 entitled “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” for further details regarding the fiscal 2014 annual impairment tests.

In fiscal 2013, the Company decided to change its annual goodwill impairment testing date from the first day of the fourth quarter (or the first day of the tenth fiscal month) to the last day of the eleventh fiscal month of each fiscal year, which is shortly after the holiday season. The change is preferable as it aligns the timing of the annual impairment test with the timing of the Company’s annual strategic planning process, which now encompasses actual holiday selling season results, given the later testing date. Goodwill is evaluated for impairment annually as of the last day of the eleventh fiscal month or whenever we identify certain events or circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount, in accordance with the provisions of ASC Topic 350, “Intangibles - Goodwill and Other” (“ASC 350”). Events or circumstances that might warrant an interim evaluation include, among other things, a significant adverse change in legal factors or in the business climate, an adverse action or assessment by a regulator, unanticipated competition, loss of key personnel and a more-likely-than-not expectation that a reporting unit or a significant portion of a reporting unit will be sold or otherwise disposed of. ASC 350 provides an entity with the option to first assess qualitative factors for each reporting unit to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount prior to performing the two-step quantitative impairment test. The optional qualitative assessment can be performed at the discretion of management for any or all of the reporting units in any given period. For the fourth quarter of fiscal 2014, the Company opted to bypass the optional qualitative assessment in favor of updating the valuation and proceeding directly to the quantitative analysis for our Toys-China and Southeast Asia reporting unit.

For the step-one quantitative goodwill impairment test, we compared the current carrying value of the reporting unit to its current fair value to determine whether there is an indication of impairment. First, we determined the current fair value of the reporting unit by blending results from the market multiples approach and the income approach. These valuation approaches consider a number of factors that include, but are not limited to, expected future cash flows, growth rates, discount rates, and comparable multiples from publicly-traded companies in our industry, and require us to make certain assumptions and estimates regarding industry economic factors and future profitability of our business. It is our policy to conduct impairment testing (both from a qualitative and quantitative perspective) based on our most current business plans, projected future revenues and cash flows, which reflect changes we anticipate in the economy and the industry. The cash flows are based on five-year financial forecasts developed internally by management and are discounted to a present value using discount rates that properly account for the risk and nature of the respective reporting unit’s cash flows and the rates of return market participants would require to invest their capital in our reporting unit. The outcome of the market multiples and income approaches are heavily dependent upon the aforementioned projections. Upon completion of step one of the quantitative impairment test, it was determined that the goodwill associated with our Toys-China and Southeast Asia reporting unit was not impaired. The estimated fair value of our Toys-China and Southeast Asia reporting unit substantially exceeded its carrying value as of the date of testing.

Debt Issuance Costs

We defer debt issuance costs, which are classified as non-current Other assets, and amortize the costs into Interest expense over the term of the related debt facility. Unamortized amounts at January 31, 2015 and February 1, 2014 were $139 million and $127 million, respectively. Deferred financing fees amortized to Interest expense for fiscals 2014, 2013 and 2012 were $48 million, $51 million and $36 million, respectively, which is inclusive of accelerated amortization due to certain debt repayments and refinancings prior to maturity.

Acquisition of Debt Securities

There were no acquisitions of debt securities during fiscal 2014 and fiscal 2012. During fiscal 2013, we acquired £13 million ($20 million at March 28, 2013) principal amount of the various classes of Debussy Notes. These debt securities are included in Other assets within the Consolidated Balance Sheet, classified as held-to-maturity debt and reported at amortized cost. Refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

Insurance Risks

We self-insure a substantial portion of our workers’ compensation, general liability, auto liability, property, medical, prescription drug and dental insurance risks, in addition to maintaining third party insurance coverage. Provisions for losses related to self-insured risks are based upon actuarial techniques and estimates for incurred but not reported claims. We record the liability for workers’ compensation on a discounted basis. We also maintain insurance coverage above retention amounts of $15 million for employment practices liability, $8 million for catastrophic events, $5 million for property, $5 million for general liability, $4 million for auto liability and a minimum of $1 million for workers’ compensation to limit the exposure related to such risks. The assumptions underlying the ultimate costs of existing claim losses are subject to a high degree of unpredictability, which can affect the liability recorded for such claims. As of January 31, 2015 and February 1, 2014, we had $99 million and $102 million, respectively, of reserves for self-insurance risk which have been included in Accrued expenses and other current liabilities and Other non-current liabilities in our Consolidated Balance Sheets.

Commitments and Contingencies

We are subject to various claims and contingencies related to lawsuits and commitments under contractual and other commercial obligations. We recognize liabilities for contingencies and commitments when a loss is probable and estimable. For additional information on our commitments and contingencies, refer to Note 15 entitled “COMMITMENTS AND CONTINGENCIES.”

Leases

We lease store locations, distribution centers, equipment and land used in our operations. Our lease store locations consist of locations which have buildings that are owned by us and land which is controlled through a ground lease with third parties (“Ground Lease Locations”) and locations that are controlled through straight leases for land and building which we lease from third parties (“Straight Lease Locations”). We account for our leases under the provisions of ASC Topic 840, “Leases” (“ASC 840”), which require that leases be evaluated and classified as operating or capital leases for financial reporting purposes. Assets held under capital lease are included in Property and equipment, net. As of January 31, 2015 and February 1, 2014, accumulated depreciation related to capital leases for property and equipment was $41 million, respectively.

We record operating leases on a straight-line basis over the lease term, which includes renewal options only if those options are specified in the lease agreement and if failure to exercise the renewal option imposes a significant economic penalty on us. For Ground Lease Locations, we include renewal options in the lease term through the estimated useful life of the owned building located on the property as failure to renew a ground lease during the estimated useful life of the building would result in forgoing an economic benefit given our significant capital investment at the inception of the lease to construct a new building. For Straight Lease Locations, we do not include renewal options in the lease term as the failure to renew a straight lease does not typically result in a significant economic penalty for us, and therefore renewal cannot be reasonably assured at the inception of the lease. Renewal options are exercised at our sole discretion. The expected lease term is used to determine whether a lease is capital or operating and is used to calculate straight-line rent expense. Additionally, the useful life of buildings and leasehold improvements are limited by the expected lease term. Refer to Note 9 entitled “LEASES” for further details.

Substantially all of our leases include options that allow us to renew or extend the lease term beyond the initial lease period, subject to terms and conditions agreed upon at the inception of the lease. Such terms and conditions include rental rates agreed upon at the inception of the lease that could represent below or above market rental rates later in the life of the lease, depending upon market conditions at the time of such renewal or extension. In addition, many leases include early termination options, which can be exercised under specified conditions, including upon damage, destruction or condemnation of a specified percentage of the value or land area of the property.

Deferred Rent

We recognize fixed minimum rent expense on non-cancelable leases on a straight-line basis over the term of each individual lease starting at the date of possession, including the build-out period, and record the difference between the recognized rental expense and amounts payable under the leases as a deferred rent liability or asset. Deferred rent liabilities in our Consolidated Balance Sheets totaled $359 million and $374 million at January 31, 2015 and February 1, 2014, respectively, of which $12 million was included in Accrued expenses and other current liabilities for each period, respectively. Landlord incentives and abatements are recorded in Deferred rent liabilities and amortized over the term of the lease.

Financial Instruments

We enter into foreign exchange forward contracts to minimize the risk associated with currency fluctuations relating to our foreign subsidiaries. We also enter into derivative financial arrangements such as interest rate swaps and interest rate caps to hedge interest rate risk associated with our long-term debt. We account for derivative financial instruments in accordance with ASC Topic 815, “Derivatives and Hedging” (“ASC 815”) and record all derivatives as either assets or liabilities on the Consolidated Balance Sheets measured at estimated fair value and recognize the changes in fair value as unrealized gains and losses. The recognition of these gains and losses depends on our intended use of the derivatives and resulting designation. We record the changes in fair value of derivative instruments, which do not qualify and therefore are not designated for hedge accounting, in our Consolidated Statements of Operations. If we determine that we do qualify for hedge accounting treatment, the following is a summary of the impact on our Consolidated Financial Statements:

• For designated cash flow hedges, the effective portion of the changes in the fair value of derivatives is recorded in Accumulated other comprehensive (loss) income and subsequently recorded in Interest expense in the Consolidated Statements of Operations at the time the hedged item affects earnings.

• For designated cash flow hedges, the ineffective portion of a hedged derivative instrument’s change in fair value is immediately recognized in Interest expense in the Consolidated Statements of Operations.

• For designated fair value hedges, the change in the fair value of the derivative as well as the offsetting change in fair value of the hedged item attributable to the hedged risk are recorded in Interest expense in the Consolidated Statements of Operations.

Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for more information related to our accounting for derivative financial instruments. We did not have significant credit risk related to our financial instruments at January 31, 2015 and February 1, 2014.

Revenue Recognition

We generally recognize sales, net of customer coupons and other sales incentives, at the time the customer takes possession of merchandise, either at the point of sale in our stores or at the time the customer receives shipment of products purchased from our websites. We recognize the sale from layaway transactions when our customer satisfies all payment obligations and takes possession of the merchandise. Sales are recorded net of sales, use and value added taxes.

Other revenues of $43 million, $56 million and $72 million for fiscals 2014, 2013 and 2012, respectively, are included in Net sales. Other revenues consist of warranty income, licensing fees and non-core product related revenue.

We have license agreements with unaffiliated third party operators located outside the United States. The agreements are largely structured with royalty income paid as a percentage of sales for the use of our trademarks, trade name and branding. Licensing fees for fiscals 2014, 2013 and 2012 were $17 million, $16 million and $16 million, respectively.

Reserve for Sales Returns

We establish reserves for sales returns for estimated product returns by our customers based on historical return experience, changes in customer demand, known returns we have not received, and other assumptions. The balance of our reserve for sales returns was $10 million at January 31, 2015 and February 1, 2014, respectively.

Cost of Sales and Selling, General & Administrative Expenses

The following table illustrates what is reflected in each expense category:

“Cost of sales”

“SG&A”

•        the cost of merchandise acquired from vendors; •        freight in; •        provision for excess and obsolete inventory; •        shipping costs to customers; •        provision for inventory shortages; and •        credits and allowances from our merchandise vendors.

•        store payroll and related payroll benefits; •        rent and other store operating expenses; •        advertising and promotional expenses; •        costs associated with operating our distribution          network, including costs related to transporting          merchandise from distribution centers to stores; •        restructuring charges; and •        other corporate-related expenses.

Credits and Allowances Received from Vendors

We receive credits and allowances that are related to formal agreements negotiated with our vendors. These credits and allowances are predominantly for product markdowns, cooperative advertising, promotions and volume related purchases. We generally treat credits and allowances, including cooperative advertising allowances, as a reduction of product cost in accordance with the provisions of ASC Topic 605, “Revenue Recognition” (“ASC 605”) since such funds are not a reimbursement of specific, incremental, identifiable SG&A costs incurred by us in selling the vendors’ products.

Advertising Costs

Gross advertising costs are recognized in SG&A at the point of first broadcast or distribution and were $379 million, $433 million and $449 million in fiscals 2014, 2013 and 2012, respectively.

Pre-Opening Costs

The cost of start-up activities, including organization costs, related to new store openings are expensed as incurred.

Costs of Computer Software

We capitalize certain costs associated with computer software developed or obtained for internal use in accordance with the provisions of ASC 350. We capitalize those costs from the acquisition of external materials and services associated with developing or obtaining internal use computer software. We capitalize certain payroll costs for employees that are directly associated with internal use computer software projects once specific criteria of ASC 350 are met. We expense those costs that are associated with preliminary stage activities, training, maintenance, and all other post-implementation stage activities as they are incurred. We amortize all costs capitalized in connection with internal use computer software projects on a straight-line basis over a useful life of five years, beginning when the software is ready for its intended use. We amortized computer software costs of $34 million, $31 million and $27 million for fiscals 2014, 2013 and 2012, respectively.

Other Income, Net

Other income, net includes the following:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Credit card program income	$	36		$	33		$	22
Gift card breakage income	27			24			21
Net gains on sales of properties	5			8			4
Impairment of long-lived assets	(13		)	(44		)	(11		)
Foreign currency translation	(19		)	(1		)	(3		)
Other (1)	17			17			20
Total	$	53		$	37		$	53

(1) Includes advertising income from our websites, fixed asset write-offs and other miscellaneous income and expense charges.

Credit Card Program

We operate under a Credit Card Program agreement (the “Agreement”) with a third-party credit lender Synchrony Financial (formerly GE Retail Bank) to offer co-branded and private label credit cards to our customers. The credit lender provides financing for our customers to purchase merchandise at our stores for all cardholders and other businesses for co-branded cardholders. We received an up-front incentive payment in fiscal 2012 for entering into the seven year Agreement with Synchrony Financial, which was deferred and is being amortized ratably over the life of the Agreement. In addition, we receive bounty fees for credit card activations and royalties on the co-branded and private label credit cards. Bounty fees and royalties are recognized when earned and realizable. During fiscals 2014, 2013 and 2012, we recognized credit card program income of $36 million, $33 million and $22 million, respectively.

Gift Card Breakage

We sell gift cards to customers in our retail stores, through our websites and through third parties and, in certain cases, provide gift cards for returned merchandise and in connection with promotions. We recognize income from gift card sales when the customer redeems the gift card, as well as an estimated amount of unredeemed liabilities (“breakage”). Gift card breakage is recognized proportionately, utilizing management estimates and assumptions based on actual redemptions, the estimated useful life of the gift card and an estimated breakage rate of unredeemed liabilities. Our estimated gift card breakage represents the remaining unused portion of the gift card liability for which the likelihood of redemption is remote and for which we have determined that we do not have a legal obligation to remit the value to the relevant jurisdictions. Income related to customer gift card redemption is included in Net sales, whereas income related to gift card breakage is recorded in Other income, net in our Consolidated Financial Statements. We recognize breakage income and derecognize the gift card liability for unredeemed gift cards in proportion to actual redemptions of gift cards. We recognized $27 million, $24 million and $21 million of gift card breakage income in fiscals 2014, 2013 and 2012, respectively.

Net Gains on Sales of Properties

Net gains on sales of properties were $5 million, $8 million and $4 million for fiscals 2014, 2013 and 2012, respectively. Refer to Note 5 entitled “PROPERTY AND EQUIPMENT” for further information.

Impairment of Long-Lived Assets and Costs Associated with Exit Activities

We evaluate the carrying value of all long-lived assets, which include property, equipment and finite-lived intangibles, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable, in accordance with ASC Topic 360, “Property, Plant and Equipment.” Events or circumstances that might warrant an impairment review include, among other things, material declines in operational performance, significant adverse market conditions and significant changes or planned changes in our use of assets, including store relocation, store closure and property sales. If a long-lived asset is found to be non-recoverable, we record an impairment charge equal to the difference between the asset’s carrying value and fair value. This evaluation requires management to make judgments relating to future cash flows, growth rates, and economic and market conditions. These evaluations are based on determining the fair value of an asset using a valuation method such as discounted cash flow or a relative, market-based approach.

During fiscals 2014, 2013 and 2012, we recorded total impairment losses of $13 million, $44 million and $11 million, respectively. Impairment losses are recorded in Other income, net within our Consolidated Statements of Operations. These impairments were primarily due to the identification of underperforming stores and the relocation of certain stores.

For any store closing where a lease obligation still exists, we record the estimated future liability associated with the rental obligation less any estimated sublease income on the date the store is closed in accordance with ASC Topic 420, “Exit or Disposal Cost Obligations.”

Foreign Currency Translation

Unrealized and realized gains and losses resulting from foreign currency transactions related to operations are included in Other income, net. In fiscal 2014, we recorded foreign currency losses of $19 million, which included an unrealized loss on foreign exchange of $15 million related to the re-measurement of the new tranche of loans in an aggregate principal amount of $280 million due fiscal 2019 (the “Tranche A-1 Loan”) attributed to Toys “R” Us (Canada) Ltd. Toys “R” Us (Canada) Ltee (“Toys-Canada”), an indirect wholly-owned subsidiary. For fiscals 2013 and 2012, we recorded foreign exchange losses of $1 million and $3 million, respectively. Refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details regarding the Tranche A-1 Loan.

Foreign Currency Translation - Foreign Subsidiaries

The functional currencies of our foreign subsidiaries are as follows:

• Australian dollar for our subsidiary in Australia;

• British pound sterling for our subsidiary in the United Kingdom;

• Brunei dollar for our subsidiary in Brunei;

• Canadian dollar for our subsidiary in Canada;

• Chinese yuan for our subsidiary in China;

• Euro for our subsidiaries in Austria, France, Germany, Spain and Portugal;

• Hong Kong dollar for our subsidiaries in Hong Kong;

• Japanese yen for our subsidiary in Japan;

• Malaysian ringgit for our subsidiary in Malaysia;

• Polish zloty for our subsidiary in Poland;

• Singapore dollar for our subsidiary in Singapore;

• Swiss franc for our subsidiary in Switzerland;

• Taiwan dollar for our subsidiary in Taiwan; and

• Thailand baht for our subsidiary in Thailand.

Assets and liabilities are translated into USD using the current exchange rates in effect at the balance sheet date, while revenues and expenses are translated using the average exchange rates during the applicable reporting period. The resulting translation adjustments are recorded in Accumulated other comprehensive (loss) income within the Consolidated Statements of Stockholders’ (Deficit) Equity.

Foreign Currency Translation - Short-Term Intercompany Loans

Foreign currency transactions related to short-term, cross-currency intercompany loans amounted to gains of $9 million, $1 million and $2 million for fiscals 2014, 2013 and 2012, respectively. Such amounts were included in Interest expense.

We economically hedge the majority of these short-term, cross-currency intercompany loans with foreign currency forward contracts. These derivative contracts were not designated as hedges and are recorded on our Consolidated Balance Sheets at fair value with a gain or loss recorded on the Consolidated Statements of Operations in Interest expense. For fiscal years 2014, 2013 and 2012, we recorded losses of $9 million, $1 million and $2 million, respectively. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

Income Taxes

We account for income taxes in accordance with ASC Topic 740, “Income Taxes” (“ASC 740”). Our provision for income taxes and effective tax rates are calculated by legal entity and jurisdiction and are based on a number of factors, including our level of pre-tax earnings, income tax planning strategies, differences between tax laws and accounting rules, statutory tax rates and credits, uncertain tax positions and valuation allowances. We use significant judgment and estimates in evaluating our tax positions. Our effective tax rate in a given financial statement period may be materially impacted by changes in the mix and level of earnings by taxing jurisdiction.

Under ASC 740, deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the Consolidated Financial Statements. Valuation allowances are established when, in management’s judgment, it is more likely than not that our deferred tax assets will not be realized. In assessing the need for a valuation allowance, management weighs the available positive and negative evidence, including limitations on the use of tax loss and other carryforwards due to changes in ownership, historic information, projections of future sources of taxable income, including future reversals of taxable temporary differences and future taxable income exclusive of reversing temporary differences and carryforwards and tax planning strategies.

At any one time, our tax returns for numerous tax years are subject to examination by U.S. Federal, state and foreign taxing jurisdictions. ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attributes for income tax positions taken or expected to be taken on a tax return. Under ASC 740, the impact of an uncertain tax position taken or expected to be taken on an income tax return must be recognized in the financial statements at the largest amount that is more-likely-than-not to be sustained. An uncertain income tax position will not be recognized in the financial statements unless it is more-likely-than-not to be sustained. We adjust these tax liabilities, as well as the related interest and penalties, based on the latest facts and circumstances, including recently enacted tax law changes, published rulings, court cases and outcomes of tax audits. While we do not expect material changes, it is possible that our actual tax liability will differ from our established tax liabilities for unrecognized tax benefits, and our effective tax rate may be materially impacted. While it is often difficult to predict the final outcome of, the timing of or the tax treatment of any particular tax position or deduction, we believe that our tax balances reflect the more-likely-than-not outcome of known tax contingencies. We report tax-related interest and penalties as a component of Income tax expense.

At January 31, 2015 and February 1, 2014, we reported unrecognized tax benefits in Accrued expenses and other current liabilities and Other non-current liabilities in our Consolidated Balance Sheets. These tax liabilities do not include a portion of our unrecognized tax benefits, which have been recorded as either a reduction of Deferred tax assets related to tax loss carryforwards or a reduction of taxes receivable. For further information, refer to Note 10 entitled “INCOME TAXES.”

Temporary Equity

On October 31, 2011, in connection with the acquisition of a 70% ownership interest in Toys (Labuan) Holding Limited (“Labuan”), the Company recognized Noncontrolling interest in the amount of $24 million which was measured at fair value at the acquisition date. Refer to Note 17 entitled “ACQUISITIONS” for further details. In accordance with the terms of the agreement, the Noncontrolling interest is redeemable for cash or common stock of the Company at the option of the holder. As such, the Noncontrolling interest has been recorded in Temporary Equity in our Consolidated Balance Sheets at its redemption value.

In addition, as a result of modifications made to our stock-based compensation plans during fiscal 2013, certain equity awards were redeemable for cash at the option of the holder and redemption was probable. As of January 31, 2015, these awards have all vested and redemption is no longer probable. Therefore, in accordance with ASC Topic 718, “Compensation – Stock Compensation” (“ASC 718”) and ASC Topic 480, “Distinguishing Liabilities from Equity” (“ASC 480”), the shares were initially recorded as Temporary Equity in fiscal 2013 in our Consolidated Balance Sheet at their redemption value and were subsequently reclassified to Additional paid-in capital in fiscal 2014. Refer to Note 7 entitled “STOCK-BASED COMPENSATION” for further details.

The reconciliation of the changes in Temporary Equity is as follows:

(In millions)
Balance, January 28, 2012	$	29
Net earnings attributable to noncontrolling interest	1
Adjustment of noncontrolling interest to redemption value	19
Balance, February 2, 2013	49
Net earnings attributable to noncontrolling interest	3
Adjustment of noncontrolling interest to redemption value	18
Redemption value of redeemable shares	8
Balance, February 1, 2014	78
Net earnings attributable to noncontrolling interest	4
Adjustment of noncontrolling interest to redemption value	10
Value of formerly redeemable shares to equity	(8		)
Capital contribution	1
Balance, January 31, 2015	$	85

Stock-Based Compensation

Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service period. We have applied ASC 718 to new awards and to awards modified, repurchased or canceled since January 29, 2006. For further information, refer to Note 7 entitled “STOCK-BASED COMPENSATION.”

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ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Schedule of Accounts Payable and Accrued Liabilities (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Accrued and Other Current Liabilities [Line Items]
Accounts payable	$ 1,571		$ 1,488
Gift card and certificate liability	205		199
Accrued bonus	110		26
Sales and use tax and value added tax payable	84		75
Accrued interest	55		58
Accrued property taxes	52		55
Accrued Sponsor Transaction Fees	47	[1]	15	[1]
Accrued vacation	44		43
Accrued payroll	42		48
Other	393	[2]	401	[2]
Accrued expenses and other current liabilities	1,032		920
Merchandise accounts payable [Member]
Accrued and Other Current Liabilities [Line Items]
Accounts payable	1,373	[3]	1,269	[3]
Non-merchandise accounts payable [Member]
Accrued and Other Current Liabilities [Line Items]
Accounts payable	$ 198	[4]	$ 219	[4]

[1] Includes fees payable to the Sponsors as a result of certain financing transactions. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

[2] (4)Includes, among other items, employee benefits, accrued lease liabilities, current deferred tax liabilities and other accruals. No individual amount included exceeds 5% of Total current liabilities.

[3] Includes $36 million and $51 million of book overdraft cash as of January 31, 2015 and February 1, 2014, respectively.

[4] Includes $84 million and $107 million of book overdraft cash as of January 31, 2015 and February 1, 2014, respectively.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cost of Sales and Selling, General & Administrative Expenses (Details)	12 Months Ended
	Jan. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cost Of Sales Description	•        the cost of merchandise acquired from vendors; •        freight in; •        provision for excess and obsolete inventory; •        shipping costs to customers; •        provision for inventory shortages; and •        credits and allowances from our merchandise vendors.
Selling, General and Administrative Expenses Description	•        store payroll and related payroll benefits; •        rent and other store operating expenses; •        advertising and promotional expenses; •        costs associated with operating our distribution network, including costs related to transporting merchandise from distribution centers to stores; •        restructuring charges; and •        other corporate-related expenses.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Jan. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Fiscal Years

Unless otherwise stated, references to years in this report relate to the fiscal years below:

Fiscal Year	Number of Weeks	Ended
2014	52	January 31, 2015
2013	52	February 1, 2014
2012	53	February 2, 2013

Schedule of Expenses by Category

The following table illustrates what is reflected in each expense category:

“Cost of sales”

“SG&A”

•        the cost of merchandise acquired from vendors; •        freight in; •        provision for excess and obsolete inventory; •        shipping costs to customers; •        provision for inventory shortages; and •        credits and allowances from our merchandise vendors.

•        store payroll and related payroll benefits; •        rent and other store operating expenses; •        advertising and promotional expenses; •        costs associated with operating our distribution          network, including costs related to transporting          merchandise from distribution centers to stores; •        restructuring charges; and •        other corporate-related expenses.

Schedule of Other Income, Net

Other income, net includes the following:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Credit card program income	$	36		$	33		$	22
Gift card breakage income	27			24			21
Net gains on sales of properties	5			8			4
Impairment of long-lived assets	(13		)	(44		)	(11		)
Foreign currency translation	(19		)	(1		)	(3		)
Other (1)	17			17			20
Total	$	53		$	37		$	53

(1) Includes advertising income from our websites, fixed asset write-offs and other miscellaneous income and expense charges.

Schedule of Change in Noncontrolling Interest

The reconciliation of the changes in Temporary Equity is as follows:

(In millions)
Balance, January 28, 2012	$	29
Net earnings attributable to noncontrolling interest	1
Adjustment of noncontrolling interest to redemption value	19
Balance, February 2, 2013	49
Net earnings attributable to noncontrolling interest	3
Adjustment of noncontrolling interest to redemption value	18
Redemption value of redeemable shares	8
Balance, February 1, 2014	78
Net earnings attributable to noncontrolling interest	4
Adjustment of noncontrolling interest to redemption value	10
Value of formerly redeemable shares to equity	(8		)
Capital contribution	1
Balance, January 31, 2015	$	85

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Jan. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Fiscal Year

Fiscal Year

Our fiscal year ends on the Saturday nearest to January 31 of each calendar year. Unless otherwise stated, references to years in this report relate to the fiscal years below:

Fiscal Year	Number of Weeks	Ended
2014	52	January 31, 2015
2013	52	February 1, 2014
2012	53	February 2, 2013

Principles of Consolidation

Principles of Consolidation

The Consolidated Financial Statements include the accounts of the Company. We eliminate all inter-company balances and transactions.

Variable Interest Entities

Variable Interest Entities

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, “Consolidation” (“ASC 810”), requires the consolidation of entities that are controlled by a company through interests other than voting interests. We evaluate our lending vehicles, including our commercial mortgage-backed securities, structured loans and any joint venture interests to determine whether we are the primary beneficiary of a variable interest entity (“VIE”). The primary beneficiary will have a controlling financial interest in a VIE if it has (1) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance and (2) the obligation to absorb losses of the entity that could potentially be significant to the VIE or the right to receive benefits from the entity that could potentially be significant to the VIE.

On March 25, 2013, our indirect wholly-owned subsidiary, Toys “R” Us Properties (UK) Limited (“UK Propco”) entered into a facility agreement (the “UK Propco Facility Agreement”) with Debussy DTC Plc (“Debussy”), pursuant to which Debussy made loans (collectively, the “UK Propco Loan”) to UK Propco on March 28, 2013 in the aggregate principal amount of £263 million. Debussy is a special purpose entity established with the limited purpose of making loans and issuing the £263 million of multiple classes of commercial mortgage backed fixed rate notes (the “Debussy Notes”) to third party investors and the Company. Refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

In accordance with ASC 810, we identified Debussy as a VIE because Debussy, by design, has insufficient equity investment at risk and its equity investment holders at risk lack the ability, through voting or similar rights, to direct the activities that most significantly impact Debussy’s economic performance.  Additionally, we evaluated our variable interests in Debussy and third party investors’ involvement in Debussy and concluded that the Company is not the primary beneficiary and therefore should not consolidate Debussy as we do not hold the power to direct the activities that most significantly impact Debussy’s economic performance. The Company has not identified any subsequent changes to Debussy’s governing documents or contractual arrangements that would change the characteristics or adequacy of the entity’s equity investment at risk in accordance with ASC 810.

Use of Estimates

Use of Estimates

The preparation of our Consolidated Financial Statements requires us to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and the related disclosures of contingent assets and liabilities as of the date of the Consolidated Financial Statements and during the applicable periods. We base these estimates on historical experience and other factors that we believe are reasonable under the circumstances. Actual results may differ materially from these estimates and such differences could have a material impact on our Consolidated Financial Statements.

Cash and Cash Equivalents

Cash and Cash Equivalents

We consider our highly liquid investments with original maturities of three months or less at acquisition to be cash equivalents. These investments primarily consist of money market funds, bank deposits, term deposits or certificates of deposit. Cash equivalents are stated at cost, which approximates fair value. Book cash overdrafts are reclassified to accounts payable.

Restricted Cash

Restricted Cash

Restricted cash represents collateral and other cash that is restricted from withdrawal. As of January 31, 2015 and February 1, 2014, we had restricted cash of $53 million, respectively.

Accounts and Other Receivables

Accounts and Other Receivables

Accounts and other receivables consist primarily of receivables from vendors and consumer credit card and debit card transactions.

Merchandise Inventories

Merchandise Inventories

We value our merchandise inventories at the lower of cost or market, as determined by the weighted average cost method. Cost of sales represents the weighted average cost of the individual items sold and is affected by adjustments to reflect current market conditions, merchandise allowances from vendors, estimated inventory shortages and estimated losses from obsolete and slow-moving inventory.

Property and Equipment, Net

Property and Equipment, Net

We record property and equipment at cost. Property and leasehold improvements represent capital improvements made to our owned and leased properties. We record depreciation and amortization using the straight-line method over the shorter of the estimated useful lives of the assets or the terms of the respective leases, if applicable.

We capitalize interest for new store construction-in-progress in accordance with ASC Topic 835, “Interest.” Capitalized interest amounts are immaterial.

Asset Retirement Obligations

Asset Retirement Obligations

We account for asset retirement obligations (“ARO”) in accordance with ASC Topic 410, “Asset Retirement and Environmental Obligations,” which requires us to recognize a liability for the fair value of obligations to retire tangible long-lived assets when there is a legal obligation to incur such costs. As a result of certain leasehold improvements we have undertaken in our stores, we may be obligated to restore the retail space to its original configuration as per the terms of the lease. We recognize a liability for ARO, capitalize asset retirement costs and amortize these costs over the life of the assets. As of January 31, 2015 and February 1, 2014, we had $63 million and $66 million, respectively, recorded for ARO.

Goodwill

Goodwill

At January 31, 2015 and February 1, 2014 our Toys-China and Southeast Asia reporting unit (included in our International segment) had $64 million of Goodwill, respectively. As a result of our fourth quarter fiscal 2013 goodwill impairment test, we recorded full impairments of the Toys-Domestic and Toys-Japan reporting unit’s goodwill balances of $361 million and $17 million, respectively, which were recorded in our Consolidated Statement of Operations for the fiscal year ended February 1, 2014. These impairment charges were a result of significant declines in the projected financial performance of the Toys-Domestic and Toys-Japan reporting units compared to the projections used in goodwill impairment tests of prior years. The decrease in financial projections was primarily due to the fiscal 2013 decline in operating results, due in large part to the holiday selling season. Refer to below and “CRITICAL ACCOUNTING POLICIES” within Item 7 entitled “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” for further details regarding the fiscal 2014 annual impairment tests.

In fiscal 2013, the Company decided to change its annual goodwill impairment testing date from the first day of the fourth quarter (or the first day of the tenth fiscal month) to the last day of the eleventh fiscal month of each fiscal year, which is shortly after the holiday season. The change is preferable as it aligns the timing of the annual impairment test with the timing of the Company’s annual strategic planning process, which now encompasses actual holiday selling season results, given the later testing date. Goodwill is evaluated for impairment annually as of the last day of the eleventh fiscal month or whenever we identify certain events or circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount, in accordance with the provisions of ASC Topic 350, “Intangibles - Goodwill and Other” (“ASC 350”). Events or circumstances that might warrant an interim evaluation include, among other things, a significant adverse change in legal factors or in the business climate, an adverse action or assessment by a regulator, unanticipated competition, loss of key personnel and a more-likely-than-not expectation that a reporting unit or a significant portion of a reporting unit will be sold or otherwise disposed of. ASC 350 provides an entity with the option to first assess qualitative factors for each reporting unit to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount prior to performing the two-step quantitative impairment test. The optional qualitative assessment can be performed at the discretion of management for any or all of the reporting units in any given period. For the fourth quarter of fiscal 2014, the Company opted to bypass the optional qualitative assessment in favor of updating the valuation and proceeding directly to the quantitative analysis for our Toys-China and Southeast Asia reporting unit.

For the step-one quantitative goodwill impairment test, we compared the current carrying value of the reporting unit to its current fair value to determine whether there is an indication of impairment. First, we determined the current fair value of the reporting unit by blending results from the market multiples approach and the income approach. These valuation approaches consider a number of factors that include, but are not limited to, expected future cash flows, growth rates, discount rates, and comparable multiples from publicly-traded companies in our industry, and require us to make certain assumptions and estimates regarding industry economic factors and future profitability of our business. It is our policy to conduct impairment testing (both from a qualitative and quantitative perspective) based on our most current business plans, projected future revenues and cash flows, which reflect changes we anticipate in the economy and the industry. The cash flows are based on five-year financial forecasts developed internally by management and are discounted to a present value using discount rates that properly account for the risk and nature of the respective reporting unit’s cash flows and the rates of return market participants would require to invest their capital in our reporting unit. The outcome of the market multiples and income approaches are heavily dependent upon the aforementioned projections. Upon completion of step one of the quantitative impairment test, it was determined that the goodwill associated with our Toys-China and Southeast Asia reporting unit was not impaired. The estimated fair value of our Toys-China and Southeast Asia reporting unit substantially exceeded its carrying value as of the date of testing.

Debt Issuance Costs

Debt Issuance Costs

We defer debt issuance costs, which are classified as non-current Other assets, and amortize the costs into Interest expense over the term of the related debt facility. Unamortized amounts at January 31, 2015 and February 1, 2014 were $139 million and $127 million, respectively. Deferred financing fees amortized to Interest expense for fiscals 2014, 2013 and 2012 were $48 million, $51 million and $36 million, respectively, which is inclusive of accelerated amortization due to certain debt repayments and refinancings prior to maturity.

Acquisition of Debt Securities

Acquisition of Debt Securities

There were no acquisitions of debt securities during fiscal 2014 and fiscal 2012. During fiscal 2013, we acquired £13 million ($20 million at March 28, 2013) principal amount of the various classes of Debussy Notes. These debt securities are included in Other assets within the Consolidated Balance Sheet, classified as held-to-maturity debt and reported at amortized cost. Refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

Insurance Risks

Insurance Risks

We self-insure a substantial portion of our workers’ compensation, general liability, auto liability, property, medical, prescription drug and dental insurance risks, in addition to maintaining third party insurance coverage. Provisions for losses related to self-insured risks are based upon actuarial techniques and estimates for incurred but not reported claims. We record the liability for workers’ compensation on a discounted basis. We also maintain insurance coverage above retention amounts of $15 million for employment practices liability, $8 million for catastrophic events, $5 million for property, $5 million for general liability, $4 million for auto liability and a minimum of $1 million for workers’ compensation to limit the exposure related to such risks. The assumptions underlying the ultimate costs of existing claim losses are subject to a high degree of unpredictability, which can affect the liability recorded for such claims. As of January 31, 2015 and February 1, 2014, we had $99 million and $102 million, respectively, of reserves for self-insurance risk which have been included in Accrued expenses and other current liabilities and Other non-current liabilities in our Consolidated Balance Sheets.

Commitments and Contingencies

Commitments and Contingencies

We are subject to various claims and contingencies related to lawsuits and commitments under contractual and other commercial obligations. We recognize liabilities for contingencies and commitments when a loss is probable and estimable. For additional information on our commitments and contingencies, refer to Note 15 entitled “COMMITMENTS AND CONTINGENCIES.”

Leases

Leases

We lease store locations, distribution centers, equipment and land used in our operations. Our lease store locations consist of locations which have buildings that are owned by us and land which is controlled through a ground lease with third parties (“Ground Lease Locations”) and locations that are controlled through straight leases for land and building which we lease from third parties (“Straight Lease Locations”). We account for our leases under the provisions of ASC Topic 840, “Leases” (“ASC 840”), which require that leases be evaluated and classified as operating or capital leases for financial reporting purposes. Assets held under capital lease are included in Property and equipment, net. As of January 31, 2015 and February 1, 2014, accumulated depreciation related to capital leases for property and equipment was $41 million, respectively.

We record operating leases on a straight-line basis over the lease term, which includes renewal options only if those options are specified in the lease agreement and if failure to exercise the renewal option imposes a significant economic penalty on us. For Ground Lease Locations, we include renewal options in the lease term through the estimated useful life of the owned building located on the property as failure to renew a ground lease during the estimated useful life of the building would result in forgoing an economic benefit given our significant capital investment at the inception of the lease to construct a new building. For Straight Lease Locations, we do not include renewal options in the lease term as the failure to renew a straight lease does not typically result in a significant economic penalty for us, and therefore renewal cannot be reasonably assured at the inception of the lease. Renewal options are exercised at our sole discretion. The expected lease term is used to determine whether a lease is capital or operating and is used to calculate straight-line rent expense. Additionally, the useful life of buildings and leasehold improvements are limited by the expected lease term. Refer to Note 9 entitled “LEASES” for further details.

Substantially all of our leases include options that allow us to renew or extend the lease term beyond the initial lease period, subject to terms and conditions agreed upon at the inception of the lease. Such terms and conditions include rental rates agreed upon at the inception of the lease that could represent below or above market rental rates later in the life of the lease, depending upon market conditions at the time of such renewal or extension. In addition, many leases include early termination options, which can be exercised under specified conditions, including upon damage, destruction or condemnation of a specified percentage of the value or land area of the property.

Deferred Rent

Deferred Rent

We recognize fixed minimum rent expense on non-cancelable leases on a straight-line basis over the term of each individual lease starting at the date of possession, including the build-out period, and record the difference between the recognized rental expense and amounts payable under the leases as a deferred rent liability or asset. Deferred rent liabilities in our Consolidated Balance Sheets totaled $359 million and $374 million at January 31, 2015 and February 1, 2014, respectively, of which $12 million was included in Accrued expenses and other current liabilities for each period, respectively. Landlord incentives and abatements are recorded in Deferred rent liabilities and amortized over the term of the lease.

Financial Instruments

Financial Instruments

We enter into foreign exchange forward contracts to minimize the risk associated with currency fluctuations relating to our foreign subsidiaries. We also enter into derivative financial arrangements such as interest rate swaps and interest rate caps to hedge interest rate risk associated with our long-term debt. We account for derivative financial instruments in accordance with ASC Topic 815, “Derivatives and Hedging” (“ASC 815”) and record all derivatives as either assets or liabilities on the Consolidated Balance Sheets measured at estimated fair value and recognize the changes in fair value as unrealized gains and losses. The recognition of these gains and losses depends on our intended use of the derivatives and resulting designation. We record the changes in fair value of derivative instruments, which do not qualify and therefore are not designated for hedge accounting, in our Consolidated Statements of Operations. If we determine that we do qualify for hedge accounting treatment, the following is a summary of the impact on our Consolidated Financial Statements:

• For designated cash flow hedges, the effective portion of the changes in the fair value of derivatives is recorded in Accumulated other comprehensive (loss) income and subsequently recorded in Interest expense in the Consolidated Statements of Operations at the time the hedged item affects earnings.

• For designated cash flow hedges, the ineffective portion of a hedged derivative instrument’s change in fair value is immediately recognized in Interest expense in the Consolidated Statements of Operations.

• For designated fair value hedges, the change in the fair value of the derivative as well as the offsetting change in fair value of the hedged item attributable to the hedged risk are recorded in Interest expense in the Consolidated Statements of Operations.

Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for more information related to our accounting for derivative financial instruments. We did not have significant credit risk related to our financial instruments at January 31, 2015 and February 1, 2014.

Revenue Recognition

Revenue Recognition

We generally recognize sales, net of customer coupons and other sales incentives, at the time the customer takes possession of merchandise, either at the point of sale in our stores or at the time the customer receives shipment of products purchased from our websites. We recognize the sale from layaway transactions when our customer satisfies all payment obligations and takes possession of the merchandise. Sales are recorded net of sales, use and value added taxes.

Other revenues of $43 million, $56 million and $72 million for fiscals 2014, 2013 and 2012, respectively, are included in Net sales. Other revenues consist of warranty income, licensing fees and non-core product related revenue.

We have license agreements with unaffiliated third party operators located outside the United States. The agreements are largely structured with royalty income paid as a percentage of sales for the use of our trademarks, trade name and branding. Licensing fees for fiscals 2014, 2013 and 2012 were $17 million, $16 million and $16 million, respectively.

Reserve for Sales Returns

Reserve for Sales Returns

We establish reserves for sales returns for estimated product returns by our customers based on historical return experience, changes in customer demand, known returns we have not received, and other assumptions. The balance of our reserve for sales returns was $10 million at January 31, 2015 and February 1, 2014, respectively.

Cost of Sales and Selling, General & Administrative Expenses

Cost of Sales and Selling, General & Administrative Expenses

The following table illustrates what is reflected in each expense category:

“Cost of sales”

“SG&A”

•        the cost of merchandise acquired from vendors; •        freight in; •        provision for excess and obsolete inventory; •        shipping costs to customers; •        provision for inventory shortages; and •        credits and allowances from our merchandise vendors.

•        store payroll and related payroll benefits; •        rent and other store operating expenses; •        advertising and promotional expenses; •        costs associated with operating our distribution          network, including costs related to transporting          merchandise from distribution centers to stores; •        restructuring charges; and •        other corporate-related expenses.

Credits and Allowances Received from Vendors

Credits and Allowances Received from Vendors

We receive credits and allowances that are related to formal agreements negotiated with our vendors. These credits and allowances are predominantly for product markdowns, cooperative advertising, promotions and volume related purchases. We generally treat credits and allowances, including cooperative advertising allowances, as a reduction of product cost in accordance with the provisions of ASC Topic 605, “Revenue Recognition” (“ASC 605”) since such funds are not a reimbursement of specific, incremental, identifiable SG&A costs incurred by us in selling the vendors’ products.

Advertising Costs

Advertising Costs

Gross advertising costs are recognized in SG&A at the point of first broadcast or distribution and were $379 million, $433 million and $449 million in fiscals 2014, 2013 and 2012, respectively.

Pre-opening Costs

Pre-Opening Costs

The cost of start-up activities, including organization costs, related to new store openings are expensed as incurred.

Costs of Computer Software

Costs of Computer Software

We capitalize certain costs associated with computer software developed or obtained for internal use in accordance with the provisions of ASC 350. We capitalize those costs from the acquisition of external materials and services associated with developing or obtaining internal use computer software. We capitalize certain payroll costs for employees that are directly associated with internal use computer software projects once specific criteria of ASC 350 are met. We expense those costs that are associated with preliminary stage activities, training, maintenance, and all other post-implementation stage activities as they are incurred. We amortize all costs capitalized in connection with internal use computer software projects on a straight-line basis over a useful life of five years, beginning when the software is ready for its intended use. We amortized computer software costs of $34 million, $31 million and $27 million for fiscals 2014, 2013 and 2012, respectively.

Other Income, net

Other Income, Net

Other income, net includes the following:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Credit card program income	$	36		$	33		$	22
Gift card breakage income	27			24			21
Net gains on sales of properties	5			8			4
Impairment of long-lived assets	(13		)	(44		)	(11		)
Foreign currency translation	(19		)	(1		)	(3		)
Other (1)	17			17			20
Total	$	53		$	37		$	53

(1) Includes advertising income from our websites, fixed asset write-offs and other miscellaneous income and expense charges.

Credit Card Program

Credit Card Program

We operate under a Credit Card Program agreement (the “Agreement”) with a third-party credit lender Synchrony Financial (formerly GE Retail Bank) to offer co-branded and private label credit cards to our customers. The credit lender provides financing for our customers to purchase merchandise at our stores for all cardholders and other businesses for co-branded cardholders. We received an up-front incentive payment in fiscal 2012 for entering into the seven year Agreement with Synchrony Financial, which was deferred and is being amortized ratably over the life of the Agreement. In addition, we receive bounty fees for credit card activations and royalties on the co-branded and private label credit cards. Bounty fees and royalties are recognized when earned and realizable. During fiscals 2014, 2013 and 2012, we recognized credit card program income of $36 million, $33 million and $22 million, respectively.

Gift Card Breakage

Gift Card Breakage

We sell gift cards to customers in our retail stores, through our websites and through third parties and, in certain cases, provide gift cards for returned merchandise and in connection with promotions. We recognize income from gift card sales when the customer redeems the gift card, as well as an estimated amount of unredeemed liabilities (“breakage”). Gift card breakage is recognized proportionately, utilizing management estimates and assumptions based on actual redemptions, the estimated useful life of the gift card and an estimated breakage rate of unredeemed liabilities. Our estimated gift card breakage represents the remaining unused portion of the gift card liability for which the likelihood of redemption is remote and for which we have determined that we do not have a legal obligation to remit the value to the relevant jurisdictions. Income related to customer gift card redemption is included in Net sales, whereas income related to gift card breakage is recorded in Other income, net in our Consolidated Financial Statements. We recognize breakage income and derecognize the gift card liability for unredeemed gift cards in proportion to actual redemptions of gift cards. We recognized $27 million, $24 million and $21 million of gift card breakage income in fiscals 2014, 2013 and 2012, respectively.

Impairment of Long-Lived Assets and Costs Associated with Exit Activities

Impairment of Long-Lived Assets and Costs Associated with Exit Activities

We evaluate the carrying value of all long-lived assets, which include property, equipment and finite-lived intangibles, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable, in accordance with ASC Topic 360, “Property, Plant and Equipment.” Events or circumstances that might warrant an impairment review include, among other things, material declines in operational performance, significant adverse market conditions and significant changes or planned changes in our use of assets, including store relocation, store closure and property sales. If a long-lived asset is found to be non-recoverable, we record an impairment charge equal to the difference between the asset’s carrying value and fair value. This evaluation requires management to make judgments relating to future cash flows, growth rates, and economic and market conditions. These evaluations are based on determining the fair value of an asset using a valuation method such as discounted cash flow or a relative, market-based approach.

During fiscals 2014, 2013 and 2012, we recorded total impairment losses of $13 million, $44 million and $11 million, respectively. Impairment losses are recorded in Other income, net within our Consolidated Statements of Operations. These impairments were primarily due to the identification of underperforming stores and the relocation of certain stores.

For any store closing where a lease obligation still exists, we record the estimated future liability associated with the rental obligation less any estimated sublease income on the date the store is closed in accordance with ASC Topic 420, “Exit or Disposal Cost Obligations.”

Foreign Currency Translation

Foreign Currency Translation - Foreign Subsidiaries

The functional currencies of our foreign subsidiaries are as follows:

• Australian dollar for our subsidiary in Australia;

• British pound sterling for our subsidiary in the United Kingdom;

• Brunei dollar for our subsidiary in Brunei;

• Canadian dollar for our subsidiary in Canada;

• Chinese yuan for our subsidiary in China;

• Euro for our subsidiaries in Austria, France, Germany, Spain and Portugal;

• Hong Kong dollar for our subsidiaries in Hong Kong;

• Japanese yen for our subsidiary in Japan;

• Malaysian ringgit for our subsidiary in Malaysia;

• Polish zloty for our subsidiary in Poland;

• Singapore dollar for our subsidiary in Singapore;

• Swiss franc for our subsidiary in Switzerland;

• Taiwan dollar for our subsidiary in Taiwan; and

• Thailand baht for our subsidiary in Thailand.

Assets and liabilities are translated into USD using the current exchange rates in effect at the balance sheet date, while revenues and expenses are translated using the average exchange rates during the applicable reporting period. The resulting translation adjustments are recorded in Accumulated other comprehensive (loss) income within the Consolidated Statements of Stockholders’ (Deficit) Equity.

Foreign Currency Translation - Short-Term Intercompany Loans

Foreign currency transactions related to short-term, cross-currency intercompany loans amounted to gains of $9 million, $1 million and $2 million for fiscals 2014, 2013 and 2012, respectively. Such amounts were included in Interest expense.

We economically hedge the majority of these short-term, cross-currency intercompany loans with foreign currency forward contracts. These derivative contracts were not designated as hedges and are recorded on our Consolidated Balance Sheets at fair value with a gain or loss recorded on the Consolidated Statements of Operations in Interest expense. For fiscal years 2014, 2013 and 2012, we recorded losses of $9 million, $1 million and $2 million, respectively. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

Income Taxes

Income Taxes

We account for income taxes in accordance with ASC Topic 740, “Income Taxes” (“ASC 740”). Our provision for income taxes and effective tax rates are calculated by legal entity and jurisdiction and are based on a number of factors, including our level of pre-tax earnings, income tax planning strategies, differences between tax laws and accounting rules, statutory tax rates and credits, uncertain tax positions and valuation allowances. We use significant judgment and estimates in evaluating our tax positions. Our effective tax rate in a given financial statement period may be materially impacted by changes in the mix and level of earnings by taxing jurisdiction.

Under ASC 740, deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the Consolidated Financial Statements. Valuation allowances are established when, in management’s judgment, it is more likely than not that our deferred tax assets will not be realized. In assessing the need for a valuation allowance, management weighs the available positive and negative evidence, including limitations on the use of tax loss and other carryforwards due to changes in ownership, historic information, projections of future sources of taxable income, including future reversals of taxable temporary differences and future taxable income exclusive of reversing temporary differences and carryforwards and tax planning strategies.

At any one time, our tax returns for numerous tax years are subject to examination by U.S. Federal, state and foreign taxing jurisdictions. ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attributes for income tax positions taken or expected to be taken on a tax return. Under ASC 740, the impact of an uncertain tax position taken or expected to be taken on an income tax return must be recognized in the financial statements at the largest amount that is more-likely-than-not to be sustained. An uncertain income tax position will not be recognized in the financial statements unless it is more-likely-than-not to be sustained. We adjust these tax liabilities, as well as the related interest and penalties, based on the latest facts and circumstances, including recently enacted tax law changes, published rulings, court cases and outcomes of tax audits. While we do not expect material changes, it is possible that our actual tax liability will differ from our established tax liabilities for unrecognized tax benefits, and our effective tax rate may be materially impacted. While it is often difficult to predict the final outcome of, the timing of or the tax treatment of any particular tax position or deduction, we believe that our tax balances reflect the more-likely-than-not outcome of known tax contingencies. We report tax-related interest and penalties as a component of Income tax expense.

At January 31, 2015 and February 1, 2014, we reported unrecognized tax benefits in Accrued expenses and other current liabilities and Other non-current liabilities in our Consolidated Balance Sheets. These tax liabilities do not include a portion of our unrecognized tax benefits, which have been recorded as either a reduction of Deferred tax assets related to tax loss carryforwards or a reduction of taxes receivable. For further information, refer to Note 10 entitled “INCOME TAXES.”

Temporary Equity

Temporary Equity

On October 31, 2011, in connection with the acquisition of a 70% ownership interest in Toys (Labuan) Holding Limited (“Labuan”), the Company recognized Noncontrolling interest in the amount of $24 million which was measured at fair value at the acquisition date. Refer to Note 17 entitled “ACQUISITIONS” for further details. In accordance with the terms of the agreement, the Noncontrolling interest is redeemable for cash or common stock of the Company at the option of the holder. As such, the Noncontrolling interest has been recorded in Temporary Equity in our Consolidated Balance Sheets at its redemption value.

In addition, as a result of modifications made to our stock-based compensation plans during fiscal 2013, certain equity awards were redeemable for cash at the option of the holder and redemption was probable. As of January 31, 2015, these awards have all vested and redemption is no longer probable. Therefore, in accordance with ASC Topic 718, “Compensation – Stock Compensation” (“ASC 718”) and ASC Topic 480, “Distinguishing Liabilities from Equity” (“ASC 480”), the shares were initially recorded as Temporary Equity in fiscal 2013 in our Consolidated Balance Sheet at their redemption value and were subsequently reclassified to Additional paid-in capital in fiscal 2014. Refer to Note 7 entitled “STOCK-BASED COMPENSATION” for further details.

The reconciliation of the changes in Temporary Equity is as follows:

(In millions)
Balance, January 28, 2012	$	29
Net earnings attributable to noncontrolling interest	1
Adjustment of noncontrolling interest to redemption value	19
Balance, February 2, 2013	49
Net earnings attributable to noncontrolling interest	3
Adjustment of noncontrolling interest to redemption value	18
Redemption value of redeemable shares	8
Balance, February 1, 2014	78
Net earnings attributable to noncontrolling interest	4
Adjustment of noncontrolling interest to redemption value	10
Value of formerly redeemable shares to equity	(8		)
Capital contribution	1
Balance, January 31, 2015	$	85

Stock-Based Compensation

Stock-Based Compensation

Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service period. We have applied ASC 718 to new awards and to awards modified, repurchased or canceled since January 29, 2006. For further information, refer to Note 7 entitled “STOCK-BASED COMPENSATION.”

XML

SCHEDULE I - PARENT COMPANY INFORMATION - Schedule I - Condensed Statements of Operations and Comprehensive Income (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Condensed Financial Statements, Captions [Line Items]
Revenues	$ 12,361	$ 12,543	$ 13,543
Depreciation and amortization	377	388	407
Other income, net	(53)	(37)	(53)
Total operating expenses	4,239	4,739	4,395
Interest expense	(451)	(524)	(480)
Income tax expense	32	169	53
Net (loss) earnings attributable to Toys “R” Us, Inc.	(292)	(1,039)	38
Comprehensive income	(452)	(1,120)	(9)
Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Revenues	0	0	0
General and administrative expenses	25	21	18
Depreciation and amortization	1	3	3
Other income, net	0	1	0
Total operating expenses	26	25	21
Interest expense	(78)	(76)	(83)
Intercompany interest expense, net	(54)	(63)	(47)
(Deficit) equity in pre-tax (loss) earnings of consolidated subsidiaries	(102)	(706)	242
Earnings before income taxes	(260)	(870)	91
Income tax expense	32	169	53
Net (loss) earnings attributable to Toys “R” Us, Inc.	$ (292)	$ (1,039)	$ 38

XML

FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) (Fair Value, Measurements, Recurring [Member], USD $) In Millions, unless otherwise specified	Jan. 31, 2015	Feb. 01, 2014
Derivative financial instruments:
Interest rate contracts		$ 13
Foreign exchange contracts		0
Total assets		13
Derivative financial instruments:
Interest rate contracts	0	1
Foreign exchange contracts	2	0
Total liabilities	2	1
Quoted Prices in Active Markets for Identical Assets (Level 1)
Derivative financial instruments:
Interest rate contracts		0
Foreign exchange contracts		0
Total assets		0
Derivative financial instruments:
Interest rate contracts	0	0
Foreign exchange contracts	0	0
Total liabilities	0	0
Significant Other Observable Inputs (Level 2)
Derivative financial instruments:
Interest rate contracts		13
Foreign exchange contracts		0
Total assets		13
Derivative financial instruments:
Interest rate contracts	0	1
Foreign exchange contracts	2	0
Total liabilities	2	1
Significant Unobservable Inputs (Level 3)
Derivative financial instruments:
Interest rate contracts		0
Foreign exchange contracts		0
Total assets		0
Derivative financial instruments:
Interest rate contracts	0	0
Foreign exchange contracts	0	0
Total liabilities	$ 0	$ 0

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Other Income, Net (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Credit card program income	$ 36		$ 33		$ 22
Gift card breakage income	27		24		21
Net gains on sales of properties	5		8		4
Impairment of long-lived assets	(13)		(44)		(11)
Foreign currency translation	(19)		(1)		(3)
Other	17	[1]	17	[1]	20	[1]
Total	$ 53		$ 37		$ 53

[1] Includes advertising income from our websites, fixed asset write-offs and other miscellaneous income and expense charges.

XML

SHORT-TERM BORROWINGS AND LONG-TERM DEBT (Tables)

12 Months Ended

Jan. 31, 2015

Debt Disclosure [Abstract]

Schedule of Debt

A summary of the Company’s consolidated Short-term borrowings and Long-term debt as well as the effective interest rates on our outstanding variable rate debt as of January 31, 2015 and February 1, 2014 is outlined in the table below:

(In millions)	January 31, 2015		February 1, 2014
Short-term borrowings
Labuan uncommitted lines of credit	$	—	$	12
Long-term debt
Spanish real estate credit facility, due fiscal 2015 (EURIBOR+6.00%)	34		71
Toys-Japan unsecured credit lines, expire fiscals 2015-2016 (1)	—		5
European and Australian asset-based revolving credit facility, expires fiscal 2016	—		—
Secured term loan facility, due fiscal 2016 (LIBOR+4.50%) (2)(3)	—		646
7.375% senior secured notes, due fiscal 2016 (2)(3)	—		357
10.375% senior notes, due fiscal 2017 (4)	448		447
8.500% senior secured notes, due fiscal 2017 (5)	721		719
French real estate credit facility, due fiscal 2018 (EURIBOR+4.50%)	53		64
Incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (2)(3)	133		372
Second incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (2)(3)	67		210
7.375% senior notes, due fiscal 2018 (4)	402		403
$1.85 billion secured revolving credit facility, expires fiscal 2019 (2)(3)(6)	—		—
Senior unsecured term loan facility, due fiscal 2019 (LIBOR+5.00%) (7)	965		973
Tranche A-1 loan facility, due fiscal 2019 (LIBOR+7.25%) (2)(3)	272		—
Secured term B-4 loan facility, due fiscal 2020 (LIBOR+8.75%) (2)(3)	1,010		—
UK real estate credit facility, due fiscal 2020 (6.85%)	396		433
Toys-Japan 1.85%-2.45% loans, due fiscals 2015-2021	63		91
8.750% debentures, due fiscal 2021 (8)	22		22
Finance obligations associated with capital projects	189		174
Capital lease obligations	13		20
	4,788		5,007
Less: current portion	176		89
Total Long-term debt (9)	$	4,612	$	4,918

(1) Toys “R” Us - Japan, Ltd. (“Toys-Japan”) currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit (“Tranche 1” due fiscal 2015 and “Tranche 2” due fiscal 2016). On July 15, 2014, Toys-Japan entered into an agreement to refinance Tranche 2 of its committed lines of credit.

(2) Represents obligations of Toys “R” Us - Delaware, Inc. (“Toys-Delaware”).

(3) On October 24, 2014, Toys-Delaware amended the credit agreement for its secured term loan facilities (the “Secured Term Loan Credit Agreement”) to provide for, among other things, a new tranche of term loans in an aggregate principal amount of $1,026 million due fiscal 2020 (the “Secured Term B-4 Loan”). Additionally, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the $1.85 billion secured revolving credit facility (“ABL Facility”) to provide for, among other things, a new tranche of loans in an aggregate principal amount of $280 million due fiscal 2019. The Secured Term B-4 Loan and the Tranche A-1 Loan, together with other sources and funds available to Toys-Delaware, were used to (i) refinance in full the Secured term loan facility due fiscal 2016, (ii) extend $380 million of the term loans due fiscal 2018 under the Incremental secured term loan facility and the Second incremental secured term loan facility into the Secured Term B-4 Loan and (iii) redeem all of the 7.375% senior secured notes due fiscal 2016 (“Toys-Delaware Secured Notes”), plus accrued interest, premiums and fees. The Secured Term B-4 Loan is guaranteed by Wayne Real Estate Parent Company, LLC, a wholly-owned subsidiary of the Company and an indirect parent of Toys “R” Us Property Company I, LLC.

(4) Represents obligations of Toys “R” Us, Inc. (the “Parent Company”) legal entity. For further details on Parent Company information, refer to Schedule I — Parent Company Condensed Financial Statements and Notes to the Condensed Financial Statements.

(5) Represents obligations of Toys “R” Us Property Company II, LLC (“TRU Propco II”).

(6) On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for the ABL Facility in order to extend the maturity date of the facility and amend certain other provisions.

(7) Represents obligations of Toys “R” Us Property Company I, LLC and its subsidiaries (“TRU Propco I”).

(8) Represents obligations of the Parent Company and Toys-Delaware.

(9) We maintain derivative instruments on certain of our long-term debt, which impact our effective interest rates. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

Schedule of Maturities of Long-term Debt

The annual maturities of our Long-term debt, including current portion, at January 31, 2015 are as follows:

(In millions)	Annual Maturities
2015	$	176
2016	34
2017	1,207
2018	658
2019	1,180
2020 and subsequent	1,571
Total	$	4,826

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

12 Months Ended

Jan. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Derivatives [Table Text Block]

The following table presents our outstanding interest rate contracts as of January 31, 2015 and February 1, 2014:

			January 31, 2015	February 1, 2014
(In millions)	Effective Date	Maturity Date	Notional Amount	Notional Amount
Interest Rate Swaps
3 Month USD LIBOR Fixed to Float Interest Rate Swap (1)	September 2010	September 2016	—	350
6 Month JPY TIBOR Float to Fixed Interest Rate Swap (2)	January 2011	January 2016	42	65
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (2)	January 2011	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap	January 2011	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap (3)	January 2012	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap	January 2012	April 2015	500	500
3 Month EURIBOR Interest Rate Cap (2)	January 2013	January 2016	34	71
3 Month EURIBOR Interest Rate Cap (2)	February 2013	February 2018	53	64
1 Month USD LIBOR Interest Rate Cap	January 2014	April 2015	311	311

(1) On November 26, 2014, we terminated this interest rate swap. As a result, we received cash proceeds of $10 million, which included $1 million of accrued interest receivable as described above.

(2) As of January 31, 2015, these derivatives were designated for hedge accounting.

(3) The Company de-designated a portion of this interest rate cap in fiscal 2010. As of January 31, 2015 and February 1, 2014, 40% of the $500 million interest rate cap is designated as a cash flow hedge.

Schedule of Foreign Exchange Contracts, Statement of Financial Position [Table Text Block]

The following table presents our outstanding foreign exchange contracts as of January 31, 2015 and February 1, 2014:

			January 31, 2015		February 1, 2014
(In millions)	Effective Date	Maturity Date	Notional  Amount		Notional  Amount
Foreign-Exchange Forwards
Short-term cross-currency intercompany loans	Varies	Varies	$	98	$	104
Merchandise purchases	Varies	Varies	—		—

Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) [Table Text Block]

The following table sets forth the net impact of the effective portion of derivatives designated as cash flow hedges on Accumulated other comprehensive (loss) income on our Consolidated Statements of Stockholders’ (Deficit) Equity for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Derivatives designated as cash flow hedges:
Beginning balance	$	(1	)	$	(2	)	$	(2	)
Change in fair value recognized in Accumulated other comprehensive (loss) income - Interest Rate Contracts	—			—			—
Reclassifications from Accumulated other comprehensive (loss) income - Interest Rate Contracts	1			1			—
	1			1			—
Ending balance	$	—		$	(1	)	$	(2	)

Derivative Instruments, Gain (Loss) [Table Text Block]

The following table sets forth the impact of derivatives on Interest expense on our Consolidated Statements of Operations for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Derivatives not designated for hedge accounting:
(Loss) gain on the change in fair value - Interest Rate Contracts	$	(2	)	$	—		$	7
Loss on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	(9		)	(1		)	(2		)
Gain (loss) on the change in fair value - Merchandise Purchases Program Foreign Exchange Contracts	9			2			(1		)
	(2		)	1			4
Derivatives designated as cash flow hedges:
Loss reclassified from Accumulated other comprehensive (loss) income (effective portion) - Interest Rate Contracts	—			—			(1		)
Gain amortized from terminated cash flow hedges - Interest Rate Contracts	—			—			1
Amortization of hedged caps	(2		)	(1		)	—
	(2		)	(1		)	—
Derivative designated as a fair value hedge:
Amortization of swap basis adjustment - Interest Rate Contract	—			(1		)	(1		)
Loss on the change in fair value - Interest Rate Contract	(2		)	(5		)	—
Gain recognized in Interest expense on hedged item	2			5			5
	—			(1		)	4
Total Interest expense	$	(4	)	$	(1	)	$	8

(1) Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]

The following table contains the notional amounts and related fair values of our derivatives included within our Consolidated Balance Sheets as of January 31, 2015 and February 1, 2014:

	January 31, 2015					February 1, 2014
(In millions)	Notional Amount		Fair Value Assets/ (Liabilities)			Notional Amount		Fair Value Assets/ (Liabilities)
Interest Rate Contracts designated as cash flow hedges:
Prepaid expenses and other current assets (1)	$	734	$	—		$	—	$	—
Other assets	53		—			835		—
Accrued expenses and other current liabilities (1)	42		—			—		—
Other non-current liabilities	—		—			65		(1		)
Interest Rate Contract designated as a fair value hedge:
Other assets	—		—			350		13
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets (1)	1,611		—			—		—
Other assets	—		—			1,611		—
Foreign Currency Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	8		—			26		—
Accrued expenses and other current liabilities	$	90	$	(2	)	$	78	$	—
Total derivative contracts outstanding:
Prepaid expenses and other current assets	$	2,353	$	—		$	26	$	—
Other assets	53		—			2,796		13
Total derivative assets (2)	$	2,406	$	—		$	2,822	$	13
Accrued expenses and other current liabilities	$	132	$	(2	)	$	78	$	—
Other non-current liabilities	—		—			65		(1		)
Total derivative liabilities (2)	$	132	$	(2	)	$	143	$	(1	)

(1) Amounts as of January 31, 2015 includes reclassifications of contracts scheduled to mature within the next 12 months, which were previously included within Other assets or Other non-current liabilities as of February 1, 2014.

(2) Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the fair value of our derivative instruments classified within the fair value hierarchy.

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Consolidated Statements of Stockholders’ (Deficit) Equity (USD $) In Millions	Total USD ($)	Common Stock Issued Shares	Common Stock Treasury Amount USD ($)	Additional Paid-in Capital USD ($)	Total Retained Earnings USD ($)	Accumulated Other Comprehensive Income (Loss) USD ($)	Toys R Us, Inc. USD ($)
Balance at Jan. 28, 2012			$ (2)	$ 35	$ 426	$ 44	$ 503
Balance (shares) at Jan. 28, 2012		49
Net loss attributable to Toys “R” Us, Inc.	38				38		38
Total other comprehensive loss, net of tax	(47)					(47)	(47)
Stock compensation expense				14			14
Repurchase of common stock			(24)				(24)
Issuance of common stock			23	(5)			18
Stock award reclassification				2			2
Adjustment of noncontrolling interest to redemption value	(19)				(19)		(19)
Restricted stock forfeitures			(1)	1
Balance at Feb. 02, 2013			(4)	47	445	(3)	485
Balance (shares) at Feb. 02, 2013		49
Net loss attributable to Toys “R” Us, Inc.	(1,039)				(1,039)		(1,039)
Total other comprehensive loss, net of tax	(81)					(81)	(81)
Stock compensation expense				15			15
Repurchase of common stock			(38)				(38)
Issuance of common stock			35	(7)			28
Adjustment of noncontrolling interest to redemption value	(18)				(18)		(18)
Restricted stock forfeitures			(2)	2
Redemption value of redeemable shares to temporary equity	8			(8)			(8)
Balance at Feb. 01, 2014			(9)	49	(612)	(84)	(656)
Balance (shares) at Feb. 01, 2014		49
Net loss attributable to Toys “R” Us, Inc.	(292)				(292)		(292)
Total other comprehensive loss, net of tax	(160)					(160)	(160)
Restricted stock forfeitures			4	(4)
Stock compensation expense				15			15
Adjustment of noncontrolling interest to redemption value	(10)				(10)		(10)
Value of formerly redeemable shares from temporary equity	8			8
Balance at Jan. 31, 2015			$ (5)	$ 68	$ (914)	$ (244)	$ (1,095)
Balance (shares) at Jan. 31, 2015		49

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FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Jan. 31, 2015

Fair Value Disclosures [Abstract]

Fair value, Long-term Debt [Table Text Block]

The table below presents the carrying values and fair values of our Long-term debt including current portion as of January 31, 2015 and February 1, 2014, aggregated by level in the fair value hierarchy within which those measurements fall.

	Long-term Debt
(In millions)	Carrying Value		Fair Value		Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
January 31, 2015	$	4,788	$	4,416	$	1,346	$	2,315	$	755
February 1, 2014	5,007		4,541		1,411		2,303		827

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The table below presents our assets and liabilities measured at fair value on a recurring basis as of January 31, 2015 and February 1, 2014, aggregated by level in the fair value hierarchy within which those measurements fall.

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Liabilities
Derivative financial instruments:
Interest rate contracts	$	—	$	—	$	—	$	—
Foreign exchange contracts	—		2		—		2
Total liabilities	$	—	$	2	$	—	$	2

Fiscal 2013

(In millions)	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets
Derivative financial instruments:
Interest rate contracts	$	—	$	13	$	—	$	13
Foreign exchange contracts	—		—		—		—
Total assets	$	—	$	13	$	—	$	13
Liabilities
Derivative financial instruments:
Interest rate contracts	$	—	$	1	$	—	$	1
Foreign exchange contracts	—		—		—		—
Total liabilities	$	—	$	1	$	—	$	1

Fair Value Measurements, Nonrecurring

As of January 31, 2015 and February 1, 2014, we did not have any long-lived assets or goodwill classified as Level 1 or Level 2 within the fair value hierarchy, respectively.

Fiscal 2014

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3)		Impairment Losses (1)
Long-lived assets held and used	$	20	$	7	$	13
Total	$	20	$	7	$	13

Fiscal 2013

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3) (2)		Impairment Losses (1)
Long-lived assets held and used	$	68	$	24	$	44
Goodwill (3)	445		64		378
Total	$	513	$	88	$	422

(1) Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

(2) Includes fair values based on offers received of $11 million as of February 1, 2014 which were previously classified as Level 2 and should have been Level 3.

(3) Includes foreign currency translation of $3 million.

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SEGMENTS - Summary of Total Merchandise Inventories and Total Assets Table (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Depreciation and amortization
Merchandise inventories	$ 2,064		$ 2,171
Total Assets	7,115		7,549
Domestic
Depreciation and amortization
Merchandise inventories	1,353		1,375
Total Assets	3,633		3,812
International
Depreciation and amortization
Merchandise inventories	711		796
Total Assets	2,122		2,442
Corporate and other
Depreciation and amortization
Total Assets	$ 1,360	[1]	$ 1,295	[1]

[1] Includes cash and cash equivalents, deferred tax assets and other corporate assets.

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DEFINED BENEFIT PENSION PLANS (Tables)

12 Months Ended

Jan. 31, 2015

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Changes in Projected Benefit Obligations

The following tables provide information regarding our pension plans:

Obligation and Funded Status at End of Fiscal Year:

(In millions)	January 31, 2015			February 1, 2014
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	137		$	128
Service cost	5			5
Interest cost	5			5
Employee contributions	—			1
Benefits paid	(6		)	(2		)
Actuarial loss (gain)	52			(1		)
Foreign currency impact	(19		)	1
Projected benefit obligation at end of year	$	174		$	137

Changes in Fair Value of Plan Assets

(In millions)	January 31, 2015			February 1, 2014
Change in fair value of plan assets:
Fair value of plan assets at beginning of year	$	118		$	105
Actual return on plan assets	17			5
Employer contributions	7			7
Employee contributions	—			1
Benefits paid	(6		)	(2		)
Foreign currency impact	(13		)	2
Fair value of plan assets at end of year	$	123		$	118

Funded Status

(In millions)	January 31, 2015			February 1, 2014
Reconciliation of funded status to total amount recognized:
Funded status	$	(51	)	$	(19	)
Amounts recognized in Consolidated Balance Sheets:
Other non-current liabilities	$	(51	)	$	(19	)
Amounts recognized in Accumulated other comprehensive loss:
Unrecognized actuarial losses, net of tax	$	42		$	9

Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets

Information for Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets:

(In millions)	January 31, 2015		February 1, 2014
Projected benefit obligation	$	174	$	137
Accumulated benefit obligation	150		118
Fair value of plan assets	123		118

Components of Net Periodic Benefit Cost

Components of Net Periodic Benefit Cost During Each Fiscal Year:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Service cost	$	5		$	5		$	5
Interest cost	5			5			5
Expected return on plan assets	(5		)	(5		)	(4		)
Net periodic benefit cost	$	5		$	5		$	6

Estimated Future Payments

Pension benefit payments, including amounts to be paid from our assets, and reflecting expected future service, as appropriate, are expected to be paid as follows:

(In millions)	Pension Benefits
2015	$	2
2016	2
2017	2
2018	2
2019	2
2020 through 2024	9

Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs and Benefit Obligations

Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs at Fiscal Year End:

	January 31, 2015		February 1, 2014		February 2, 2013
Discount rate	3.7	%	4.1	%	4.0	%
Expected rate of return on plan assets	4.5	%	4.9	%	4.6	%
Rate of compensation increase	2.6	%	2.7	%	2.8	%

Weighted-average Assumptions Used to Determine Benefit Obligations at Fiscal Year End:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014
Discount rate	2.7	%	3.9	%
Rate of compensation increase	2.6	%	2.6	%

Weighted Average Asset Allocation by Asset Category

The following represents our pension plan target asset allocations for fiscal 2015, as well as the actual asset allocations as of January 31, 2015 and February 1, 2014:

	2015 Target Allocation		January 31, 2015		February 1, 2014
Equity securities	28.3	%	28.3	%	27.7	%
Debt securities	58.3	%	58.3	%	56.6	%
Insurance contracts	7.3	%	7.3	%	8.3	%
Cash and cash equivalents	6.1	%	6.1	%	7.4	%
Total	100	%	100	%	100	%

Schedule of Fair Value of Plan Assets

There have been no changes in valuation technique or related inputs for the fiscal years ended January 31, 2015 and February 1, 2014.

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Equity Securities: (1)
Domestic	$	—	$	11	$	11
International	—		24		24
Fixed Income: (2)
Domestic	—		4		4
International	—		68		68
Insurance Contracts (3)	—		9		9
Cash and cash equivalents (4)	7		—		7
Total	$	7	$	116	$	123

Fiscal 2013

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Equity Securities: (1)
Domestic	$	—	$	12	$	12
International	—		21		21
Fixed Income: (2)
Domestic	—		2		2
International	—		64		64
Insurance Contracts (3)	—		10		10
Cash and cash equivalents (4)	9		—		9
Total	$	9	$	109	$	118

(1) Domestic and international equity securities categorized as Level 2 are valued using the Net Asset Value (“NAV”) per fund share, which is derived from quoted prices in active markets of the underlying securities.

(2) Domestic and international fixed-income securities categorized as Level 2 are valued using the NAV per fund share, which is derived using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported trades.

(3) Insurance contracts contain a minimum guaranteed return and are categorized as Level 2 as the fair value of the assets is equal to the total amount of all individual technical reserves plus the non allocated employer’s financing fund reserves at the valuation date. The individual technical and financing fund reserves are equal to the accumulated paid contributions taking into account the insurance ratification and any allocated profit sharing return.

(4) Cash and cash equivalents include highly liquid investments with original maturities of three months or less at acquisition. Due to the short-term nature of these investments, their carrying amounts approximate fair value. Therefore, we have determined that our cash and cash equivalents in their entirety are classified as Level 1 within the fair value hierarchy.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Impact of Derivatives on Interest Expense (Details) (Interest Expense [Member], USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Derivative designated as a fair value hedge:
Total Interest expense (related to derivatives)	$ (4)		$ (1)		$ 8
Derivatives not designated for hedge accounting:
Derivative designated as a fair value hedge:
Total Interest expense (related to derivatives)	(2)		1		4
Derivatives not designated for hedge accounting: | Interest Rate Contract [Member]
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value	(2)		0		7
Derivatives not designated for hedge accounting: | Intercompany Loan Foreign Exchange Contracts [Member]
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value	(9)	[1]	(1)	[1]	(2)	[1]
Derivatives not designated for hedge accounting: | Merchandise Purchases Program Foreign Exchange Contracts [Member]
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value	9		2		(1)
Designated as Hedging Instrument [Member] | Derivatives designated as cash flow hedges:
Derivative designated as a fair value hedge:
Total Interest expense (related to derivatives)	(2)		(1)		0
Designated as Hedging Instrument [Member] | Derivative designated as a fair value hedge:
Derivative designated as a fair value hedge:
Gain recognized in Interest expense on hedged item	2		5		5
Total Interest expense (related to derivatives)	0		(1)		4
Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | Derivatives designated as cash flow hedges:
Derivatives designated as cash flow hedges:
Loss reclassified from Accumulated other comprehensive (loss) income (effective portion) - Interest Rate Contracts	0		0		(1)
Gain amortized from terminated cash flow hedges - Interest Rate Contracts	0		0		1
Amortization of hedged caps	(2)		(1)		0
Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | Derivative designated as a fair value hedge:
Derivative designated as a fair value hedge:
Amortization of swap basis adjustment - Interest Rate Contract	0		(1)		(1)
Loss on the change in fair value - Interest Rate Contract	$ (2)		$ (5)		$ 0

[1] Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

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INCOME TAXES - Narrative (Details) (USD $)	12 Months Ended
	Jan. 31, 2015	Feb. 02, 2013	Feb. 01, 2014	Jan. 28, 2012
Schedule of Income Taxes [Line Items]
Interest and penalties		$ (1,000,000)
Deferred Tax Liabilities, Undistributed Foreign Earnings	222,000,000		291,000,000
Unrecognized tax benefits	30,000,000	32,000,000	37,000,000	42,000,000
U.S. Federal tax loss and other carryforwards	385,000,000		398,000,000
State tax loss and other carryforwards	84,000,000		75,000,000
Foreign tax loss and other carryforwards	169,000,000		197,000,000
Increase (decrease) in valuation allowance	110,000,000
Valuation allowance	621,000,000		511,000,000
Deferred Tax Assets, Valuation Allowance, Foreign	6,000,000
Unrecognized tax benefits, affect effective tax rate	23,000,000
Unrecognized tax benefits that would impact deferred tax accounts	7,000,000
Unrecognized tax benefits, accrued interest	4,000,000	4,000,000	5,000,000
Unrecognized Tax Benefits Including Income Tax Penalties and Interest Accrued	35,000,000
Maximum [Member]
Schedule of Income Taxes [Line Items]
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense	1,000,000		1,000,000
Unrecognized tax benefits, accrued penalties	1,000,000	1,000,000	1,000,000
Tax Loss Carryforward [Member]
Schedule of Income Taxes [Line Items]
Unrecognized tax benefits	7,000,000		8,000,000
Expire During the Next Five Years [Member]
Schedule of Income Taxes [Line Items]
Carryforwards Expiration Period	5 years
State tax loss and other carryforwards	4,000,000
Foreign tax loss and other carryforwards	4,000,000
Expire During the Next Five Years [Member] | Maximum [Member]
Schedule of Income Taxes [Line Items]
U.S. Federal tax loss and other carryforwards	1,000,000
Expire During the Next Six to Twenty Years [Member]
Schedule of Income Taxes [Line Items]
U.S. Federal tax loss and other carryforwards	143,000,000
State tax loss and other carryforwards	68,000,000
Foreign tax loss and other carryforwards	3,000,000
Expire During the Next Six to Twenty Years [Member] | Maximum [Member]
Schedule of Income Taxes [Line Items]
Carryforwards Expiration Period	20 years
Expire During the Next Six to Twenty Years [Member] | Minimum [Member]
Schedule of Income Taxes [Line Items]
Carryforwards Expiration Period	6 years
Indefinite Expiration Years [Member]
Schedule of Income Taxes [Line Items]
U.S. Federal tax loss and other carryforwards	241,000,000
State tax loss and other carryforwards	12,000,000
Foreign tax loss and other carryforwards	162,000,000
U.S. Federal Tax Credit and Other Carryforwards [Member]
Schedule of Income Taxes [Line Items]
Increase (decrease) in valuation allowance	99,000,000
State Tax Loss And Other Carryforwards [Member]
Schedule of Income Taxes [Line Items]
Increase (decrease) in valuation allowance	15,000,000
Foreign Tax Loss And Other Carryforwards [Member]
Schedule of Income Taxes [Line Items]
Increase (decrease) in valuation allowance	4,000,000
Reinvestment of Earnings Indefinitely [Member]
Schedule of Income Taxes [Line Items]
Undistributed Earnings of Foreign Subsidiaries	1,000,000
Deferred Tax Liabilities, Undistributed Foreign Earnings	$ 0

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Consolidated Statements of Operations (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Consolidated Statements of Operations [Abstract]
Net sales	$ 12,361	$ 12,543	$ 13,543
Cost of sales	7,931	8,154	8,592
Gross margin	4,430	4,389	4,951
Selling, general and administrative expenses	3,915	4,010	4,041
Depreciation and amortization	377	388	407
Goodwill impairment	0	378	0
Other income, net	(53)	(37)	(53)
Total operating expenses	4,239	4,739	4,395
Operating earnings (loss)	191	(350)	556
Interest expense	(451)	(524)	(480)
Interest income	4	7	16
(Loss) earnings before income taxes	(256)	(867)	92
Income tax expense	32	169	53
Net (loss) earnings	(288)	(1,036)	39
Less: Net earnings attributable to noncontrolling interest	4	3	1
Net (loss) earnings attributable to Toys “R” Us, Inc.	$ (292)	$ (1,039)	$ 38

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Temporary Equity - Noncontrolling Interest (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013	Jan. 28, 2012	Oct. 31, 2011
Temporary Equity Disclosure [Abstract]
Temporary Equity	$ 85	$ 78	$ 49	$ 29	$ 24
Less: Net earnings attributable to noncontrolling interest	4	3	1
Adjustment of noncontrolling interest to redemption value	10	18	19
Redemption value of redeemable shares		8
Value of formerly redeemable shares to equity	(8)
Capital contribution	$ 1

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LITIGATION AND LEGAL PROCEEDINGS - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Feb. 01, 2014	Feb. 02, 2013	Jan. 31, 2015
Aleo [Member]
Loss Contingencies [Line Items]
Loss Contingency, Damages Awarded, Value		$ 20
Loss Contingency, Punitive Damages Awarded, Value		18
Litigation Settlement, Expense	20
Payments for Legal Settlements	25
Visa and MasterCard
Loss Contingencies [Line Items]
Proceeds from Legal Settlements			$ 12

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Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Cash Flows from Operating Activities:
Net (loss) earnings	$ (288)		$ (1,036)		$ 39
Adjustments to reconcile Net (loss) earnings to Net cash provided by operating activities:
Depreciation and amortization	377		388		407
Amortization and write-off of debt issuance costs and debt discount (1)	59	[1]	73	[1]	44	[1]
Net gains on sales of properties	(5)		(8)		(4)
Deferred income taxes	(1)		133		36
Non-cash portion of asset impairments and other charges	20		49		22
Goodwill impairment	0		378		0
Proceeds from settlement of derivatives	9		0		0
Unrealized losses (gains) on foreign exchange	15		(1)		0
Other	23		16		(2)
Changes in operating assets and liabilities:
Accounts and other receivables	(6)		(1)		(9)
Merchandise inventories	(16)		13		(32)
Prepaid expenses and other operating assets	14		21		13
Accounts payable, Accrued expenses and other liabilities	283		160		(4)
Income taxes payable and receivable	(8)		(41)		27
Net cash provided by operating activities	476		144		537
Cash Flows from Investing Activities:
Capital expenditures	(207)		(238)		(286)
(Increase) decrease in restricted cash	(5)		(34)		14
Proceeds from sales of fixed assets	18		35		20
Property insurance recovery	2		0		0
Acquisitions	(1)		0		(15)
Purchases of debt securities	0		(20)		0
Proceeds from redemption of debt securities	0		52		0
Net cash used in investing activities	(193)		(205)		(267)
Cash Flows from Financing Activities:
Long-term debt borrowings	2,866		3,159		1,972
Long-term debt repayments	(3,010)		(3,491)		(1,802)
Short-term debt borrowings, net	(12)		(2)		5
Capitalized debt issuance costs	(35)		(47)		(25)
Other	0		(7)		(3)
Net cash (used in) provided by financing activities	(191)		(388)		147
Effect of exchange rate changes on Cash and cash equivalents	(38)		(25)		0
Cash and cash equivalents:
Net increase (decrease) during period	54		(474)		417
Cash and cash equivalents at beginning of period	644		1,118		701
Cash and cash equivalents at end of period	698		644		1,118
Supplemental Disclosures of Cash Flow Information:
Interest paid	380		458		432
Net income tax payments (refunds)	43		71		(4)
Non-Cash Operating Information:
Purchases of property and equipment included in Accounts payable and Accrued expenses and other current liabilities	$ 42		$ 24		$ 26

[1] Includes amortization and write-off of debt discount, which was previously presented within Other, of $22 million and $8 million for fiscals 2013 and 2012, respectively.

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DEFINED BENEFIT PENSION PLANS - Schedule of Fair Value of Plan Assets (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	$ 123		$ 118		$ 105
Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	9	[1]	10	[1]
Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	7	[2]	9	[2]
Domestic | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	11	[3]	12	[3]
Domestic | Fixed income
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	4	[4]	2	[4]
International | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	24	[3]	21	[3]
International | Fixed income
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	68	[4]	64	[4]
Quoted Prices in Active Markets for Identical Assets (Level 1)
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	7		9
Quoted Prices in Active Markets for Identical Assets (Level 1) | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	0	[1]	0	[1]
Quoted Prices in Active Markets for Identical Assets (Level 1) | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	7	[2]	9	[2]
Quoted Prices in Active Markets for Identical Assets (Level 1) | Domestic | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	0	[3]	0	[3]
Quoted Prices in Active Markets for Identical Assets (Level 1) | Domestic | Fixed income
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	0	[4]	0	[4]
Quoted Prices in Active Markets for Identical Assets (Level 1) | International | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	0	[3]	0	[3]
Quoted Prices in Active Markets for Identical Assets (Level 1) | International | Fixed income
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	0	[4]	0	[4]
Significant Other Observable Inputs (Level 2)
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	116		109
Significant Other Observable Inputs (Level 2) | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	9	[1]	10	[1]
Significant Other Observable Inputs (Level 2) | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	0	[2]	0	[2]
Significant Other Observable Inputs (Level 2) | Domestic | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	11	[3]	12	[3]
Significant Other Observable Inputs (Level 2) | Domestic | Fixed income
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	4	[4]	2	[4]
Significant Other Observable Inputs (Level 2) | International | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	24	[3]	21	[3]
Significant Other Observable Inputs (Level 2) | International | Fixed income
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	$ 68	[4]	$ 64	[4]

[1] Insurance contracts contain a minimum guaranteed return and are categorized as Level 2 as the fair value of the assets is equal to the total amount of all individual technical reserves plus the non allocated employer’s financing fund reserves at the valuation date. The individual technical and financing fund reserves are equal to the accumulated paid contributions taking into account the insurance ratification and any allocated profit sharing return.

[2] Cash and cash equivalents include highly liquid investments with original maturities of three months or less at acquisition. Due to the short-term nature of these investments, their carrying amounts approximate fair value. Therefore, we have determined that our cash and cash equivalents in their entirety are classified as Level 1 within the fair value hierarchy.

[3] Domestic and international equity securities categorized as Level 2 are valued using the Net Asset Value (“NAV”) per fund share, which is derived from quoted prices in active markets of the underlying securities.

[4] Domestic and international fixed-income securities categorized as Level 2 are valued using the NAV per fund share, which is derived using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported trades.

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PROPERTY AND EQUIPMENT - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Property, Plant and Equipment [Abstract]
Gross proceeds from disposal of idle properties	$ 18	$ 35	$ 20
Net gains on sales of properties	$ 5	$ 8	$ 4

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ACQUISITIONS - Narrative (Details) (Toys (Labuan) Holdings Limited [Member], USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 02, 2013	Oct. 31, 2011
Toys (Labuan) Holdings Limited [Member]
Business Acquisition [Line Items]
Business Acquisition, Percentage of Voting Interests Acquired			70.00%
Business Acquisition, Cost of Acquired Entity, Cash Paid			$ 79
Business Acquisition, Cost of Acquired Entity, Cash hold back			10
Business Acquisition, Contingent Consideration, at Fair Value			8
Business Acquisition Percentage of Voting Interests Not Acquired			30.00%
Business Acquisition, Remaining Interest Purchase Option, Period	3 years
Business Acquisition, Contingent Consideration, Cash Payment	1	5
Business Acquisition, Contingent Consideration, Potential Cash Payment	2
Business Acquisition, Cost Of Acquired Entity, Settlement of Cash hold back		10
Noncontrolling interest			$ 24

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STOCK-BASED COMPENSATION (Tables)

12 Months Ended

Jan. 31, 2015

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Weighted Average Valuation Assumptions

The following are the weighted-average assumptions used:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014	February 2, 2013
Volatility	45.0	%	40.0%-45.0%	50.0	%
Risk-free interest rate	1.4%-2.4%		2.0%-2.7%	1.8	%
Expected term	4.0-5.5 years		3.8-5.2 years	5.1 years
Dividend Yield	—		—	—
Weighted-average grant-date fair value per option:	$2.55		$9.67	$20.27

Summary of Service Based Option Activity

A summary of option activity under the 2010 Incentive Plan and Management Equity Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price
Outstanding at beginning of fiscal year	2,661,025		$	29.40	3,483,283		$	36.02	3,895,776		$	32.73
Granted	3,901,217		8.00		1,587,057		25.25		640,756		44.00
Exercised	—		—		(1,057,773	)	26.37		(735,576	)	21.61
Forfeited/Canceled	(2,639,871	)	29.23		(1,351,542	)	43.97		(317,673	)	45.13
Outstanding at end of fiscal year	3,922,371		$	8.23	2,661,025		$	29.40	3,483,283		$	36.02

	Options	Weighted-average Exercise Price		Weighted-average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Options vested or expected to vest at January 31, 2015	3,883,928	$	8.17	8.5	$	—
Options exercisable at January 31, 2015	—	$	—	—	$	—

Summary of Stock Based Compensation Expense Recognized in Selling, General and Administration and the Tax Benefit Recognized in Income Tax (Benefit) Expense

The amount of stock-based compensation expense recognized in SG&A and the tax benefit recognized in Income tax expense in fiscals 2014, 2013 and 2012 was as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
SG&A	$	15	$	15	$	16
Total recognized tax benefit	—		—		6

Restricted Stock [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Summary of Nonvested Restricted Share and Restricted Unit Activity

A summary of nonvested restricted share activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Shares		Weighted-average Grant-date Fair Value		Shares		Weighted-average Grant-date Fair Value		Shares		Weighted-average Grant-date Fair Value
Nonvested shares at beginning of fiscal year	39,182		$	60.00	91,632		$	60.00	105,714		$	60.00
Granted	—		—		—		—		—		—
Shares vested	(35,472	)	60.00		(45,192	)	60.00		—		—
Forfeited/Canceled	(3,710	)	60.00		(7,258	)	60.00		(14,082	)	60.00
Nonvested shares at end of fiscal year	—		$	—	39,182		$	60.00	91,632		$	60.00

Restricted Stock Units (RSUs) [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Summary of Nonvested Restricted Share and Restricted Unit Activity

A summary of outstanding restricted stock unit activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value
Outstanding units at beginning of fiscal year	945,878		$	29.05	215,849		$	46.04	30,804		$	60.00
Granted	50,000		8.00		791,165		25.40		199,428		44.00
Units converted	(156,079	)	45.20		(20,694	)	51.93		(2,001	)	49.49
Forfeited/Canceled	(549,799	)	30.49		(40,442	)	36.66		(12,382	)	47.34
Outstanding units at end of fiscal year	290,000		$	14.01	945,878		$	29.05	215,849		$	46.04

Performance-Based Units [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Summary of Performance Based Unit Activity

A summary of performance-based stock unit activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value
Outstanding units at beginning of fiscal year	39,370		$	45.34	175,104		$	46.24	25,863		$	60.00
Granted	—		—		—		—		160,187		44.00
Units converted	—		—		(1,677	)	50.36		—		—
Forfeited/Canceled	(9,761	)	49.42		(134,057	)	46.45		(10,946	)	45.95
Outstanding units at end of fiscal year	29,609		$	44.00	39,370		$	45.34	175,104		$	46.24

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STOCK-BASED COMPENSATION - Summary of Service Based Option Activity (Details) (Stock Options [Member], USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding at beginning of fiscal year	2,661,025	3,483,283	3,895,776
Granted	3,901,217.00	1,587,057.00	640,756.00
Exercised	0	(1,057,773)	(735,576)
Forfeited/Canceled	(2,639,871)	(1,351,542)	(317,673)
Outstanding at end of fiscal year	3,922,371	2,661,025	3,483,283
Outstanding at beginning of fiscal year	$ 29.40	$ 36.02	$ 32.73
Granted	$ 8.00	$ 25.25	$ 44.00
Exercised	$ 0.00	$ 26.37	$ 21.61
Forfeited/Canceled	$ 29.23	$ 43.97	$ 45.13
Outstanding at end of fiscal year	$ 8.23	$ 29.40	$ 36.02
Stock options, shares vested or expected to vest	3,883,928
Stock options, shares exercisable	0
Weighted average exercise price of stock options vested or expected to vest	$ 8.17
Weighted average exercise price of stock options exercisable	$ 0.00
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Remaining Contractual Term	8 years 183 days
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedandExpectedtoVestExercisableWeightedaverageRemainingContractualTerm2	$ 0.00
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value	$ 0
Aggregate intrinsic value of stock options exercisable	$ 0

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LITIGATION AND LEGAL PROCEEDINGS

12 Months Ended

Jan. 31, 2015

Loss Contingency, Information about Litigation Matters [Abstract]

LITIGATION AND LEGAL PROCEEDINGS

LITIGATION AND LEGAL PROCEEDINGS

In October 2012, the Massachusetts Supreme Judicial Court granted the Company’s request for direct appellate review of a judgment in the amount of $20 million, including $18 million in punitive damages, that was entered against the Company in a wrongful death products liability case entitled Aleo v. SLB Toys USA, Inc., et al. (Superior Court of Massachusetts, Essex County, No. 2008-02149-A) (the “Judgment”). Oral argument concerning this appeal was held on May 6, 2013. On September 13, 2013, the Massachusetts Supreme Judicial Court issued its decision affirming the Judgment. During fiscal 2013, we accrued an additional $20 million related to this matter which was recorded in SG&A. In October 2013, the Company paid $25 million to satisfy the Judgment.

In May 2013, we opted out of the settlement of a class action lawsuit against Visa and MasterCard alleging violations of antitrust laws.  In January 2014, we, along with several other companies, filed a separate lawsuit against Visa and MasterCard entitled Progressive Casualty Insurance Co. et al. v. Visa, Inc., et al. (United States District Court for the Eastern District of New York, No. 14-00276).  A settlement was reached in December 2014, and we received a payment of $12 million in January 2015 which was recorded in SG&A.

In addition to the litigation discussed above, we are, and in the future may be, involved in various other lawsuits, claims and proceedings incident to the ordinary course of business. The results of litigation are inherently unpredictable. Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time and result in diversion of significant resources. We are not able to estimate an aggregate amount or range of reasonably possible losses for those legal matters for which losses are not probable and estimable, primarily for the following reasons: (i) many of the relevant legal proceedings are in preliminary stages, and until such proceedings develop further, there is often uncertainty regarding the relevant facts and circumstances at issue and potential liability; and (ii) many of these proceedings involve matters of which the outcomes are inherently difficult to predict. However, based upon our historical experience with similar matters, we do not expect that any such additional losses would be material to our consolidated financial position, results of operations or cash flows.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables)

12 Months Ended

Jan. 31, 2015

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

Accumulated other comprehensive (loss) income is reflected in the Consolidated Balance Sheets and Consolidated Statements of Stockholders’ (Deficit) Equity, as follows:

(In millions)	Foreign currency translation adjustments, net of tax			Unrealized gain (loss) on hedged transactions, net of tax			Unrecognized actuarial losses, net of tax			Accumulated other comprehensive (loss) income
Balance, January 28, 2012	$	54		$	(2	)	$	(8	)	$	44
Current period change	(46		)	—			(1		)	(47		)
Balance, February 2, 2013	8			(2		)	(9		)	(3		)
Current period change	(82		)	1			—			(81		)
Balance, February 1, 2014	(74		)	(1		)	(9		)	(84		)
Current period change	(128		)	1			(33		)	(160		)
Balance, January 31, 2015	$	(202	)	$	—		$	(42	)	$	(244	)

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RELATED PARTY TRANSACTIONS - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended			0 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013	Feb. 02, 2009	Mar. 22, 2014	Oct. 25, 2014	Aug. 22, 2013	Mar. 26, 2013	Feb. 28, 2013	Jan. 30, 2013	Aug. 02, 2012	Apr. 11, 2012	Feb. 01, 2009 Rate
Related Party Transaction [Line Items]
Capitalized debt issuance costs	$ 35	$ 47	$ 25
The Sponsors [Member]
Related Party Transaction [Line Items]
Term of Advisory Agreement				10 years
Advisory Agreement Extension Period				1 year
Advisory Fee Annual Increase, Percent													5.00%
Sponsor Fees	17	22	21
Transaction Fees Percentage													1.00%
Interest Expense, Related Party	10	10	8
KKR [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value		9
Vornado [Member]
Related Party Transaction [Line Items]
Operating Leases, Rent Expense	8	8	10
Percentage of Operated Stores	0.70%	0.80%	0.90%
Unaffiliated Joint-Venture Parties [Member]
Related Party Transaction [Line Items]
Operating Leases, Rent Expense	2
Maximum [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Related Party, Management and Advisory Fee, Out of Pocket Expense	1	1	0
Secured revolving credit facility, expires fiscal two thousand nineteen [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Capitalized debt issuance costs					19
Tranche A-one loan facility, due fiscal two thousand and nineteen and Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Capitalized debt issuance costs						13
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | KKR [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	96
Propco I Term Loan Facility [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Capitalized debt issuance costs							10
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | KKR [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	17	17
New UK Propco Loan [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Capitalized debt issuance costs								4
French real estate credit facility, due fiscal two thousand eighteen [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Capitalized debt issuance costs									1
Spanish real estate credit facility, due fiscal two thousand fifteen [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Capitalized debt issuance costs										1
Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Capitalized debt issuance costs											4
Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] | KKR [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	9	9
Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] | The Sponsors [Member]
Related Party Transaction [Line Items]
Capitalized debt issuance costs												2
Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] | KKR [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	2	9
Incremental secured term loan facility, due fiscal two thousand eighteen [Member] | KKR [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	12	50
Secured term loan facility, due fiscal two thousand sixteen [Member] | KKR [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value		70
Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] | KKR [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value		$ 5

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RELATED PARTY TRANSACTIONS

12 Months Ended

Jan. 31, 2015

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

The Sponsors provide management and advisory services to us pursuant to an advisory agreement executed at the closing of the merger transaction effective as of July 21, 2005 and amended June 10, 2008, February 1, 2009 and August 29, 2014 (“Advisory Agreement”). The initial term of the Advisory Agreement is ten years. After ten years, it extends annually for one year unless we or the Sponsors provide notice of termination to the other. Prior to an amendment in August 2014, described below, the management and advisory fees paid to the Sponsors (the “Advisory Fees”) increased 5% per year during the ten-year term of the agreement with the exception of fiscal 2009.

In August 2014, the Advisory Agreement was amended in order to reduce the Advisory Fees to $17 million for fiscal year 2014 and each year thereafter.  If in the future we successfully complete an initial public offering (“IPO”), the Sponsors may elect to receive from the proceeds of such IPO, an amount equal to the aggregate difference between: (x) the Advisory Fees that we would have paid in fiscal year 2014 and each fiscal year thereafter had such amounts not been fixed and (y) the Advisory Fees that were actually paid by us for fiscal year 2014 and each fiscal year thereafter. We recorded Advisory Fees of $17 million, $22 million and $21 million for fiscals 2014, 2013 and 2012, respectively. During fiscals 2014, 2013 and 2012, we also paid the Sponsors fees of less than $1 million, respectively, for out-of-pocket expenses.

Additionally, the Advisory Agreement provides that affiliates of the Sponsors will be entitled to receive a fee equal to 1% of the aggregate transaction value in connection with certain financing, acquisition, disposition and change of control transactions (“Transaction Fees”). The Advisory Agreement includes customary exculpation and indemnification provisions in favor of the Sponsors and their affiliates. In the event that the Advisory Agreement is terminated by the Sponsors or us, the Sponsors will receive all unpaid Advisory Fees, all unpaid Transaction Fees and expenses due under the Advisory Agreement with respect to periods prior to the termination date plus the net present value of the Advisory Fees that would have been payable for the remainder of the applicable term of the Advisory Agreement. Transaction fees are capitalized as deferred debt issuance costs and are amortized over the term of the related debt agreement and included in Other assets on our Consolidated Balance Sheet.

In connection with the amendment and restatement of the ABL Facility on March 21, 2014, we incurred Transaction Fees of $19 million pursuant to the terms of the Advisory Agreement.

In connection with entering into the Secured Term B-4 Loan and Tranche A-1 Loan on October 24, 2014, we incurred Transaction Fees of $13 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $96 million of the Secured Term B-4 Loan as of January 31, 2015.

In connection with the Propco I Term Loan Facility entered into on August 21, 2013, we incurred Transactions Fees of $10 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $17 million of the Propco I Term Loan Facility as of January 31, 2015 and February 1, 2014, respectively.

In connection with the UK Propco Facility Agreement entered into on March 25, 2013, we incurred Transactions Fees of $4 million pursuant to the terms of the Advisory Agreement.

In connection with the France Propco Facility Agreement entered into on February 27, 2013, we incurred Transactions Fees of $1 million pursuant to the terms of the Advisory Agreement.

In connection with the Spain Propco Facility Agreement entered into on January 29, 2013, we incurred Transaction Fees of $1 million pursuant to the terms of the Advisory Agreement.

In connection with the offering of the 2017 Notes on August 1, 2012, we incurred Transaction Fees of $4 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $9 million of the 2017 Notes as of January 31, 2015 and February 1, 2014, respectively.

In connection with the Second Incremental Secured Term Loan entered into on April 10, 2012, we incurred Transaction Fees of $2 million pursuant to the terms of the Advisory Agreement. KKR owned an aggregate of $2 million and $9 million of the Second Incremental Secured Term Loan as of January 31, 2015 and February 1, 2014, respectively.

KKR owned an aggregate of $12 million and $50 million of the Incremental Secured Term Loan as of January 31, 2015 and February 1, 2014, respectively. In addition, KKR owned an aggregate of $9 million of the Toys-Delaware Secured Notes as of February 1, 2014, $70 million of the Secured Term Loan Facility as of February 1, 2014, and $5 million of the Propco II Notes as of February 1, 2014. For further details, see Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

From time to time, we and our subsidiaries, as well as the Sponsors or their affiliates, may acquire debt or debt securities issued by us or our subsidiaries in open market transactions, tender offers, exchange offers, privately negotiated transactions or otherwise. During fiscals 2014, 2013 and 2012, affiliates of Vornado Realty Trust (“Vornado”) and KKR held debt and debt securities issued by the Company and its subsidiaries. The interest amounts paid on such debt and debt securities held by related parties were $10 million in fiscals 2014 and 2013, respectively. In fiscal 2012, the interest amounts paid on such debt and debt securities held by related parties were $8 million.

Additionally, under lease agreements with affiliates of Vornado, we paid an aggregate amount of $8 million in fiscals 2014 and 2013, respectively, and $10 million in fiscal 2012 with respect to 0.7%, 0.8% and 0.9%, respectively, of our operated stores, which include Express stores. Of the aggregate amount paid in fiscals 2014, 2013 and 2012, $2 million, respectively, was allocable to joint-venture parties not otherwise affiliated with Vornado.

Each of the Sponsors, either directly or through affiliates, has ownership interests in a broad range of companies (“Portfolio Companies”) with whom we may from time to time enter into commercial transactions in the ordinary course of business, primarily for the purchase of goods and services. We believe that none of our transactions or arrangements with Portfolio Companies are significant enough to be considered material to the Sponsors or to our business.

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STOCK-BASED COMPENSATION - Summary of Stock Based Compensation Expense Recognized in Selling, General and Administration and the Tax Benefit Recognized in Income Tax (Benefit) Expense (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total recognized tax benefit	$ 0	$ 0	$ 6
Selling, General and Administrative Expenses [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
SG&A	$ 15	$ 15	$ 16

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SCHEDULE I - PARENT COMPANY INFORMATION - Net Impact of the Effective Portion of Derivatives Designated as Cash Flow Hedges on Accumulated Other Comprehensive Income (Loss) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Derivatives previously designated as cash flow hedges:
Balance, Unrealized (loss) gain on hedged transactions, net of tax	$ (1)	$ (2)	$ (2)
Unrealized (loss) gain on hedged transactions	1	1	0
Balance, Unrealized (loss) gain on hedged transactions, net of tax	0	(1)	(2)
Designated as Hedging Instrument [Member] | Derivatives designated as cash flow hedges: | Interest Rate Contract [Member]
Derivatives previously designated as cash flow hedges:
Balance, Unrealized (loss) gain on hedged transactions, net of tax	(1)	(2)	(2)
Reclassifications from Accumulated other comprehensive (loss) income - Interest Rate Contracts	1	1	0
Unrealized (loss) gain on hedged transactions	1	1	0
Balance, Unrealized (loss) gain on hedged transactions, net of tax	0	(1)	(2)
Designated as Hedging Instrument [Member] | Derivatives designated as cash flow hedges: | Interest Rate Contract [Member] | Parent Company [Member]
Derivatives previously designated as cash flow hedges:
Balance, Unrealized (loss) gain on hedged transactions, net of tax	1	1	1
Reclassifications from Accumulated other comprehensive (loss) income - Interest Rate Contracts	(1)	0	0
Unrealized (loss) gain on hedged transactions	(1)	0	0
Balance, Unrealized (loss) gain on hedged transactions, net of tax	$ 0	$ 1	$ 1

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Consolidated Statements of Cash Flows (Parentheticals) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Feb. 01, 2014	Feb. 02, 2013
Cash Flows from Operating Activities [Abstract]
Amortization of Debt Discount (Premium)	$ 22	$ 8

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Consolidated Statement of Comprehensive Income (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Consolidated Statements of Comprehensive Income [Abstract]
Net (loss) earnings	$ (288)	$ (1,036)	$ 39
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustments	(128)	(82)	(46)
Unrealized gain on hedged transactions	1	1	0
Unrecognized actuarial losses	(33)	0	(1)
Total other comprehensive loss, net of tax	(160)	(81)	(47)
Comprehensive loss, net of tax	(448)	(1,117)	(8)
Less: Comprehensive income attributable to noncontrolling interest	4	3	1
Comprehensive loss attributable to Toys “R” Us, Inc.	$ (452)	$ (1,120)	$ (9)

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LEASES

12 Months Ended

Jan. 31, 2015

Leases [Abstract]

LEASES

LEASES

We lease a majority of the real estate and certain equipment used in our operations. Most real estate leases require us to pay real estate taxes and other expenses and some leases require additional payments based on percentages of sales.

Minimum rental commitments under non-cancelable operating leases, capital leases and lease financing obligations as of January 31, 2015 are as follows:

	Operating Leases (1)						Capital Leases and Financing Obligations (2)
(In millions)	Gross Minimum Rentals		Sublease Income		Net Minimum Rentals		Lease Obligation
2015	$	561	$	15	$	546	$	31
2016	488		13		475		27
2017	399		10		389		24
2018	333		9		324		24
2019	272		8		264		20
2020 and subsequent	1,055		24		1,031		96
Total	$	3,108	$	79	$	3,029	$	222

(1) Excluded from the minimum rental commitments displayed above are $1.7 billion related to options to extend ground lease terms that are reasonably assured of being exercised, the balance of which is predominantly related to fiscals 2020 and thereafter.

(2) Included in Capital Leases and Financing Obligations displayed above is $20 million of interest.

Total rent expense, net of sublease income, was $601 million, $609 million and $628 million in fiscals 2014, 2013 and 2012, respectively. Sublease income was $18 million, $19 million and $19 million in fiscals 2014, 2013 and 2012, respectively. We remain directly and primarily liable for lease payments to third party landlords for locations where we have subleased all or a portion of the locations to third parties. Rental payments received from our sub-lessees offset the lease payments we make to third party landlords. To the extent that sub-lessees fail to make sublease rental payments, our total net rent expense to the third party landlords would increase in direct proportion.

We record operating leases on a straight-line basis over the lease term, which includes renewal options only if those options are specified in the lease agreement and if failure to exercise the renewal option imposes a significant economic penalty on us. For Ground Lease Locations, we include renewal options in the lease term through the estimated useful life of the owned building located on the property as failure to renew a ground lease during the estimated useful life of the building would result in forgoing an economic benefit given our significant capital investment at the inception of the lease to construct a new building. For Straight Lease Locations, we do not include renewal options in the lease term as the failure to renew a straight lease does not typically result in a significant economic penalty for us, and therefore renewal cannot be reasonably assured at the inception of the lease. Substantially all of our leases include options that allow us to renew or extend the lease term beyond the initial lease period, subject to terms and conditions agreed upon at the inception of the lease. Such terms and conditions include rental rates agreed upon at the inception of the lease that could represent below or above market rental rates later in the life of the lease, depending upon market conditions at the time of such renewal or extension. In addition, many leases include early termination options, which can be exercised under specified conditions, including, upon damage, destruction or condemnation of a specified percentage of the value or land area of the property.

The difference between the recognized rental expense and amounts payable under the leases is recorded as deferred rent liability. Deferred rent liabilities in our Consolidated Balance Sheets totaled $359 million and $374 million at January 31, 2015 and February 1, 2014, respectively, of which $12 million was included in Accrued expenses and other current liabilities for each respective period.

Lease payments that depend on factors that are not measurable at the inception of the lease, such as future sales volume, are contingent rentals and are excluded from minimum lease payments. We include contingent rentals in the determination of total rental expense when it is probable that the expense has been incurred and the amount is reasonably estimable. Contingent rent expense was $10 million, $10 million and $12 million for fiscals 2014, 2013 and 2012, respectively. Future payments for maintenance, insurance and taxes to which we are obligated are excluded from minimum lease payments. Tenant allowances received upon entering into certain store leases are deferred and recognized on a straight-line basis as a reduction to rent expense over the lease term.

We have been and may be involved in the construction of leased stores which includes non-standard tenant improvements. As a result of this involvement, we were deemed the “owner” for accounting purposes and were required to capitalize the construction costs on our Consolidated Balance Sheets. Upon completion of these projects, we performed an analysis pursuant to ASC 840 and determined that we were unable to derecognize the assets capitalized during construction. Therefore, in conjunction with these leases, we recorded financing obligations equal to the cash proceeds and fair market value of the assets received. As of January 31, 2015 and February 1, 2014, the carrying amounts of our financing obligations, which approximates fair value, were $189 million and $174 million, respectively. The rental payments to the landlord are recognized as a reduction of the financing obligation and interest expense. We also continue to recognize rent expense on the ground leases for the land on which these assets were constructed.

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SCHEDULE I - PARENT COMPANY INFORMATION - Narrative (Details) In Millions, unless otherwise specified	12 Months Ended															12 Months Ended																		12 Months Ended					0 Months Ended	12 Months Ended						12 Months Ended				12 Months Ended
	Jan. 31, 2015 USD ($)	Feb. 01, 2014 USD ($)	Feb. 02, 2013 USD ($)	Jan. 31, 2015 Parent Company [Member] USD ($)	Feb. 01, 2014 Parent Company [Member] USD ($)	Feb. 02, 2013 Parent Company [Member] USD ($)	Jan. 31, 2015 Subsidiaries [Member] USD ($)	Feb. 01, 2014 Subsidiaries [Member] USD ($)	Feb. 02, 2013 Subsidiaries [Member] USD ($)	Jan. 31, 2015 Toys (Labuan) Holdings Limited [Member] USD ($)	Feb. 02, 2013 Toys (Labuan) Holdings Limited [Member] USD ($)	Jan. 31, 2015 Toys R Us (UK) Limited [Member] Parent Company [Member] USD ($)	Feb. 01, 2014 Toys R Us (UK) Limited [Member] Parent Company [Member] USD ($)	Jul. 21, 2005 Toys R Us (UK) Limited [Member] Parent Company [Member] USD ($)	Jul. 21, 2005 Toys R Us (UK) Limited [Member] Parent Company [Member] GBP (£)	Jan. 31, 2015 Toys R Us - Delaware [Member] Parent Company [Member] USD ($)	Feb. 01, 2014 Toys R Us - Delaware [Member] Parent Company [Member] USD ($)	Feb. 02, 2013 Toys R Us - Delaware [Member] Parent Company [Member] USD ($)	Jan. 31, 2015 Property Subsidiaries [Member] Parent Company [Member] USD ($)	Feb. 01, 2014 Property Subsidiaries [Member] Parent Company [Member] USD ($)	Feb. 02, 2013 Property Subsidiaries [Member] Parent Company [Member] USD ($)	Feb. 01, 2014 Toys-Europe [Member] Parent Company [Member] USD ($)	Jan. 31, 2015 TRU Asia, Ltd. [Member] Parent Company [Member] USD ($)	Feb. 02, 2013 TRU Asia, Ltd. [Member] Parent Company [Member] USD ($)	Jan. 31, 2015 Toys (Labuan) Holdings Limited [Member] Parent Company [Member] USD ($)	Jan. 31, 2015 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] USD ($)		Feb. 01, 2014 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] USD ($)		Jan. 31, 2015 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] Parent Company [Member] USD ($)		Feb. 01, 2014 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] Parent Company [Member] USD ($)		Jan. 31, 2015 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] Toys R Us - Delaware [Member] USD ($)	Feb. 01, 2014 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] Toys R Us - Delaware [Member] USD ($)	Feb. 02, 2013 Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] Toys R Us - Delaware [Member] USD ($)	Jan. 31, 2015 Labuan uncommitted lines of credit [Member] Parent Company [Member] USD ($)	Jan. 31, 2015 Labuan uncommitted lines of credit [Member] Parent Company [Member] HKD	Aug. 22, 2013 Ten point seven five percent senior notes, due fiscal two thousand seventeen [Member] USD ($)	Jan. 31, 2015 Ten point seven five percent senior notes, due fiscal two thousand seventeen [Member] Toys R Us Property Company I, LLC [Member] Parent Company [Member] USD ($)	Feb. 01, 2014 Ten point seven five percent senior notes, due fiscal two thousand seventeen [Member] Toys R Us Property Company I, LLC [Member] Parent Company [Member] USD ($)	Feb. 02, 2013 Ten point seven five percent senior notes, due fiscal two thousand seventeen [Member] Toys R Us Property Company I, LLC [Member] Parent Company [Member] USD ($)	Jan. 31, 2015 U.K. real estate credit facility, due fiscal two thousand twenty [Member] USD ($)	Jan. 31, 2015 U.K. real estate credit facility, due fiscal two thousand twenty [Member] GBP (£)	Feb. 01, 2014 U.K. real estate credit facility, due fiscal two thousand twenty [Member] USD ($)	Jan. 31, 2015 U.K. real estate credit facility, due fiscal two thousand twenty [Member] Toys-Europe [Member] Parent Company [Member] USD ($)	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] USD ($)	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] EUR (€)	Feb. 01, 2014 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] USD ($)	Jan. 31, 2015 Spanish real estate credit facility, due fiscal two thousand fifteen [Member] Toys-Europe [Member] Parent Company [Member] USD ($)	Jan. 31, 2015 Interest Rate Contract [Member] USD ($)	Feb. 01, 2014 Maximum [Member] Interest Rate Contract [Member] USD ($)
Condensed Financial Statements, Captions [Line Items]
Notes Payable, Related Parties, Noncurrent														$ 770
Promissory Note Received as Dividend														887	509
Related Party Transaction, Due from (to) Related Party												(175)	(179)			755	697
Insurance Liabilities, Related Party																89
Insurance Liabilities, Third Party																	90
Other Payables, Related Parties																4	4
Due from subsidiary				376	316
Income tax benefit	(32)	(169)	(53)	(32)	(169)	(53)	(91)	(127)	(105)
Long-term debt	4,788	5,007		872	872																					22	[1]	22	[1]	22	[2]	22	[2]										396	263	433		34	30	71
Long-term Debt, Fair Value	4,400	4,500		639	687
Interest expense	(451)	(524)	(480)	(78)	(76)	(83)																												(2)	(2)	(2)			(77)
Line of Credit Facility, Future Borrowings, Amount Guaranteed																																					33	257
Average Remaining Maturity of Foreign Currency Derivatives	12 months			12 months
Derivative, Net Liability Position, Aggregate Fair Value																																																			2	1
Derivative, Remaining Maturity																																																			12 months
Cash Distributions Paid to Parent Company by Consolidated Subsidiaries				93	202	203											79	129	93	123	72																			86	115	64
Proceeds from Cash Distributions, Return of Capital					109	10
Capital contribution	1																					30	5	5																						274				10
Business Acquisition, Contingent Consideration, Cash Payment										$ 1	$ 5														$ 1

[1] (8)Represents obligations of the Parent Company and Toys-Delaware.

[2] Represents obligations of Toys “R” Us, Inc. and Toys–Delaware.

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DEFINED BENEFIT PENSION PLANS - Weighted Average Asset Allocation by Asset Category (Details)	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations		100.00%	100.00%
Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations		28.30%	27.70%
Debt securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations		58.30%	56.60%
Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations		7.30%	8.30%
Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations		6.10%	7.40%
Scenario, Forecast [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Target Plan Asset Allocations	100.00%
Scenario, Forecast [Member] | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Target Plan Asset Allocations	28.30%
Scenario, Forecast [Member] | Debt securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Target Plan Asset Allocations	58.30%
Scenario, Forecast [Member] | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Target Plan Asset Allocations	7.30%
Scenario, Forecast [Member] | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Target Plan Asset Allocations	6.10%

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DEFINED BENEFIT PENSION PLANS - Estimated Future Payments (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015
Compensation and Retirement Disclosure [Abstract]
2015	$ 2
2016	2
2017	2
2018	2
2019	2
2020 through 2024	$ 9

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Document and Entity Information Document (USD $)	12 Months Ended
	Jan. 31, 2015	Mar. 02, 2015	Aug. 02, 2014
Document Information [Line Items]
Entity Registrant Name	TOYS R US INC
Entity Central Index Key	0001005414
Current Fiscal Year End Date	--01-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-K
Document Period End Date	Jan. 31, 2015
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Common Stock, Shares Outstanding		49,201,899
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	Yes
Entity Current Reporting Status	Yes
Entity Public Float			$ 0

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INCOME TAXES

12 Months Ended

Jan. 31, 2015

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

(Loss) earnings before income taxes are as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
U.S.	$	(263	)	$	(851	)	$	(18	)
Foreign	7			(16		)	110
(Loss) earnings before income taxes	$	(256	)	$	(867	)	$	92

Income tax expense (benefit) is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Current:
U.S. Federal	$	(13	)	$	(7	)	$	(28	)
Foreign	46			46			45
State	—			(3		)	—
Total current income tax expense (benefit)	$	33		$	36		$	17
Deferred:
U.S. Federal	$	1		$	42		$	(9	)
Foreign	(2		)	72			11
State	—			19			34
Total deferred income tax expense (benefit)	$	(1	)	$	133		$	36
Total income tax expense (benefit)	$	32		$	169		$	53

Included within Total income tax expense (benefit) is a benefit of less than $1 million, benefit of less than $1 million, and expense of $1 million related to interest and penalties in fiscals 2014, 2013 and 2012, respectively. The interest and penalties relate to tax payments and refunds for prior period tax filings made or to be made, as well as amounts associated with increases and decreases to unrecognized tax benefits.

We have not provided deferred taxes on $1 million of accumulated earnings of certain foreign subsidiaries as it is management’s intention to reinvest those earnings indefinitely. The estimated unrecognized deferred income tax liabilities on these earnings, net of associated foreign tax credits and other offsets, is zero.

The effective tax rate reconciliations are as follows:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014		February 2, 2013
U.S. Federal statutory tax rate	35.0	%	35.0	%	35.0	%
State taxes, net of U.S. Federal benefit	—	%	(1.2	)%	23.9	%
Foreign operations (1)	(13.5	)%	(12.3	)%	3.7	%
U.S. Federal valuation allowance	(36.6	)%	(27.9	)%	0.8	%
Unrecognized tax benefits (2)	3.0	%	—	%	(3.6	)%
Goodwill impairment (3)	—	%	(13.4	)%	—	%
Other	(0.4	)%	0.3	%	(2.2	)%
Effective tax rate	(12.5	)%	(19.5	)%	57.6	%

(1) Foreign operations include the net impact of: differences between local statutory rates and the U.S. Federal statutory rate; the impact of changes to foreign valuation allowances; the net cost of foreign unrecognized tax benefits; the cost of repatriating foreign earnings, net of foreign tax credits; changes to our assertion regarding the permanent reinvestment of foreign earnings related to certain foreign entities; permanent items related to foreign operations; as well as changes in the tax status of foreign entities.

(2) Unrecognized tax benefits include benefits related to the resolution of issues in connection with resolving tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations. See “Unrecognized Tax Benefits” in this footnote.

(3) Goodwill impairment represents the U.S. Federal tax cost associated with the amount of Goodwill that was impaired for which we did not have tax basis, and therefore for which we could not take a tax benefit.

The tax effects of temporary differences that give rise to deferred tax assets and liabilities are:

(In millions)	January 31, 2015			February 1, 2014
Deferred tax assets:
U.S. Federal tax loss and other carryforwards	$	385		$	398
State tax loss and other carryforwards	84			75
Foreign tax loss and other carryforwards	169			197
Straight line rent	127			137
Inventory	52			75
Insurance loss reserve	35			36
Restructuring charges	7			10
Other	158			119
Gross deferred tax assets before valuation allowance	1,017			1,047
Valuation allowance	(621		)	(511		)
Total deferred tax assets	$	396		$	536
Deferred tax liabilities:
Fixed assets (1)	$	(67	)	$	(131	)
Undistributed earnings of foreign subsidiaries	(222		)	(291		)
Foreign currency translation	(24		)	(26		)
Other	(21		)	(14		)
Total deferred tax liabilities	$	(334	)	$	(462	)
Net deferred tax assets	$	62		$	74

The deferred tax assets and liabilities above are reflected in the Consolidated Balance Sheets as follows:

(In millions)	January 31, 2015			February 1, 2014
Current deferred tax assets	$	45		$	31
Current deferred tax liabilities (2)	(4		)	(13		)
Non-current deferred tax assets	133			152
Non-current deferred tax liabilities	(112		)	(96		)
	$	62		$	74

(1) Includes deferred impact of finance obligations associated with capital projects.

(2) The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities in the Consolidated Balance Sheets.

Our gross deferred tax assets above include an offset of $7 million and $8 million of unrecognized tax benefits related to tax loss carryforwards as of January 31, 2015 and February 1, 2014, respectively.

Carryforwards

In addition to the unused portion of losses and credits reported on tax returns, our carryforwards also include interest deductions that are being carried forward due to thin-capitalization and other tax limitations, as well as credits that will be realized in connection with the undistributed earnings of foreign subsidiaries on which we have provided taxes.

Of our $385 million of U.S. Federal tax loss and other carryforwards, less than $1 million will expire during the next 5 years, $143 million will expire during the next 6 to 20 years and $241 million may be carried forward indefinitely. Of our $84 million of state tax loss and other carryforwards, $4 million will expire during the next 5 years, $68 million will expire during the next 6 to 20 years and $12 million may be carried forward indefinitely. Of our $169 million of foreign tax loss and other carryforwards, $4 million will expire during the next 5 years, $3 million will expire during the next 6 to 20 years and $162 million may be carried forward indefinitely.

On July 21, 2005, the Company was acquired by the Sponsors. U.S. Federal and certain state and foreign taxing jurisdictions impose limitations on the amount of tax losses, credits and other carryforwards that can be used to offset current income and tax within any given year when there has been an ownership change. We have evaluated the impact of these limitations and have established a valuation allowance to reduce some of these deferred tax assets to the amount expected to be realized.

Valuation Allowance

We have evaluated the available positive and negative evidence and have concluded that, for some of our deferred tax assets, it is more likely than not that these assets will not be realized in the foreseeable future. As a result, we have established a valuation allowance to reduce these deferred tax assets for the amount we believe will not be realized. The increase to our valuation allowance for U.S. Federal and state jurisdictions, as well as in certain foreign jurisdictions, was predominantly due to the fact that, as of the end of fiscal 2014, we have incurred a pre-tax cumulative loss over the past three fiscal years. During fiscal 2014, our valuation allowance increased by $110 million. This includes a$99 million increase for U.S. Federal tax, a $15 million increase for state tax and a $4 million decrease for foreign tax.

Of our total valuation allowance of $621 million, there is $6 million related to the foreign valuation allowance which, if a benefit is subsequently recognized, will result in a reduction of another asset.

Unrecognized Tax Benefits

A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits (excluding interest and penalties) is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Beginning balance	$	37		$	32		$	42
Additions for tax positions of the current year	4			4			5
Additions for tax positions of prior years	5			6			3
Reductions for tax positions of prior years (1)	(11		)	(1		)	(12		)
Settlements	—			—			(5		)
Currency translation adjustment	(4		)	—			—
Lapse of statute of limitations	(1		)	(4		)	(1		)
Ending balance	$	30		$	37		$	32

(1) Reductions for tax positions of prior years include amounts related to the resolution of issues in connection with resolving tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations.

At January 31, 2015, $23 million of the $30 million of unrecognized tax benefits would affect our effective tax rate, if recognized, and the remaining $7 million would affect our deferred tax accounts. In addition, we had $4 million and less than $1 million of accrued interest and penalties, respectively, at January 31, 2015. We had $5 million and less than $1 million of accrued interest and penalties, respectively, at February 1, 2014, and $4 million and less than $1 million of accrued interest and penalties, respectively, at February 2, 2013.

The Company and its subsidiaries are subject to taxation in the United States and various foreign jurisdictions. Of the major jurisdictions, we are subject to examination in: the United States for U.S. Federal purposes for fiscal 2010 and forward and for state purposes for fiscal 2010 and forward; Australia for fiscal 2009 and forward; Canada for fiscal 2007 and forward; France for fiscal 2011 and forward; Germany for fiscal 2009 and forward; Japan for fiscal 2008 and forward; Spain for fiscal 2008 and forward; and the UK for fiscal 2009 and forward. While it is often difficult to predict whether we will prevail, we believe that our tax liabilities for unrecognized tax benefits reflect the more likely than not outcome of known tax contingencies.

We believe that it is reasonably possible that the total amount of unrecognized tax benefits of $35 million (inclusive of tax, interest and penalties) will not change during the next twelve months due to ongoing tax examinations and applicable statutes of limitations.

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SEGMENTS - Percentage of Consolidated Net Sales from Product Category (Details)	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Domestic
Depreciation and amortization
Product Category Net Sales Percentage	100.00%		100.00%		100.00%
Domestic | Baby
Depreciation and amortization
Product Category Net Sales Percentage	38.00%		37.70%		37.90%
Domestic | Core Toy
Depreciation and amortization
Product Category Net Sales Percentage	17.40%		16.20%		16.00%
Domestic | Entertainment
Depreciation and amortization
Product Category Net Sales Percentage	10.20%		11.30%		11.70%
Domestic | Learning
Depreciation and amortization
Product Category Net Sales Percentage	22.70%		22.80%		22.40%
Domestic | Seasonal
Depreciation and amortization
Product Category Net Sales Percentage	11.20%		11.30%		11.30%
Domestic | Other
Depreciation and amortization
Product Category Net Sales Percentage	0.50%	[1]	0.70%	[1]	0.70%	[1]
International
Depreciation and amortization
Product Category Net Sales Percentage	100.00%		100.00%		100.00%
International | Baby
Depreciation and amortization
Product Category Net Sales Percentage	20.20%		20.40%		21.60%
International | Core Toy
Depreciation and amortization
Product Category Net Sales Percentage	23.50%		22.70%		21.90%
International | Entertainment
Depreciation and amortization
Product Category Net Sales Percentage	8.50%		10.00%		11.40%
International | Learning
Depreciation and amortization
Product Category Net Sales Percentage	31.10%		30.80%		29.20%
International | Seasonal
Depreciation and amortization
Product Category Net Sales Percentage	15.90%		15.30%		15.20%
International | Other
Depreciation and amortization
Product Category Net Sales Percentage	0.80%	[2]	0.80%	[2]	0.70%	[2]

[1] Consists primarily of non-product related revenues.

[2] Consists primarily of non-product related revenues, including licensing fees from unaffiliated third parties.From time to time, we may make revisions to our prior period Net sales by product category to conform to the current period allocation. These revisions did not have a significant impact to our prior year disclosure.

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DEFINED BENEFIT PENSION PLANS - Components of Net Periodic Benefit Cost (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Compensation and Retirement Disclosure [Abstract]
Service cost	$ 5	$ 5	$ 5
Interest cost	5	5	5
Expected return on plan assets	(5)	(5)	(4)
Net periodic benefit cost	$ 5	$ 5	$ 6

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Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Current Assets:
Cash and cash equivalents	$ 698		$ 644
Accounts and other receivables	225		249
Merchandise inventories	2,064		2,171
Current deferred tax assets	45		31
Prepaid expenses and other current assets	122		125
Total current assets	3,154		3,220
Property and equipment, net	3,335		3,638
Goodwill	64		64
Deferred tax assets	133		152
Restricted cash	53		53
Other assets	376		422
Total Assets	7,115		7,549
Current Liabilities:
Accounts payable	1,571		1,488
Accrued expenses and other current liabilities	1,032		920
Income taxes payable	20		19
Current portion of long-term debt	176		89
Total current liabilities	2,799		2,516
Long-term debt	4,612	[1]	4,918	[1]
Deferred tax liabilities	112		96
Deferred rent liabilities	347		362
Other non-current liabilities	255		235
Temporary Equity	85		78
Stockholders’ Deficit:
Common stock (par value $0.001 and $0.001; shares authorized 55,000,000 and 55,000,000; shares outstanding 49,195,396 and 49,047,844 at January 31, 2015 and February 1, 2014, respectively)	0		0
Treasury stock	(5)		(9)
Additional paid-in capital	68		49
Accumulated deficit	(914)		(612)
Accumulated other comprehensive loss	(244)		(84)
Total Stockholders’ Deficit	(1,095)		(656)
Total Liabilities, Temporary Equity and Stockholders’ Deficit	$ 7,115		$ 7,549

[1] (9)We maintain derivative instruments on certain of our long-term debt, which impact our effective interest rates. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

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FAIR VALUE MEASUREMENTS

12 Months Ended

Jan. 31, 2015

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

To determine the fair value of our assets and liabilities, we utilize the established fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Derivative Financial Instruments

Currently, we use derivative financial arrangements to manage a variety of risk exposures, including interest rate risk associated with our Long-term debt and foreign currency risk relating to cross-currency intercompany lending and merchandise purchases. The valuation of our foreign currency contracts is determined using market-based foreign exchange rates, which are classified as Level 2 inputs.

The valuation of our interest rate contracts is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves, foreign exchange rates and implied volatilities. We evaluate the inputs used to value our derivatives at the end of each reporting period.

For our interest rate contracts, we primarily use Level 2 inputs mentioned above to arrive at fair value. Additionally, for interest rate contracts we also incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements taking into account the impact of any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees. We measure the credit risk of our derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. The portfolio-level adjustments are then allocated each period to the individual assets or liabilities within the portfolio.

The credit valuation adjustments are calculated by determining the total expected exposure of the derivatives (which incorporates both the current and potential future exposure) and then applying each counterparty’s credit spread to the applicable exposure. The total expected exposure of a derivative is derived using market-observable inputs, such as yield curves and volatilities. The inputs utilized for our own credit spread are based on implied spreads from our debt, which are considered unobservable inputs. These credit valuation adjustments fall within Level 3 of the fair value hierarchy and include estimates of current credit spreads to evaluate the likelihood of default. For counterparties with publicly available credit information, the credit spreads over LIBOR used in the calculations represent implied credit default swap spreads obtained from a third party credit data provider. Generally, significant increases (decreases) in our own credit spread in isolation would result in significantly lower (higher) fair value measurement for these derivatives. Based on the mixed input valuation, we classify these derivatives based on the lowest level in the fair value hierarchy that is significant to the overall fair value of the instrument.

Any transfer into or out of a level of the fair value hierarchy is recognized based on the value of the instruments at the end of the reporting period.

The table below presents our assets and liabilities measured at fair value on a recurring basis as of January 31, 2015 and February 1, 2014, aggregated by level in the fair value hierarchy within which those measurements fall.

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Liabilities
Derivative financial instruments:
Interest rate contracts	$	—	$	—	$	—	$	—
Foreign exchange contracts	—		2		—		2
Total liabilities	$	—	$	2	$	—	$	2

Fiscal 2013

(In millions)	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets
Derivative financial instruments:
Interest rate contracts	$	—	$	13	$	—	$	13
Foreign exchange contracts	—		—		—		—
Total assets	$	—	$	13	$	—	$	13
Liabilities
Derivative financial instruments:
Interest rate contracts	$	—	$	1	$	—	$	1
Foreign exchange contracts	—		—		—		—
Total liabilities	$	—	$	1	$	—	$	1

For the fiscal years ended January 31, 2015 and February 1, 2014, we had no derivative financial instruments within Level 3 of the fair value hierarchy.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Certain of our assets and liabilities are measured at fair value on a nonrecurring basis. We evaluate the carrying value of all long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The fair value measurements related to long-lived assets held and used classified as Level 3 were determined using a discounted cash flow valuation method or a relative, market-based approach based on purchase offers or appraisals we have received from third parties. The inputs we use to calculate discounted cash flows include the projected cash flows for the asset group (generally by store location) and, when significant, a risk-adjusted rate of return we estimate would be used by a market participant in valuing the assets. The projected cash flows are based on the Company’s sales, gross margin and expense forecasts for each asset group, taking into consideration historical cash flows, as well as anticipated costs and/or proceeds from disposal. For our market-based valuations, we use purchase offers we receive from third parties, predominantly for our properties, which are classified as Level 3 because they are not received in an organized market or observable to market participants. Alternatively, when management commits to sell properties and no third party offers exist, we use asset appraisals conducted by external specialists with experience in real estate valuations. These require a significant amount of judgment regarding appropriate comparable properties and their assessment of current market conditions.

For the fiscal years ended January 31, 2015 and February 1, 2014, we had no impairments to long-lived assets held for sale. There have been no changes in valuation technique or related inputs for long-lived assets for the fiscal years ended January 31, 2015 and February 1, 2014. During fiscal 2014, management determined that fair values based on offers received should be reclassified to Level 3. The impact of this change on the prior period was deemed immaterial.

Goodwill is evaluated for impairment annually or whenever we identify certain events or circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The fair value measurements related to goodwill are classified as Level 3 and were determined by blending results from the market multiples approach and the income approach. These valuation approaches consider a number of factors that include, but are not limited to, expected future cash flows, growth rates, discount rates, and comparable multiples from publicly-traded companies in our industry, and require us to make certain assumptions and estimates regarding industry economic factors and future profitability of our business. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details on the valuation technique and related inputs for goodwill. For the fiscal year ended January 31, 2015, we had no goodwill impairment. There have been no changes in valuation technique or related inputs for goodwill for the fiscal years ended January 31, 2015 and February 1, 2014.

The table below presents our long-lived assets and goodwill evaluated for impairment and measured at fair value on a nonrecurring basis for the fiscal years ended January 31, 2015 and February 1, 2014, aggregated by level in the fair value hierarchy within which those measurements fall. Because these assets are not measured at fair value on a recurring basis, certain carrying amounts and fair value measurements presented in the table may reflect values at earlier measurement dates and may no longer represent their fair values at January 31, 2015 and February 1, 2014. As of January 31, 2015 and February 1, 2014, we did not have any long-lived assets or goodwill classified as Level 1 or Level 2 within the fair value hierarchy, respectively.

Fiscal 2014

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3)		Impairment Losses (1)
Long-lived assets held and used	$	20	$	7	$	13
Total	$	20	$	7	$	13

Fiscal 2013

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3) (2)		Impairment Losses (1)
Long-lived assets held and used	$	68	$	24	$	44
Goodwill (3)	445		64		378
Total	$	513	$	88	$	422

(1) Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

(2) Includes fair values based on offers received of $11 million as of February 1, 2014 which were previously classified as Level 2 and should have been Level 3.

(3) Includes foreign currency translation of $3 million.

Other Financial Instruments

The fair values of our Long-term debt including current portion are estimated using quoted market prices for the same or similar issues and other pertinent information available to management as of the end of the respective periods. The fair values of debt instruments classified as Level 1 are based on quoted prices in reasonably active markets and Level 2 instruments are valued using market prices we obtain from external third parties. Debt instruments classified as Level 3 are not publicly traded, and therefore we are unable to obtain quoted market prices, and are generally valued using estimated spreads, a present value calculation or a cash flow analysis, as appropriate. There have been no significant changes in valuation technique or related inputs for Long-term debt for the fiscal years ended January 31, 2015 and February 1, 2014. The table below presents the carrying values and fair values of our Long-term debt including current portion as of January 31, 2015 and February 1, 2014, aggregated by level in the fair value hierarchy within which those measurements fall.

	Long-term Debt
(In millions)	Carrying Value		Fair Value		Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
January 31, 2015	$	4,788	$	4,416	$	1,346	$	2,315	$	755
February 1, 2014	5,007		4,541		1,411		2,303		827

Other financial instruments that are not measured at fair value on our Consolidated Balance Sheets include cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and short-term borrowings. Due to the short-term nature of these assets and liabilities, their carrying amounts approximate fair value.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

12 Months Ended

Jan. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We are exposed to market risk from potential changes in interest rates and foreign currency exchange rates. We regularly evaluate our exposure and enter into derivative financial instruments to economically manage these risks. We record all derivatives as either assets or liabilities on the Consolidated Balance Sheets measured at estimated fair value and we do not offset assets and liabilities with the same counterparty. We recognize the changes in fair value as unrealized gains and losses. The recognition of these gains or losses depends on our intended use of the derivatives and the resulting designation. In certain defined conditions, we may designate a derivative as a hedge for a particular exposure.

Interest Rate Contracts

We and our subsidiaries have a variety of fixed and variable rate debt instruments and are exposed to market risks resulting from interest rate fluctuations. We enter into interest rate swaps and/or caps to reduce our exposure to variability in expected future cash outflows and changes in the fair value of certain Long-term debt, attributable to the changes in LIBOR, EURIBOR and TIBOR. Some of our interest rate contracts contain credit-risk related contingent features and are subject to master netting arrangements. As of January 31, 2015, our interest rate contracts have various maturity dates through February 2018. A portion of our interest rate swaps and caps as of January 31, 2015 are designated as cash flow hedges in accordance with ASC 815.

The hedge accounting for a designated cash flow hedge requires that the effective portion be recorded to Accumulated other comprehensive (loss) income; the ineffective portion of a cash flow hedge is recorded to Interest expense. We evaluate the effectiveness of our cash flow hedging relationships on an ongoing basis. For our derivatives that are designated as cash flow hedges, no material ineffectiveness was recorded for fiscals 2014, 2013 and 2012, respectively. Reclassifications from Accumulated other comprehensive (loss) income to Interest expense primarily relate to realized Interest expense on interest rate swaps and caps and the amortization of gains (losses) recorded on previously terminated or de-designated swaps and caps. We expect to reclassify a net loss of $1 million in fiscal 2015 to Interest expense from Accumulated other comprehensive (loss) income.

The hedge accounting for a designated fair value hedge requires that the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk be recognized in Interest expense. We evaluate the effectiveness of our fair value hedging relationship on an ongoing basis and recalculate the change in the fair value of the derivative and the underlying hedged item separately. During fiscal 2014, the $350 million notional amount interest rate swap that we designated as a fair value hedge failed to meet the effectiveness assessment thresholds required to qualify for hedge accounting. Accordingly, subsequent changes in the fair value of the derivative were recorded in Interest expense. We recorded net gains of less than $1 million in earnings related to ineffectiveness for fiscal 2013 and we recorded a net gain of $5 million in earnings related to ineffectiveness for fiscal 2012. In conjunction with the dedesignation of the fair value hedge, commencing in the second quarter of fiscal 2014, we no longer adjusted the hedged debt for changes in fair value attributable to changes in the benchmark interest rate. We were amortizing to maturity the residual basis adjustment to the hedged debt from the application of hedge accounting to Interest expense. In the third quarter of fiscal 2014, we extinguished the previously hedged debt and recognized a $4 million gain in Interest expense. On November 26, 2014, we terminated the associated $350 million notional amount interest rate swap which was originally scheduled to expire in September 2016. As a result, we received cash proceeds of $10 million, which included $1 million of accrued interest receivable.

Certain of our agreements with credit-risk related contingent features contain cross-default provisions which provide that we could be declared in default on our derivative obligations if we default on certain specified indebtedness. As of January 31, 2015 and February 1, 2014, there were no derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 31, 2015 and February 1, 2014, we were not required to post collateral for any of these derivatives.

The following table presents our outstanding interest rate contracts as of January 31, 2015 and February 1, 2014:

			January 31, 2015	February 1, 2014
(In millions)	Effective Date	Maturity Date	Notional Amount	Notional Amount
Interest Rate Swaps
3 Month USD LIBOR Fixed to Float Interest Rate Swap (1)	September 2010	September 2016	—	350
6 Month JPY TIBOR Float to Fixed Interest Rate Swap (2)	January 2011	January 2016	42	65
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (2)	January 2011	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap	January 2011	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap (3)	January 2012	April 2015	500	500
1 Month USD LIBOR Interest Rate Cap	January 2012	April 2015	500	500
3 Month EURIBOR Interest Rate Cap (2)	January 2013	January 2016	34	71
3 Month EURIBOR Interest Rate Cap (2)	February 2013	February 2018	53	64
1 Month USD LIBOR Interest Rate Cap	January 2014	April 2015	311	311

(1) On November 26, 2014, we terminated this interest rate swap. As a result, we received cash proceeds of $10 million, which included $1 million of accrued interest receivable as described above.

(2) As of January 31, 2015, these derivatives were designated for hedge accounting.

(3) The Company de-designated a portion of this interest rate cap in fiscal 2010. As of January 31, 2015 and February 1, 2014, 40% of the $500 million interest rate cap is designated as a cash flow hedge.

Foreign Exchange Contracts

We enter into foreign currency forward contracts to economically hedge the USD merchandise purchases of our foreign subsidiaries and our short-term, cross-currency intercompany loans with and between our foreign subsidiaries. We enter into these contracts in order to reduce our exposure to the variability in expected cash outflows attributable to changes in foreign currency rates. These derivative contracts are not designated as hedges and are recorded on our Consolidated Balance Sheets at fair value with a gain or loss recorded on the Consolidated Statements of Operations in Interest expense.

Our foreign exchange contracts typically mature within 12 months. Some of these contracts contain credit-risk related contingent features and are subject to master netting arrangements. Some of these agreements contain provisions which provide that we could be declared in default on our derivative obligations if we default on certain specified indebtedness. At January 31, 2015 and February 1, 2014, derivative liabilities related to agreements that contain credit-risk related contingent features had a fair value of $2 million and less than $1 million, respectively. We are not required to post collateral for these contracts.

The following table presents our outstanding foreign exchange contracts as of January 31, 2015 and February 1, 2014:

			January 31, 2015		February 1, 2014
(In millions)	Effective Date	Maturity Date	Notional  Amount		Notional  Amount
Foreign-Exchange Forwards
Short-term cross-currency intercompany loans	Varies	Varies	$	98	$	104
Merchandise purchases	Varies	Varies	—		—

The following table sets forth the net impact of the effective portion of derivatives designated as cash flow hedges on Accumulated other comprehensive (loss) income on our Consolidated Statements of Stockholders’ (Deficit) Equity for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Derivatives designated as cash flow hedges:
Beginning balance	$	(1	)	$	(2	)	$	(2	)
Change in fair value recognized in Accumulated other comprehensive (loss) income - Interest Rate Contracts	—			—			—
Reclassifications from Accumulated other comprehensive (loss) income - Interest Rate Contracts	1			1			—
	1			1			—
Ending balance	$	—		$	(1	)	$	(2	)

The following table sets forth the impact of derivatives on Interest expense on our Consolidated Statements of Operations for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Derivatives not designated for hedge accounting:
(Loss) gain on the change in fair value - Interest Rate Contracts	$	(2	)	$	—		$	7
Loss on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	(9		)	(1		)	(2		)
Gain (loss) on the change in fair value - Merchandise Purchases Program Foreign Exchange Contracts	9			2			(1		)
	(2		)	1			4
Derivatives designated as cash flow hedges:
Loss reclassified from Accumulated other comprehensive (loss) income (effective portion) - Interest Rate Contracts	—			—			(1		)
Gain amortized from terminated cash flow hedges - Interest Rate Contracts	—			—			1
Amortization of hedged caps	(2		)	(1		)	—
	(2		)	(1		)	—
Derivative designated as a fair value hedge:
Amortization of swap basis adjustment - Interest Rate Contract	—			(1		)	(1		)
Loss on the change in fair value - Interest Rate Contract	(2		)	(5		)	—
Gain recognized in Interest expense on hedged item	2			5			5
	—			(1		)	4
Total Interest expense	$	(4	)	$	(1	)	$	8

(1) Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

The following table contains the notional amounts and related fair values of our derivatives included within our Consolidated Balance Sheets as of January 31, 2015 and February 1, 2014:

	January 31, 2015					February 1, 2014
(In millions)	Notional Amount		Fair Value Assets/ (Liabilities)			Notional Amount		Fair Value Assets/ (Liabilities)
Interest Rate Contracts designated as cash flow hedges:
Prepaid expenses and other current assets (1)	$	734	$	—		$	—	$	—
Other assets	53		—			835		—
Accrued expenses and other current liabilities (1)	42		—			—		—
Other non-current liabilities	—		—			65		(1		)
Interest Rate Contract designated as a fair value hedge:
Other assets	—		—			350		13
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets (1)	1,611		—			—		—
Other assets	—		—			1,611		—
Foreign Currency Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	8		—			26		—
Accrued expenses and other current liabilities	$	90	$	(2	)	$	78	$	—
Total derivative contracts outstanding:
Prepaid expenses and other current assets	$	2,353	$	—		$	26	$	—
Other assets	53		—			2,796		13
Total derivative assets (2)	$	2,406	$	—		$	2,822	$	13
Accrued expenses and other current liabilities	$	132	$	(2	)	$	78	$	—
Other non-current liabilities	—		—			65		(1		)
Total derivative liabilities (2)	$	132	$	(2	)	$	143	$	(1	)

(1) Amounts as of January 31, 2015 includes reclassifications of contracts scheduled to mature within the next 12 months, which were previously included within Other assets or Other non-current liabilities as of February 1, 2014.

(2) Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the fair value of our derivative instruments classified within the fair value hierarchy.

Offsetting of Derivatives

We present our derivatives at gross fair values in the Consolidated Balance Sheets. However, some of our interest rate and foreign exchange contracts are subject to master netting arrangements which allow net settlements under certain conditions. As of January 31, 2015 and February 1, 2014, the aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets were nominal, respectively, and the aggregate gross fair value of derivative assets which could be net settled against our derivative liabilities were nominal, respectively. As of January 31, 2015 and February 1, 2014, none of the master netting arrangements involved collateral.

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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Jan. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

We are subject to various claims and contingencies related to lawsuits as well as commitments under contractual and other commercial obligations. We recognize liabilities for contingencies and commitments when a loss is probable and estimable. Refer to Note 10 entitled “INCOME TAXES” for liabilities associated with uncertain tax positions. Refer to Note 9 entitled “LEASES” for minimum rental commitments under non-cancelable operating leases having a term of more than one year as of January 31, 2015.

As of January 31, 2015, we remain contingently liable for amounts due or amounts that may become due under certain real estate lease agreements that have been assigned to third parties. In the event of default by the assignees, we could be liable for payment obligations associated with these leases which have future lease related payments (not discounted to present value) of$63 million through September 2032. The impact of these obligations is not material to our Consolidated Financial Statements.

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SEGMENTS

12 Months Ended

Jan. 31, 2015

Segment Reporting [Abstract]

SEGMENTS

SEGMENTS

We generate sales, operating earnings and cash flows by retailing numerous product offerings worldwide. We operate all of the “R” Us branded retail stores in the United States, Puerto Rico and Guam and 77% of the 942 “R” Us branded retail stores internationally (excluding temporary Express store locations). The balance of the “R” Us branded retail stores internationally are operated by licensees. Licensing fees did not have a material impact on our Net sales and accounted for $17 million, $16 million and $16 million for fiscals 2014, 2013 and 2012, respectively. We also own and operate websites including Toysrus.com, Babiesrus.com, eToys.com, FAO.com and toys.com, as well as other Internet sites we operate in our international markets.

Our business has two reportable segments: Toys “R” Us – Domestic (“Domestic”) and Toys “R” Us – International (“International”). The following is a brief description of our segments:

• Domestic — Our Domestic segment sells a variety of products in the baby, core toy, entertainment, learning and seasonal categories through 872 stores that operate in 49 states in the United States, Puerto Rico and Guam and through the Internet. Domestic Net sales in fiscal 2014 were derived from traditional toy stores (including Babies “R” Us Express (“BRU Express”) and Juvenile Expansion formats), baby stores, side-by-side (“SBS”) stores, permanent Express stores (with cumulative lease terms of at least two years) and our flagship stores in New York City. Additionally, we generated Net sales through our temporary Express store locations.

• International — Our International segment sells a variety of products in the baby, core toy, entertainment, learning and seasonal categories through 730 operated and 212 licensed stores in 36 countries and jurisdictions and through the Internet. In addition to fees received from licensed stores, International Net sales in fiscal 2014 were derived from traditional toy stores (including BRU Express formats), SBS stores, baby stores and permanent Express stores (with cumulative lease terms of at least two years). Additionally, we generated Net sales through our temporary Express store locations. Our operated stores are located in Australia, Austria, Brunei, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom.

The Chief Operating Decision Maker evaluates segment performance primarily based on Net sales and segment Operating earnings (loss). Segment Operating earnings (loss) excludes corporate related charges and income. All intercompany transactions between the segments have been eliminated. Income tax information by segment has not been included as taxes are calculated at a company-wide level and are not allocated to each segment. Revenues from external customers are derived primarily from merchandise sales and we do not generate material sales from any single customer.

The following tables show our percentage of Net sales by product category:

	Fiscal Years Ended
Domestic:	January 31, 2015		February 1, 2014		February 2, 2013
Baby	38.0	%	37.7	%	37.9	%
Core Toy	17.4	%	16.2	%	16.0	%
Entertainment	10.2	%	11.3	%	11.7	%
Learning	22.7	%	22.8	%	22.4	%
Seasonal	11.2	%	11.3	%	11.3	%
Other (1)	0.5	%	0.7	%	0.7	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues.

	Fiscal Years Ended
International:	January 31, 2015		February 1, 2014		February 2, 2013
Baby	20.2	%	20.4	%	21.6	%
Core Toy	23.5	%	22.7	%	21.9	%
Entertainment	8.5	%	10.0	%	11.4	%
Learning	31.1	%	30.8	%	29.2	%
Seasonal	15.9	%	15.3	%	15.2	%
Other (1)	0.8	%	0.8	%	0.7	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues, including licensing fees from unaffiliated third parties.

From time to time, we may make revisions to our prior period Net sales by product category to conform to the current period allocation. These revisions did not have a significant impact to our prior year disclosure.

A summary of financial results by reportable segment is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Net sales
Domestic	$	7,524		$	7,638		$	8,149
International	4,837			4,905			5,394
Total Net sales	$	12,361		$	12,543		$	13,543
Operating earnings (loss)
Domestic (1) (2)	$	332		$	(197	)	$	571
International (1)	229			203			309
Corporate and other	(370		)	(356		)	(324		)
Operating earnings (loss)	191			(350		)	556
Interest expense	(451		)	(524		)	(480		)
Interest income	4			7			16
(Loss) earnings before income taxes	$	(256	)	$	(867	)	$	92

(1) Fiscal 2013 includes full impairments of the Toys-Domestic and Toys-Japan reporting unit’s goodwill balances of $361 million and $17 million, respectively. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for further details.

(2) Includes incremental expense related to the write-down of excess and obsolete inventory of $51 million for fiscal 2013.

Certain corporate and other items are reported separately in our disclosure of segment Operating earnings (loss). In addition to the income items described above, charges include corporate office expenses and shared service center expenses, as well as certain other centrally managed expenses, which are not fully allocated to our reportable segments. The significant categories of expenses include salaries, benefits and related expenses, professional fees, corporate facility depreciation and amortization and insurance. Salaries, benefits and related expenses include salaries, bonus, payroll taxes and health insurance expenses for corporate office employees. Professional fees include costs related to internal control compliance, financial statement audits, legal, information technology and other consulting fees, which are engaged and managed through the corporate office. Depreciation and amortization includes depreciation of leasehold improvements for properties occupied by corporate office employees. Corporate insurance expense includes the cost of fire, liability and automobile premiums.

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
Depreciation and amortization
Domestic	$	210	$	216	$	225
International	116		123		136
Corporate	51		49		46
Total Depreciation and amortization	$	377	$	388	$	407
Capital expenditures
Domestic	$	67	$	113	$	148
International	83		86		95
Corporate	57		39		43
Total Capital expenditures	$	207	$	238	$	286

(In millions)	January 31, 2015		February 1, 2014
Merchandise inventories
Domestic	$	1,353	$	1,375
International	711		796
Total Merchandise inventories	$	2,064	$	2,171
Total Assets
Domestic	$	3,633	$	3,812
International	2,122		2,442
Corporate and other (1)	1,360		1,295
Total Assets	$	7,115	$	7,549

(1) Includes cash and cash equivalents, deferred tax assets and other corporate assets.

Our Net sales, inclusive of each country’s respective Internet operations, and long-lived assets by country or region are as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
Net sales
United States (1)	$	7,524	$	7,638	$	8,149
Europe (2)	1,405		1,447		1,439
Japan	1,308		1,374		1,795
Canada	834		883		928
UK	710		680		735
China and Southeast Asia	333		277		233
Australia	230		228		248
Other (3)	17		16		16
Total Net sales	$	12,361	$	12,543	$	13,543

(1) Includes our wholly-owned operations in Puerto Rico and Guam.

(2) Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

(3) Represents licensing fees from unaffiliated third parties.

(In millions)	January 31, 2015		February 1, 2014
Long-lived assets
United States (1)	$	2,372	$	2,521
Europe (2)	352		417
Japan	306		383
UK	281		312
Canada	180		212
China and Southeast Asia	41		32
Australia	14		16
Total Long-lived assets	$	3,546	$	3,893

(1) Includes our wholly-owned operations in Puerto Rico and Guam.

(2) Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

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SEGMENTS - Net Sales and Long Lived Assets by Country or Region (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014		Feb. 02, 2013
Depreciation and amortization
Net sales	$ 12,361		$ 12,543		$ 13,543
Long-lived assets	3,546		3,893
United States
Depreciation and amortization
Net sales	7,524	[1]	7,638	[1]	8,149	[1]
Long-lived assets	2,372	[1]	2,521	[1]
Europe
Depreciation and amortization
Net sales	1,405	[2]	1,447	[2]	1,439	[2]
Long-lived assets	352	[2]	417	[2]
Japan
Depreciation and amortization
Net sales	1,308		1,374		1,795
Long-lived assets	306		383
Canada
Depreciation and amortization
Net sales	834		883		928
Long-lived assets	180		212
UK
Depreciation and amortization
Net sales	710		680		735
Long-lived assets	281		312
China and Southeast Asia
Depreciation and amortization
Net sales	333		277		233
Long-lived assets	41		32
Australia
Depreciation and amortization
Net sales	230		228		248
Long-lived assets	14		16
Other
Depreciation and amortization
Net sales	$ 17	[3]	$ 16	[3]	$ 16	[3]

[1] Includes our wholly-owned operations in Puerto Rico and Guam.

[2] Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

[3] Represents licensing fees from unaffiliated third parties.

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STOCK-BASED COMPENSATION

12 Months Ended

Jan. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

Management Equity Plan

On July 21, 2005, we adopted the Toys “R” Us, Inc. 2005 Management Equity Plan (the “Management Equity Plan”). Under the Management Equity Plan, outstanding awards during fiscal 2014 included service-based options and restricted stock to officers and other key employees of the Company and its subsidiaries. In connection with Amendment No. 2 to the 2010 Incentive Plan (“Amendment No. 2”) effective September 2014, the Company made the determination to no longer issue any awards under the Management Equity Plan.

The service-based options generally follow a graded vesting schedule of 40% on the second anniversary of the award with the remaining portion vesting in equal annual installments over the subsequent three years, subject to the participant’s continued employment with the Company, and vest automatically upon a change of control of the Company. All options generally expire on the tenth anniversary of the date of the grant, unless the terms are amended pursuant to the Management Equity Plan.

In November 2013, the Company extended the expiration dates of certain outstanding option awards under the Management Equity Plan, which were originally scheduled to expire in fiscals 2015 and 2016, to August 6, 2017. We accounted for the modification in accordance with ASC 718. Management concluded that the modification resulted in incremental compensation costs of $1 million, which were recorded in SG&A in fiscal 2013.

Under the Management Equity Plan, each participant’s restricted shares or shares issued or issuable pursuant to stock options will be subject to repurchase rights by the Company in the event of a termination of employment due to death or disability and under specific circumstances upon retirement. In connection with the 2014 Option Exchange described below, the exercise of any put rights on any shares held by the participants who elected to participate will be subject to the prior approval of the Board. The Company has no plans to open a transaction window for participants to put the shares to the Company in the foreseeable future.

2010 Incentive Plan

In fiscal 2010, we adopted the Toys “R” Us, Inc. 2010 Incentive Plan (the “2010 Incentive Plan”). The 2010 Incentive Plan provides that the total number of shares of our common stock that may be issued is 3,750,000 and the maximum number of such shares of common stock for which incentive stock options may be granted is 500,000. In connection with Amendment No. 2, the number of shares available for issuance under the 2010 Incentive Plan were increased by the number of shares available for issuance under the Management Equity Plan as of July 17, 2014 and any shares that after July 17, 2014 would have otherwise been available for issuance thereunder. The Board of Directors of the Company has discretion over the amount of shares available for future issuances of stock awards.

All outstanding options issued under the 2010 Incentive Plan and Management Equity Plan are scheduled to expire at dates ranging from August 6, 2017 to October 10, 2024. We expect to satisfy future option exercises by issuing shares held in treasury or authorized but unissued new shares.

Stock options

In fiscals 2014, 2013 and 2012, we granted options under the 2010 Incentive Plan. The options were granted at an exercise price equal to grant date fair market value. Options granted in fiscal 2014, except for the options granted under the 2014 Option Exchange described below, generally follow a graded vesting schedule of four equal annual installments commencing on the first anniversary of the awards. Additionally, certain options issued in fiscal 2014 will be subject to performance and time vesting and will only be deemed fully vested when they have both time vested and performance vested. Options granted in fiscals 2013 and 2012 generally follow a graded vesting schedule of 50% on the second anniversary of the awards with the remaining portion vesting in equal annual installments over the subsequent two years, subject to the participant’s continued employment with us, and will vest automatically upon a change of control of the Company. Options generally expire ten years from the date of the grant, however, the options issued in connection with the 2014 Option Exchange will expire the later of five years after the final vesting date of the New Options or the original expiration date of the respective Old Options.

Restricted Stock

Additionally, in connection with the services they provide as the Company’s Board of Directors, certain members of our Board of Directors were granted restricted stock units in fiscal 2014, which were valued at a fair market value on the grant date of $8.00 per share. These restricted stock units granted to certain members of our Board of Directors cliff vest 100% on the first anniversary of the grant date. In fiscals 2013 and 2012, concurrent with the grant of the options, additional awards were granted under the 2010 Incentive Plan consisting of service-based restricted stock and restricted stock units, which were valued at a fair market value on the date of grant of $30.00 per share and $44.00 per share in fiscals 2013 and 2012, respectively. The restricted stock units issued in fiscal 2013 for certain officers follow the same graded vesting schedule as the options granted in the same year, while the restricted stock units for other officers cliff vest 100% on the second anniversary of the award, subject to the participant’s continued employment with the Company, and will vest automatically upon a change in control of the Company. The service-based restricted stock and restricted stock units for fiscal 2012 follow the same graded vesting schedule as the options granted in the same year.

In fiscal 2012, certain officers were awarded performance-based restricted stock and restricted stock units valued at a fair market value on the date of the grant of $44.00. The performance-based awards cliff vest 100% on the third anniversary of the awards if the performance criteria have been met. The performance metrics are based 50% on our consolidated Adjusted Compensation EBITDA performance results and 50% on our total return on invested capital (ROIC) results, each over a three year period.

Option Exchanges

In November 2013, certain participants under the 2010 Incentive Plan were offered an opportunity to exchange certain of their outstanding stock options (“2013 Old Options”) and all outstanding performance shares or units for a grant of one new stock option (“2013 New Options”) for every two 2013 Old Options canceled, which 2013 New Options have an exercise price of $22.00. On December 23, 2013, the Company closed its offer with a total of 919,599 and 104,240 2013 Old Options and performance shares or units canceled, respectively, and a total of 459,805 2013 New Options issued under the 2010 Incentive Plan. The 2013 New Options follow a vesting schedule of 50% on the second anniversary of the awards with the remaining portion vesting in equal annual installments over the subsequent two years (subject to the earlier expiration in accordance with the 2013 New Option award agreement), subject to the participant’s continued employment with the Company, and will vest automatically upon a change of control of the Company. We accounted for the modification in accordance with ASC 718. Management has concluded that the modification had a nominal impact on compensation costs.

In September 2014, certain participants were offered an opportunity to exchange their outstanding stock options that were granted prior to fiscal 2014 (“Old Options”) under the Management Equity Plan or the 2010 Incentive Plan for new stock options granted under the 2010 Incentive Plan (“New Options”) on a one-for-one basis (the “2014 Option Exchange”). On October 10, 2014, the Company closed its offer with a total of 1,566,307 Old Options canceled and an equal amount of New Options issued under the 2010 Incentive Plan. The New Options have an exercise price of $8.00 and vest as follows: (i) New Options granted in exchange for Old Options originally granted during the period commencing on January 1, 2005 and ending on December 31, 2012 vest 50% on the award exchange date and 25% on each of the first and second anniversaries of the award exchange date and (ii) New Options granted in exchange for Old Options originally granted in fiscal 2013 vest in equal annual installments over the subsequent four years from the award exchange date. We accounted for the modification in accordance with ASC 718. Management concluded that the modification resulted in incremental compensation costs of $2 million in fiscal 2014, which were recorded in SG&A.

One-time awards

In connection with the appointment of Antonio Urcelay as CEO announced on October 16, 2013, the Company entered into an employment agreement which provided a one-time award of restricted stock units under the 2010 Incentive Plan, which had a grant date of November 5, 2013. The one-time award had a grant date fair value of $8 million, or $22.00 per share, 50% of which vested on October 16, 2014 and the remainder of which was scheduled to vest in equal installments at the end of each fiscal quarter commencing January 31, 2015, with the last portion scheduled to vest on October 31, 2015, subject to continued employment through the applicable vesting dates.

In October 2014, Mr. Urcelay exchanged the one-time restricted stock unit award described above for new options under the 2010 Incentive Plan. Pursuant to the terms of the amendment to Mr. Urcelay’s employment agreement, Mr. Urcelay forfeited certain of his outstanding restricted stock units in exchange for new options (the “Urcelay Options”). Fifty percent and 12.5% of the Urcelay Options vested on October 31, 2014, and January 31, 2015, respectively and 12.5% will vest on each of April 30, 2015, July 31, 2015 and October 31, 2015, subject to Mr. Urcelay’s continued employment on each such date. The Urcelay Options have the same exercise price per share as the New Options. We accounted for the modification in accordance with ASC 718. Management has concluded that the modification did not result in incremental compensation costs.

On November 5, 2013 the Company entered into an employment agreement with Harry J. Mullany III to serve as President, Toys “R” Us, US. The employment agreement provided a one-time award of stock options and restricted stock units under the 2010 Incentive Plan with grant date fair values of $5 million and $2 million, respectively, each at $22.00 per share.  Fifty percent of the options were scheduled to vest in four equal annual installments beginning on the first anniversary of the grant date. The remaining option awards were subject to time and performance vesting and would have only been deemed fully vested when the performance obligations pursuant to Mr. Mullany’s employment agreement were satisfied. The restricted stock units were scheduled to vest in four equal annual installments beginning on the first anniversary of the grant date. Additionally, Mr. Mullany purchased 22,728 shares of stock at a price of $22.00 per share.

In October 2014, the Company and Mr. Mullany entered into an option exchange pursuant to which Mr. Mullany exchanged his outstanding time-based and performance-based options described above for equal amounts of new time-based and performance-based options. The new time-based options have the same terms and exercise price per share as the New Options issued as part of the 2014 Option Exchange. Mr. Mullany’s new performance-based options, will be subject to time and performance vesting and will only be deemed fully vested when the performance criteria is satisfied. Additionally, Mr. Mullany forfeited certain of his outstanding restricted stock units in exchange for new time-based options (the “Mullany Options”). The Mullany Options have the same exercise price per share as the New Options and will vest in four equal annual installments commencing on November 5, 2014. We accounted for the modification in accordance with ASC 718. Management has concluded that the modification had a nominal impact on compensation costs.

In June 2014, the Company entered into an employment agreement with Michael J. Short to serve as Chief Financial Officer. The employment agreement provided (i) a one-time award of stock options under the 2010 Incentive Plan, which had a grant date of October 10, 2014 and will vest infour equal annual installments beginning on the first anniversary of the grant date and (ii) a one-time award of additional options, fifty percent of which will vest in four equal annual installments beginning on the first anniversary of the grant date and the remaining fifty percent of which are subject to time and performance vesting and will only be deemed fully vested when the performance obligations pursuant to Mr. Short’s employment agreement are satisfied. These one-time awards have a grant date fair value of $1 million, at $8.00 per share.

Award Acceleration

In September 2014, the Company accelerated the vesting of certain restricted share units and restricted share awards issued under the 2010 Incentive Plan (the “Award Acceleration”). This acceleration provided that these unvested restricted shares for eligible participants became immediately vested as of September 8, 2014. We accounted for the modification of these awards in accordance with ASC 718. Management concluded that the acceleration resulted in incremental compensation costs of $1 million in fiscal 2014, which were included in SG&A.

In addition, the Company has no plans to open a transaction window for participants to put the shares to the Company in the foreseeable future, and therefore, the put right for these awards has effectively been eliminated. In accordance with ASC 718 and ASC 480, the shares have been reclassified from temporary equity to permanent equity as redemption of these equity awards is no longer considered probable or redeemable at the option of the holder.

Additional Amendments

Effective March 2012, participants in the Management Equity Plan are bound by the terms and conditions of Amendment No. 4 to the Management Equity Plan (“Amendment No. 4”). This amendment provided for, among other things, a longer exercise period, expiring no later than the original term of the option, and the right to a cashless exercise of options held by a participant who was terminated without cause after four or more years of continuous service. Option holders under the 2010 Incentive Plan had the same rights to a longer exercise period and a cashless exercise right in the event such participant’s employment was terminated without cause (or the participant resigns for good reason) after four or more years of continuous service and in certain cases of retirement, as further described in the form of option award agreement. We accounted for the modification of awards impacted by the terms of Amendment No. 4 in accordance with ASC 718. Management concluded that the modification had a nominal impact on compensation costs. In connection with the 2014 Option Exchange, the New Options will be subject to repurchase rights by the Company following a termination of employment and any cashless exercises will be subject to prior approval of the Board.

Effective May 2012, we adopted Amendment No. 5 (“Amendment No. 5”) to the Management Equity Plan. Amendment No. 5 allowed any plan participant, as long as he or she remains employed by the Company or its affiliates, the right to put up to 25%, calculated as provided in Amendment No. 5, of his or her Original Investment Shares, the number of shares that would be equal to the value of their original investment to us, during permitted transaction windows, until the occurrence of an initial public offering of the Company. The purchase price per share payable by us in connection with any such put rights would be the fair market value as of a date determined by our Board of Directors that would be the anticipated closing date of the repurchase. We accounted for the modification of awards impacted by the terms of Amendment No. 5 in accordance with ASC 718. As these awards allowed the plan participant the right to put a portion of their rollover options, we were required to account for them as liability-classified awards. These liability awards were remeasured at their fair market value as of each reporting period through the date of settlement. Management concluded that the modification resulted in incremental compensation costs of $2 million, which was recorded in SG&A in fiscal 2012. In connection with the 2014 Option Exchange, all shares issued under the Management Equity Plan will be subject to repurchase rights by the Company following a termination of employment and the exercise of any put rights on the shares will be subject to the prior approval of the Board. The Company has no plans to open a transaction window for participants to put the shares to the Company in the foreseeable future.

Effective March 2013, we adopted Amendment No. 6 (“Amendment No. 6”) to the Management Equity Plan which provides that any participant in the Management Equity Plan, who is a former employee of the Company or its affiliates as of March 1, 2013 or who continues to be employed by the Company or its affiliates, has the right to put to the Company (i) in 2013, up to 50% of his or her Original Investment Shares held at March 1, 2013 and (ii) in 2014, any or all of the participant’s then remaining Original Investment Shares, in each case, during permitted transaction windows, until the occurrence of an initial public offering of the Company. In each case, the purchase price per share payable by the Company in connection with any such put rights would be the fair market value determined as of a date determined by the Board of Directors that would be the anticipated closing date of the repurchase. Additionally effective in March 2013, certain participants under the 2010 Incentive Plan were granted the right to put to the Company any or all of the restricted stock that becomes vested as well as any net shares acquired upon vesting of restricted stock units beginning 6 months after the applicable vesting date of these awards. We accounted for the modification of these awards impacted under the Management Equity Plan and 2010 Incentive Plan in accordance with ASC 718 and ASC 480, and determined that the impacted awards retained equity classification. However, as these equity awards were redeemable for cash at the option of the holder and redemption was probable, the shares were recorded in temporary equity at their redemption value and the redemption amount was adjusted to fair market value as of each reporting period through the date of settlement. Management concluded that the modifications did not have an impact to compensation costs.

Commencing September 2014, concurrent with the Award Acceleration, the Company informed participants that it no longer has plans to open a transaction window for participants to put the shares to the Company in the foreseeable future, and therefore, the put right for these awards described above has effectively been eliminated. The shares previously recorded in temporary equity as a result of the adoption of Amendment No. 6 have been reclassified from temporary equity to permanent equity as redemption of these equity awards is no longer considered probable or redeemable at the option of the holder.

Valuation Assumptions

The fair value of each option award modified or granted under the 2010 Incentive Plan and Management Equity Plan is estimated on the date of modification or grant using a lattice option-pricing model that uses the assumptions noted in the following table, along with the associated weighted-average fair values. We use historical data to estimate pre-vesting option forfeitures. To the extent actual results of forfeitures differ from the estimates, such amounts will be recorded as an adjustment in the period the estimates are revised. The expected volatilities are based on a combination of implied and historical volatilities of a peer group of companies, as the Company is a non-publicly traded company. The risk-free rate is based on the United States Treasury yield curve in effect at the time of grant for periods corresponding with the expected life of the options. The expected term represents the median time until exercise and is based on contractual terms of the awards, expectations of employee exercise behavior and expectations of liquidity for the underlying shares. The expected dividend yield is based on an assumption that no dividends are expected to be approved in the near future. The following are the weighted-average assumptions used:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014	February 2, 2013
Volatility	45.0	%	40.0%-45.0%	50.0	%
Risk-free interest rate	1.4%-2.4%		2.0%-2.7%	1.8	%
Expected term	4.0-5.5 years		3.8-5.2 years	5.1 years
Dividend Yield	—		—	—
Weighted-average grant-date fair value per option:	$2.55		$9.67	$20.27

For fiscals 2014 and 2013, the range of assumptions presented includes the assumptions used for the modified option awards as well as the grants issued under the 2010 Incentive Plan.

Options

A summary of option activity under the 2010 Incentive Plan and Management Equity Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price
Outstanding at beginning of fiscal year	2,661,025		$	29.40	3,483,283		$	36.02	3,895,776		$	32.73
Granted	3,901,217		8.00		1,587,057		25.25		640,756		44.00
Exercised	—		—		(1,057,773	)	26.37		(735,576	)	21.61
Forfeited/Canceled	(2,639,871	)	29.23		(1,351,542	)	43.97		(317,673	)	45.13
Outstanding at end of fiscal year	3,922,371		$	8.23	2,661,025		$	29.40	3,483,283		$	36.02

	Options	Weighted-average Exercise Price		Weighted-average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Options vested or expected to vest at January 31, 2015	3,883,928	$	8.17	8.5	$	—
Options exercisable at January 31, 2015	—	$	—	—	$	—

There were no options exercised in fiscal 2014. The aggregate intrinsic value of options exercised, which includes options exercised on a net settlement basis, was $4 million and $16 million in fiscals 2013 and 2012, respectively. The total fair value of options vested was $2 million, $19 million and $23 million in fiscals 2014, 2013 and 2012, respectively. We received no proceeds from the exercise of options in fiscal 2013, and less than $1 million in fiscal 2012. We did not cash settle share-based liability awards in fiscal 2014. We paid a nominal amount and $2 million in fiscals 2013 and 2012, respectively, to cash settle share-based liability awards. We did not repurchase shares in fiscal 2014. We paid $8 million and less than $3 million in fiscals 2013 and 2012, respectively, to repurchase shares. We did not recognize any tax benefits as a result of options exercised in fiscal 2013 and recognized tax benefits of $6 million for options exercised in fiscal 2012.

As of January 31, 2015, there was $10 million of total unrecognized compensation cost related to option share-based compensation arrangements granted under the 2010 Incentive Plan and Management Equity Plan. This cost is expected to be recognized over a weighted-average period of 2.6 years.

Restricted Shares and Units

A summary of nonvested restricted share activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Shares		Weighted-average Grant-date Fair Value		Shares		Weighted-average Grant-date Fair Value		Shares		Weighted-average Grant-date Fair Value
Nonvested shares at beginning of fiscal year	39,182		$	60.00	91,632		$	60.00	105,714		$	60.00
Granted	—		—		—		—		—		—
Shares vested	(35,472	)	60.00		(45,192	)	60.00		—		—
Forfeited/Canceled	(3,710	)	60.00		(7,258	)	60.00		(14,082	)	60.00
Nonvested shares at end of fiscal year	—		$	—	39,182		$	60.00	91,632		$	60.00

A summary of outstanding restricted stock unit activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value
Outstanding units at beginning of fiscal year	945,878		$	29.05	215,849		$	46.04	30,804		$	60.00
Granted	50,000		8.00		791,165		25.40		199,428		44.00
Units converted	(156,079	)	45.20		(20,694	)	51.93		(2,001	)	49.49
Forfeited/Canceled	(549,799	)	30.49		(40,442	)	36.66		(12,382	)	47.34
Outstanding units at end of fiscal year	290,000		$	14.01	945,878		$	29.05	215,849		$	46.04

As of January 31, 2015, there was $1 million of total unrecognized compensation cost related to restricted share-based compensation arrangements under the 2010 Incentive Plan. This cost is expected to be recognized over a weighted-average period of 1.1 years.

The fair value of restricted shares vested and restricted stock units converted was $9 million and $4 million for fiscals 2014 and 2013, respectively, and we did not recognize any tax benefits as a result of the vesting and conversion. The fair value of restricted shares vested and restricted stock units converted, and the tax benefits recognized as a result of the vesting and conversion, were nominal for fiscal 2012.

Performance-Based Shares and Units

A summary of performance-based stock unit activity under the 2010 Incentive Plan during fiscals 2014, 2013 and 2012 is presented below:

	Fiscal Years Ended
	January 31, 2015				February 1, 2014				February 2, 2013
	Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value		Units		Weighted-average Grant-date Fair Value
Outstanding units at beginning of fiscal year	39,370		$	45.34	175,104		$	46.24	25,863		$	60.00
Granted	—		—		—		—		160,187		44.00
Units converted	—		—		(1,677	)	50.36		—		—
Forfeited/Canceled	(9,761	)	49.42		(134,057	)	46.45		(10,946	)	45.95
Outstanding units at end of fiscal year	29,609		$	44.00	39,370		$	45.34	175,104		$	46.24

As of January 31, 2015, we did not have outstanding performance-based share awards as the performance-based share awards granted on May 26, 2011 were canceled as of the third anniversary date of the award due to the inability to meet the performance criteria for vesting.

The amount of stock-based compensation expense recognized in SG&A and the tax benefit recognized in Income tax expense in fiscals 2014, 2013 and 2012 was as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014		February 2, 2013
SG&A	$	15	$	15	$	16
Total recognized tax benefit	—		—		6

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PROPERTY AND EQUIPMENT - Property, Plant and Equipment (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014
Property, Plant and Equipment [Line Items]
Land	695	$ 733
Buildings	1,967	2,059
Furniture and equipment	1,639	1,733
Property and leasehold improvements	2,500	2,594
Costs of computer software	210	212
Construction in progress	32	20
Leased equipment under capital lease	51	57
Propert and equipment	7,094	7,408
Less: accumulated depreciation and amortization	3,759	3,770
Property plant and equipment net including assets held for sale, total	3,335	$ 3,638
Costs of computer software
Property, Plant and Equipment [Line Items]
Useful life (in years)	5 years
Minimum [Member] | Building [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	45 years
Minimum [Member] | Furniture and equipment
Property, Plant and Equipment [Line Items]
Useful life (in years)	3 years
Minimum [Member] | Leasehold improvements
Property, Plant and Equipment [Line Items]
Useful life (in years)	5 years
Minimum [Member] | Leased equipment under capital lease
Property, Plant and Equipment [Line Items]
Useful life (in years)	3 years
Maximum [Member] | Building [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	50 years
Maximum [Member] | Furniture and equipment
Property, Plant and Equipment [Line Items]
Useful life (in years)	20 years
Maximum [Member] | Leasehold improvements
Property, Plant and Equipment [Line Items]
Useful life (in years)	25 years
Maximum [Member] | Leased equipment under capital lease
Property, Plant and Equipment [Line Items]
Useful life (in years)	5 years

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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule of Notional Amounts and Related Fair Values of Derivatives (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount	$ 2,406	[1]	$ 2,822	[1]
Derivative Asset, Fair Value	0	[1]	13	[1]
Prepaid expenses and other current assets
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount	2,353		26
Derivative Asset, Fair Value	0		0
Other assets
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount	53		2,796
Derivative Asset, Fair Value	0		13
Derivatives not designated for hedge accounting: | Interest Rate Contract [Member] | Prepaid expenses and other current assets
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount	1,611	[2]	0	[2]
Derivative Asset, Fair Value	0	[2]	0	[2]
Derivatives not designated for hedge accounting: | Interest Rate Contract [Member] | Other assets
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount	0		1,611
Derivative Asset, Fair Value	0		0
Parent Company [Member] | Derivatives not designated for hedge accounting: | Interest Rate Contract [Member] | Prepaid expenses and other current assets
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount	1,311	[3]	0	[3]
Derivative Asset, Fair Value	0	[3]	0	[3]
Parent Company [Member] | Derivatives not designated for hedge accounting: | Interest Rate Contract [Member] | Other assets
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount	0		1,311
Derivative Asset, Fair Value	$ 0		$ 0

[1] Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the fair value of our derivative instruments classified within the fair value hierarchy.

[2] Amounts as of January 31, 2015 includes reclassifications of contracts scheduled to mature within the next 12 months, which were previously included within Other assets or Other non-current liabilities as of February 1, 2014.

[3] .

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PROPERTY AND EQUIPMENT

12 Months Ended

Jan. 31, 2015

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

The following detail of property and equipment includes estimated useful lives which are generally used to depreciate the assets on a straight-line basis:

($ In millions)	Useful life (in years)	January 31, 2015		February 1, 2014
Land		$	695	$	733
Buildings	45-50	1,967		2,059
Furniture and equipment	3-20	1,639		1,733
Property and leasehold improvements	5-25	2,500		2,594
Costs of computer software	5	210		212
Construction in progress		32		20
Leased equipment under capital lease	3-5	51		57
		7,094		7,408
Less: accumulated depreciation and amortization		3,759		3,770
Total		$	3,335	$	3,638

Net gains on sales of properties

During fiscals 2014, 2013 and 2012, we sold certain properties and assets for proceeds of $18 million, $35 million and $20 million, respectively, resulting in net gains of $5 million, $8 million and $4 million, respectively, which were recorded in Other income, net on our Consolidated Statements of Operations.

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ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

12 Months Ended

Jan. 31, 2015

Accounts Payable and Accrued Liabilities, Current [Abstract]

ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

A summary of our Accounts payable, Accrued expenses and other current liabilities as of January 31, 2015 and February 1, 2014 is outlined in the table below:

(In millions)	January 31, 2015		February 1, 2014
Merchandise accounts payable (1)	$	1,373	$	1,269
Non-merchandise accounts payable (2)	198		219
Accounts payable	$	1,571	$	1,488
Gift card and certificate liability	$	205	$	199
Accrued bonus	110		26
Sales and use tax and value added tax payable	84		75
Accrued interest	55		58
Accrued property taxes	52		55
Accrued sponsor transaction fees (3)	47		15
Accrued vacation	44		43
Accrued payroll	42		48
Other (4)	393		401
Accrued expenses and other current liabilities	$	1,032	$	920

(1) Includes $36 million and $51 million of book overdraft cash as of January 31, 2015 and February 1, 2014, respectively.

(2) Includes $84 million and $107 million of book overdraft cash as of January 31, 2015 and February 1, 2014, respectively.

(3) Includes fees payable to the Sponsors as a result of certain financing transactions. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

(4) Includes, among other items, employee benefits, accrued lease liabilities, current deferred tax liabilities and other accruals. No individual amount included exceeds 5% of Total current liabilities.

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ACCUMULATED OTHER COMPREHENSIVE INCOME

12 Months Ended

Jan. 31, 2015

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME

ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

Total other comprehensive loss, net of tax is included in the Consolidated Statements of Comprehensive Loss and Consolidated Statements of Stockholders’ (Deficit) Equity. Accumulated other comprehensive (loss) income is reflected in the Consolidated Balance Sheets and Consolidated Statements of Stockholders’ (Deficit) Equity, as follows:

(In millions)	Foreign currency translation adjustments, net of tax			Unrealized gain (loss) on hedged transactions, net of tax			Unrecognized actuarial losses, net of tax			Accumulated other comprehensive (loss) income
Balance, January 28, 2012	$	54		$	(2	)	$	(8	)	$	44
Current period change	(46		)	—			(1		)	(47		)
Balance, February 2, 2013	8			(2		)	(9		)	(3		)
Current period change	(82		)	1			—			(81		)
Balance, February 1, 2014	(74		)	(1		)	(9		)	(84		)
Current period change	(128		)	1			(33		)	(160		)
Balance, January 31, 2015	$	(202	)	$	—		$	(42	)	$	(244	)

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STOCK-BASED COMPENSATION - Weighted Average Valuation Assumptions (Details) (Stock Options [Member], USD $)	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility	45.00%		50.00%
Risk-free interest rate			1.80%
Expected term			5 years 37 days
Dividend Yield	0.00%	0.00%	0.00%
Weighted-average grant-date fair value per option:	$ 2.55	$ 9.67	$ 20.27
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility		40.00%
Risk-free interest rate	1.40%	2.00%
Expected term	4 years	3 years 292 days
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility		45.00%
Risk-free interest rate	2.40%	2.70%
Expected term	5 years 183 days	5 years 73 days

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DEFINED BENEFIT PENSION PLANS - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Jan. 30, 2016	Feb. 01, 2014
Defined Benefit Plan Disclosure [Line Items]
Unrecognized net actuarial losses, net of tax	(42)		$ (9)
Maximum [Member]
Defined Benefit Plan Disclosure [Line Items]
Cash Equivalents, Original Maturity	3 months
Maximum [Member] | Defined benefit pension plans
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Amortization of Net Gains (Losses)	2
UK and Japan Pension Plans [Member] | Minimum [Member] | Defined benefit pension plans
Defined Benefit Plan Disclosure [Line Items]
Percentage of plan assets related to U.K. and Japan pension plans	90.00%
Scenario, Forecast [Member] | Defined benefit pension plans
Defined Benefit Plan Disclosure [Line Items]
Contribution to pension plan		$ 6

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STOCK-BASED COMPENSATION - Summary of Nonvested Restricted Share and Restricted Unit Activity (Details) (USD $)	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested shares / Outstanding units at beginning of fiscal year	39,182	91,632	105,714
Granted	0	0	0
Shares vested / Units converted	(35,472)	(45,192)	0
Forfeited/Canceled	(3,710)	(7,258)	(14,082)
Nonvested shares / Outstanding units at end of fiscal year	0	39,182	91,632
Nonvested shares / Outstanding units at beginning of fiscal year	$ 60.00	$ 60.00	$ 60.00
Granted	$ 0.00	$ 0.00	$ 0.00
Shares vested / Units converted	$ 60.00	$ 60.00	$ 0.00
Forfeited/Canceled	$ 60.00	$ 60.00	$ 60.00
Nonvested shares / Outstanding units at end of fiscal year	$ 0.00	$ 60.00	$ 60.00
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested shares / Outstanding units at beginning of fiscal year	945,878	215,849	30,804
Granted	50,000	791,165	199,428
Shares vested / Units converted	(156,079)	(20,694)	(2,001)
Forfeited/Canceled	(549,799)	(40,442)	(12,382)
Nonvested shares / Outstanding units at end of fiscal year	290,000	945,878	215,849
Nonvested shares / Outstanding units at beginning of fiscal year	$ 29.05	$ 46.04	$ 60.00
Granted	$ 8.00	$ 25.40	$ 44.00
Shares vested / Units converted	$ 45.20	$ 51.93	$ 49.49
Forfeited/Canceled	$ 30.49	$ 36.66	$ 47.34
Nonvested shares / Outstanding units at end of fiscal year	$ 14.01	$ 29.05	$ 46.04

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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule I - Condensed Statements of Cash Flows (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Condensed Financial Statements, Captions [Line Items]
Cash Flows from Operating Activities	$ 476	$ 144	$ 537
Cash Flows from Investing Activities:
Proceeds from redemption of debt securities	0	52	0
Net cash used in investing activities	(193)	(205)	(267)
Cash Flows from Financing Activities:
Long-term debt borrowings	2,866	3,159	1,972
Other	0	(7)	(3)
Net cash (used in) provided by financing activities	(191)	(388)	147
Cash and cash equivalents:
Net increase (decrease) during period	54	(474)	417
Cash and cash equivalents at beginning of period	644	1,118	701
Cash and cash equivalents at end of period	698	644	1,118
Supplemental Disclosures of Cash Flow Information:
Interest paid	380	458	432
Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Cash Flows from Operating Activities	(13)	(21)	114
Cash Flows from Investing Activities:
Investments in subsidiaries	5	(180)	(33)
Intercompany loan repayments by subsidiaries	2,056	1,956	2,107
Loans to subsidiaries	(2,116)	(2,251)	(2,005)
Proceeds from redemption of debt securities	0	52	0
Net cash used in investing activities	(55)	(423)	69
Cash Flows from Financing Activities:
Long-term debt borrowings	0	0	446
Long-term debt repayment	0	0	(400)
Borrowings from subsidiaries	0	0	265
Other	0	(7)	(17)
Net cash (used in) provided by financing activities	0	(7)	294
Cash and cash equivalents:
Net increase (decrease) during period	(68)	(451)	477
Cash and cash equivalents at beginning of period	79	530	53
Cash and cash equivalents at end of period	11	79	530
Supplemental Disclosures of Cash Flow Information:
Interest paid	$ 77	$ 78	$ 75

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STOCK-BASED COMPENSATION - Narrative (Details) (USD $)	12 Months Ended		0 Months Ended	12 Months Ended	0 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	May 22, 2010	Feb. 02, 2013	Jul. 22, 2005	Dec. 24, 2013	Nov. 06, 2013	Oct. 11, 2014	Jan. 31, 2015	Nov. 01, 2014	May 26, 2011	Nov. 01, 2015	Aug. 01, 2015	May 01, 2015	Mar. 12, 2013
2005 Management Equity Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Incremental expenses		$ 2,000,000
Years of Continuous Service	4 years
Put option percentage on original investment shares	25.00%								25.00%						50.00%
2010 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total number of shares issued under incentive plan	3,750,000								3,750,000
Percentage of performance metrics based on consolidated adjusted compensation EBITDA performance				50.00%
Percentage of performance metrics based on total return on invested capital				50.00%
Years of Continuous Service			4 years
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price	8.00	$ 25.25		44.00
Granted	3,901,217	1,587,057		640,756
Aggregate intrinsic value of service based options exercised		4,000,000		16,000,000
Fair value of service based vested options	2,000,000	19,000,000		23,000,000
Cash payments to settle share based liability awards		2,000,000
Payments to repurchase shares previously issued to employees		8,000,000
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense		6,000,000
Stock Options [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Receipts from exercise of service based options		1,000,000
Payments to repurchase shares previously issued to employees				3,000,000
Stock Options [Member] | 2005 Management Equity Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested					40.00%
Incremental expenses		1,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period					10 years
Stock Options [Member] | 2005 Management Equity Plan | Tranches Two and Three [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period					3 years
Stock Options [Member] | 2005 Management Equity Plan | Tranches Two and Three [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period					2 years
Stock Options [Member] | 2010 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested	50.00%	50.00%		50.00%		50.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	1 year	2 years		2 years		2 years
Incremental expenses	2,000,000	1,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exchange Ratio		1
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price	8.00	$ 22.00
Total unrecognized compensation cost	10,000,000								10,000,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	2 years 219 days
Stock Options [Member] | 2010 Incentive Plan | President [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested							50.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period							1 year
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price							$ 22.00
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value							5,000,000
Stock Options [Member] | 2010 Incentive Plan | Chief Financial Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period								1 year
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price								$ 8.00
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Fair Value								1,000,000
Stock Options [Member] | 2010 Incentive Plan | Old Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period	1,566,307.00					919,599.00
Stock Options [Member] | 2010 Incentive Plan | New Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	4 years
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	5 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exchange Ratio	1
Granted						459,805.00
Stock Options [Member] | 2010 Incentive Plan | First Anniversary [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested	25.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	1 year
Stock Options [Member] | 2010 Incentive Plan | Second Anniversary [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested	25.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	2 years
Stock Options [Member] | 2010 Incentive Plan | Installments [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	4 years
Stock Options [Member] | 2010 Incentive Plan | Installments [Member] | President [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period							4 years
Stock Options [Member] | 2010 Incentive Plan | Installments [Member] | Chief Financial Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period								4 years
Stock Options [Member] | 2010 Incentive Plan | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total number of shares issued under incentive plan	500,000								500,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exchange Ratio		2
Stock Options [Member] | 2010 Incentive Plan | Maximum [Member] | Old Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exchange Ratio	1
Stock Options [Member] | 2010 Incentive Plan | Tranche Two [Member] | Chief Financial Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested								50.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period								1 year
Stock Options [Member] | 2010 Incentive Plan | Tranche Two [Member] | Installments [Member] | Chief Financial Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period								4 years
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value	0.00	$ 0.00		0.00
Restricted Stock [Member] | 2010 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 30.00		44.00
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price	8.00
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value	9,000,000	4,000,000
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value	8.00	$ 25.40		44.00
Restricted Stock Units (RSUs) [Member] | 2010 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested	100.00%	100.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	1 year	2 years
Restricted Stock Units (RSUs) [Member] | 2010 Incentive Plan | Chief Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested							50.00%		12.50%	50.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value							$ 22.00
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Fair Value							8,000,000
Restricted Stock Units (RSUs) [Member] | 2010 Incentive Plan | President [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value							$ 22.00
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period							1 year
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Fair Value							2,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value							22.00
Share-based Compensation Arrangement by Share-based Payment Award, Shares Purchased for Award							22,728
Restricted Stock Units (RSUs) [Member] | 2010 Incentive Plan | Installments [Member] | President [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period							4 years
Restricted Stock Units (RSUs) [Member] | 2010 Incentive Plan | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	6 months
Performance Shares [Member] | 2010 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value				44.00
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period						104,240.00
Performance Shares [Member] | 2010 Incentive Plan | Tranche Two [Member] | Chief Financial Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested								50.00%
Peformance-based shares and Performance-based stock units [Member] | 2010 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested				100.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period				3 years							3 years
Share-based Compensation Arrangement by Share-based Payment Award, Performance Metrics Period				3 years
Nonvested Restricted Shares and Restricted Units [Member] | 2010 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation cost	1,000,000								1,000,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	1 year 37 days
Scenario, Forecast [Member] | Restricted Stock Units (RSUs) [Member] | 2010 Incentive Plan | Chief Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested												12.50%	12.50%	12.50%

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DEFINED BENEFIT PENSION PLANS - Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs and Benefit Obligations (Details)	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Compensation and Retirement Disclosure [Abstract]
Discount rate	3.70%	4.10%	4.00%
Expected rate of return on plan assets	4.50%	4.90%	4.60%
Rate of compensation increase	2.60%	2.70%	2.80%
Discount rate	2.70%	3.90%
Rate of compensation increase	2.60%	2.60%

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ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)

12 Months Ended

Jan. 31, 2015

Accounts Payable and Accrued Liabilities, Current [Abstract]

Schedule of Accounts Payable and Accrued Liabilities

A summary of our Accounts payable, Accrued expenses and other current liabilities as of January 31, 2015 and February 1, 2014 is outlined in the table below:

(In millions)	January 31, 2015		February 1, 2014
Merchandise accounts payable (1)	$	1,373	$	1,269
Non-merchandise accounts payable (2)	198		219
Accounts payable	$	1,571	$	1,488
Gift card and certificate liability	$	205	$	199
Accrued bonus	110		26
Sales and use tax and value added tax payable	84		75
Accrued interest	55		58
Accrued property taxes	52		55
Accrued sponsor transaction fees (3)	47		15
Accrued vacation	44		43
Accrued payroll	42		48
Other (4)	393		401
Accrued expenses and other current liabilities	$	1,032	$	920

(1) Includes $36 million and $51 million of book overdraft cash as of January 31, 2015 and February 1, 2014, respectively.

(2) Includes $84 million and $107 million of book overdraft cash as of January 31, 2015 and February 1, 2014, respectively.

(3) Includes fees payable to the Sponsors as a result of certain financing transactions. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

(4) Includes, among other items, employee benefits, accrued lease liabilities, current deferred tax liabilities and other accruals. No individual amount included exceeds 5% of Total current liabilities.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Outstanding Foreign Exchange Contracts (Details) (Foreign-Exchange Forwards, USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014
Short-term cross-currency intercompany loans
Derivative [Line Items]
Effective Date	Varies
Maturity Date	Varies
Notional Amount	$ 98	$ 104
Merchandise purchases
Derivative [Line Items]
Effective Date	Varies
Maturity Date	Varies
Notional Amount	$ 0	$ 0

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OTHER EMPLOYEE RETIREMENT AND COMPENSATION BENEFITS

12 Months Ended

Jan. 31, 2015

Compensation and Retirement Disclosure [Abstract]

OTHER EMPLOYEE RETIREMENT AND COMPENSATION BENEFITS

OTHER EMPLOYEE RETIREMENT AND COMPENSATION BENEFITS

We offer other employee retirement and compensation benefits for eligible employees. The Supplemental Executive Retirement Plan (“SERP”) provides supplemental retirement benefits to certain executive officers in excess of the limitations that are imposed by Section 401(a)(17) of the Internal Revenue Code of 1986, as amended, on contributions to our TRU Partnership Employees’ Savings and Profit Sharing Plan (the “Savings Plan”). Participants are generally 100% vested in their SERP accounts after completing 5 years of employment with the Company. During fiscal 2014 we recorded SERP expenses of less than $1 million. During fiscals 2013 and 2012, we recorded SERP expenses of $1 million and less than $1 million, respectively. As of January 31, 2015 and February 1, 2014, the SERP liability was $2 million and $3 million, respectively.

Included in our Savings Plan, we have a 401(k) salary deferral feature, company-matching contributions and a profit sharing component for eligible U.S.-based employees. Under the terms of the Savings Plan, annual employer profit sharing contributions are made at the discretion of the Board of Directors, subject to certain limitations. The Savings Plan may be terminated at our discretion. Employee eligibility for participation in the 401(k) savings account portion of the Savings Plan requires 12 months of service and completion of 1,000 hours. In addition, the Company makes a matching contribution in an amount equal to 100% of the first 4%, of the participant’s contribution. We also have various defined contribution and other foreign government sponsored retirement plans for foreign employees, which are managed by each respective foreign location. Expenses related to the Savings Plan, other foreign defined contribution plans and other foreign government sponsored retirement plans were $24 million in fiscals 2014 and 2013, respectively, and $25 million in fiscal 2012. The Board of Directors did not elect to contribute to the profit sharing portion of the Savings Plan in fiscals 2014, 2013 and 2012.

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RECENT ACCOUNTING PRONOUNCEMENTS

12 Months Ended

Jan. 31, 2015

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

In February 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis” (“ASU 2015-02”). ASU 2015-02 is intended to improve targeted areas of consolidation guidance for reporting organizations that are required to evaluate whether they should consolidate certain legal entities. This ASU simplifies consolidation accounting by reducing the number of consolidation models and improves current GAAP by (1) placing more emphasis on risk of loss when determining a controlling financial interest; (2) reducing the frequency of the application of related-party guidance when determining a controlling financial interest in a VIE; and (3) changing consolidation conclusions for public and private companies in several industries that typically make use of limited partnerships or VIEs. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. Entities can transition to the standard either retrospectively or as a cumulative effect adjustment as of the date of adoption. The adoption of ASU 2015-02 is not expected to have an impact on our Consolidated Financial Statements.

In January 2015, the FASB issued ASU No. 2015-01, “Income Statement - Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items” (“ASU 2015-01”). ASU 2015-01 eliminates from U.S. GAAP the concept of extraordinary items. Under the previous practice, an entity was required to separately classify, present, and disclose extraordinary events and transactions. The FASB issued this ASU as part of its initiative to reduce complexity in accounting standards. This ASU will also align more closely U.S. GAAP income statement presentation guidance with IAS 1, “Presentation of Financial Statements,” which prohibits the presentation and disclosure of extraordinary items. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. A reporting entity may either apply the amendments prospectively or retrospectively to all prior periods presented in the financial statements. The adoption of ASU 2015-01 is not expected to have an impact on our Consolidated Financial Statements.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). ASU 2014-15 is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Other than the additional disclosures regarding the Company’s ability to continue as a going concern, the adoption of ASU 2014-15 is not expected to have an impact on our Consolidated Financial Statements.

In June 2014, the FASB issued ASU No. 2014-12, “Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period” (“ASU 2014-12”).  ASU 2014-12 provides specific guidance on this Topic, requiring that performance targets that affect vesting and that could be achieved after the requisite service period be treated as a performance condition.  A reporting entity should apply existing guidance in ASC Topic 718 as it relates to awards with performance conditions that affect vesting to account for such awards.  This varies from the previous practice, as such provisions were also accounted for as non-vesting restrictions which affect the determination of grant-date fair value and required expense recognition over the requisite service period regardless of whether the performance condition is met.  The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted.  An entity may apply the standards (1) prospectively to all share-based payment awards that are granted or modified on or after the effective date, or (2) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter.  The adoption of ASU 2014-12 is not expected to have an impact on our Consolidated Financial Statements.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 amends the guidance for revenue recognition to replace numerous, industry-specific requirements and converges areas under this topic with those of the International Financial Reporting Standards. The ASU implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. The amendment also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, and early adoption is prohibited. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. Management is currently assessing the impact the adoption of ASU 2014-09 will have on our Consolidated Financial Statements.

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OTHER EMPLOYEE RETIREMENT AND COMPENSATION BENEFITS - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Defined Benefit Plan Disclosure [Line Items]
Vesting percentage	100.00%
Employment period to vest one hundred percent	5 years
Supplemental executive retirement plan expenses		$ 1
Supplemental executive retirement plan liability	2	3
Period of Service for Eligibility in the Savings Plan	12 months
Period of Service for Eligibility in the Savings Plan	1000 hours
Defined Contribution Plan, Employer Matching Contribution, Percent of Employee Contribution	100.00%
Matching contribution by employer	4.00%
Other foreign defined contribution plans and other foreign government sponsored retirement plans expenses	24	24	25
Maximum [Member]
Defined Benefit Plan Disclosure [Line Items]
Supplemental executive retirement plan expenses	$ 1		$ 1

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Narrative (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended		0 Months Ended	12 Months Ended
	Jan. 31, 2015		Nov. 27, 2014	Feb. 02, 2013	Feb. 01, 2014		Jan. 30, 2016	Nov. 26, 2014
Derivative [Line Items]
Average Remaining Maturity of Foreign Currency Derivatives	12 months
Interest Rate Contract [Member]
Derivative [Line Items]
Derivative, Net Liability Position, Aggregate Fair Value	2
Derivative, Remaining Maturity	12 months
Interest Rate Contract [Member] | Maximum [Member]
Derivative [Line Items]
Derivative, Net Liability Position, Aggregate Fair Value					1
One Month Usd Libor De-designated [Member] | Interest Rate Caps
Derivative [Line Items]
Percentage of Derivative Instrument Designated as Cash Flow Hedge	40.00%				40.00%
Interest Rate Caps | One Month Usd Libor De-designated [Member]
Derivative [Line Items]
Notional Amount	500	[1]			500	[1]
Derivative designated as a fair value hedge: | Interest Rate Contract [Member]
Derivative [Line Items]
Gains (Losses) on Extinguishment of Debt	4
Designated as Hedging Instrument [Member] | Derivatives designated as cash flow hedges: | Interest Rate Contract [Member]
Derivative [Line Items]
Notional Amount								350
Derivative, Proceeds from Termination of Derivative			10
Accrued Investment Income Receivable								1
Designated as Hedging Instrument [Member] | Derivative designated as a fair value hedge: | Interest Rate Contract [Member]
Derivative [Line Items]
Gain (Loss) on Fair Value Hedge Ineffectiveness, Net				5
Designated as Hedging Instrument [Member] | Derivative designated as a fair value hedge: | Interest Rate Contract [Member] | Maximum [Member]
Derivative [Line Items]
Gain (Loss) on Fair Value Hedge Ineffectiveness, Net					1
Scenario, Forecast [Member] | Designated as Hedging Instrument [Member] | Derivatives designated as cash flow hedges: | Interest Rate Contract [Member]
Derivative [Line Items]
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months							$ (1)

[1] The Company de-designated a portion of this interest rate cap in fiscal 2010. As of January 31, 2015 and February 1, 2014, 40% of the $500 million interest rate cap is designated as a cash flow hedge.

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SCHEDULE I - PARENT COMPANY INFORMATION - Summary of the Parent Company's Long-Term Debt (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015		Feb. 01, 2014
Debt Instrument [Line Items]
Long-term debt	$ 4,788		$ 5,007
Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	10.375%		10.375%
Long-term debt	448	[1]	447	[1]
Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	7.375%		7.375%
Long-term debt	402	[1]	403	[1]
Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	8.75%		8.75%
Long-term debt	22	[2]	22	[2]
Parent Company [Member]
Debt Instrument [Line Items]
Long-term debt	872		872
Parent Company [Member] | Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	10.375%		10.375%
Long-term debt	448		447
Parent Company [Member] | Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	7.375%		7.375%
Long-term debt	402		403
Parent Company [Member] | Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	8.75%		8.75%
Long-term debt	$ 22	[3]	$ 22	[3]

[1] Represents obligations of Toys “R” Us, Inc. (the “Parent Company”) legal entity. For further details on Parent Company information, refer to Schedule I — Parent Company Condensed Financial Statements and Notes to the Condensed Financial Statements.

[2] (8)Represents obligations of the Parent Company and Toys-Delaware.

[3] Represents obligations of Toys “R” Us, Inc. and Toys–Delaware.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details)	12 Months Ended						12 Months Ended												12 Months Ended				12 Months Ended		12 Months Ended			12 Months Ended						12 Months Ended
	Jan. 31, 2015 USD ($) countries stores	Feb. 01, 2014 USD ($)	Feb. 02, 2013 USD ($)	Jan. 28, 2012 USD ($)	Oct. 31, 2011 USD ($)	Jan. 31, 1994 countries	Jan. 31, 2015 Interest Expense [Member] Intercompany Loan Foreign Exchange Contracts [Member] Derivatives not designated for hedge accounting: USD ($)		Feb. 01, 2014 Interest Expense [Member] Intercompany Loan Foreign Exchange Contracts [Member] Derivatives not designated for hedge accounting: USD ($)		Feb. 02, 2013 Interest Expense [Member] Intercompany Loan Foreign Exchange Contracts [Member] Derivatives not designated for hedge accounting: USD ($)		Jan. 31, 2015 Employment Practices Liability [Member] USD ($)	Jan. 31, 2015 Catastrophe [Member] USD ($)	Jan. 31, 2015 Property Liability [Member] USD ($)	Jan. 31, 2015 General Liability [Member] USD ($)	Jan. 31, 2015 Auto Liability [Member] USD ($)	Jan. 31, 2015 Workers' Compensation Liability [Member] USD ($)	Jan. 31, 2015 Costs of computer software	Mar. 28, 2013 Debussy [Member] USD ($)	Mar. 28, 2013 Debussy [Member] GBP (£)	Oct. 31, 2011 Toys (Labuan) Holdings Limited [Member]	Feb. 01, 2014 Domestic USD ($)	Jan. 31, 2015 Domestic stores	Feb. 01, 2014 International USD ($)	Jan. 31, 2015 International countries stores	Mar. 28, 2013 New UK Propco Loan [Member] GBP (£)	Jan. 31, 2015 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] USD ($)	Oct. 24, 2014 Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] USD ($)	Jul. 21, 2005 The Sponsors [Member] USD ($)	Jan. 31, 2015 Toys (Labuan) Holdings Limited [Member] USD ($)	Feb. 01, 2014 Toys (Labuan) Holdings Limited [Member] USD ($)	Jan. 31, 1994 Minimum [Member] stores	Jan. 31, 2015 Maximum [Member]
Summary of Significant Accounting Policies [Line Items]
Business Acquisition, Percentage of Voting Interests Acquired																						70.00%
Term of Credit Card Program Agreement			7 years
Number of Stores	1,602																							872		942							1,000
Number of Stores Operated by Franchisees	212																									212
Number of Countries in which Entity Operates	37					17																				36
Merger, value																														$ 6,600,000,000
Debt Instrument, Face Amount	4,826,000,000																			20,000,000	13,000,000						263,000,000		280,000,000
Cash Equivalents, Original Maturity																																		3 months
Restricted cash	53,000,000	53,000,000
Asset Retirement Obligation	63,000,000	66,000,000
Goodwill	64,000,000	64,000,000																													64,000,000	64,000,000
Goodwill impairment	0	378,000,000	0																				361,000,000		17,000,000
Unamortized Debt Issuance Expense	139,000,000	127,000,000																										7,000,000	8,000,000
Amortization of Financing Costs	48,000,000	51,000,000	36,000,000
Insurance deductible													15,000,000	8,000,000	5,000,000	5,000,000	4,000,000	1,000,000
Self Insurance Reserve	99,000,000	102,000,000
Capital Leases, Lessee Balance Sheet, Assets by Major Class, Accumulated Depreciation	41,000,000	41,000,000
Deferred rent liabilities	359,000,000	374,000,000
Deferred rent liabilities, current, recorded in Accrued expenses and other current liabilities	12,000,000	12,000,000
Other Revenue, Net	43,000,000	56,000,000	72,000,000
Licenses Revenue	17,000,000	16,000,000	16,000,000
Revenue Recognition, Sales Returns, Reserve for Sales Returns	10,000,000	10,000,000
Advertising Expense	379,000,000	433,000,000	449,000,000
Property, Plant and Equipment, Useful Life																			5 years
Capitalized Computer Software, Amortization	34,000,000	31,000,000	27,000,000
Gift card breakage income	27,000,000	24,000,000	21,000,000
Net gains on sales of properties	5,000,000	8,000,000	4,000,000
Impairment on long-lived assets	13,000,000	44,000,000	11,000,000
Unrealized losses (gains) on foreign exchange	19,000,000	1,000,000	3,000,000
Foreign Currency Transaction Gain (Loss), Unrealized	(15,000,000)	1,000,000	0																									15,000,000
Gains (Losses) from Intercompany Foreign Currency Transactions	9,000,000	1,000,000	2,000,000
Gain (loss) on the change in fair value							(9,000,000)	[1]	(1,000,000)	[1]	(2,000,000)	[1]
Temporary Equity	85,000,000	78,000,000	49,000,000	29,000,000	24,000,000
Credit card program income	$ 36,000,000	$ 33,000,000	$ 22,000,000

[1] Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule of Outstanding Interest Rate Contracts (Details) (Interest Rate Caps, USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015		Feb. 01, 2014
One Month Usd Libor Not Designated, Two Thousand Eleven [Member]
Interest Rate Caps
Effective Date	January 2011
Maturity Date	April 2015
Notional Amount	$ 500		$ 500
One Month Usd Libor Not Designated, Two Thousand Twelve [Member]
Interest Rate Caps
Effective Date	January 2012
Maturity Date	April 2015
Notional Amount	500		500
One Month Usd Libor Not Designated, Two Thousand Fourteen [Member]
Interest Rate Caps
Effective Date	January 2014
Maturity Date	April 2015
Notional Amount	311		311
Parent Company [Member] | One Month Usd Libor Not Designated, Two Thousand Eleven [Member]
Interest Rate Caps
Effective Date	January 2011	[1]
Maturity Date	April 2015	[1]
Notional Amount	500	[1]	500	[1]
Parent Company [Member] | One Month Usd Libor Not Designated, Two Thousand Twelve [Member]
Interest Rate Caps
Effective Date	January 2012	[1]
Maturity Date	April 2015	[1]
Notional Amount	500	[1]	500	[1]
Parent Company [Member] | One Month Usd Libor Not Designated, Two Thousand Fourteen [Member]
Interest Rate Caps
Effective Date	January 2014	[1]
Maturity Date	April 2015	[1]
Notional Amount	$ 311	[1]	$ 311	[1]

[1] These interest rate caps are not designated as cash flow hedges in accordance with ASC 815.

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Consolidated Balance Sheets (Parentheticals) (USD $)	Jan. 31, 2015	Feb. 01, 2014
Consolidated Balance Sheets [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	55,000,000	55,000,000
Common stock, shares issued and outstanding	49,195,396	49,047,844

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DEFINED BENEFIT PENSION PLANS - Funded Status (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015	Feb. 01, 2014
Reconciliation of funded status to total amount recognized:
Funded status	$ (51)	$ (19)
Amounts recognized in Consolidated Balance Sheets:
Other non-current liabilities	(51)	(19)
Amounts recognized in Accumulated other comprehensive loss:
Unrecognized actuarial losses, net of tax	$ 42	$ 9

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT

12 Months Ended

Jan. 31, 2015

Debt Disclosure [Abstract]

SHORT-TERM BORROWINGS AND LONG-TERM DEBT

SHORT-TERM BORROWINGS AND LONG-TERM DEBT

A summary of the Company’s consolidated Short-term borrowings and Long-term debt as well as the effective interest rates on our outstanding variable rate debt as of January 31, 2015 and February 1, 2014 is outlined in the table below:

(In millions)	January 31, 2015		February 1, 2014
Short-term borrowings
Labuan uncommitted lines of credit	$	—	$	12
Long-term debt
Spanish real estate credit facility, due fiscal 2015 (EURIBOR+6.00%)	34		71
Toys-Japan unsecured credit lines, expire fiscals 2015-2016 (1)	—		5
European and Australian asset-based revolving credit facility, expires fiscal 2016	—		—
Secured term loan facility, due fiscal 2016 (LIBOR+4.50%) (2)(3)	—		646
7.375% senior secured notes, due fiscal 2016 (2)(3)	—		357
10.375% senior notes, due fiscal 2017 (4)	448		447
8.500% senior secured notes, due fiscal 2017 (5)	721		719
French real estate credit facility, due fiscal 2018 (EURIBOR+4.50%)	53		64
Incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (2)(3)	133		372
Second incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (2)(3)	67		210
7.375% senior notes, due fiscal 2018 (4)	402		403
$1.85 billion secured revolving credit facility, expires fiscal 2019 (2)(3)(6)	—		—
Senior unsecured term loan facility, due fiscal 2019 (LIBOR+5.00%) (7)	965		973
Tranche A-1 loan facility, due fiscal 2019 (LIBOR+7.25%) (2)(3)	272		—
Secured term B-4 loan facility, due fiscal 2020 (LIBOR+8.75%) (2)(3)	1,010		—
UK real estate credit facility, due fiscal 2020 (6.85%)	396		433
Toys-Japan 1.85%-2.45% loans, due fiscals 2015-2021	63		91
8.750% debentures, due fiscal 2021 (8)	22		22
Finance obligations associated with capital projects	189		174
Capital lease obligations	13		20
	4,788		5,007
Less: current portion	176		89
Total Long-term debt (9)	$	4,612	$	4,918

(1) Toys “R” Us - Japan, Ltd. (“Toys-Japan”) currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit (“Tranche 1” due fiscal 2015 and “Tranche 2” due fiscal 2016). On July 15, 2014, Toys-Japan entered into an agreement to refinance Tranche 2 of its committed lines of credit.

(2) Represents obligations of Toys “R” Us - Delaware, Inc. (“Toys-Delaware”).

(3) On October 24, 2014, Toys-Delaware amended the credit agreement for its secured term loan facilities (the “Secured Term Loan Credit Agreement”) to provide for, among other things, a new tranche of term loans in an aggregate principal amount of $1,026 million due fiscal 2020 (the “Secured Term B-4 Loan”). Additionally, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the $1.85 billion secured revolving credit facility (“ABL Facility”) to provide for, among other things, a new tranche of loans in an aggregate principal amount of $280 million due fiscal 2019. The Secured Term B-4 Loan and the Tranche A-1 Loan, together with other sources and funds available to Toys-Delaware, were used to (i) refinance in full the Secured term loan facility due fiscal 2016, (ii) extend $380 million of the term loans due fiscal 2018 under the Incremental secured term loan facility and the Second incremental secured term loan facility into the Secured Term B-4 Loan and (iii) redeem all of the 7.375% senior secured notes due fiscal 2016 (“Toys-Delaware Secured Notes”), plus accrued interest, premiums and fees. The Secured Term B-4 Loan is guaranteed by Wayne Real Estate Parent Company, LLC, a wholly-owned subsidiary of the Company and an indirect parent of Toys “R” Us Property Company I, LLC.

(4) Represents obligations of Toys “R” Us, Inc. (the “Parent Company”) legal entity. For further details on Parent Company information, refer to Schedule I — Parent Company Condensed Financial Statements and Notes to the Condensed Financial Statements.

(5) Represents obligations of Toys “R” Us Property Company II, LLC (“TRU Propco II”).

(6) On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for the ABL Facility in order to extend the maturity date of the facility and amend certain other provisions.

(7) Represents obligations of Toys “R” Us Property Company I, LLC and its subsidiaries (“TRU Propco I”).

(8) Represents obligations of the Parent Company and Toys-Delaware.

(9) We maintain derivative instruments on certain of our long-term debt, which impact our effective interest rates. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

As of January 31, 2015, we had total indebtedness of $4.8 billion, of which $2.7 billion was secured indebtedness. Toys “R” Us, Inc. is a holding company and conducts its operations through its subsidiaries, certain of which have incurred their own indebtedness. Our credit facilities, loan agreements and indentures contain customary covenants that, among other things restrict our ability to:

• incur certain additional indebtedness;

• transfer money between the Parent Company and our various subsidiaries;

• pay dividends on, repurchase or make distributions with respect to our or our subsidiaries’ capital stock or make other restricted payments;

• issue stock of subsidiaries;

• make certain investments, loans or advances;

• transfer and sell certain assets;

• create or permit liens on assets;

• consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;

• enter into certain transactions with our affiliates; and

• amend certain documents.

The amount of total net assets that were subject to such restrictions was $582 million as of January 31, 2015. Our agreements also contain various and customary events of default with respect to the indebtedness, including, without limitation, the failure to pay interest or principal when the same is due under the agreements, cross default and cross acceleration provisions, the failure of representations and warranties contained in the agreements to be true and certain insolvency events. If an event of default occurs and is continuing, the principal amounts outstanding thereunder, together with all accrued and unpaid interest and other amounts owed thereunder, may be declared immediately due and payable by the lenders.

We are dependent on the borrowings provided by the lenders to support our working capital needs, capital expenditures and to service debt. As of January 31, 2015, we have funds available to finance our operations under our ABL Facility through March 2019, subject to an earlier springing maturity, our European and Australian asset-based revolving credit facility (“European ABL Facility”) through March 2016 and our Toys-Japan unsecured credit lines with a tranche maturing June 2015 and a tranche maturing June 2016. In addition, Labuan and Toys-Japan have uncommitted lines of credit due on demand.

The annual maturities of our Long-term debt, including current portion, at January 31, 2015 are as follows:

(In millions)	Annual Maturities
2015	$	176
2016	34
2017	1,207
2018	658
2019	1,180
2020 and subsequent	1,571
Total	$	4,826

Labuan uncommitted lines of credit, due on demand ($0 million at January 31, 2015)

Labuan has several uncommitted unsecured lines of credit with various financial institutions with total availability of HK$275 million ($35 million at January 31, 2015). As of January 31, 2015, we had no borrowings and $3 million of bank guarantees issued under these facilities. The remaining availability under these facilities was $32 million. The average interest rate on the drawn borrowings was 2.36% as of February 1, 2014.

Toys-Japan unsecured credit lines, expire fiscals 2015-2016 ($0 million at January 31, 2015)

Toys-Japan currently has an agreement with a syndicate of financial institutions, which includes two unsecured loan commitment lines of credit. Tranche 1 is available in amounts up to ¥13.0 billion ($111 million at January 31, 2015), expiring on June 30, 2015, and bears an interest rate of Tokyo Interbank Offered Rate (“TIBOR”) plus 0.80% per annum. At January 31, 2015, we had no outstanding borrowings under Tranche 1, with $111 million of remaining borrowing availability. Deferred debt issuance costs for this agreement were less than $1 million and $1 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

On July 15, 2014, Toys-Japan entered into an agreement with a syndicate of financial institutions to refinance Tranche 2. As a result, Tranche 2 is available in amounts up to ¥3.5 billion ($30 million at January 31, 2015), expiring on June 30, 2016, and bears an interest rate of TIBOR plus 0.80% per annum. At January 31, 2015, we had no outstanding borrowings under Tranche 2, with $30 million of remaining availability. Deferred debt issuance costs for this agreement were less than $1 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

These agreements contain covenants that require, among other things, Toys-Japan to maintain a certain level of net assets and a provision that requires Toys-Japan to not incur two consecutive years of ordinary loss in accordance with accounting principles generally accepted in Japan (“JGAAP”), as defined in the credit agreement. The agreement also restricts Toys-Japan from paying dividends or making loans to affiliates without lender consent.

Additionally on July 15, 2014, Toys-Japan amended its uncommitted line of credit resulting in total availability of ¥1.5 billion ($13 million at January 31, 2015), which will renew August 1 of each year unless otherwise canceled. The uncommitted line of credit bears an interest rate of TIBOR plus 0.50%. As of January 31, 2015, we had no outstanding borrowings under the uncommitted line of credit.

On September 17, 2014, Toys-Japan entered into an uncommitted line of credit with a financial institution that is part of our Tranche 1 syndicate. The uncommitted line of credit of ¥0.5 billion ($4 million at January 31, 2015) bears an interest rate of the short-term prime rate plus 1.00%, as defined in the agreement, and matures on August 31, 2015. As the agreement states that the borrowings associated with this line of credit plus the borrowings associated with this financial institution’s portion of Tranche 1 borrowings cannot exceed its already committed credit of ¥1.5 billion, this uncommitted line of credit does not result in incremental availability. As of January 31, 2015, we had no outstanding borrowings under the uncommitted line of credit.

European and Australian asset-based revolving credit facility, expires fiscal 2016 ($0 million at January 31, 2015)

The European ABL Facility, as amended, provides for a five-year £138 million ($208 million at January 31, 2015) asset-based senior secured revolving credit facility which will expire on March 8, 2016. Loans under the European ABL Facility bear interest at a rate of LIBOR or Euro Interbank Offered Rate (“EURIBOR”) plus a margin of 2.25%, 2.50% or 2.75% depending on historical excess availability. In addition, a commitment fee accrues on any unused portion of the commitments at a rate per annum of 0.375% or 0.50% based on usage. At January 31, 2015, we had no outstanding borrowings, with $86 million of remaining availability under the European ABL Facility. Deferred debt issuance costs for this credit facility were $2 million and $4 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Borrowings under the European ABL Facility are subject to, among other things, the terms of a borrowing base derived from the value of eligible inventory and/or eligible credit card receivables of certain of Toys “R” Us Europe, LLC’s (“Toys Europe”) and Toys “R” Us Australia Holdings, LLC’s (“Toys Australia”) subsidiaries organized in Australia, England and France. The terms of the European ABL Facility include a customary cash dominion trigger requiring the cash of certain of Toys Europe’s and Toys Australia’s subsidiaries to be applied to pay down outstanding loans if availability falls below certain thresholds. The European ABL Facility also contains a springing fixed charge coverage ratio of 1.00 to 1.00 based on earnings before interest, taxes, depreciation and amortization (“EBITDA”) (as defined in the agreement governing the European ABL Facility) and fixed charges of Toys Europe, Toys Australia and their subsidiaries. Borrowings under the European ABL Facility are guaranteed by Toys Europe, Toys Australia and certain of their material subsidiaries, with certain customary local law limitations and to the extent such guarantees do not result in adverse tax consequences. Borrowings are secured by substantially all of the assets of Toys Europe, Toys Australia and the UK and Australian obligors, as well as by share pledges over the shares of certain other material subsidiaries and pledges over certain of their assets (including bank accounts and certain receivables). The European ABL Facility contains covenants that, among other things, restrict the ability of Toys Europe and Toys Australia and their respective subsidiaries to incur certain additional indebtedness, create or permit liens on assets, repurchase or pay dividends or make certain other restricted payments on capital stock, make acquisitions or investments or engage in mergers or consolidations.

$1.85 billion secured revolving credit facility, expires fiscal 2019 ($0 million at January 31, 2015)

On March 21, 2014, Toys-Delaware and certain of its subsidiaries amended and restated the credit agreement for the ABL Facility in order to extend the maturity date of the facility and amend certain other provisions. The ABL Facility as amended will continue to provide for $1.85 billion of revolving commitments, and permits Toys-Delaware to request an increase in commitments by up to $1.15 billion, subject to certain conditions, including obtaining new or increased commitments from new or existing lenders. The ABL Facility has a final maturity date of March 21, 2019, with a springing maturity date if the Toys-Delaware term loans due fiscal 2018 are not repaid 30 days prior to maturity. The ABL Facility as amended bears a tiered floating interest rate of London Interbank Offered Rate (“LIBOR”) plus a margin of between 1.50% and 1.75% depending on usage (or, at the election of the borrower, a tiered floating interest rate based on the agent’s prime rate plus a margin of between 0.50% and 0.75% depending on usage). A commitment fee is payable on the undrawn portion of the ABL Facility in an amount equal to 0.25% per annum of the average daily balance of unused commitments during each calendar quarter. In connection with the amended and restated credit agreement, we incurred transaction fees of $31 million, which are capitalized as deferred debt issuance costs, amortized over the term of the agreement and included in Other assets on our Consolidated Balance Sheet. Prior to the amended ABL Facility, unamortized debt issuance costs were $17 million, of which $1 million was expensed, and the remaining amount will be amortized over the term of the amended and restated credit agreement.

At January 31, 2015, under our ABL Facility, we had no outstanding borrowings, a total of $99 million of outstanding letters of credit and excess availability of $973 million. We are also subject to a minimum excess availability covenant of $125 million, with remaining availability of $848 million in excess of the covenant at January 31, 2015. Deferred debt issuance costs for this credit facility were $38 million and $19 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The ABL facility is available for general corporate purposes and the issuance of letters of credit. Borrowings under this credit facility are secured by tangible and intangible assets of Toys-Delaware and certain of its subsidiaries, subject to specific exclusions stated in the credit agreement. The credit agreement contains covenants that, among other things, restrict Toys-Delaware’s ability to incur certain additional indebtedness, create or permit liens on assets, engage in mergers or consolidations, make investments, loans or advances, sell or transfer assets, pay dividends or distributions, repurchase capital stock or make other restricted payments, repay or prepay certain debt, engage in transactions with affiliates, amend material documents and change fiscal year. The ABL Facility, as amended pursuant to the amended and restated credit agreement, requires Toys-Delaware to maintain excess availability at all times of no less than $125 million and to sweep cash toward prepayment of the loans if excess availability falls below $150 million for any three days in a 30-day period (or if certain specified defaults are continuing or if excess availability falls below $130 million at any time). Availability is determined pursuant to a borrowing base, consisting of specified percentages of eligible inventory and eligible credit card receivables and certain real estate less any applicable availability reserves.

On October 24, 2014, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the ABL Facility and the Intercreditor Agreement (as defined below) in connection with the issuance of the Secured Term B-4 Loan and Tranche A-1 Loan. Refer to the Tranche A-1 loan facility below for further details on the amendment to the credit agreement for the ABL Facility. The Intercreditor amendment amended the Amended and Restated Intercreditor Agreement, dated as of August 24, 2010 (the “Intercreditor Agreement”), to provide for, among other things, modifications to the priority among the lenders under the Secured Term B-4 Loan and the Tranche A-1 Loan with respect to the Canadian Pledge Collateral (as defined in the Intercreditor Agreement).

€30 million Spanish real estate credit facility, due fiscal 2015 ($34 million at January 31, 2015)

On January 29, 2013, Toys “R” Us Iberia Real Estate S.L.U. (“TRU Iberia Real Estate”) entered into a three year senior secured term loan facility agreement (the “Spain Propco Facility Agreement”) for an aggregate principal amount of €75 million. TRU Iberia Real Estate owns freehold and leasehold interests in properties in various retail markets throughout Spain. Under an operating company/property company structure, TRU Iberia Real Estate leases these properties on a triple-net basis to Toys “R” Us Iberia, SA (“Spain Opco”). Substantially all of TRU Iberia Real Estate’s revenues and cash flows are derived from payments from Spain Opco under a series of uniform lease agreements. The loan is secured by 26 properties located in Spain. The Spain Propco Facility Agreement will mature on January 29, 2016 and bears interest equal to EURIBOR plus 6.00%. We have entered into an interest rate cap as required under the Spain Propco Facility Agreement capping EURIBOR at 2.00% per annum. TRU Iberia Real Estate is required to repay the principal of the loan in installments equal to €22.5 million, €22.5 million and €30 million in the first, second and third years of the loan, respectively. As such, we have repaid the first and second installments of €22.5 million during fiscals 2013 and 2014, respectively, and the third installment of €30 million ($34 million at January 31, 2015) has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Deferred debt issuance costs for this credit facility were $3 million and $5 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Our Parent Company has provided the lenders with a deficiency guarantee with respect to certain losses the lenders may suffer in certain circumstances. The Spain Propco Facility Agreement contains covenants that, among other things, restrict the ability of TRU Iberia Real Estate to incur additional indebtedness, pay dividends or make other distributions, make restricted payments or certain investments, create or permit liens on assets, sell assets or engage in mergers or consolidations. The agreement also contains financial covenants including a loan to value covenant, an interest coverage ratio covenant and an EBITDA (as defined in the Spain Propco Facility Agreement) to rent covenant related to Spain Opco.

10.375% senior notes, due fiscal 2017 ($448 million at January 31, 2015)

On August 1, 2012, we completed the offering of $450 million aggregate principal amount of 10.375% senior notes, which will mature on August 15, 2017 (the “2017 Notes”). The 2017 Notes were issued at a discount of $4 million, which resulted in proceeds of $446 million. The 2017 Notes are solely the obligation of the Parent Company and are not guaranteed by Toys-Delaware or any of our other subsidiaries. Investment funds or accounts advised by or affiliated with Kohlberg Kravis Roberts & Co. L.P. (collectively, “KKR”) owned an aggregate of $9 million of the 2017 Notes as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for these notes were $8 million and $10 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The indenture governing the 2017 Notes contain covenants, including, among other things, covenants that restrict the ability of the Company and its restricted subsidiaries to incur additional indebtedness, pay dividends or make other distributions, make investments and other restricted payments, create liens, sell assets, incur restrictions on the ability of a subsidiary to pay dividends or make other payments, enter into certain transactions with affiliates and consolidate, merge, sell or otherwise dispose of all or substantially all of their assets. These covenants are subject to a number of important qualifications and exceptions and will not be applicable to any of our subsidiaries that are designated as “unrestricted subsidiaries.” As of January 31, 2015, TRU Asia, LLC, our majority owned subsidiary operating in Asia (other than Japan), is an unrestricted subsidiary.

Certain covenants will be suspended at any time the 2017 Notes are rated “investment grade.” As of January 31, 2015, the 2017 Notes are not “investment grade.” In addition, the indenture contains customary terms and covenants, including certain events of default after which the 2017 Notes may be due and payable immediately.

The 2017 Notes may be redeemed, in whole or in part, at any time prior to February 15, 2015 at a price equal to 100% of the aggregate principal amount of the 2017 Notes plus a “make-whole” premium, plus accrued and unpaid interest to the date of redemption. The 2017 Notes will be redeemable, in whole or in part, at any time on or after February 15, 2015 at the specified redemption prices, plus accrued and unpaid interest, if any, to the redemption date. In addition, we may redeem up to 40% of the 2017 Notes before February 15, 2015 with the net cash proceeds from certain equity offerings. Following specified kinds of changes of control, we will be required to make an offer to repurchase all of the 2017 Notes at a purchase price of 101% of their principal amount, plus accrued and unpaid interest, if any, to the repurchase date. Interest on the 2017 Notes is payable in cash semi-annually in arrears on February 15 and August 15 of each year.

8.500% senior secured notes, due fiscal 2017 ($721 million at January 31, 2015)

On November 20, 2009, TRU Propco II, an indirect wholly-owned subsidiary, completed the offering of $725 million aggregate principal amount of senior secured 8.500% notes, which will mature on December 1, 2017 (the “Propco II Notes”). TRU Propco II owns fee and ground leasehold interests in properties in various retail markets throughout the United States. Under an operating company/property company structure, TRU Propco II leases these properties on a triple-net basis to Toys-Delaware. Substantially all of TRU Propco II’s revenues and cash flows are derived from payments from Toys-Delaware under the master lease agreement between TRU Propco II as landlord and Toys-Delaware as tenant (the “TRU Propco II Master Lease”). The rent under the TRU Propco II Master Lease will increase by 10% every five years during its 20-year term. The Propco II Notes were issued at a discount of $10 million which resulted in proceeds of $715 million. The Propco II Notes are solely the obligation of TRU Propco II and are not guaranteed by the Parent Company or Toys-Delaware or any of our other subsidiaries. The Propco II Notes are secured by the first priority security interests in all of the existing and future real estate properties of TRU Propco II and its interest in the TRU Propco II Master Lease. Those real estate properties and interests in the TRU Propco II Master Lease are not available to satisfy or secure the obligations of the Company or its affiliates, other than the obligations of TRU Propco II under the Propco II Notes. KKR owned an aggregate of $5 million of the Propco II Notes as of February 1, 2014. Deferred debt issuance costs for these notes were $10 million and $14 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The indenture governing the Propco II Notes contains covenants that, among other things, restrict the ability of TRU Propco II to incur additional indebtedness, sell assets, enter into affiliate transactions, pay dividends or make other distributions, make other restricted payments and investments, or create liens.  The indenture governing the Propco II Notes also contains covenants that limit the ability of the Parent Company to cause or permit Toys-Delaware to incur indebtedness, pay dividends, make distributions or make other restricted payments and investments. These covenants are subject to a number of important qualifications and limitations. The Propco II Notes are redeemable, in whole or in part, at specified redemption prices, plus accrued and unpaid interest, if any. Following specified kinds of changes of control with respect to the Parent Company, Toys-Delaware or TRU Propco II, TRU Propco II will be required to offer to purchase the Propco II Notes at a purchase price in cash equal to 101% of their principal amount, plus accrued and unpaid interest, if any to, but not including, the purchase date. Interest on the Propco II Notes is payable in cash semi-annually in arrears on June 1 and December 1 of each year.

€47 million French real estate credit facility, due fiscal 2018 ($53 million at January 31, 2015)

On February 27, 2013, Toys “R” Us France Real Estate SAS (“TRU France Real Estate”) entered into a five year senior secured term loan facility agreement (the “France Propco Facility Agreement”) for an aggregate principal amount of €48 million. TRU France Real Estate owns freehold and leasehold interests in properties in various retail markets throughout France. Under an operating company/property company structure, TRU France Real Estate leases these properties on a triple-net basis to Toys “R” Us SARL (“France Opco”). Substantially all of TRU France Real Estate’s revenues and cash flows are derived from payments from France Opco under a series of amended lease agreements. The loan is secured by nine properties located in France. The France Propco Facility Agreement will mature on February 27, 2018 and bears interest equal to EURIBOR plus 4.50%. We have entered into an interest rate cap as required under the France Propco Facility Agreement capping EURIBOR at 2.50% per annum. Additionally, TRU France Real Estate is required to make principal payments equal to 1.25% per year of the original loan amount. As such, $1 million has been classified as Current portion of long-term debt on our Consolidated Balance Sheets as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for this credit facility were $2 million and $4 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The France Propco Facility Agreement contains covenants that, among other things, restrict the ability of TRU France Real Estate to incur additional indebtedness, pay dividends or make other distributions, make restricted payments or certain investments, create or permit liens on assets, sell assets or engage in mergers or consolidations. The agreement also contains financial covenants including a loan to value covenant and an interest coverage ratio covenant relating to France Propco.

7.375% senior notes, due fiscal 2018 ($402 million at January 31, 2015)

On September 22, 2003, the Parent Company issued $400 million in notes bearing interest at a coupon rate of 7.375%, which will mature on October 15, 2018. The notes were issued at a discount of $2 million which resulted in proceeds of $398 million. Simultaneously with the sale of the notes, we entered into interest rate swap agreements. We subsequently terminated the swaps and received a payment of $10 million which is being amortized over the remaining term of the notes. Interest is payable semi-annually on April 15 and October 15 of each year. These notes carry a limitation on creating liens on domestic real property or improvements or the stock or indebtedness of domestic subsidiaries (subject to certain exceptions) that exceed the greater of 10% of the consolidated net tangible assets or 15% of the consolidated capitalization. The covenants also restrict sale and leaseback transactions (subject to certain exceptions) unless net proceeds are at least equal to the sum of all costs incurred in connection with the acquisition of the principal property and a lien would be permitted on such principal property. Deferred debt issuance costs for these notes were $1 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Senior unsecured term loan facility, due fiscal 2019 ($965 million at January 31, 2015)

On August 21, 2013, TRU Propco I entered into the Propco I Term Loan Facility for an aggregate principal amount of $985 million. The Propco I Term Loan Facility was issued at a discount of $10 million, which resulted in proceeds of $975 million. The proceeds, together with other funds available to TRU Propco I, were used to redeem in full TRU Propco I’s $950 million senior unsecured 10.750% notes due fiscal 2017 (the “Propco I Notes”), plus accrued interest, premiums and expenses, and to pay fees and expenses relating to the Propco I Term Loan Facility. As a result of the repayment of the Propco I Notes, we expensed $77 million composed of a redemption premium of $51 million, and the write-off of unamortized original issue discount and deferred debt issuance costs during fiscal 2013. KKR owned an aggregate of $17 million of the Propco I Term Loan Facility as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for this loan were $23 million and $27 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

TRU Propco I owns fee and leasehold interests in properties in the United States, which it leases on a long-term basis to Toys-Delaware, pursuant to a master lease agreement.

The Propco I Term Loan Facility matures on August 21, 2019 and bears interest equal to, at the option of TRU Propco I, (i) LIBOR plus a margin of 5.00% per annum or (ii) the Base Rate (defined as the highest of (x) the Federal Funds Rate plus 0.50%, (y) the rate of interest in effect for such day as publicly announced from time to time by the Administrative Agent as its “prime rate,” and (z) one-month LIBOR plus 1.00%) plus a margin of 4.00% per annum, each of (i) and (ii)(z) subject to a LIBOR floor of 1.00%. The Propco I Term Loan Facility currently bears interest equal to LIBOR plus a margin of 5.00% per annum. The Propco I Term Loan Facility is guaranteed by all of TRU Propco I’s subsidiaries (the “Guarantors”). The Propco I Term Loan Facility is solely the obligation of TRU Propco I and the Guarantors and is not guaranteed by the Parent Company or Toys-Delaware.

The Propco I Term Loan Facility is required to be repaid in equal quarterly installments commencing January 31, 2014 in aggregate annual amounts equal to 1.00% of the original principal amount, with the balance payable on the final maturity date. The Propco I Term Loan Facility also requires TRU Propco I to prepay outstanding term loans with 25% of TRU Propco I’s annual excess cash flow (as defined in the Propco I Term Loan Facility), commencing with the fiscal year ending January 31, 2015, subject to the right of the lenders to decline such prepayment (the “Declined Proceeds”). Additionally, the Propco I Term Loan Facility requires TRU Propco I to prepay outstanding term loans at specified times, subject to certain exceptions and reinvestment rights, in connection with certain asset sales in an amount generally equal to 65% of the appraised value (as defined in the Propco I Term Loan Facility) of the real property disposed of in such sale. As such, an aggregate amount of $57 million has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Propco I may optionally prepay the outstanding principal balance of the loan at any time.

The Propco I Term Loan Facility contains certain affirmative and negative covenants, including, among other things, covenants that, subject to certain exceptions, restrict the ability of TRU Propco I and its subsidiaries to incur certain additional indebtedness, make distributions, create or permit liens on assets, sell or otherwise dispose of assets, or engage in mergers or consolidations. The exceptions include the right of TRU Propco I to make distributions from 75% of excess cash flow plus certain other amounts, including Declined Proceeds, subject to the satisfaction of certain conditions, including satisfaction of a fixed charge ratio (as defined in the Propco I Term Loan Facility) of at least 2.0 to1.0 for 50% of such distributions. If an event of default under the Propco I Term Loan Facility shall occur and be continuing, the principal amount of loans outstanding thereunder, together with all accrued and unpaid interest and other amounts owed thereunder, may be declared immediately due and payable.

Tranche A-1 loan facility, due fiscal 2019 ($272 million at January 31, 2015)

On October 24, 2014, Toys-Delaware and certain of its subsidiaries amended the credit agreement for the ABL Facility to provide for, among other things, the Tranche A-1 Loan in an aggregate principal amount of $280 million. Toys-Canada borrowed $125 million principal amount of the Tranche A-1 Loan, which is subject to foreign exchange re-measurement. The Tranche A-1 Loan was issued at a discount of $8 million, which resulted in the receipt of gross proceeds of $272 million. In conjunction with the Tranche A-1 Loan, we capitalized $8 million of transaction fees as deferred debt issuance costs, which are being amortized over the term of the facility. Deferred debt issuance costs for this loan were $7 million as of January 31, 2015 and have been included in Other assets on our Consolidated Balance Sheet.

The Tranche A-1 Loan will mature on October 24, 2019, subject to a springing maturity in 2018 if the remaining Incremental secured term loan and Second incremental secured term loan have not been refinanced, extended or otherwise replaced or repaid prior to such time. The Tranche A-1 Loan will bear interest equal to, at the option of Toys-Delaware or Toys-Canada, as applicable, (i) LIBOR plus a margin of 7.25% per annum (subject to a LIBOR floor of 1.00%) or (ii) the Prime Rate (defined as the highest of (x) the rate of interest in effect for such day as publicly announced from time to time by the ABL Agent as its “prime rate”, (y) the Federal Funds Rate plus 0.50%, and (z) one-month LIBOR plus 1.00%), plus a margin of 6.25% per annum. The Tranche A-1 Loan currently bears interest equal to LIBOR plus a margin of 7.25% per annum (subject to a LIBOR floor of 1.00%).

Certain prepayments of the Tranche A-1 Loan which lower the All-in Yield (as defined in the credit agreement for the ABL Facility) of the Tranche A-1 Loan on or prior to the one-year anniversary of the refinancing closing date will be subject to a prepayment premium of 1.00% of the principal amount that is repriced or refinanced (subject to certain exceptions).

The Tranche A-1 Loan is guaranteed by Toys-Delaware’s subsidiaries (other than certain excluded subsidiaries) that guarantee the existing loans and commitments under the credit agreement for the ABL Facility. The Tranche A-1 Loan is secured by the same collateral that secures the existing loans and commitments under the credit agreement for the ABL Facility.

The Tranche A-1 Loan is subject to a borrowing base consisting of specified percentages of eligible inventory, eligible credit card receivables and certain Canadian real estate which does not reduce the availability under the borrowing base for the ABL Facility (provided that the Tranche A-1 Loan borrowing base includes (i) $125 million of the required availability amount for the ABL Facility and (ii) an availability reserve with respect to the borrowing base for the ABL Facility if the amount of outstanding Tranche A-1 Loan otherwise exceeds the borrowing base with respect to the Tranche A-1 Loan).

Secured Term Loan Credit Agreement

Incremental secured term loan, due fiscal 2018 ($133 million at January 31, 2015)

Second incremental secured term loan, due fiscal 2018 ($67 million at January 31, 2015)

Secured term B-4 loan facility, due fiscal 2020 ($1,010 million at January 31, 2015)

On October 24, 2014, Toys-Delaware amended the Secured Term Loan Credit Agreement to provide for, among other things, the Secured Term B-4 Loan tranche in an aggregate principal amount of $1,026 million. The Secured Term B-4 Loan was issued at a discount of $19 million.  In conjunction with the Secured Term B-4 Loan, we capitalized $27 million of transaction fees as deferred debt issuance costs which are being amortized over the term of the facility.  KKR owned an aggregate of $96 million of the Secured Term B-4 Loan as of January 31, 2015. Deferred debt issuance costs for this loan were $26 million as of January 31, 2015 and have been included in Other assets on our Consolidated Balance Sheet.

The Secured Term B-4 Loan and the Tranche A-1 Loan, together with other sources and funds available to Toys-Delaware, were used to (i) refinance in full the Secured term loan facility due fiscal 2016, (ii) extend $380 million of the term loans due fiscal 2018 under the Incremental secured term loan facility and the Second incremental secured term loan facility into the Secured Term B-4 Loan and (iii) redeem all of the Toys-Delaware Secured Notes at a redemption price of 101.844% of the principal amount thereof, plus accrued and unpaid interest to the redemption date.  As a result of the refinancing, we expensed $35 million, composed of the write-off of unamortized deferred debt issuance costs and original issue discount related to the extinguishment of the Secured term loan facility, and a portion of the Incremental secured term loan facility and the Second incremental secured term loan facility and the Toys-Delaware Secured Notes, as well as a redemption premium of $6 million on the Toys-Delaware Secured Notes.

The Secured Term B-4 Loan will mature on April 24, 2020 and bear interest equal to, at the option of Toys-Delaware, (i) LIBOR plus a margin of 8.75% per annum (subject to a LIBOR floor of 1.00%) or (ii) the Base Rate (defined as the highest of (x) the Federal Funds Rate plus 0.50%, (y) the rate of interest in effect for such day as publicly announced from time to time by the Term Agent as its “prime rate” and (z) one-month LIBOR plus 1.00%) plus a margin of 7.75% per annum (subject to a Base Rate floor of 2.00%). The Secured Term B-4 Loan currently bears interest equal to LIBOR plus a margin of 8.75% per annum (subject to a LIBOR floor of 1.00%).

The Secured Term B-4 Loan is required to be repaid in equal quarterly installments commencing February 28, 2015 in aggregate annual amounts equal to 1.00% of the original principal amount, with the balance payable on the final maturity date. As such, $10 million has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Voluntary prepayments and certain mandatory prepayments of the Secured Term B-4 Loan will be subject to a prepayment premium of (i) prior to the one and one-half year anniversary of the refinancing closing date, a “make-whole” price as set forth in the Secured Term Loan Credit Agreement, (ii) after the one and one-half year anniversary of the refinancing closing date, but prior to the two and one-half year anniversary of the refinancing closing date, 2.00% of the principal amount prepaid and (iii) after the two and one-half year anniversary of the refinancing closing date, but prior to the three and one-half year anniversary of the refinancing closing date, 1.00% of the principal amount prepaid.

On May 25, 2011, Toys-Delaware and certain of its subsidiaries entered into a Joinder Agreement (the “Joinder Agreement”) to the Secured Term Loan Credit Agreement. The Joinder Agreement added a tranche of term loans in an aggregate principal amount of $400 million due fiscal 2018 (“Incremental Secured Term Loan”). The Incremental Secured Term Loan was issued at a discount of $4 million which resulted in proceeds of $396 million. On October 24, 2014, Toys-Delaware refinanced $237 million of the Incremental Secured Term Loan outstanding in conjunction with the issuance of the Secured Term B-4 Loan described above. The Incremental Secured Term Loan will mature on May 25, 2018, and bears interest at LIBOR (with a floor of 1.50%) plus 3.75%, which is subject to a step down of 0.25% based on total leverage.

KKR owned an aggregate of $12 million and $50 million of the Incremental Secured Term Loan as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for this loan were $1 million and $4 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Pursuant to the terms of the Joinder Agreement, Toys-Delaware is required to make quarterly principal payments equal to 0.25% ($4 million per year) of the original principal amount of the Incremental Secured Term Loan. As such, this amount has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Toys-Delaware may optionally prepay the outstanding principal balance of the Incremental Secured Term Loan at any time.

On April 10, 2012, Toys-Delaware and certain of its subsidiaries entered into a Second Joinder Agreement (the “Second Joinder Agreement”) to the Secured Term Loan Credit Agreement. The Second Joinder Agreement added a tranche of term loans in an aggregate principal amount of $225 million due fiscal 2018 (“Second Incremental Secured Term Loan”). The Second Incremental Secured Term Loan was issued at a discount of $5 million, which resulted in proceeds of $220 million. On October 24, 2014, Toys-Delaware refinanced $143 million of the Second Incremental Secured Term Loan outstanding in conjunction with the issuance of the Secured Term B-4 Loan described above. The Second Incremental Secured Term Loan will mature on May 25, 2018, and bears interest at LIBOR (with a floor of 1.50%) plus 3.75%, subject to a 0.25% step-down based on our total leverage ratio.

KKR owned an aggregate of $2 million and $9 million of the Second Incremental Secured Term Loan as of January 31, 2015 and February 1, 2014, respectively. Deferred debt issuance costs for this loan was $1 million and $3 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Toys-Delaware is required to make quarterly principal payments equal to 0.25% ($2 million per year) of the original principal amount of the Second Incremental Secured Term Loan. As such, this amount has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Toys-Delaware may optionally prepay the outstanding principal balance of the Second Incremental Secured Term Loan at any time.

The Secured Term Loan Credit Agreement contains customary covenants applicable to Toys-Delaware and certain of its subsidiaries, including, among other things, covenants that restrict the ability of Toys-Delaware and certain of its subsidiaries to incur certain additional indebtedness, create or permit liens on assets, or engage in mergers or consolidations, pay dividends, repurchase capital stock, make other restricted payments, make loans or advances, engage in transactions with affiliates, or amend material documents. These covenants are subject to certain exceptions, including among other things to allow for certain other additional debt incurrences including unsecured, later-maturing debt subject to a fixed charge coverage test and the provision of a cumulative credit exception allowing for Toys-Delaware and certain of its subsidiaries to make investments, pay dividends and make certain other restricted payments subject to Toys-Delaware meeting a fixed charge coverage test. If an event of default under the Secured Term Loan Credit Agreement occurs and is continuing, the principal amount outstanding, together with all accrued and unpaid interest and other amounts owed may be declared by the lenders or become immediately due and payable. Toys-Delaware may optionally prepay the outstanding principal balance of the loans at any time.

The Secured Term Loan Credit Agreement contains a provision that requires us to repay a specified percentage of excess cash flow generated in the previous fiscal year, as defined in the agreement. Cash flow generated for the fiscal year ended February 1, 2014 did not result in a required repayment under this provision during fiscal 2014. The October 24, 2014 amendment to the agreement waived the excess cash flow provision that would have applied to fiscal 2014. Further, the loans under the Secured Term Loan Credit Agreement are guaranteed by certain of Toys-Delaware subsidiaries and the borrowings thereunder are secured by the trademarks and certain other intellectual property of Geoffrey, LLC, Toys-Delaware’s wholly owned subsidiary, and the assets securing the ABL Facility including inventory, accounts receivable, equipment and certain other personal property owned or acquired by Toys-Delaware and certain of its subsidiaries.

In addition, the Secured Term B-4 Loan is guaranteed by Wayne Real Estate Parent Company, LLC (the “Additional Guarantor”) pursuant to an unsecured guarantee (the “Unsecured Guarantee”) for the benefit of the lenders of the Secured Term B-4 Loan. The Additional Guarantor is a wholly-owned subsidiary of the Company and is an indirect parent of TRU Propco I which, along with its wholly-owned subsidiaries, leases its properties to Toys-Delaware pursuant to a master lease agreement. Additionally, Toys-Delaware has agreed to provide, in the future, for the benefit of the lenders of the Secured Term B-4 Loan, a first priority security interest in certain specified real property, subject to certain exceptions.

The Unsecured Guarantee contains certain provisions triggering mandatory prepayments by Toys-Delaware of the Secured Term B-4 Loan, including, among other things, in connection with the incurrence of certain additional indebtedness and the making of certain restricted payments, in each case, by the Additional Guarantor and its subsidiaries, subject to certain exceptions, including exceptions for indebtedness and restricted payments permitted under the current Propco I Term Loan Facility. The Unsecured Guarantee also contains certain covenants applicable to the Additional Guarantor and its subsidiaries, including, among other things, limitations on the sale or disposition of assets and the conduct of business, subject to certain exceptions. In addition, if the Additional Guarantor fails to comply with certain covenants in the Unsecured Guarantee, additional interest of 2.00% per annum with respect to the aggregate outstanding principal amount of Secured Term B-4 Loan will be payable by Toys-Delaware.

£263 million UK real estate credit facility, due fiscal 2020 ($396 million at January 31, 2015)

On March 25, 2013, UK Propco entered into the UK Propco Facility Agreement with Debussy, pursuant to which Debussy made the UK Propco Loan to UK Propco on March 28, 2013 in the aggregate principal amount of £263 million. UK Propco owns freehold and leasehold interests in properties in various retail markets throughout the United Kingdom. Under an operating company/property company structure, UK Propco leases these properties on a triple-net basis to Toys “R” Us Limited (“UK Opco”). Substantially all of UK Propco’s revenues and cash flows are derived from payments from UK Opco under a series of amended lease agreements. The UK Propco Loan is secured by, among other things, 31 owned and leased properties held by UK Propco, certain cash reserve accounts which are classified as Restricted cash on the Consolidated Balance Sheets and the stock of UK Propco. The UK Propco Loan bears interest on a weighted average basis of 6.85% per annum plus mandatory costs and matures on July 7, 2020.

The UK Propco Facility Agreement contains covenants that restrict the ability of UK Propco to incur certain additional indebtedness, make restricted payments or certain investments, create or permit liens on assets, dispose of properties, acquire further property, vary or terminate the lease agreements referred to above, conclude further leases or engage in mergers or consolidations. If an event of default, including an event resulting from the failure to comply with a rent to interest coverage ratio applicable to UK Propco, under the UK Propco Loan occurs and is continuing, the principal amount outstanding, together with all accrued and unpaid interest and other amounts owed may be declared immediately due and payable by the lenders. The loans are subject to mandatory prepayments in certain cases, including from the proceeds of certain permitted property disposals, and UK Propco may optionally prepay the loans at any time, provided that prior to July 7, 2015 and subject to certain exceptions, the loans may only be prepaid in full. Any prepayment prior to July 7, 2015, subject to certain exceptions, shall be subject to a “make whole” premium. Any prepayment occurring during the first, second and third year after July 7, 2015 are subject to a prepayment fee equal to 3%, 2% and 1%, respectively, of the amount of the loan prepaid.

Debussy is a special purpose entity established with the limited purpose of making loans and issuing £263 million of the Debussy Notes to third party investors and the Company. On July 24, 2013, Debussy completed the securitization of the UK Propco Loan, the notes of which are now publicly traded on the Irish Stock Exchange. In connection with the securitization, UK Propco entered into an amendment and restatement agreement relating to the UK Propco Facility Agreement.  The Company owns and holds £13 million ($20 million as of January 31, 2015) principal amount of the various classes of the Debussy Notes, which are included in Other assets within the Consolidated Balance Sheet, classified as held-to-maturity and reported at amortized cost. For further details regarding the consolidation of Debussy, refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.” Deferred debt issuance costs for this credit facility were $16 million and $21 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Toys-Japan bank loans (1.85% to 2.45%), due fiscals 2015-2021 ($63 million at January 31, 2015)

Toys-Japan had four bank loans with various financial institutions totaling $63 million at January 31, 2015. On January 17, 2011, Toys-Japan entered into a bank loan with a syndicate financial institution for ¥11.5 billion. The loan will mature on January 29, 2016 and bears an interest rate of TIBOR plus 1.50% per annum. In conjunction with the loan, we entered into an interest rate swap, converting the variable rate of interest to a fixed rate of 2.45%. The swap has been designated as a cash flow hedge. Toys-Japan is required to make principal payments of ¥1.6 billion annually in January of each year, with the remaining principal and interest due upon maturity. The outstanding balance of this loan was ¥4.9 billion or $42 million, which has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. On February 28, 2011, Toys-Japan entered into a bank loan with a financial institution for ¥1.0 billion. The loan will mature on February 25, 2016 and bears an interest rate of 1.85% per annum. Toys-Japan is required to make semi-annual principal payments of ¥115 million ($1 million at January 31, 2015). As of January 31, 2015, the outstanding balance of this loan was ¥310 million or $3 million. On October 31, 2014, Toys-Japan entered into a bank loan with a financial institution for ¥0.5 billion. The loan will mature on October 25, 2019 and bears an interest rate of 1.85% per annum. Toys-Japan is required to make semi-annual principal payments of ¥50 million (less than $1 million at January 31, 2015). As of January 31, 2015, the outstanding balance of this loan was ¥0.5 billion or $4 million. On February 28, 2013, Toys-Japan entered into a bank loan with a financial institution for ¥2.0 billion. The loan will mature on February 26, 2021 and bears an interest rate of 2.18% per annum. Toys-Japan is required to make semi-annual principal payments of ¥125 million ($1 million at January 31, 2015). As of January 31, 2015, the outstanding balance of this loan was ¥1.6 billion or $14 million. For these loans, the semi-annual principal payments due within one year totaling $5 million are classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 31, 2015. Deferred debt issuance costs for these loans were less than $1 million and $1 million as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets. In addition, during fiscal 2014, two of the previously outstanding loans matured.

These agreements contain covenants that require, among other things, Toys-Japan to maintain a certain level of net assets and profitability during the agreement terms, including provisions that require Toys-Japan to not incur two consecutive years of ordinary loss in accordance with JGAAP, as defined in the credit agreement. The agreement also restricts Toys-Japan from paying dividends or making loans to affiliates without lender consent.

8.750% debentures, due fiscal 2021 ($22 million at January 31, 2015)

On August 29, 1991, the Parent Company issued $200 million in debentures bearing interest at a coupon rate of 8.750% (the “Debentures”), maturing on September 1, 2021. Interest is payable semi-annually on March 1 and September 1 of each year. On November 2, 2006, Toys-Delaware commenced a cash tender offer for any and all of the outstanding Debentures (the “Tender Offer”) and a related consent solicitation to effect certain amendments to the indenture, eliminating all of the restrictive covenants and certain events of default in the indenture. On November 30, 2006, the Tender Offer expired, and on December 1, 2006, Toys-Delaware consummated the Tender Offer of $178 million or 89% of the outstanding Debentures in the Tender Offer using borrowings under an unsecured credit facility to purchase the tendered Debentures. Deferred debt issuance costs for these Debentures were nominal as of January 31, 2015 and February 1, 2014, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

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FAIR VALUE MEASUREMENTS - Schedule of Fair Value, Long-term Debt (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015	Feb. 01, 2014
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Carrying Value	$ 4,788	$ 5,007
Long-term Debt, Fair Value	4,400	4,500
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Long-term Debt, Fair Value	1,346	1,411
Significant Other Observable Inputs (Level 2)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Long-term Debt, Fair Value	2,315	2,303
Significant Unobservable Inputs (Level 3)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Long-term Debt, Fair Value	$ 755	$ 827

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SEGMENTS - Summary of Depreciation, Amortization and Capital Expenditure (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Depreciation and amortization
Depreciation and amortization	$ 377	$ 388	$ 407
Capital expenditures	207	238	286
Domestic
Depreciation and amortization
Depreciation and amortization	210	216	225
Capital expenditures	67	113	148
International
Depreciation and amortization
Depreciation and amortization	116	123	136
Capital expenditures	83	86	95
Corporate
Depreciation and amortization
Depreciation and amortization	51	49	46
Capital expenditures	$ 57	$ 39	$ 43

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SCHEDULE I - PARENT COMPANY INFORMATION - Annual Maturities of the Parent Company's Long-Term Debt (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015
Debt Instrument [Line Items]
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months	$ 176
Long-term Debt, Maturities, Repayments of Principal in Year Two	34
Long-term Debt, Maturities, Repayments of Principal in Year Three	1,207
Long-term Debt, Maturities, Repayments of Principal in Year Four	658
Long-term Debt, Maturities, Repayments of Principal in Year Five	1,180
Long-term Debt, Maturities, Repayments of Principal after Year Five	1,571
Debt Instrument, Face Amount	4,826
Parent Company [Member]
Debt Instrument [Line Items]
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months	0
Long-term Debt, Maturities, Repayments of Principal in Year Two	0
Long-term Debt, Maturities, Repayments of Principal in Year Three	450
Long-term Debt, Maturities, Repayments of Principal in Year Four	400
Long-term Debt, Maturities, Repayments of Principal in Year Five	0
Long-term Debt, Maturities, Repayments of Principal after Year Five	22
Debt Instrument, Face Amount	$ 872

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ACCUMULATED OTHER COMPREHENSIVE INCOME - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013	Jan. 31, 2015	Jan. 28, 2012
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Foreign currency translation adjustments, net of tax, balance	$ (74)	$ 8	$ 54	$ (202)
Unrealized (loss)gain on hedged transactions, net of tax, balance	0	(1)	(2)		(2)
Unrecognized actuarial (losses) gains, net of tax, balance	(9)	(9)	(8)	(42)
Accumulated other comprehensive (loss) income, balance	(84)	(3)	44	(244)
Foreign currency translation adjustments, net of tax	(128)	(82)	(46)
Unrealized gain (loss) on hedged transactions, net of tax	1	1	0
Unrecognized actuarial losses, net of tax	33	0	1
Accumulated other comprehensive (loss) income	$ (160)	$ (81)	$ (47)

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SCHEDULE I - PARENT COMPANY INFORMATION

12 Months Ended

Jan. 31, 2015

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Shedule I - Parent Company Condensed Financial Statements and Notes to Condensed Financial Statements

Toys “R” Us, Inc.

Schedule I — Condensed Statements of Operations and Comprehensive Loss

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Revenues	$	—		$	—		$	—
General and administrative expenses	25			21			18
Depreciation and amortization	1			3			3
Other expense, net	—			1			—
Total operating expenses	26			25			21
Other (expense) income:
Interest expense, net	(78		)	(76		)	(83		)
Intercompany interest expense, net	(54		)	(63		)	(47		)
(Deficit) equity in pre-tax (loss) earnings of consolidated subsidiaries	(102		)	(706		)	242
(Loss) earnings before income taxes	(260		)	(870		)	91
Income tax expense	32			169			53
Net (loss) earnings	$	(292	)	$	(1,039	)	$	38
Comprehensive loss	$	(452	)	$	(1,120	)	$	(9	)

See accompanying notes to Condensed Financial Statements.

Toys “R” Us, Inc.

Schedule I — Condensed Balance Sheets

(In millions)	January 31, 2015			February 1, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	11		$	79
Income taxes receivable	20			—
Prepaid expenses and other current assets	9			4
Due from subsidiary	376			316
Total current assets	416			399
Property and equipment, net	1			3
Deferred tax assets	2			2
Other assets	12			27
	$	431		$	431
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accrued expenses and other current liabilities	$	121		$	88
Income taxes payable	2			—
Total current liabilities	123			88
Long-term debt	872			872
Due to subsidiaries, net	461			46
Other non-current liabilities	70			73
Temporary equity	—			8
Stockholders’ deficit	(1,095		)	(656		)
	$	431		$	431

See accompanying notes to Condensed Financial Statements.

Toys “R” Us, Inc.

Schedule I — Condensed Statements of Cash Flows

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Cash Flows from Operating Activities	$	(13	)	$	(21	)	$	114
Cash Flows from Investing Activities:
Investments in subsidiaries	5			(180		)	(33		)
Intercompany loan repayments by subsidiaries	2,056			1,956			2,107
Loans to subsidiaries	(2,116		)	(2,251		)	(2,005		)
Proceeds from redemption of debt securities	—			52			—
Net cash (used in) provided by investing activities	(55		)	(423		)	69
Cash Flows from Financing Activities:
Long-term debt borrowings	—			—			446
Long-term debt repayment	—			—			(400		)
Borrowings from subsidiaries	—			—			265
Other	—			(7		)	(17		)
Net cash (used in) provided by financing activities	—			(7		)	294
Cash and cash equivalents:
Net (decrease) increase during period	(68		)	(451		)	477
Cash and cash equivalents at beginning of period	79			530			53
Cash and cash equivalents at end of period	$	11		$	79		$	530
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	77		$	78		$	75

See accompanying notes to Condensed Financial Statements.

BASIS OF PRESENTATION

The Parent Company is a holding company that conducts substantially all of its business operations through its subsidiaries. As specified in certain of its subsidiaries’ debt agreements, there are restrictions on the Parent Company’s ability to obtain funds from certain of its subsidiaries through dividends, loans or advances (refer to Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT”). Accordingly, these condensed financial statements have been presented on a “parent-only” basis. Under a parent-only presentation, the Parent Company’s investments in its consolidated subsidiaries are presented under the equity method of accounting. These parent-only financial statements should be read in conjunction with Toys “R” Us, Inc.’s audited Consolidated Financial Statements included elsewhere herein.

In connection with the July 21, 2005 Merger and subsequent reorganization, the Parent Company borrowed $770 million and received a promissory note of $887 million (£509 million) as a dividend from its indirect wholly-owned subsidiary, Toys “R” Us (UK) Limited (“Toys Limited”). On January 25, 2012 the $770 million intercompany note payable to Toys Limited was amended to translate the outstanding principal and accrued interest on that date to pounds sterling. As of January 31, 2015 and February 1, 2014, Due to subsidiaries, net included the outstanding net intercompany receivable balance from Toys Limited of $175 million and $179 million, respectively.

Additionally included within Due to subsidiaries, net, as of January 31, 2015 and February 1, 2014 is an intercompany payable to Toys-Delaware of $755 million and $697 million, respectively, which includes accrued interest. The intercompany payable to Toys-Delaware includes long-term notes payable by Parent to Toys-Delaware as of January 31, 2015 and February 1, 2014 for which the amounts are listed in the table below. All of the notes are documented, unsecured, and include a market rate of interest. For fiscals 2014 and 2013, the long-term notes payable by Parent to Toys-Delaware were offset by $89 million and $90 million, respectively, of third party insurance liabilities for which Toys-Delaware is the primary obligor. The remaining intercompany payable balance includes $4 million of other payables to Toys-Delaware for fiscals 2014 and 2013, respectively.

(In millions)	Fiscal 2014		Fiscal 2013
Note issued by Parent in FY 2005	$	299	$	286
Note issued by Parent in FY 2009	222		201
Note issued by Parent in FY 2012 (1)	229		206
Note issued by Parent in FY 2012	90		90
Long-term notes payable by Parent to Toys-Delaware (2)	$	840	$	783

(1) Note is expressly subordinated in right of payment to the senior obligations of the Parent.

(2) Includes accrued and unpaid interest.

As of January 31, 2015 and February 1, 2014, an outstanding short-term loan of $376 million and $316 million, respectively, to Toys-Delaware was recorded in Due from subsidiary.

For fiscals 2014, 2013 and 2012, the income tax expense of $32 million, $169 million and $53 million, respectively, represents the Parent Company’s consolidated income tax expense. Such amounts include income tax expense of $91 million, $127 million and $105 million, respectively, related to our subsidiaries, which have not been consolidated for this presentation. The Parent Company is responsible for cash income tax payments on the separate company income of such subsidiaries for United States Federal and certain state filings.

DEBT

A summary of the Parent Company’s Long-term debt as of January 31, 2015 and February 1, 2014 is outlined in the table below:

(In millions)	January 31, 2015		February 1, 2014
10.375% senior notes, due fiscal 2017	448		447
7.375% senior notes, due fiscal 2018	402		403
8.750% debentures, due fiscal 2021 (1)	22		22
Total Long-term debt	$	872	$	872

(1) Represents obligations of Toys “R” Us, Inc. and Toys–Delaware.

The total fair values of the Parent Company’s Long-term debt, with carrying values of $872 million at January 31, 2015 and February 1, 2014, respectively, were $639 million and $687 million, respectively. The fair values of the Parent Company’s Long-term debt are estimated using the quoted market prices for the same or similar issues and other pertinent information available to management as of the end of the respective periods.

The annual maturities of the Parent Company’s Long-term debt at January 31, 2015 are as follows:

(In millions)	Annual Maturities
2015	$	—
2016	—
2017	450
2018	400
2019	—
2020 and subsequent	22
Total	$	872

The Parent Company is a co-obligor of the outstanding debentures due fiscal 2021, and these debt securities are included in Long-term debt within the Parent Company Condensed Balance Sheets for stand-alone reporting purposes. However, it is expected all future principal and interest payments will be funded through the operating cash flows of Toys-Delaware. During fiscals 2014, 2013 and 2012, Toys-Delaware recorded interest expense related to the outstanding debentures due fiscal 2021 of $2 million, respectively, which is reflected as part of (Deficit) equity in pre-tax (loss) earnings of consolidated subsidiaries in the Parent Company Condensed Statements of Operations and Comprehensive Loss.

The Parent Company provides guarantees related to the uncommitted credit lines of Labuan in an aggregate amount up to HK$257 million ($33 million at January 31, 2015) for future borrowings. During fiscal 2012, the Parent Company provided the lenders of the Spain Propco Facility Agreement entered into on January 29, 2013 with a deficiency guarantee with respect to certain losses the lenders may suffer in certain circumstances.

For a discussion of the debt obligations of the Parent Company and its subsidiaries, see Note 2 to the Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We are exposed to market risk from potential changes in interest rates and foreign currency exchange rates. We regularly evaluate our exposure and enter into derivative financial instruments to economically manage these risks. We record all derivatives as either assets or liabilities on the Parent Company Condensed Balance Sheets measured at estimated fair value and we do not offset assets and liabilities with the same counterparty. We recognize the changes in fair value as unrealized gains and losses. The recognition of these gains and losses depends on our intended use of the derivatives and the resulting designation. In certain defined conditions, a derivative may be specifically designated as a hedge for a particular exposure.

Interest Rate Contracts

We and our subsidiaries have a variety of fixed and variable rate debt instruments and are exposed to market risks resulting from interest rate fluctuations. We enter into interest rate swaps and/or caps to reduce our exposure to variability in expected future cash outflows attributable to the changes in LIBOR rates. Some of our interest rate contracts may contain credit-risk related contingent features and are subject to master netting arrangements. As of January 31, 2015, our interest rate contracts have maturity dates through April 2015.

At January 31, 2015 and February 1, 2014, we had no derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 31, 2015 and February 1, 2014, we were not required to post collateral with any derivative counterparties.

The following table presents our outstanding interest rate contracts as of January 31, 2015 and February 1, 2014:

			January 31, 2015		February 1, 2014
(In millions)	Effective Date	Maturity Date	Notional  Amount		Notional  Amount
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (1)	January 2011	April 2015	$	500	$	500
1 Month USD LIBOR Interest Rate Cap (1)	January 2012	April 2015	500		500
1 Month USD LIBOR Interest Rate Cap (1)	January 2014	April 2015	311		311

(1) These interest rate caps are not designated as cash flow hedges in accordance with ASC 815.

Foreign Exchange Contracts

We occasionally enter into foreign currency forward contracts to economically hedge our short-term, cross-currency intercompany loans with our foreign subsidiaries. We enter into these contracts in order to reduce our exposure to the variability in expected cash outflows attributable to changes in foreign currency rates. These derivative contracts are not designated as hedges and are recorded on the Parent Company Condensed Balance Sheets at fair value with a gain or loss recorded on the Parent Company Condensed Statements of Operations and Comprehensive Loss in Interest expense, net. At January 31, 2015 and February 1, 2014, we had no outstanding foreign exchange contracts.

Our foreign exchange contracts typically mature within 12 months. Some of these contracts may contain credit-risk related contingent features and are subject to master netting arrangements. Some of these agreements contain provisions where we could be declared in default on our derivative obligations if we default on certain specified indebtedness. At January 31, 2015 and February 1, 2014, derivative liabilities related to agreements that contain credit-risk related contingent features had a fair value of $2 million and less than $1 million, respectively. We are not required to post collateral for these contracts.

The following table sets forth the net impact of the effective portion of Parent Company’s derivatives on Accumulated other comprehensive (loss) income for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014		February 2, 2013
Derivatives previously designated as cash flow hedges:
Beginning balance	$	1		$	1	$	1
Reclassifications from Accumulated other comprehensive      (loss) income - Interest Rate Contracts	(1		)	—		—
	(1		)	—		—
Ending balance	$	—		$	1	$	1

The following table sets forth the impact of derivatives on Interest expense, net on the Parent Company Condensed Statements of Operations and Comprehensive Loss for the fiscal years ended January 31, 2015, February 1, 2014 and February 2, 2013:

	Fiscal Years Ended
(In millions)	January 31, 2015		February 1, 2014			February 2, 2013
Derivatives not designated for hedge accounting:
Loss on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	$	—	$	(1	)	$	—
	—		(1		)	—
Derivatives previously designated as cash flow hedges:
Amortization of hedged caps	1		—			—
	1		—			—
Total Interest expense, net	$	1	$	(1	)	$	—

(1) Gains and losses related to our short-term, intercompany loan foreign exchange contracts are recorded in Interest expense, net, in addition to the corresponding foreign exchange gains and losses related to our short-term, cross-currency intercompany loans. For further details related to gains and losses resulting from foreign currency transactions, refer to Note 1 to our Consolidated Financial Statements entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.”

The following table contains the notional amounts and fair values of Parent Company’s outstanding derivative contracts as of January 31, 2015 and February 1, 2014:

	January 31, 2015				February 1, 2014
	Notional		Fair Value Assets/		Notional		Fair Value Assets/
(In millions)	Amount		(Liabilities)		Amount		(Liabilities)
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets (1)	$	1,311	$	—	$	—	$	—
Other assets	$	—	$	—	$	1,311	$	—

(1) Amounts as of January 31, 2015 includes reclassifications of contracts scheduled to mature within the next 12 months, which were previously included within Other assets as of February 1, 2014.

Refer to Note 3 to our Consolidated Financial Statements entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details on derivative instruments.

Offsetting of Derivatives

We present our derivatives at gross fair values in the Parent Company Condensed Balance Sheets. However, some of our interest rate and foreign exchange contracts are subject to master netting arrangements which allow net settlements under certain conditions. As of January 31, 2015 and February 1, 2014, the aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets were nominal, respectively, and the aggregate gross fair value of derivative assets which could be net settled against our derivative liabilities were nominal, respectively. As of January 31, 2015 and February 1, 2014, none of the master netting arrangements involved collateral.

COMMITMENTS AND CONTINGENCIES

Although the Parent Company does not currently have material legal proceedings pending against it, it may be subject to various claims and contingencies related to lawsuits, as well as commitments under contractual and other obligations. Refer to Note 14 to our Consolidated Financial Statements entitled “LITIGATION AND LEGAL PROCEEDINGS” for further information. Additionally, the Parent Company is a guarantor on certain leases entered into by its subsidiaries. For a discussion of the lease obligations of the Parent Company and its subsidiaries, see Note 9 to our Consolidated Financial Statements entitled “LEASES.”

DISTRIBUTIONS AND CAPITAL CONTRIBUTIONS

Distributions

The Parent Company received cash distributions (inclusive of returns of capital) from certain of its subsidiaries of $93 million, $202 million and $203 million during fiscals 2014, 2013 and 2012, respectively. The cash distributions received included $79 million and $129 million in fiscals 2013 and 2012, respectively, from its subsidiary Toys-Delaware. No cash distributions were received from Toys-Delaware in fiscal 2014.

The cash distributions received also included $93 million, $123 million and $72 million, in fiscals 2014, 2013 and 2012, respectively, from certain of our property subsidiaries, which included no returns of capital in fiscal 2014 and returns of capital of $109 million and $10 million in fiscals 2013 and 2012, respectively. The cash distributions received during fiscals 2014, 2013 and 2012 from our property subsidiary TRU Propco I were $86 million, $115 million and $64 million, respectively.

Capital Contributions

During fiscal 2014, Parent Company made a capital contribution of $5 million to TRU Asia, Ltd., $1 million of which it used to pay contingent consideration related to the Labuan acquisition.

During fiscal 2013, Parent Company made a capital contribution of $274 million to Toys Europe, which it used in connection with the refinancing of the UK real estate credit facility. Additionally, during fiscal 2013, Parent Company made a capital contribution of $10 million to Toys Europe to assist in the funding of the Spain Propco Facility Agreement debt repayment for the fourth quarter of fiscal 2013. During fiscal 2012, Parent Company made a capital contribution of $30 million to Toys Europe, which it used in connection with the refinancing of the Spain Propco Facility. Refer to Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

Additionally, during fiscal 2012, Parent Company made a capital contribution of $5 million to TRU Asia, Ltd., which it used to pay contingent consideration related to the Labuan acquisition.

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INCOME TAXES - Income Tax (Benefit) Expense (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Current:
U.S. Federal	$ (13)	$ (7)	$ (28)
Foreign	46	46	45
State	0	(3)	0
Total current income tax expense (benefit)	33	36	17
Deferred:
U.S. Federal	1	42	(9)
Foreign	(2)	72	11
State	0	19	34
Total deferred income tax expense (benefit)	(1)	133	36
Total income tax expense (benefit)	$ 32	$ 169	$ 53

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INCOME TAXES (Tables)

12 Months Ended

Jan. 31, 2015

Income Tax Disclosure [Abstract]

Earnings before Income Taxes

(Loss) earnings before income taxes are as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
U.S.	$	(263	)	$	(851	)	$	(18	)
Foreign	7			(16		)	110
(Loss) earnings before income taxes	$	(256	)	$	(867	)	$	92

Income Tax (Benefit) Expense

Income tax expense (benefit) is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Current:
U.S. Federal	$	(13	)	$	(7	)	$	(28	)
Foreign	46			46			45
State	—			(3		)	—
Total current income tax expense (benefit)	$	33		$	36		$	17
Deferred:
U.S. Federal	$	1		$	42		$	(9	)
Foreign	(2		)	72			11
State	—			19			34
Total deferred income tax expense (benefit)	$	(1	)	$	133		$	36
Total income tax expense (benefit)	$	32		$	169		$	53

Effective Tax Rate Reconciliation

The effective tax rate reconciliations are as follows:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014		February 2, 2013
U.S. Federal statutory tax rate	35.0	%	35.0	%	35.0	%
State taxes, net of U.S. Federal benefit	—	%	(1.2	)%	23.9	%
Foreign operations (1)	(13.5	)%	(12.3	)%	3.7	%
U.S. Federal valuation allowance	(36.6	)%	(27.9	)%	0.8	%
Unrecognized tax benefits (2)	3.0	%	—	%	(3.6	)%
Goodwill impairment (3)	—	%	(13.4	)%	—	%
Other	(0.4	)%	0.3	%	(2.2	)%
Effective tax rate	(12.5	)%	(19.5	)%	57.6	%

Summary of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that give rise to deferred tax assets and liabilities are:

(In millions)	January 31, 2015			February 1, 2014
Deferred tax assets:
U.S. Federal tax loss and other carryforwards	$	385		$	398
State tax loss and other carryforwards	84			75
Foreign tax loss and other carryforwards	169			197
Straight line rent	127			137
Inventory	52			75
Insurance loss reserve	35			36
Restructuring charges	7			10
Other	158			119
Gross deferred tax assets before valuation allowance	1,017			1,047
Valuation allowance	(621		)	(511		)
Total deferred tax assets	$	396		$	536
Deferred tax liabilities:
Fixed assets (1)	$	(67	)	$	(131	)
Undistributed earnings of foreign subsidiaries	(222		)	(291		)
Foreign currency translation	(24		)	(26		)
Other	(21		)	(14		)
Total deferred tax liabilities	$	(334	)	$	(462	)
Net deferred tax assets	$	62		$	74

Summary of Deferred Tax Assets and Liabilities Reflected in Consolidated Balance Sheets

The deferred tax assets and liabilities above are reflected in the Consolidated Balance Sheets as follows:

(In millions)	January 31, 2015			February 1, 2014
Current deferred tax assets	$	45		$	31
Current deferred tax liabilities (2)	(4		)	(13		)
Non-current deferred tax assets	133			152
Non-current deferred tax liabilities	(112		)	(96		)
	$	62		$	74

(1) Includes deferred impact of finance obligations associated with capital projects.

(2) The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities in the Consolidated Balance Sheets.

Reconciliation of Beginning and Ending Amount of Gross Unrecognized Tax Benefits (Excluding Interest and Penalties)

A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits (excluding interest and penalties) is as follows:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Beginning balance	$	37		$	32		$	42
Additions for tax positions of the current year	4			4			5
Additions for tax positions of prior years	5			6			3
Reductions for tax positions of prior years (1)	(11		)	(1		)	(12		)
Settlements	—			—			(5		)
Currency translation adjustment	(4		)	—			—
Lapse of statute of limitations	(1		)	(4		)	(1		)
Ending balance	$	30		$	37		$	32

(1) Reductions for tax positions of prior years include amounts related to the resolution of issues in connection with resolving tax examinations, making protective elections, as well as changes to and clarifications of tax rules and regulations.

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DEFINED BENEFIT PENSION PLANS

12 Months Ended

Jan. 31, 2015

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

DEFINED BENEFIT PENSION PLANS

DEFINED BENEFIT PENSION PLANS

We sponsor defined benefit pension plans covering certain international employees in the UK, Japan, Germany and Austria, with such benefits accounted for on an accrual basis using actuarial assumptions. For our pension plans, we use a measurement date matching the end of our fiscal years.

The following tables provide information regarding our pension plans:

Obligation and Funded Status at End of Fiscal Year:

(In millions)	January 31, 2015			February 1, 2014
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	137		$	128
Service cost	5			5
Interest cost	5			5
Employee contributions	—			1
Benefits paid	(6		)	(2		)
Actuarial loss (gain)	52			(1		)
Foreign currency impact	(19		)	1
Projected benefit obligation at end of year	$	174		$	137

(In millions)	January 31, 2015			February 1, 2014
Change in fair value of plan assets:
Fair value of plan assets at beginning of year	$	118		$	105
Actual return on plan assets	17			5
Employer contributions	7			7
Employee contributions	—			1
Benefits paid	(6		)	(2		)
Foreign currency impact	(13		)	2
Fair value of plan assets at end of year	$	123		$	118

(In millions)	January 31, 2015			February 1, 2014
Reconciliation of funded status to total amount recognized:
Funded status	$	(51	)	$	(19	)
Amounts recognized in Consolidated Balance Sheets:
Other non-current liabilities	$	(51	)	$	(19	)
Amounts recognized in Accumulated other comprehensive loss:
Unrecognized actuarial losses, net of tax	$	42		$	9

Of the $42 million of unrecognized actuarial losses, net of tax in Accumulated other comprehensive loss as of January 31, 2015, $2 million is expected to be amortized into net periodic benefit cost in fiscal 2015.

Information for Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets:

(In millions)	January 31, 2015		February 1, 2014
Projected benefit obligation	$	174	$	137
Accumulated benefit obligation	150		118
Fair value of plan assets	123		118

Components of Net Periodic Benefit Cost During Each Fiscal Year:

	Fiscal Years Ended
(In millions)	January 31, 2015			February 1, 2014			February 2, 2013
Service cost	$	5		$	5		$	5
Interest cost	5			5			5
Expected return on plan assets	(5		)	(5		)	(4		)
Net periodic benefit cost	$	5		$	5		$	6

Contributions

For fiscal 2015, we expect to contribute $6 million to our pension plans.

Estimated Future Payments

Pension benefit payments, including amounts to be paid from our assets, and reflecting expected future service, as appropriate, are expected to be paid as follows:

(In millions)	Pension Benefits
2015	$	2
2016	2
2017	2
2018	2
2019	2
2020 through 2024	9

Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs at Fiscal Year End:

	January 31, 2015		February 1, 2014		February 2, 2013
Discount rate	3.7	%	4.1	%	4.0	%
Expected rate of return on plan assets	4.5	%	4.9	%	4.6	%
Rate of compensation increase	2.6	%	2.7	%	2.8	%

Weighted-average Assumptions Used to Determine Benefit Obligations at Fiscal Year End:

	Fiscal Years Ended
	January 31, 2015		February 1, 2014
Discount rate	2.7	%	3.9	%
Rate of compensation increase	2.6	%	2.6	%

Determination of Discount Rate

The discount rate used to determine benefit obligations for our pension plans has been developed based on the AA corporate bond yield curve.

Determination of Expected Return on Assets

The expected return on assets is the rate of return expected to be achieved on pension fund assets in the long term, net of investment expenses. More than 90% of the plan assets relate to the UK and Japan pension plans. The UK and Japan pension plans expected return on assets assumption for fiscal 2015 has been determined by considering the return on the actual asset classes held as of the measurement date and our expectations of future rates of return on each asset class. For the UK and Japan pension plans, we determine the expected rate of return by utilizing the current return available on stocks, and government and corporate bonds and applying suitable risk premiums that consider historical market returns and current market expectations. The estimate of the expected rate of return is based on a long term view and considers the impact of economic conditions in the evaluation of historical market returns.

Plan Assets

Investment policies and strategies

Our overall investment policy and strategic management of the plan assets are the responsibility of the trustees (acting based on advice as they deem appropriate) and are driven by investment objectives as set out below. The remaining elements of our investment policy are part of the day-to-day management of the assets, which is delegated to a professional investment manager. The trustees of our defined benefit pension plans are guided by an overall objective of achieving, over the long-term, a return on the investments, which is consistent with the long-term assumptions made by the actuaries in determining funding of the plans.

The investment returns that the trustees expect to achieve are those that are broadly in line with or above the returns of the respective market indices and performance targets against which the investment manager is benchmarked. Over the longer term, the trustees expect to achieve an investment return in excess of the consumer price index.

Weighted-average asset allocation by asset category

The primary investment goal for our plans’ assets is to maximize total asset returns while ensuring the plans’ assets are available to fund the plans’ liabilities as they become due. A change in the overall investment strategy could significantly impact the expected rate of return on plan assets.

The following represents our pension plan target asset allocations for fiscal 2015, as well as the actual asset allocations as of January 31, 2015 and February 1, 2014:

	2015 Target Allocation		January 31, 2015		February 1, 2014
Equity securities	28.3	%	28.3	%	27.7	%
Debt securities	58.3	%	58.3	%	56.6	%
Insurance contracts	7.3	%	7.3	%	8.3	%
Cash and cash equivalents	6.1	%	6.1	%	7.4	%
Total	100	%	100	%	100	%

Risk management

In managing the Company’s plan assets, our investment managers evaluate and manage risk associated with funded status risk, interest rate risk, market risk, counterparty risk, liquidity risk and operational risk. Cash flow management and asset class diversification are central to our risk management strategy and are critical to the overall investment strategy of our pension plan assets.

Fair value of plan assets

The following tables present our plan assets by fair value hierarchy in accordance with ASC Topic 820, “Fair Value Measurements and Disclosures” as of January 31, 2015 and February 1, 2014. The fair value hierarchy is comprised of three levels based on the reliability of inputs used to determine fair value. Level 1 refers to fair values determined based on quoted prices in active markets for identical assets. Level 2 refers to fair values estimated using significant other observable inputs, while Level 3 includes fair values estimated using significant unobservable inputs. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement of the instrument. There have been no changes in valuation technique or related inputs for the fiscal years ended January 31, 2015 and February 1, 2014.

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Equity Securities: (1)
Domestic	$	—	$	11	$	11
International	—		24		24
Fixed Income: (2)
Domestic	—		4		4
International	—		68		68
Insurance Contracts (3)	—		9		9
Cash and cash equivalents (4)	7		—		7
Total	$	7	$	116	$	123

Fiscal 2013

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Equity Securities: (1)
Domestic	$	—	$	12	$	12
International	—		21		21
Fixed Income: (2)
Domestic	—		2		2
International	—		64		64
Insurance Contracts (3)	—		10		10
Cash and cash equivalents (4)	9		—		9
Total	$	9	$	109	$	118

(1) Domestic and international equity securities categorized as Level 2 are valued using the Net Asset Value (“NAV”) per fund share, which is derived from quoted prices in active markets of the underlying securities.

(2) Domestic and international fixed-income securities categorized as Level 2 are valued using the NAV per fund share, which is derived using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported trades.

(3) Insurance contracts contain a minimum guaranteed return and are categorized as Level 2 as the fair value of the assets is equal to the total amount of all individual technical reserves plus the non allocated employer’s financing fund reserves at the valuation date. The individual technical and financing fund reserves are equal to the accumulated paid contributions taking into account the insurance ratification and any allocated profit sharing return.

(4) Cash and cash equivalents include highly liquid investments with original maturities of three months or less at acquisition. Due to the short-term nature of these investments, their carrying amounts approximate fair value. Therefore, we have determined that our cash and cash equivalents in their entirety are classified as Level 1 within the fair value hierarchy.

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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule I - Condensed Balance Sheets (Details) (USD $) In Millions, unless otherwise specified	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013	Jan. 28, 2012
Current Assets:
Cash and cash equivalents	$ 698	$ 644	$ 1,118	$ 701
Prepaid expenses and other current assets	122	125
Total current assets	3,154	3,220
Property and equipment, net	3,335	3,638
Deferred tax assets	133	152
Other assets	376	422
Total Assets	7,115	7,549
Current Liabilities:
Accrued expenses and other current liabilities	1,032	920
Income taxes payable	20	19
Total current liabilities	2,799	2,516
Long-term debt	4,788	5,007
Other non-current liabilities	255	235
Stockholders’ deficit	(1,095)	(656)
Total Liabilities, Temporary Equity and Stockholders’ Deficit	7,115	7,549
Parent Company [Member]
Current Assets:
Cash and cash equivalents	11	79	530	53
Income taxes receivable	20	0
Prepaid expenses and other current assets	9	4
Due from subsidiary	376	316
Total current assets	416	399
Property and equipment, net	1	3
Deferred tax assets	2	2
Other assets	12	27
Total Assets	431	431
Current Liabilities:
Accrued expenses and other current liabilities	121	88
Income taxes payable	2	0
Total current liabilities	123	88
Long-term debt	872	872
Due to subsidiaries, net	461	46
Other non-current liabilities	70	73
Temporary equity	0	8
Stockholders’ deficit	(1,095)	(656)
Total Liabilities, Temporary Equity and Stockholders’ Deficit	$ 431	$ 431