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 30, 2016

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 1, 2016, there were 49,347,672 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, our “Strategic Pillars,” store openings, integration and remodeling, the development, implementation and integration of our e-commerce business, the continued benefit of the “Fit for Growth” process improvements, future financial or operational performance, projected sales for certain periods, same store 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, access to trade credit, future financings, refinancings and debt repayments, 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, implementation and operation of our new e-commerce platform, marketing strategies, the availability of adequate financing, ability to repatriate cash from our foreign operations, ability to distribute cash from our operating subsidiaries to their parent entities, 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	22
Item 2.	Properties	22
Item 3.	Legal Proceedings	23
Item 4.	Mine Safety Disclosures	23
PART II.
Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	24
Item 6.	Selected Financial Data	24
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	47
Item 8.	Financial Statements and Supplementary Data	49
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	112
Item 9A.	Controls and Procedures	112
Item 9B.	Other Information	115
PART III.
Item 10.	Directors, Executive Officers and Corporate Governance	116
Item 11.	Executive Compensation	118
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	147
Item 13.	Certain Relationships and Related Transactions and Director Independence	148
Item 14.	Principal Accounting Fees and Services	150
PART IV.
Item 15.	Exhibits and Financial Statement Schedules	152
SIGNATURES		153
INDEX TO EXHIBITS		155

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 2015 ended January 30, 2016; fiscal 2014 ended January 31, 2015; and fiscal 2013 ended February 1, 2014. References to 2015, 2014 and 2013 are to our fiscal years unless otherwise specified.

Overview

We are relentlessly striving to be the best toy and baby products retail company in the world! Our purpose is to put huge smiles on the faces of children of all ages by being the world’s greatest toy store and to make it easier for parents to make the best possible choices as they care for their babies.

We are the leading global specialty retailer of toys and baby products as measured by Net sales. Our Toys “R” Us and Babies “R” Us brands are 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 omnichannel offerings that leverage the synergies between our brick-and-mortar stores and e-commerce.

As of January 30, 2016, we operated 1,622 stores and licensed an additional 252 stores. These stores are located in 39 countries and jurisdictions around the world under the Toys “R” Us and Babies “R” Us banners. In addition, we operate smaller format Toys “R” Us Express stores (“Express stores”), some of which are open on a short-term basis during the holiday season. Our omnichannel experience incorporates our websites including Toysrus.com and Babiesrus.com, as well as other e-commerce sites in our international markets. For fiscal 2015, we generated Net sales of $11,802 million, resulting in Adjusted EBITDA of $800 million and Net loss attributable to Toys “R” Us, Inc. of $130 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., refer to Item 6 entitled “SELECTED FINANCIAL DATA” of this Annual Report on Form 10-K.

Our 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 (“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 retail destination for children of all ages 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.

Leadership and Strategy

On July 1, 2015, we hired David A. Brandon to be our CEO and Chairman of the Board. We also strengthened our senior leadership team with a number of key hires across a broad range of disciplines, including human resources, finance and operations. These hires, along with existing management, provide us with a fresh perspective on the business and bring with them a wealth of relevant experience and knowledge in leading key areas of our business.

Our Company has outlined the following key strategic growth initiatives, which we refer to as our “Strategic Pillars:”

• Grow and Build the Toys “R” Us and Babies “R” Us Brands Throughout the World. Invest in our existing stores and e-commerce platforms and continue to grow our brands globally.

• Create a World Class Experience for Our Customers. Develop empowered teams that strive for flawless execution in every aspect of the in-store and omnichannel experience.

• Create a Strong Financial Foundation. Continue to drive cost savings while we transition to our growth phase.

• Make Talent and Culture a Competitive Advantage. Create a culture of high performance, responsiveness and agility.

1

Our Strengths

Strong Brand Equity

Our brand names are highly recognized in North America, Europe and Asia, and our expertise in the toy and baby products retail space, broad range of product offerings, substantial scale and geographic footprint and strong vendor relationships account for our market-leading position and distinguish us from the competition.

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 e-commerce business. On average, our Domestic and International stores (other than Express stores) offer 12,500 and 7,000 items year-round, respectively. Express stores, due to their size, typically carry 3,000 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, customer experience and marketing.

E-Commerce and Omnichannel

Over the past several years, we have seen growth in our e-commerce business, particularly within our omnichannel programs. For fiscal 2015, our consolidated e-commerce business generated net sales of $1,331 million, 42% of which was contributed by our omnichannel programs. The chart below shows our e-commerce net sales growth with the percentage of omnichannel fulfillment for the past five fiscal years:

($ In millions)

Our omnichannel capabilities through which we integrate our e-commerce and brick-and-mortar stores include the following:

• Buy Online, Pick Up In Store. Available within all stores in the United States, United Kingdom, Canada and Germany. Offers customers the ability to browse and shop online and pick up their purchases in-store in as little as one hour.

• Ship to Store. Allows customers in the United States to purchase items online 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.

• Pay In-Store. Provides customers the flexibility to shop online and pay for their items in any store across the United States.

• Ship from Store. Leverages inventory from 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.

Currently, we are transitioning the management of our U.S e-commerce operations in-house, which we expect to launch later this year. We aim to significantly improve the customer experience online and better integrate our omnichannel presentation. We believe that this will provide us the flexibility needed to grow and allow us to respond to changing customer dynamics in an ever competitive marketplace. In addition, this year we reduced our everyday free shipping purchase minimum in the U.S. at Toysrus.com and Babiesrus.com from $49 to $19, one of the most competitive offers in the marketplace.

2

Internationally, we have an online presence in 19 countries and jurisdictions, which includes Australia, Austria, Belgium, Canada, China, France, Germany, Hong Kong, Japan, Malaysia, Netherlands, Poland, Portugal, Singapore, Spain, Switzerland, Taiwan, Thailand and the United Kingdom, as well as in several of our licensed markets. We also offer international shipping through a third party for select products ordered online to more than 60 countries across Asia, the Caribbean islands, 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 physical stores.

International Store Portfolio Expansion

We believe that we have the potential to continue to grow the number of stores internationally, particularly those in the emerging economies which are seeing overall GDP growth and rising incomes. Our first licensed store in China opened in 2006 through our partnership with Li & Fung. In fiscal 2011, the Company acquired a 70% ownership interest in Toys (Labuan) Holding Limited (“Asia JV”) from Li & Fung, which included locations in Brunei, China, Hong Kong, Malaysia, Singapore, Taiwan and Thailand, consisting of 90 operating stores. Since the acquisition of Asia JV, we have more than doubled our store count and now operate 188 Toys “R” Us retail stores as of January 30, 2016. Our International segment operating store portfolio has grown by 21% since fiscal 2011:

Our licensed store base has also continued to expand as we identify opportunities in markets where we do not already have a physical store presence.  In fiscal 2015, our International licensed locations increased by 40 stores compared to the prior year.  As of January 30, 2016, we licensed 252 stores in 20 countries and jurisdictions, generating $17 million in licensing revenue.

Customer Loyalty Programs and Marketing

Domestically, we provide several programs that benefit customers throughout the year including:

Rewards “R” Us. With 19 million current active members, we believe this loyalty program results in an improved customer shopping experience and more frequent visits to our stores and online sites. In fiscal 2015, our valued loyalty members contributed approximately two-thirds of our Domestic Net sales and benefited from the program’s rewards and promotions. Members earn $5 for every $125 spent and have 60 days to redeem the offer, with members of our Credit Card Program earning double rewards for every $1 spent. Through this program we offer a variety of exclusive one-time and ongoing benefits, deals and promotions to our customers, and allow them to earn and redeem points at our stores and online. This includes Bonus Points days, Black Friday previews, Credit Card promotions and eligibility to our Endless Earnings and Geoffrey’s Birthday Club programs.

Babies “R” Us Registry. Our baby business offers a broad range of baby products and delivers a high level of customer service and product knowledge to our customers.  Our Baby Registry program has been used by over 22 million registrants to-date and our baby product assortment draws 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 online allows an expectant parent to list desired products and enables gift-givers to tailor purchases to the expectant parent’s specific needs and wishes. We have made it even easier for customers to register and manage their registries through our completely revamped registry mobile app. Because first-time parents tend to make multiple product purchases during a relatively short period of time, we seek to provide a “one-stop shopping” venue for all baby product needs. We then become a resource for infant products such as baby formula, diapers and baby food, as well as baby clothing, on-the-go gear and other baby care items. 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 full portfolio of products. We continue to build on these relationships as these children mature and eventually become parents themselves. Additionally, we believe that selling baby merchandise staples such as baby formula, diapers, infant clothing and gear helps to mitigate the seasonal variability in our toy business. Domestically, we provide an Endless Earnings tiered feature of our Babies

3

“R” Us Registry, where expectant parents who are Rewards “R” Us members, receive 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. In addition to our Baby Registry, we offer a variety of helpful publications and innovative programs, classes and services for expectant and new parents, including frequent in-store events and product demonstrations.

Much like our Rewards “R” Us and Baby Registry programs in the U.S., we have over 11 million active members in similar loyalty programs around the world. In addition, we offer 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.

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 and to try to connect with our customers on a personal level. These strategies include targeted advertisements and mass marketing programs such as e-mail marketing, digital and social media, direct mail, national television and radio spots, catalogs inserts in national and local newspapers, direct mailings to loyalty program members and in-store marketing. We continue to transition a significant portion of our marketing reach 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 Toys “R” Us Book of Awesome” promotional catalog release, which features an interactive digital app and is distributed through direct mail, newspapers and our stores in advance of the holiday selling season.

Customer Experience

Every day we strive to improve the customer experience in our stores and online. This enables us to bring joy into the lives of our customers by being the toy and baby authority and definitive destination for kid fun, gift-giving solutions and parenting services. 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 team members to deepen their product knowledge and enhance their targeted selling skills in order to improve customer service.

In the U.S., we have improved the shopping experience in our stores in key ways. We continue to invest in our store appearance as part of our “Clean and Bright” initiative. Our U.S. stores are equipped with navigation, including digital store-specific maps to help customers pinpoint the location of the items they are looking for by using their smartphone on a navigational sign at the entrance to our stores. Additionally, customer points of interest are located at the front of our toy stores which are designed to help customers easily find what they’re looking for — a “Here’s What’s Hot Shop” with the hottest and trending toys in one convenient location and our “Gift Express” shop featuring grab-and-go gifts for $30 or less.

For the added convenience of our customers, we offer a layaway program and provide a home delivery service. In addition, our “Price Match Guarantee” program matches competitors’ in-store and selected online retailer pricing on identical items.

Inventory Management

We continue to focus on improving the customer experience by maintaining stronger in-stock positions in our stores and online for the hottest toys at competitive prices. In fiscal 2015, we re-evaluated our in-stock approach to ensure our shelves are full and satisfy demand, particularly during the peak holiday season. Our product life cycle management process continues to help reduce clearance margin risk by instituting greater discipline around product exit dates.

Cost Savings

Through our “Fit for Growth” cost savings initiative we identified opportunities to improve product margins and reduce expenses without jeopardizing the customer experience.  Since the commencement of this initiative in fiscal 2014 we have realized $307 million in savings and expect to continue to benefit from such process improvements in the coming years within some of the following areas:

• marketing effectiveness;

• advertising media optimization;

• in-store operational productivity;

• end-to-end process re-engineering;

• private label product sourcing; and

• supply chain efficiency.

4

Vendor Relationships

We view our well-established vendor relationships as a core strength of the organization and continue to build these partnerships in the hopes of growing together.  We provide vendors with a year-round platform to showcase their brands and test their new products in our stores.  In return, we obtain greater access to products in demand and support for advertising and marketing efforts to drive category leadership and differentiation.  We continue to add private label and exclusive products to our mix, including unique and exceptional items from our FAO Schwarz brand.

Operating Performance

We believe our strengths along with the implementation of our Strategic Pillars have created a strong financial foundation to position our brands for continued growth. As a result, our Adjusted EBITDA has steadily increased since fiscal 2013:

(In millions)

(For a reconciliation of Adjusted EBITDA to Net loss attributable to Toys “R” Us, Inc., refer to Item 6 entitled “SELECTED FINANCIAL DATA”)

Our Stores

As of January 30, 2016, we operated and licensed retail stores worldwide in the following formats:

Store Type	Store Count	Typical Square Footage
Operated:
Traditional Toy (1)	895	20,000 - 50,000
Side-by-side (“SBS”) (2)	415	30,000 - 70,000
Baby (3)	239	30,000 - 55,000
Permanent Express	73	2,000 - 7,000
Total Operated Stores	1,622
Licensed (4)	252	Various

(1) Devote on average 5,000 square feet to boutique areas for baby products.

(2) Devote 20,000 to 40,000 square feet to traditional toy products and 10,000 to 30,000 square feet to baby products.

(3) Devote 3,000 square feet to traditional toy products and includes our Babies “R” Us flagship store in Union Square, New York City.

(4) “R” Us branded retail stores. Licensing revenue did not have a material impact on Net sales.

Globally, our store portfolio includes smaller format Express stores located in shopping malls, outlet malls and other high traffic areas. During the 2015 holiday season, we operated 170 Express stores, of which 129 were still open as of January 30, 2016. Of the 129 Express stores that remained open, 73 have been included in our overall store count as they each have a cumulative lease term of at least two years (“Permanent Express”). The remaining 56 Express stores are considered temporary stores (“Temporary Express”). 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.

5

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: Toys “R” Us – Domestic (“Domestic”) and Toys “R” Us – International (“International”). Refer to 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 through 866 stores that operate in 49 states in the United States, Puerto Rico and Guam and through e-commerce. As of January 30, 2016, our Domestic stores consisted of 361 traditional toy stores, 224 baby stores, 213 SBS stores and 68 Permanent Express stores, as well as Temporary Express locations. Domestic Net sales were $7,356 million for fiscal 2015, which accounts for 62% of our consolidated Net sales.

• International — Our International segment sells a variety of products through 756 operated and 252 licensed stores in 38 countries and jurisdictions and through e-commerce. As of January 30, 2016, our International stores consisted of 534 traditional toy stores, 202 SBS stores, 15 baby stores and 5 Permanent Express stores, as well as Temporary Express locations. International Net sales were $4,446 million for fiscal 2015, which accounts for 38% 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, commodities, infant care products, apparel, 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;

• Entertainment — video game software, systems and accessories, tablets, portable 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, IMAGINARIUM, FAO SCHWARZ, KOALA BABY, AVIGO, FAST LANE, YOU & ME, JUST LIKE HOME, STATS, ANIMAL ALLEY, JOURNEY GIRLS, BRUIN, SIZZLIN’ COOL, TRUE HEROES, DREAM DAZZLERS and TOTALLY ME! 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. Our private label penetration rate was 13% of Net sales in fiscal 2015. 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 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.

6

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, has raised over $110 million since its inception and, together with the Company, contributes millions of dollars annually 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, Make-A-Wish America, Special Olympics and Save the Children, among others. 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 that provides assistance to employees affected by natural and personal disasters. The Geoffrey Fund relies on donations from employees to carry out its mission.

Market and Competition

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; 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. 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 products 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, strong in-stock positions, convenient locations, knowledgeable customer service and competitive pricing and shipping offers.

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 2015, 2014 and 2013, 41%, 40% and 42%, 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 revenue was $17 million for fiscals 2015 and 2014, respectively, and $16 million for fiscal 2013. 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.

7

Geographic Distribution of Domestic Stores

The following table sets forth the location of our Domestic stores as of January 30, 2016:

Location	Number of Stores
Alabama	9
Alaska	1
Arizona	16
Arkansas	5
California	109
Colorado	11
Connecticut	14
Delaware	3
Florida	58
Georgia	27
Hawaii	4
Idaho	2
Illinois	39
Indiana	17
Iowa	6
Kansas	6
Kentucky	10
Louisiana	9
Maine	3
Maryland	16
Massachusetts	23
Michigan	32
Minnesota	8
Mississippi	7
Missouri	16
Montana	1
Nebraska	3
Nevada	10
New Hampshire	7
New Jersey	43
New Mexico	3
New York	60
North Carolina	21
North Dakota	1
Ohio	39
Oklahoma	8
Oregon	10
Pennsylvania	44
Rhode Island	2
South Carolina	9
South Dakota	2
Tennessee	15
Texas	65
Utah	7
Vermont	1
Virginia	27
Washington	15
West Virginia	4
Wisconsin	12
Guam	1
Puerto Rico	5
Total (1)	866

(1) This includes 68 Permanent Express stores and excludes the remaining 31 Temporary Express locations which remained open as of January 30, 2016. During the 2015 holiday selling season, we operated 135 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 30, 2016:

Location	Number of Stores Operated
Australia	35
Austria	15
Brunei	1
Canada	82
China	99
France	48
Germany	66
Hong Kong	15
Japan	163
Malaysia	34
Poland	11
Portugal	9
Singapore	8
Spain	48
Switzerland	10
Taiwan	20
Thailand	11
United Kingdom	81
Total (1)	756

(1) This includes 5 Permanent Express stores and excludes the remaining 25 Temporary Express locations which remained open as of January 30, 2016. During the 2015 holiday selling season, we operated 35 Express stores internationally.

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The following table sets forth the location of our International licensed stores as of January 30, 2016:

Location	Number of Stores Licensed
Bahrain	1
Denmark	16
Egypt	4
Finland	7
Iceland	3
Ireland	2
Israel	26
Kuwait	2
Macau	2
Namibia	1
Norway	14
Oman	1
Philippines	27
Qatar	1
Saudi Arabia	14
South Africa	68
South Korea	35
Sweden	18
United Arab Emirates	9
Zambia	1
Total	252

Employees

As of January 30, 2016, we employed 62,000 full-time and part-time individuals worldwide, with 35,000 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 97,000 full-time and part-time employees worldwide during the 2015 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 manage overall inventory levels and distribution costs. In fiscal 2015, we opened a state-of-the-art distribution center in France which integrates our three previous fulfillment centers and serves as the headquarters office for Toys “R” Us, France. We believe that this facility creates greater operational efficiencies for our business, while allowing us to better serve our customers through our growing omnichannel capabilities in Europe.

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

We continuously seek to improve our global supply chain management, optimize our inventory assortment and upgrade our automated replenishment system to improve inventory turnover. In line with this strategy, we have 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.

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Our Vendors

We procure our merchandise from a wide variety of domestic and international vendors. In fiscal 2015, we had 3,500 active vendor relationships. For fiscal 2015, our top 20 vendors worldwide, based on our purchase volume in U.S. Dollar (“USD”), represented 46% of the total products we purchased.

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, among others 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. 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 significantly 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 2015, 2014 and 2013, 41%, 40% and 42%, 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, labor strikes, work stoppages, terrorist acts or disruptive global political events, prior to or during the holiday season, as described below.

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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, as well as Internet and catalog businesses, such as Amazon.com, national and regional chains and department stores and local retailers in the markets we serve. We also compete with national and local discount stores, consumer electronics retailers, supermarkets and warehouse clubs. 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, subscription or cloud play, which eliminates the need for a retailer. Furthermore, competitors’ subscription models for diapers, formula, and other commodities may 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.

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 30, 2016, we had outstanding borrowings of $80 million under our secured revolving credit facility (“ABL Facility”). As of January 30, 2016, we had unused availability under committed lines of credit of $1,089 million. For fiscal 2015, peak borrowings under all of our

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revolving credit facilities and credit lines were $1,025 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. A negative change in our credit ratings or our vendors’ perception of our creditworthiness, including due to pending debt maturities, may impact their willingness to provide trade credit 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.” In an effort to optimize our e-commerce operations and improve the customer experience online, we are currently developing an e-commerce platform which will allow us to manage and control all aspects of our e-commerce operations internally rather than through a third-party provider.

We continue to evaluate 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 changing consumer preferences and competitive and economic conditions. We continuously endeavor to minimize our operating expenses, without adversely affecting the customer experience or 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. 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.

Our ability to successfully relocate or 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.

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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 successfully transition to an internally developed Domestic e-commerce platform and 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.

We are currently in the process of developing a new internal e-commerce platform for our Domestic business which we expect to launch in fiscal 2016. We may be faced with significant unforeseen transition challenges including implementation delays, cost overruns, technology interruptions and disruption of our distribution channels, which could adversely affect our e-commerce platform. Any inability to successfully transition to, operate or maintain our internal platform or unforeseen transition operation challenges or disruptions may materially impact our sales, results of operations and financial condition and may materially adversely affect our ability to achieve future sales and profitability growth.

Additionally, 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 including our new internal e-commerce platform;

• 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.

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

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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 are 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 4%, 6% and 7% of our annual Net sales for fiscals 2015, 2014 and 2013, 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’ birth rates have dropped or stagnated 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 2015, we had 3,500 active vendor relationships through which we procure the merchandise that we offer to our customers. For fiscal 2015, our top 20 vendors worldwide, based on our purchase volume in USD, represented 46% 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 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, including 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.

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Our business operations could be disrupted if our information technology systems, including our new internal e-commerce platform, 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, including our new internal e-commerce platform, fail to perform as anticipated, or should we experience any delays or difficulties in transitioning to these or other new systems, or integrating these systems with our current systems, 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 and customers. 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 materially adversely affect our reputation with our customers and others, and thus affect our sales and profitability. In addition, a serious breach could negatively impact 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 adequately insure against or insurance may be costly.

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 30, 2016, we leased 1,313 of our properties from third-parties pursuant to long-term space and ground leases. Total rent expense, net of sublease income, was $546 million, $601 million and $609 million for fiscals 2015, 2014 and 2013, respectively, and is expected to be approximately $491 million for fiscal 2016. 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 64% 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 2015, 2014 and 2013, 38%, 39% and 39% of our Net sales, respectively, were generated outside the United States. In addition, as of January 30, 2016 and January 31, 2015, 32% and 33% 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 Asia and 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 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.

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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 2015, 2014 and 2013, 38%, 39% and 39% of our Net sales, respectively, were transacted in a currency other than the USD, the majority of which were denominated in yen, Euros, Canadian dollars and pounds. In fiscal 2015, our reported operating earnings would have decreased or increased $27 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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Labor shortages and increases in hourly wage rates could restrict our ability to operate our stores, grow our business or result in increased labor costs that could reduce our profits.

Our success depends in large part on our ability to attract, retain, train, manage and engage skilled employees. If we are unable to do so, our ability to adequately manage and staff our stores could be impaired, which could reduce customer satisfaction and sales. Staffing shortages also could hinder our ability to grow and expand our businesses. Payroll costs are a major component of the operating expenses at our stores. A shortage of skilled labor could require higher wages that would increase labor costs, which could adversely affect our profits. In addition, our hourly wage may increase as a result of market pressure and the minimum wage has increased or is scheduled to increase in multiple states and local jurisdictions and there is a possibility that Congress will increase the federal minimum wage. Increases in hourly wage rates could have a material adverse effect on our costs and profitability.

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 Affordable Care Act has impacted and will potentially impact our healthcare cost structure and may, over time, increase our employee healthcare related expenses. Provisions of this law have become effective and others will become effective at various dates over the next several years and we expect that there will be clarifications and continued guidance updates to many of the provisions. The law is relatively new and we continue to evaluate the potential additional impact the healthcare reform legislation will have on our business as additional provisions will become effective and 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 further 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.

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

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 utilize outsourcing arrangements for certain financial and other functions. By relying on third-party service providers we may come across unexpected obstacles that can disrupt our business operations.

We have outsourced certain financial and other functions to third-party service providers to achieve further operating efficiencies. Inadequate management or training of theses providers can lead to lack of proper skill sets to effectively manage and execute the applicable processes. In addition, we are at risk of data security, losing visibility and control of the applicable processes and potential language barriers. If we do not effectively manage outsourcing relationships, if third-party providers do not perform efficiently or in a timely manner, or if we experience problems with transitioning the work to a third party, we may experience disruptions in transaction processing or information technology services all of which can negatively impact our business processes, reputation and customers.

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.

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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. In February 2016, the Financial Accounting Standards Board (“FASB”) released new accounting rules, effective fiscal 2019, requiring companies to capitalize substantially all leases, including operating leases, in their financial statements. This change would require us to record a significant amount of lease related assets and liabilities on our balance sheet. These and other future changes to accounting rules or regulations may materially adversely affect our reported results of operations and financial position.

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 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.

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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 30, 2016, our total indebtedness was $4.7 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;

• 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. In addition, we and our subsidiaries may from time to time prepay, repurchase, refinance or otherwise acquire debt or debt securities issued by us or our subsidiaries in open market transactions, tender offers, exchange offers, privately negotiated transactions or otherwise. Such exchanges or refinancings may include the issuance or guarantee of debt by certain of our subsidiaries, and may be accompanied by transactions or asset transfers among certain of our subsidiaries. Any debt issued in such transactions may be issued or guaranteed by entities that are not obligors on the debt being refinanced, and may have liens on assets that are not pledged to secure the debt being refinanced.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.

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.

As of January 30, 2016, we had the following debt maturing within two years: $725 million of 8.500% senior secured notes at one of our property company entities and $450 million of 10.375% senior notes at the holding company entity. We believe we will have the ability to refinance, or repay a portion and refinance the balance of, these notes prior to their respective maturity dates; however, a number of factors including factors beyond our control could reduce or restrict our ability to refinance these debt obligations on favorable terms.

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 holders of

21

our debt could proceed against the issuers or guarantors of that debt, and the collateral granted to them to secure that debt, if any. Additionally, a failure to repay amounts when due under certain debt will likely constitute an event of default and entitle the holders of other debt to accelerate or otherwise proceed against the issuers or guarantors of such debt.

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 and refinance our indebtedness. Among other things, these covenants limit our ability to:

• incur certain additional indebtedness;

• transfer assets between and among 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, our secured lenders could proceed against the collateral granted to them to secure that indebtedness. If the lenders under the debt agreements accelerate the 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 30, 2016 (excluding licensed operations in our International segment):

	Owned	Ground Leased(1)	Leased (2)	Total	Total Gross Square Feet  (3) (In millions)
Stores:
Domestic	275	213	378	866	35
International	78	26	652	756	21
	353	239	1,030	1,622	56
Distribution Centers:
Domestic	7	—	1	8	7
International	5	—	5	10	4
	12	—	6	18	11
Total Operating Stores and Distribution Centers	365	239	1,036	1,640	67

(1) Owned buildings on leased land.

(2) This includes 68 and 5 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 31 and 25 Temporary Express store locations within our Domestic and International segments, respectively, which remained open as of January 30, 2016. During the fiscal 2015 holiday selling season, we operated 135 Domestic and 35 International Express stores.

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

Refer to 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 $12 million for fiscal 2015 and $10 million for fiscals 2014 and 2013, respectively.

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

As of January 30, 2016, we maintained 73 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 the majority 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. Refer to Note 2 to the Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

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 current and former employees and a private investor and there is no established public trading market for our Common Stock. As of March 1, 2016, there were approximately 300 holders of our Common Stock. During fiscals 2015, 2014 and 2013, no dividends were paid out to shareholders. Refer to 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 30, 2016			January 31, 2015			February 1, 2014			February 2, 2013		January 28, 2012
Statement of Operations Data:
Net sales	$	11,802		$	12,361		$	12,543		$	13,543	$	13,909
Net (loss) earnings (2)	(124		)	(288		)	(1,036		)	39		151
Net (loss) earnings attributable to Toys “R” Us, Inc. (2)	(130		)	(292		)	(1,039		)	38		149
Balance Sheet Data (end of period):
Working capital	$	490		$	355		$	704		$	1,171	$	708
Property and equipment, net	3,163			3,335			3,638			3,891		4,052
Total assets	6,968			7,115			7,549			8,921		8,842
Total debt (3)	4,743			4,788			5,019			5,343		5,170
Total (deficit) equity	(1,265		)	(1,095		)	(656		)	485		503
Store Count Data (end of period):
Domestic	866			872			873			875		876
International - Operated	756			730			704			665		626
Total Operated	1,622			1,602			1,577			1,540		1,502
International - Licensed	252			212			185			163		151
Non-GAAP Financial Measure:
Adjusted EBITDA (4)	$	800		$	642		$	583		$	1,019	$	1,054

(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. Refer to Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

(4) Adjusted EBITDA is defined as EBITDA (earnings (loss) before net interest expense (income), 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 other charges, 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.

A 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 30, 2016			January 31, 2015			February 1, 2014			February 2, 2013			January 28, 2012
Net (loss) earnings attributable to Toys “R” Us, Inc.	$	(130	)	$	(292	)	$	(1,039	)	$	38		$	149
Add:
Income tax expense (benefit)	76			32			169			53			(1		)
Interest expense, net	426			447			517			464			432
Depreciation and amortization	343			377			388			407			403
EBITDA	715			564			35			962			983
Adjustments:
Severance	24			17			13			3			7
Compensation expense (a)	24			22			3			2			1
Impairment of long-lived assets (b)	16			13			44			11			6
Certain transaction costs (c)	13			(2		)	1			5			7
Foreign currency re-measurement (d)	11			15			—			—			—
Store closure costs (e)	7			4			2			7			5
Sponsors’ management and advisory fees (f)	6			18			22			21			20
Net earnings attributable to noncontrolling interest (g)	6			4			3			1			2
Net gains on sales of properties (h)	(20		)	(5		)	(8		)	(4		)	(3		)
Litigation (i)	(1		)	(8		)	23			1			8
Property losses, net of insurance recoveries (j)	(1		)	(9		)	—			8			11
Goodwill impairment (k)	—			—			378			—			—
Obsolete inventory clearance (l)	—			9			51			—			—
Prior period adjustments (m)	—			—			16			—			—
Restructuring (n)	—			—			—			2			3
Acquisition costs (o)	—			—			—			—			4
Adjusted EBITDA	$	800		$	642		$	583		$	1,019		$	1,054

(a) Primarily represents the incremental compensation expense related to certain one-time awards and modifications (net of forfeitures of certain officers’ awards).

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(b) Asset impairments primarily due to the identification of underperforming stores, the relocation of certain stores and property sales. Refer to 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.

(c) Fiscal 2015 primarily represents expenses associated with the transition of our U.S. e-commerce operations and other transaction costs.

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

(e) Represents store closure costs, net of lease surrender income.

(f) Represents fees expensed to the Sponsors in accordance with the advisory agreement. In June 2015, the advisory agreement was amended in order to reduce the advisory fees payable in fiscal 2015 and thereafter from $17 million to $6 million annually. Refer to Note 16 to our Consolidated Financial Statements entitled “RELATED PARTY TRANSACTIONS” for further details.

(g) Represents noncontrolling interests in Asia JV.

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

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

(j) 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.

(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 the incremental expense related to the write-down of excess and obsolete inventory, as well as, third party fees associated with our clearance efforts.

(m) 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 e-commerce prior period sales.

(n) Represents additional charges related to our 2003 and 2005 restructuring activities primarily due to changes in management’s estimates for events such as lease terminations, assignments and sublease income adjustments.

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

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 notes, and contains forward-looking statements that involve risks and uncertainties. Refer to “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 2015 compared to fiscal 2014 and fiscal 2014 compared to fiscal 2013.

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

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

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RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTSprovides a brief description of significant accounting standards which were adopted during fiscal 2015. 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. Our Toys “R” Us and Babies “R” Us brands are 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 omnichannel offerings that leverage the synergies between our brick-and-mortar stores and e-commerce.

As of January 30, 2016, we operated 1,622 stores and licensed an additional 252 stores. These stores are located in 39 countries and jurisdictions around the world under the Toys “R” Us and Babies “R” Us banners. In addition, we operate smaller format Toys “R” Us Express stores (“Express stores”), some of which are open on a short-term basis during the holiday season. Our omnichannel experience incorporates our websites including Toysrus.com and Babiesrus.com, as well as other e-commerce sites in our international markets. For fiscal 2015, we generated Net sales of $11,802 million, resulting in Adjusted EBITDA of $800 million and Net loss attributable to Toys “R” Us, Inc. of $130 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., refer to Item 6 entitled “SELECTED FINANCIAL DATA” of this Annual Report on Form 10-K.

Our brand names are highly recognized in North America, Europe and Asia, and our expertise in the toy and baby products retail space, broad range of product offerings, substantial scale and geographic footprint and strong vendor relationships account for our market-leading position and distinguish us from the competition.

Every day we strive to improve the customer experience in our stores and online. This enables us to bring joy into the lives of our customers by being the toy and baby authority and definitive destination for kid fun, gift-giving solutions and parenting services. 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 team members to deepen their product knowledge and enhance their targeted selling skills in order to improve customer service.

Our Business Segments

Our business has two reportable segments: Domestic and International. Refer to 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 through 866 stores that operate in 49 states in the United States, Puerto Rico and Guam and through e-commerce. As of January 30, 2016, our Domestic stores consisted of 361 traditional toy stores, 224 baby stores, 213 SBS stores and 68 Permanent Express stores, as well as Temporary Express locations. Domestic Net sales were $7,356 million for fiscal 2015, which accounts for 62% of our consolidated Net sales.

• International — Our International segment sells a variety of products through 756 operated and 252 licensed stores in 38 countries and jurisdictions and through e-commerce. As of January 30, 2016, our International stores consisted of 534 traditional toy stores, 202 SBS stores, 15 baby stores and 5 Permanent Express stores, as well as Temporary Express locations. International Net sales were $4,446 million for fiscal 2015, which accounts for 38% 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 2015, 2014 and 2013:

	Fiscal Years Ended
($ In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Net sales	$	11,802		$	12,361		$	12,543
Same store sales	0.9		%	0.0		%	(4.4		)%
Gross margin	$	4,226		$	4,430		$	4,389
Gross margin as a percentage of Net sales	35.8		%	35.8		%	35.0		%
Selling, general and administrative expenses (“SG&A”)	$	3,593		$	3,915		$	4,010
SG&A as a percentage of Net sales	30.4		%	31.7		%	32.0		%
Net loss attributable to Toys “R” Us, Inc.	$	(130	)	$	(292	)	$	(1,039	)
Non-GAAP Financial Measure:
Adjusted EBITDA (1)	$	800		$	642		$	583

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

Fiscal 2015 financial highlights:

• Net sales decreased by $559 million compared to the prior year. Excluding a $571 million negative impact of foreign currency translation, Net sales increased by $12 million.

• Consolidated same store sales increased by 0.9 percentage points driven by growth in our International segment.

• Gross margin, as a percentage of Net sales, (“Gross margin rate”) remained consistent with the prior year.

• SG&A decreased by $322 million primarily due to a favorable impact from foreign currency translation and reductions in payroll, advertising and occupancy expenses.

• Net loss attributable to Toys “R” Us, Inc. improved by $162 million.

Same Store Sales

In computing same store sales, we include stores that have been open for at least 56 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 the computation of same store sales.

Our same store sales computation includes the following:

• stores that have been remodeled 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 e-commerce businesses.

By measuring the year-over-year sales of merchandise in the stores that have been open for 56 weeks or more and online, we can better gauge how the core store base and e-commerce business is performing since same store sales excludes the impact of store openings and closings, as well as foreign currency translation.

Various factors affect same store 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, terrorism and catastrophic events can affect same store sales because they may discourage travel or require temporary store closures, thereby reducing customer traffic. These factors have

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caused our same store sales to fluctuate significantly in the past on a monthly, quarterly and annual basis and, as a result, we expect that same store sales will continue to fluctuate in the future.

The changes in our same store sales by segment for fiscals 2013, 2014 and 2015 are as follows:

Percentage of Net Sales by Product Category

	Fiscal Years Ended
Domestic:	January 30, 2016		January 31, 2015		February 1, 2014
Baby	36.9	%	37.9	%	37.7	%
Core Toy	18.4	%	17.2	%	15.9	%
Entertainment	9.0	%	10.2	%	11.3	%
Learning	23.5	%	22.6	%	22.6	%
Seasonal	11.4	%	11.2	%	11.3	%
Other (1)	0.8	%	0.9	%	1.2	%
Total	100	%	100	%	100	%

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

	Fiscal Years Ended
International:	January 30, 2016		January 31, 2015		February 1, 2014
Baby	20.5	%	20.2	%	20.4	%
Core Toy	23.2	%	23.5	%	22.7	%
Entertainment	7.1	%	8.5	%	10.0	%
Learning	32.8	%	31.1	%	30.8	%
Seasonal	15.7	%	15.9	%	15.3	%
Other (1)	0.7	%	0.8	%	0.8	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues, including licensing revenue 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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Store Count by Segment

	Domestic		International		Total Operated
February 1, 2014	873		704		1,577
Opened	33		59		92
Closed	(34	)	(33	)	(67	)
January 31, 2015	872		730		1,602
Opened	15		49		64
Closed	(21	)	(23	)	(44	)
January 30, 2016	866		756		1,622

Store Type	Domestic		International		Toys “R” Us - Consolidated
	January 30, 2016	January 31, 2015	January 30, 2016 (1)	January 31, 2015	January 30, 2016	January 31, 2015
Traditional Toy	361	372	534	511	895	883
SBS	213	214	202	198	415	412
Baby	224	226	15	15	239	241
Permanent Express	68	60	5	6	73	66
Total Operated	866	872	756	730	1,622	1,602
Excluded from store count:
Licensed (2)	—	—	252	212	252	212
Temporary Express	31	32	25	17	56	49

(1) The net increase in International stores compared to the prior year is primarily due to 29 stores in China and Southeast Asia.

(2) The net increase in licensed stores from prior year is predominantly due to 22 stores in South Africa, four stores in the Philippines and three stores in South Korea.

Fiscal 2015 Compared to Fiscal 2014

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

(In millions)	Fiscal 2015			Fiscal 2014			Change
Toys “R” Us - Consolidated	$	(130	)	$	(292	)	$	162

Net loss attributable to Toys “R” Us, Inc. improved by $162 million to $130 million in fiscal 2015, compared to $292 million in fiscal 2014. The improvement was primarily due to a $322 million reduction in SG&A, partially offset by a $204 million decline in Gross margin, in each case due in large part to the impact from foreign currency translation.

Net Sales

										Percentage of Net sales
($ In millions)	Fiscal 2015		Fiscal 2014		$ Change			% Change		Fiscal 2015		Fiscal 2014
Domestic	$	7,356	$	7,524	$	(168	)	(2.2	)%	62.3	%	60.9	%
International	4,446		4,837		(391		)	(8.1	)%	37.7	%	39.1	%
Toys “R” Us - Consolidated	$	11,802	$	12,361	$	(559	)	(4.5	)%	100.0	%	100.0	%

Net sales decreased by $559 million or 4.5%, to $11,802 million in fiscal 2015, compared to $12,361 million in fiscal 2014. The impact of foreign currency translation decreased Net sales by $571 million in fiscal 2015.

Excluding the impact of foreign currency translation, the increase in Net sales for fiscal 2015 was predominantly due to an increase in International same store sales primarily driven by higher average transaction amounts and new locations within our

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International segment. Partially offsetting the increase was a decline in Net sales from Domestic store closures and a reduction in same store sales domestically, driven by a decrease in the number of transactions.

Domestic

Net sales for our Domestic segment decreased by $168 million or 2.2%, to $7,356 million in fiscal 2015. The decrease in Net sales was primarily a result of store closures and a decrease in same store sales of 0.6%.

The decrease in same store sales resulted primarily from declines in our entertainment and baby categories. The decrease in our entertainment category was predominantly due to portable electronics and video game software. The decline in our baby category was predominantly in commodities, which includes diapers, wipes, formula and baby food. Partially offsetting these decreases were increases in our core toy and learning categories. The increase in our core toy category was primarily due to collectibles. The increase in our learning category was mainly due to preschool toys.

International

Net sales for our International segment decreased by $391 million or 8.1%, to $4,446 million in fiscal 2015. Excluding a $571 milliondecrease due to foreign currency translation, International Net sales improved primarily as a result of an increase in same store sales of 3.2% and net sales from new locations.

The increase in same store sales resulted primarily from increases in our learning and baby categories. The increase in our learning category was mainly due to construction toys. The increase in our baby category was primarily due to baby gear and apparel. Partially offsetting these increases was a decline in our entertainment category primarily due to video game software and systems.

Gross Margin

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.

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.

								Percentage of Net sales
($ In millions)	Fiscal 2015		Fiscal 2014		$ Change			Fiscal 2015		Fiscal 2014		Change
Domestic	$	2,521	$	2,563	$	(42	)	34.3	%	34.1	%	0.2	%
International	1,705		1,867		(162		)	38.3	%	38.6	%	(0.3	)%
Toys “R” Us - Consolidated	$	4,226	$	4,430	$	(204	)	35.8	%	35.8	%	—	%

Gross margin decreased by $204 million to $4,226 million in fiscal 2015, compared to $4,430 million in fiscal 2014. Foreign currency translation decreased Gross margin by $215 million.

Gross margin rate remained consistent in fiscal 2015 compared to fiscal 2014, with an increase in our Domestic segment offset by a decrease in our International segment.

Domestic

Gross margin decreased by $42 million to $2,521 million in fiscal 2015. Gross margin rate increased by 0.2 percentage points in fiscal 2015 compared to fiscal 2014.

The increase in Gross margin rate resulted from sales mix away from lower margin products in our entertainment and baby categories, partially offset by an increase in shipping costs due to higher e-commerce sales volume.

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International

Gross margin decreased by $162 million to $1,705 million in fiscal 2015. Foreign currency translation decreased Gross margin by $215 million. Gross margin rate decreased0.3 percentage points in fiscal 2015 compared to fiscal 2014.

The decrease in Gross margin rate resulted primarily from increased cost of USD denominated inventory purchases, most notably in our core toy category. Partially offsetting the decrease were margin rate improvements predominantly in our baby category and sales mix away from lower margin products in our entertainment category.

Selling, General and Administrative Expenses

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

	Fiscal 2015		Fiscal 2014
Payroll and related benefits	44.4	%	44.7	%
Occupancy costs	30.4	%	30.0	%
Advertising and promotional expenses	9.1	%	9.7	%
Transaction fees (1)	3.8	%	3.1	%
Professional fees	3.2	%	3.4	%
Other (2)	9.1	%	9.1	%
Total	100	%	100	%

(1) Primarily consists of credit card fees, which includes income from the Visa and MasterCard settlement in fiscal 2014.

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

								Percentage of Net sales
($ In millions)	Fiscal 2015		Fiscal 2014		$ Change			Fiscal 2015		Fiscal 2014		Change
Toys “R” Us - Consolidated	$	3,593	$	3,915	$	(322	)	30.4	%	31.7	%	(1.3	)%

SG&A decreased by $322 million to $3,593 million in fiscal 2015, compared to $3,915 million in fiscal 2014. Foreign currency translation decreased SG&A by $174 million. As a percentage of Net sales, SG&A decreased by 1.3 percentage points.

Excluding the impact of foreign currency translation, SG&A decreased by $148 million primarily due to an $81 million decrease in payroll expenses, which includes a $57 million decline in store payroll expenses, and a $40 million decrease in advertising and promotional expenses. Additionally contributing to the decrease in SG&A was a $16 million decrease in occupancy costs, predominantly as a result of Domestic store closures.

Depreciation and Amortization

(In millions)	Fiscal 2015		Fiscal 2014		Change
Toys “R” Us - Consolidated	$	343	$	377	$	(34	)

Depreciation and amortization decreased by $34 million to $343 million in fiscal 2015, compared to $377 million in fiscal 2014. Foreign currency translation decreased Depreciation and amortization by $14 million. Excluding the impact of foreign currency translation, the decrease in Depreciation and amortization was primarily due to fully depreciated assets.

Other Income, Net

Other income, net includes the following:

• credit card program income;

• gift card breakage income;

• net gains on sales of properties;

• foreign exchange gains and losses;

• impairment of long-lived assets; and

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• other operating income and expenses.

(In millions)	Fiscal 2015		Fiscal 2014		Change
Toys “R” Us - Consolidated	$	88	$	53	$	35

Other income, net increased by $35 million to $88 million in fiscal 2015, compared to $53 million in fiscal 2014. Foreign currency translation increased Other income, net by $4 million. Excluding the impact of foreign currency translation, the increase in Other income, net was primarily due to a $15 million increase in net gains on sales of properties and a $12 million increase in credit card program income.

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

Interest Expense

(In millions)	Fiscal 2015		Fiscal 2014		Change
Toys “R” Us - Consolidated	$	429	$	451	$	(22	)

Interest expense decreased by $22 million to $429 million in fiscal 2015, compared to $451 million in fiscal 2014. The decrease in Interest expense was primarily due to $35 million of incremental expense recorded in the prior year, mainly composed of the write-off of unamortized deferred debt issuance costs and original issue discount related to the extinguishment of debt. Additionally contributing to the decrease was a $17 million reversal of deferred debt issuance costs as a result of a fiscal 2015 amendment to the advisory agreement which waived any previously accrued and unpaid transaction fees payable to our Sponsors in connection with prior refinancings. Refer to Note 16 within our Consolidated Financial Statements entitled “RELATED PARTY TRANSACTIONS” for further details. Partially offsetting these decreases were higher rates of interest on the Secured term B-4 loan facility due fiscal 2020 and the Tranche A-1 loan facility due fiscal 2019 as a result of the prior year refinancing.

Interest Income

(In millions)	Fiscal 2015		Fiscal 2014		Change
Toys “R” Us - Consolidated	$	3	$	4	$	(1	)

Interest income decreased by $1 million to $3 million in fiscal 2015, compared to $4 million in fiscal 2014.

Income Tax Expense

($ In millions)	Fiscal 2015			Fiscal 2014			Change
Toys “R” Us - Consolidated	$	76		$	32		$	44
Consolidated effective tax rate	(158.3		)%	(12.5		)%	(145.8		)%

The net increase in income tax expense of $44 million in fiscal 2015 compared to fiscal 2014 was principally due to a change in the mix and level of earnings between jurisdictions.

Our income tax expense in fiscal 2015 was unfavorably impacted by certain non-routine, discrete items, including a valuation allowance established in a foreign jurisdiction. 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 2015 income tax expense is a benefit associated with the release of a valuation allowance in another foreign jurisdiction.

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. Favorably impacting the fiscal 2014 income tax expense is a benefit associated with the reduction of uncertain tax benefits.

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

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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 to $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 same store sales primarily driven by an increase in the number of transactions. Partially offsetting the increase in Net sales was a decrease in Domestic same store 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 same store sales of 1.0%.

The decrease in same store 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 million decrease 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 same store sales of 1.8%.

The increase in same store 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.

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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 rate increased by 0.8 percentage points in fiscal 2014 compared to fiscal 2013. The increase in Gross margin rate 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 rate increased by 1.5 percentage points in fiscal 2014 compared to fiscal 2013.

The increase in Gross margin rate resulted primarily from overall margin improvements predominantly in our entertainment, baby 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 rate 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 fiscal 2013.

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

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

(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.

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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 fiscal 2013 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

(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.

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 fiscal 2013 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 at a lower rate of interest. Partially offsetting the decrease in Interest expense was the fiscal 2014 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.

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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.

LIQUIDITY AND CAPITAL RESOURCES

Overview

As of January 30, 2016, we were in compliance with all of the covenants related to our outstanding debt. At January 30, 2016, under the $1.85 billion secured revolving credit facility (“ABL Facility”), we had $80 million of outstanding borrowings, a total of $99 million of outstanding letters of credit and excess availability of $1,009 million. We are also subject to a minimum excess availability covenant of $125 million, with remaining availability of $884 million in excess of the covenant.

Toys “R” Us - Japan, Ltd. (“Toys-Japan”) has an agreement with a syndicate of financial institutions, which includes three unsecured loan commitment lines of credit (“Tranche 1A,” “Tranche 1B” and “Tranche 2”). On June 30, 2015, Toys-Japan entered into an agreement to refinance an unsecured loan commitment line of credit (“Tranche 1” due fiscal 2015) into Tranche 1A and Tranche 1B. Tranche 1A is available in amounts of up to ¥9.45 billion ($78 million at January 30, 2016). As of January 30, 2016, we had no outstanding borrowings under Tranche 1A, with $78 million of remaining availability. Tranche 1B is available in amounts of up to ¥2.0 billion ($17 million at January 30, 2016). As of January 30, 2016 we had no outstanding borrowings under Tranche 1B, with $17 million of remaining availability. Tranche 2 is available in amounts of up to ¥3.5 billion ($29 million at January 30, 2016). As of January 30, 2016, we had no outstanding borrowings under Tranche 2, with $29 million of remaining availability.

Additionally, on June 30, 2015, Toys-Japan amended an uncommitted line of credit reducing its availability from ¥1.5 billion to ¥1.0 billion. Toys-Japan has an additional uncommitted line of credit with total availability of ¥0.5 billion. At January 30, 2016, Toys-Japan had no outstanding borrowings under its uncommitted lines of credit, with a total of ¥1.5 billion ($12 million at January 30, 2016) of incremental availability.

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On December 18, 2015, certain of our foreign subsidiaries amended and restated the credit agreement for the European and Australian asset-based revolving credit facility (“European ABL Facility”) in order to extend the maturity date of the facility and amend certain other provisions. Our European ABL Facility provides for a five-year £138 million ($197 million at January 30, 2016) asset-based senior secured revolving credit facility which will expire on December 18, 2020. At January 30, 2016, we had no outstanding borrowings, with $81 million of remaining availability under the European ABL Facility.

Asia JV has several uncommitted unsecured lines of credit with various financial institutions with total availability of HK$221 million ($28 million at January 30, 2016). As of January 30, 2016, we had no outstanding borrowings and $4 million of bank guarantees issued under these facilities. The remaining availability under these facilities was $24 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 30, 2016, 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 December 2020 and our Toys-Japan unsecured credit lines with two tranches maturing June 2016 and a tranche maturing June 2017. In addition, Asia JV 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 third quarter of the year when inventory is purchased for the fourth quarter holiday selling season. For fiscal 2015, peak borrowings under our revolving credit facilities and credit lines amounted to $1,025 million, with total remaining availability of $876 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, a financial market disruption could have a negative impact on our ability to refinance our maturing debt and available resources in the future. Refer to Item 1A “Risk Factors—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.” and “—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.”

As of January 30, 2016, we had $1.3 billion of indebtedness maturing before the end of fiscal 2017, which primarily consisted of the following instruments:

• $450 million of 10.375% senior notes, due fiscal 2017

• $725 million of 8.500% senior secured notes, due fiscal 2017

We believe that we have the ability to address these upcoming maturities by refinancing the notes, a portion of which may be repaid using cash on hand; however market conditions could reduce or restrict our ability to refinance these notes on favorable terms. We are currently working with advisors to assist us in connection with potential debt refinancings. Our minimum projected obligations for fiscal 2016 and beyond are set forth below under “Contractual Obligations.”

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As of January 30, 2016, our consolidated Cash and cash equivalents balance was $680 million. Cash and cash equivalents at each respective legal entity may be subject to restrictions on transfer imposed by applicable law and debt covenant restrictions as well as seasonal working capital needs, which primarily represent the purchase of inventory and operating expenses. Our Cash and cash equivalents balance is typically highest during the fourth quarter, in conjunction with the holiday season. As of January 30, 2016, the balance consisted of the following:

(In millions)	January 30, 2016
Domestic
Toys “R” Us Property Company II, LLC (1)	$	91
Toys “R” Us Property Company I, LLC	85
Toys “R” Us, Inc. (the “Parent Company”)	1
Other (1)	38
Total Domestic	215
International
Europe	223
Japan	146
Other (1)	96
Total International	465
Consolidated Cash and cash equivalents	$	680

(1) Toys “R” Us - Delaware, Inc. had Cash and cash equivalents of $139 million, which includes Toys “R” Us Property Company II, LLC, the majority of Other Domestic and Toys-Canada, included within Other International.

Capital Expenditures

A component of our long-term strategy is our capital expenditure program. Our capital expenditures are primarily for enhancing our e-commerce and other information technology and logistics systems, as well as improving existing stores and construction of new stores. 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 2015		Fiscal 2014		Fiscal 2013
Information technology	$	83	$	79	$	58
Store improvements (1)	64		58		28
Distribution centers	28		31		16
New stores	17		32		73
Other store-related projects (2)	27		7		63
Total capital expenditures	$	219	$	207	$	238

(1) Includes expenditures related to the “Clean and Bright” initiative.

(2) Includes remodels and other store updates. Fiscal 2013 includes expenditures for SBS conversions as well as other baby integration remodels.

Cash Flows

(In millions)	Fiscal 2015			Fiscal 2014			Fiscal 2013
Net cash provided by operating activities	$	238		$	476		$	144
Net cash used in investing activities	(210		)	(193		)	(205		)
Net cash used in financing activities	(27		)	(191		)	(388		)
Effect of exchange rate changes on Cash and cash equivalents	(19		)	(38		)	(25		)
Net (decrease) increase during period in Cash and cash equivalents	$	(18	)	$	54		$	(474	)

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Cash Flows Provided by Operating Activities

Net cash provided by operating activities decreased to $238 million in fiscal 2015, compared to $476 million in fiscal 2014. The decrease was primarily due to an increase in vendor payments within our International segment in the first quarter of fiscal 2015 due to the timing of payments at the end of fiscal 2014. Additionally contributing to the decrease were increases in annual bonus payout and merchandise purchases in order to maintain stronger in-stock positions. These were partially offset by improved operating earnings.

Net cash provided by operating activities increased by $332 million to $476 million in fiscal 2014, compared to $144 million in fiscal 2013. The increase was primarily due to improved operating performance and a decrease in vendor payments due to timing.

Cash Flows Used in Investing Activities

Net cash used in investing activities increased by $17 million to $210 million in fiscal 2015, compared to $193 million in fiscal 2014, primarily due to a $12 million increase in capital expenditures and a $5 million decrease in proceeds received from sales of fixed assets.

Net cash used in investing activities decreased by $12 million to $193 million in fiscal 2014, compared to $205 million in fiscal 2013. The decrease was due to a $31 million reduction in capital expenditures, a change of $29 million in restricted cash primarily resulting from the fiscal 2013 incremental amount required to be held in conjunction with the terms of the UK Propco Facility Agreement and a fiscal 2013 purchase of $20 million in debt securities of Debussy DTC Plc (“Debussy”). The decrease was partially offset by a fiscal 2013 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 fiscal 2013.

Cash Flows Used in Financing Activities

Net cash used in financing activities decreased by $164 million to $27 million in fiscal 2015, compared to $191 million in fiscal 2014. The decrease was due to a $135 million decline in net debt repayments and a $29 million reduction in capitalized debt issuance costs predominantly as a result of a reduction in refinancing activity in the current year.

Net cash used in financing activities decreased by $197 million to $191 million in fiscal 2014, compared to $388 million in fiscal 2013. The decrease was primarily due to a $178 million decrease in net debt repayments compared to 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 $448 million as of January 30, 2016.

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. Additionally, a failure to repay amounts when due under certain debt will likely constitute an event of default and entitle the holders of other debt to accelerate or otherwise proceed against the issuers or guarantors of such debt. 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. We are currently in compliance with the covenants relating to our debt.

As of January 30, 2016, we had total indebtedness of $4.7 billion, of which $2.7 billion was secured indebtedness and $1.3 billion is due within two years. 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. Such refinancings may include the issuance or guarantee of debt by certain of our subsidiaries, and may be accompanied by transactions or asset transfers among certain of our subsidiaries. Any debt issued in such transactions may be issued or guaranteed by entities that are not obligors on the debt being refinanced, and may have liens on assets that are not pledged to secure the debt being refinanced.

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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. Refer to Item 1A “Risk Factors—Risks Related to Our Substantial Indebtedness.” 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 2015, the following events occurred with respect to our debt structure:

• On January 29, 2016, Toys-Japan entered into an additional bank loan with a syndicate of financial institutions for ¥4.1 billion ($34 million at January 30, 2016) which will mature on January 29, 2021.

• On December 18, 2015, certain of our foreign subsidiaries amended and restated the credit agreement for the European ABL Facility in order to extend the maturity date of the facility to December 18, 2020 and amend certain other provisions. The European ABL Facility, as amended, will continue to provide for a five-year £138 million ($197 million at January 30, 2016) asset-based senior secured revolving credit facility.

• On June 30, 2015, Toys-Japan entered into an agreement with a syndicate of financial institutions to refinance its Tranche 1 unsecured loan commitment line of credit into Tranche 1A and Tranche 1B. Tranche 1A is available in amounts up to ¥9.45 billion ($78 million at January 30, 2016) and expires on June 30, 2017. Tranche 1B is available in amounts up to ¥2.0 billion ($17 million at January 30, 2016) and expires on June 30, 2016.

We and our subsidiaries, as well as the Sponsors or their affiliates, may from time to time prepay, repurchase, refinance or otherwise 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 30, 2016, except as noted below:

	Payments Due By Period
(In millions)	Fiscal 2016		Fiscals 2017 & 2018		Fiscals 2019 & 2020		Fiscals 2021 and thereafter		Total
Operating leases (1)	$	505	$	822	$	578	$	952	$	2,857
Less: sub-leases to third parties	14		23		16		18		71
Net operating lease obligations	491		799		562		934		2,786
Capital leases and financing obligations	33		57		41		71		202
Short-term borrowings and long-term debt (2)	62		1,856		2,630		23		4,571
Interest payments (3)(4)	375		623		230		2		1,230
Purchase obligations (5)	1,212		—		—		—		1,212
Other (6)	144		156		53		32		385
Total contractual obligations (7)(8)	$	2,317	$	3,491	$	3,516	$	1,062	$	10,386

(1) Excluded from the minimum rental commitments displayed above are $1.4 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 2021 and thereafter.

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

(3) 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.

(4) 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 2015.

(5) 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 30, 2016.

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

(7) The above table does not reflect liabilities for uncertain tax positions of $30 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.

(8) The above table does not reflect the potential acquisition of Li & Fung’s 30% interest in Asia JV. 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 & Fung the option to require us to buy their 30% interest in the business beginning on April 30, 2017. Refer to 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 2015, 2014 and 2013:

(In millions)	Fiscal 2015		Fiscal 2014		Fiscal 2013
Real estate taxes	$	82	$	82	$	81
Maintenance and insurance	73		74		71
Contingent rent	12		10		10
Total	$	167	$	166	$	162

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 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.

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Merchandise Inventories

We value our merchandise inventories at the lower of cost or net realizable value, 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 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.

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 $68 million and $54 million as of January 30, 2016 and January 31, 2015, respectively. 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 2015.

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 2015, 2014 and 2013, we recorded $16 million, $13 million and $44 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

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

43

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 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.

In the fourth quarter of fiscal 2015, we performed a qualitative assessment for our Toys-China and Southeast Asia reporting unit and determined that it was more likely than not that the respective fair value substantially exceeded the carrying value and noted no goodwill impairment indicators. Upon completion of the qualitative assessment, it was determined that the goodwill associated with our Toys-China and Southeast Asia reporting unit of $64 million as of January 30, 2016, was not impaired. 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 $100 million and $99 million as of January 30, 2016 and January 31, 2015, 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 30, 2016.

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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 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

45

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.

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. Nine 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 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-17 “Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes” (“ASU 2015-17”). ASU 2015-17 simplifies the presentation of deferred taxes by requiring all deferred tax assets and liabilities to be classified as noncurrent on the balance sheet. Under the previous practice, the requirement was to separate deferred taxes into current and noncurrent amounts on the balance sheet. This ASU will align the presentation of deferred tax assets and liabilities with International Financial Reporting Standards (“IFRS”). ASU 2015-17 has no impact on the requirement to offset deferred tax assets and liabilities for each taxpaying component within a tax jurisdiction. The Company has early adopted the amendments in ASU 2015-17 as of January 30, 2016 on a prospective basis and prior periods have not been restated. Other than the revised balance sheet presentation of deferred income tax assets and liabilities, the adoption of ASU 2015-17 did not have an impact on our Consolidated Financial Statements.

In August 2015, the FASB issued ASU 2015-13 “Derivative and Hedging (Topic 815): Application of the Normal Purchase and Normal Sales Scope Exception to Certain Electricity Contracts within Nodal Energy Markets” (“ASU 2015-13). Current GAAP does not contain specific guidance about whether the use of locational marginal pricing by an independent system operator results in net settlement of a contract for the purchase or sale of electricity on a forward basis that necessitates transmission through, or delivery to a location within, a nodal energy market. ASU 2015-13 specifies that entities would not be precluded from applying the normal purchase and normal sales exception to derivative accounting to forward contracts for the physical delivery of electricity in nodal energy markets that result in parties incurring locational margin pricing charges or credits. The new guidance in ASU 2015-13 states that the use of locational marginal pricing by an independent system operator to determine a transmission charge or credit in a nodal energy market would not constitute a net settlement of a forward contract for the purchase or sale of electricity, even when legal title to the electricity is conveyed to the independent system operator during transmission. The Company has adopted the amendments in ASU 2015-13, effective August 10, 2015, as the amendments in the update are effective upon issuance. The adoption did not have an impact on our Consolidated Financial Statements.

In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory” (“ASU 2015-11”). ASU 2015-11 simplifies the subsequent measurement of inventory by requiring inventory to be measured at the lower of cost and net realizable value. The FASB defines net realizable value as the “estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.” Under previous guidance, an entity subsequently measures inventory at the lower of cost or market, with market defined as the replacement cost, net realizable value or net realizable value less a normal profit margin. An entity uses current replacement cost provided that it is not above net realizable value (i.e. the ceiling) or below net realizable value less an “approximately normal profit margin” (i.e. the floor). ASU 2015-11 eliminates this analysis for entities within the scope of the guidance. ASU 2015-11 applies to entities that recognize inventory within the scope of ASC 330, except for inventory measured under the LIFO method or the retail inventory method. The Company has early adopted the amendments in ASU 2015-11, effective May 3, 2015. The adoption did not have an impact on our Consolidated Financial Statements.

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In May 2015, the FASB issued ASU 2015-08, “'Business Combinations (Topic 805): Pushdown Accounting - Amendments to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115” (“ASU 2015-08”). The amendments in ASU 2015-08 amend various SEC paragraphs included in the FASB’s Accounting Standards Codification to reflect the issuance of Staff Accounting Bulletin No. 115 (“SAB 115”). SAB 115 rescinds portions of the interpretive guidance included in the SEC’s Staff Accounting Bulletins series and brings existing guidance into conformity with ASU No. 2014-17, “Business Combinations (Topic 805): Pushdown Accounting,” which 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 Company has adopted the amendments in ASU 2015-08, effective May 8, 2015, as the amendments in the update are effective upon issuance. The adoption did not have an impact on our Consolidated Financial Statements.

In May 2015, the FASB issued ASU 2015-07, “Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)” (“ASU 2015-07”). The amendments apply to reporting entities that elect to measure the fair value of an investment using the net asset value (“NAV”) per share (or its equivalent) practical expedient. The amendments remove the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the NAV per share practical expedient. The amendments also remove the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the NAV per share practical expedient. Rather, those disclosures are limited to investments for which the entity has elected to measure the fair value using that practical expedient. Entities should apply the amendments in this update retrospectively to all periods presented. The Company has early adopted ASU 2015-07, effective February 2, 2015. As the Company measures certain defined benefit plan assets using the NAV practicable expedient, upon adoption of ASU 2015-07, the fair value of these plan assets will be removed from the fair value hierarchy in all periods presented in the Company’s Consolidated Financial Statements. The Company will continue to disclose information on these investments for which fair value is measured at NAV as a practical expedient.

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 foreign currency exchange rates and market interest rates as of January 30, 2016.

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 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 2014 to fiscal 2015. 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 January 30, 2016.

• 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 to manage this exposure. As of January 30, 2016, we estimate that a 10% change in foreign currency exchange rates against the USD would impact our pre-tax earnings by $2 million with respect to our merchandise foreign exchange forward contracts. As of January 31, 2015, we did not have any outstanding foreign currency forward contracts.

• Our Toys-Canada subsidiary borrowed a portion of the Tranche A-1 Loan denominated in USD, which is subject to foreign exchange re-measurement. As of January 30, 2016, we estimate that a 10% change in the Canadian Dollar against the USD would impact our pre-tax earnings by $11 million.

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

47

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 30, 2016 and January 31, 2015, 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, respectively.

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. Certain of our variable rate debt instruments include interest rate floors, which limit the impact of potential market interest rate declines. 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 30, 2016, we had one interest rate contract which was designated for hedge accounting as a cash flow hedge. For designated cash flow hedges, the effective portion of the changes in the fair value of derivatives are recorded in Accumulated other comprehensive loss 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 30, 2016:

(In millions)	Impact of 1% Increase			Impact of 1% Decrease
Interest rate swaps/caps	$	—		$	—
Variable rate debt	(15		)	1
Total pre-tax income exposure to interest rate risk	$	(15	)	$	1

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 January 31, 2015, we estimated that a 1% hypothetical increase in interest rates could potentially have caused a $5 million decrease in our pre-tax earnings. A decrease in interest rates was estimated to have no significant impact on our pre-tax earnings. 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.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

	PAGE
Report of Independent Registered Public Accounting Firm	50
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)	104
Schedule I — Parent Company Condensed Financial Statements and Notes to the Condensed Financial Statements	105

49

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 sheet of Toys “R” Us, Inc. and subsidiaries as of January 30, 2016, and the related consolidated statement of operations, comprehensive loss, stockholders' (deficit) equity and cash flows for the year ended January 30, 2016. Our audit also included the financial statement schedule included in the Index at Item 15. These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule 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 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 audit provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Toys “R” Us, Inc. and subsidiaries at January 30, 2016, and the consolidated results of their operations and their cash flows for the year ended January 30, 2016, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Toys “R” Us, Inc.’s internal control over financial reporting as of January 30, 2016, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission(2013 framework)and our report dated March 24, 2016 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

New York, New York

March 24, 2016

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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 accompanying consolidated balance sheet of Toys “R” Us, Inc. and subsidiaries (the "Company") as of January 31, 2015, and the related consolidated statements of operations, comprehensive loss, stockholders' (deficit) equity, and cash flows for each of the two 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 the results of their operations and their cash flows for each of the two 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.

/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 30, 2016			January 31, 2015			February 1, 2014
Net sales	$	11,802		$	12,361		$	12,543
Cost of sales	7,576			7,931			8,154
Gross margin	4,226			4,430			4,389
Selling, general and administrative expenses	3,593			3,915			4,010
Depreciation and amortization	343			377			388
Goodwill impairment	—			—			378
Other income, net	(88		)	(53		)	(37		)
Total operating expenses	3,848			4,239			4,739
Operating earnings (loss)	378			191			(350		)
Interest expense	(429		)	(451		)	(524		)
Interest income	3			4			7
Loss before income taxes	(48		)	(256		)	(867		)
Income tax expense	76			32			169
Net loss	(124		)	(288		)	(1,036		)
Less: Net earnings attributable to noncontrolling interest	6			4			3
Net loss attributable to Toys “R” Us, Inc.	$	(130	)	$	(292	)	$	(1,039	)

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 30, 2016			January 31, 2015			February 1, 2014
Net loss	$	(124	)	$	(288	)	$	(1,036	)
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustments	(47		)	(128		)	(82		)
Unrealized gain on hedged transactions	1			1			1
Unrecognized actuarial gains (losses)	20			(33		)	—
Total other comprehensive loss, net of tax	(26		)	(160		)	(81		)
Comprehensive loss, net of tax	(150		)	(448		)	(1,117		)
Less: Comprehensive income attributable to noncontrolling interest	6			4			3
Comprehensive loss attributable to Toys “R” Us, Inc.	$	(156	)	$	(452	)	$	(1,120	)

See Notes to the Consolidated Financial Statements.

53

Toys “R” Us, Inc. and Subsidiaries

Consolidated Balance Sheets

(In millions - except share amounts)	January 30, 2016			January 31, 2015
ASSETS
Current Assets:
Cash and cash equivalents	$	680		$	698
Accounts and other receivables	225			225
Merchandise inventories	2,270			2,064
Current deferred tax assets	—			45
Prepaid expenses and other current assets	113			122
Total current assets	3,288			3,154
Property and equipment, net	3,163			3,335
Goodwill	64			64
Deferred tax assets	96			133
Restricted cash	52			53
Other assets	305			376
Total Assets	$	6,968		$	7,115
LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accounts payable	$	1,699		$	1,571
Accrued expenses and other current liabilities	994			1,032
Income taxes payable	32			20
Current portion of long-term debt	73			176
Total current liabilities	2,798			2,799
Long-term debt	4,670			4,612
Deferred tax liabilities	64			112
Deferred rent liabilities	345			347
Other non-current liabilities	245			255
Temporary Equity	111			85
Stockholders’ Deficit:
Common stock (par value $0.001 and $0.001; shares authorized 60,000,000 and 55,000,000; shares outstanding 49,347,672 and 49,195,396 at January 30, 2016 and January 31, 2015, respectively)	—			—
Treasury stock	—			(5		)
Additional paid-in capital	67			68
Accumulated deficit	(1,062		)	(914		)
Accumulated other comprehensive loss	(270		)	(244		)
Total Stockholders’ Deficit	(1,265		)	(1,095		)
Total Liabilities, Temporary Equity and Stockholders’ Deficit	$	6,968		$	7,115

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 30, 2016			January 31, 2015			February 1, 2014
Cash Flows from Operating Activities:
Net loss	$	(124	)	$	(288	)	$	(1,036	)
Adjustments to reconcile Net loss to Net cash provided by operating activities:
Depreciation and amortization	343			377			388
Amortization and write-off of debt issuance costs and debt discount (1)	28			59			73
Net gains on sales of properties	(20		)	(5		)	(8		)
Deferred income taxes	17			(1		)	133
Non-cash portion of asset impairments and other charges	20			20			49
Goodwill impairment	—			—			378
Proceeds from settlement of derivatives	—			9			—
Unrealized losses (gains) on foreign exchange	10			15			(1		)
Other	(1		)	23			16
Changes in operating assets and liabilities:
Accounts and other receivables	(2		)	(6		)	(1		)
Merchandise inventories	(256		)	(16		)	13
Prepaid expenses and other operating assets	18			14			21
Accounts payable, Accrued expenses and other liabilities	190			283			160
Income taxes payable, net	15			(8		)	(41		)
Net cash provided by operating activities	238			476			144
Cash Flows from Investing Activities:
Capital expenditures	(219		)	(207		)	(238		)
Increase in restricted cash	(2		)	(5		)	(34		)
Proceeds from sales of fixed assets	13			18			35
Acquisitions	(2		)	(1		)	—
Property insurance recovery	—			2			—
Purchases of debt securities	—			—			(20		)
Proceeds from redemption of debt securities	—			—			52
Net cash used in investing activities	(210		)	(193		)	(205		)
Cash Flows from Financing Activities:
Long-term debt borrowings	1,451			2,866			3,159
Long-term debt repayments	(1,472		)	(3,010		)	(3,491		)
Short-term debt borrowings, net	—			(12		)	(2		)
Capitalized debt issuance costs	(6		)	(35		)	(47		)
Other	—			—			(7		)
Net cash used in financing activities	(27		)	(191		)	(388		)
Effect of exchange rate changes on Cash and cash equivalents	(19		)	(38		)	(25		)
Cash and cash equivalents:
Net (decrease) increase during period	(18		)	54			(474		)
Cash and cash equivalents at beginning of period	698			644			1,118
Cash and cash equivalents at end of period	$	680		$	698		$	644
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	393		$	380		$	458
Net income tax payments	$	39		$	43		$	71
Non-Cash Operating Information:
Purchases of property and equipment included in Accounts payable, Accrued expenses and other current liabilities	$	56		$	42		$	24

(1) Fiscal 2013 includes $22 million of amortization and write-off of debt discount, which was previously presented within Other.

See Notes to the Consolidated Financial Statements.

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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			Total Stockholders’ (Deficit) Equity
(In millions)	Issued Shares	Treasury Amount
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	)
Net loss attributable to Toys “R” Us, Inc.	—	$	—		$	—		$	(130	)	$	—		$	(130	)
Total other comprehensive loss, net of tax	—	—			—			—			(26		)	(26		)
Issuance of restricted stock	—	5			(5		)	—			—			—
Stock compensation expense	—	—			4			—			—			4
Adjustment of noncontrolling interest to redemption value	—	—			—			(18		)	—			(18		)
Balance, January 30, 2016	49	$	—		$	67		$	(1,062	)	$	(270	)	$	(1,265	)

See Notes to the Consolidated Financial Statements.

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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 omnichannel offerings that leverage our brick-and-mortar stores and e-commerce. As of January 30, 2016, we operated 1,622 stores and licensed an additional 252 stores. These stores are located in 39 countries and jurisdictions around the world under the Toys “R” Us and Babies “R” Us banners. In addition, we operate smaller format Toys “R” Us Express stores (“Express stores”), some of which are open on a short-term basis during the holiday season. Our omnichannel experience incorporates our websites including Toysrus.com and Babiesrus.com, as well as other e-commerce sites in our international markets.

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 (“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 retail destination for children of all ages 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
2015	52	January 30, 2016
2014	52	January 31, 2015
2013	52	February 1, 2014

Basis of Presentation

The accompanying consolidated financial statements as of January 30, 2016 and January 31, 2015 and for each of the three year periods ended January 30, 2016, January 31, 2015 and February 1, 2014, have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). In November 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-17 “Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes” (“ASU 2015-17”). ASU 2015-17 simplifies the presentation of deferred taxes by requiring all deferred tax assets and liabilities to be classified as noncurrent on the balance sheet. Under the previous practice, the requirement was to separate deferred taxes into current and noncurrent amounts on the balance sheet. The Company early adopted the amendments in ASU 2015-17 as of January 30, 2016 on a prospective basis and therefore updated the balance sheet presentation in the current year. The prior period has not been restated.

Principles of Consolidation

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

Variable Interest Entities

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.

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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 30, 2016 and January 31, 2015, we had restricted cash of $52 million and $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 net realizable value, 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 30, 2016 and January 31, 2015, we had $67 million and $63 million, respectively, recorded for ARO.

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Goodwill

At January 30, 2016 and January 31, 2015 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. In the fourth quarter of fiscal 2014, we performed a quantitative assessment for our Toys-China and Southeast Asia reporting unit and it was determined that the goodwill was not impaired. 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 2015 annual impairment tests.

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.

In the fourth quarter of fiscal 2015, we performed a qualitative assessment for our Toys-China and Southeast Asia reporting unit and determined that it was more likely than not that the respective fair value substantially exceeded the carrying value and noted no goodwill impairment indicators.

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 30, 2016 and January 31, 2015 were $82 million and $139 million, respectively. Deferred financing fees amortized to Interest expense for fiscals 2015, 2014 and 2013 were $20 million, $48 million and $51 million, respectively, which is inclusive of accelerated amortization due to certain debt repayments and refinancings prior to maturity. During fiscal 2015, there was a reversal of $30 million of unamortized deferred debt issuance costs as a result of an amendment to the advisory agreement which waived any previously incurred transaction fees payable to our Sponsors in connection with prior refinancings. Refer to Note 16 within our Consolidated Financial Statements entitled “RELATED PARTY TRANSACTIONS” for further details.

Acquisition of Debt Securities

There were no acquisitions of debt securities during fiscal 2015 and fiscal 2014. 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 and business interruption, $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 30, 2016 and January 31, 2015, we had $100 million and $99 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.

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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 30, 2016 and January 31, 2015, accumulated depreciation related to capital leases for property and equipment was $25 million and $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 $354 million and $359 million at January 30, 2016 and January 31, 2015, respectively, of which $9 million and $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 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.

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• 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 30, 2016 and January 31, 2015.

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 $45 million, $43 million and $56 million for fiscals 2015, 2014 and 2013, respectively, are included in Net sales. Other revenues consist of warranty income, licensing revenue 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 revenue was $17 million for fiscals 2015 and 2014, respectively, and $16 million for fiscal 2013.

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 $9 million and $10 million at January 30, 2016 and January 31, 2015, 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 $326 million, $379 million and $433 million in fiscals 2015, 2014 and 2013, 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

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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 $37 million, $34 million and $31 million for fiscals 2015, 2014 and 2013, respectively.

Other Income, Net

Other income, net includes the following:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Credit card program income	$	48		$	36		$	33
Gift card breakage income	30			27			24
Net gains on sales of properties	20			5			8
Foreign currency transactions	(14		)	(19		)	(1		)
Impairment of long-lived assets	(16		)	(13		)	(44		)
Other (1)	20			17			17
Total	$	88		$	53		$	37

(1) Includes advertising income from our websites, layaway income 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. We also receive profit sharing revenue based on a percentage of outstanding customer credit card indebtedness. Bounty fees, royalties and profit sharing revenue are recognized when earned and realizable. In fiscal 2015, we received $8 million in profit sharing revenue after reaching the contractual milestone. During fiscals 2015, 2014 and 2013, we recognized credit card program income of $48 million, $36 million and $33 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 $30 million, $27 million and $24 million of gift card breakage income in fiscals 2015, 2014 and 2013, respectively.

Net Gains on Sales of Properties

Net gains on sales of properties were $20 million, $5 million and $8 million for fiscals 2015, 2014 and 2013, 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

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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 the carrying value of 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 2015, 2014 and 2013, we recorded total impairment losses of $16 million, $13 million and $44 million, respectively. These impairments were primarily due to the identification of underperforming stores, the relocation of certain stores and property sales.

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 Transactions

Unrealized and realized gains and losses resulting from foreign currency transactions related to operations are included in Other income, net. In fiscal 2015, we recorded foreign currency losses of $14 million, which included an unrealized loss on foreign exchange of $11 million related to the re-measurement 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. 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 Tranche A-1 Loan. For fiscal 2013, we recorded foreign exchange losses of $1 million. 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 operating 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 U.S. Dollar (“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 within the Consolidated Statements of Stockholders’ (Deficit) Equity.

Foreign Currency Transactions - Short-Term Intercompany Loans

Foreign currency transactions related to short-term, cross-currency intercompany loans, which we economically hedge, amounted to gains of $5 million, $9 million and $1 million for fiscals 2015, 2014 and 2013, respectively. Such amounts were included in Interest expense. The related foreign currency forward 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. For fiscal years 2015, 2014 and 2013, we recorded losses of $5 million, $9 million and $1 million, respectively. Refer to Note 3 entitled “DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” for further details.

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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 30, 2016 and January 31, 2015, we reported unrecognized tax benefits in 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 (“Asia JV”), 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, all these awards had vested and redemption was 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, 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
Net earnings attributable to noncontrolling interest	6
Adjustment of noncontrolling interest to redemption value	18
Capital contribution	2
Balance, January 30, 2016	$	111

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 30, 2016 and January 31, 2015 is outlined in the table below:

(In millions)	January 30, 2016		January 31, 2015
Short-term borrowings
Asia JV uncommitted lines of credit	$	—	$	—
Long-term debt
Spanish real estate credit facility, due fiscal 2015 (EURIBOR+6.00%) (1)	—		34
Toys-Japan unsecured credit lines, expire fiscals 2016-2017 (2)	—		—
10.375% senior notes, due fiscal 2017 (3)	448		448
8.500% senior secured notes, due fiscal 2017 (4)	722		721
French real estate credit facility, due fiscal 2018 (EURIBOR+4.50%)	50		53
Incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (5)	130		133
Second incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (5)	65		67
7.375% senior notes, due fiscal 2018 (3)	402		402
$1.85 billion secured revolving credit facility, expires fiscal 2019 (5)	80		—
Senior unsecured term loan facility, due fiscal 2019 (LIBOR+5.00%) (6)	923		965
Tranche A-1 loan facility, due fiscal 2019 (LIBOR+7.25%) (5)	273		272
Secured term B-4 loan facility, due fiscal 2020 (LIBOR+8.75%) (5)	1,002		1,010
UK real estate credit facility, due fiscal 2020 (6.85%)	375		396
European and Australian asset-based revolving credit facility, expires fiscal 2020 (7)	—		—
Toys-Japan 1.85%-2.18% loans, due fiscals 2016-2021 (8)	49		63
8.750% debentures, due fiscal 2021 (9)	22		22
Finance obligations associated with capital projects	183		189
Capital lease and other obligations	19		13
	4,743		4,788
Less: current portion	73		176
Total Long-term debt (10)	$	4,670	$	4,612

(1) On January 29, 2016, Toys “R” Us Iberia Real Estate S.L.U., using cash on hand, paid the €24 million final installment of its senior secured term loan facility (the “Spain Propco Facility Agreement.”)

(2) On June 30, 2015, Toys “R” Us - Japan, Ltd. (“Toys-Japan”) entered into an agreement to refinance its committed line of credit (“Tranche 1” due fiscal 2015) into Tranche 1A due fiscal 2017 (“Tranche 1A”) and Tranche 1B due fiscal 2016 (“Trance 1B”).

(3) 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.

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

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

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

(7) On December 18, 2015, certain of our foreign subsidiaries amended and restated the European and Australian asset-based revolving credit facility (the “European ABL Facility”) to extend the maturity date of the facility and amend certain other provisions.

(8) On January 29, 2016, Toys-Japan entered into an additional bank loan with an aggregate principal amount of ¥4.1 billion.

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

(10) 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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As of January 30, 2016, we had total indebtedness of $4.7 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 $448 million as of January 30, 2016. 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 30, 2016, we have funds available to finance our operations under our $1.85 billion secured revolving credit facility (“ABL Facility”) through March 2019, subject to an earlier springing maturity, our European ABL Facility through December 2020 and our Toys-Japan unsecured credit lines with two tranches maturing June 2016 and a tranche maturing June 2017. In addition, Asia JV and Toys-Japan have uncommitted lines of credit due on demand.

The annual maturities of our Long-term debt, including current portion, at January 30, 2016 are as follows:

(In millions)	Annual Maturities
2016	$	73
2017	1,215
2018	659
2019	1,280
2020	1,363
2021 and subsequent	183
Total	$	4,773

Asia JV uncommitted lines of credit, due on demand ($0 million at January 30, 2016)

Asia JV has several uncommitted unsecured lines of credit with various financial institutions with total availability of HK$221 million ($28 million at January 30, 2016). As of January 30, 2016, we had no borrowings and $4 million of bank guarantees issued under these facilities. The remaining availability under these facilities was $24 million.

Toys-Japan unsecured credit lines, expire fiscals 2016-2017 ($0 million at January 30, 2016)

Toys-Japan currently has an agreement with a syndicate of financial institutions, which includes three unsecured loan commitment lines of credit (Tranche 1A, Tranche 1B and “Tranche 2” due fiscal 2016).

On June 30, 2015, Toys-Japan entered into an agreement with a syndicate of financial institutions to refinance Tranche 1. As a result, Tranche 1 was refinanced into Tranche 1A and Tranche 1B. Tranche 1A is available in amounts of up to ¥9.45 billion ($78 million at January 30, 2016), expires on June 30, 2017 and bears an interest rate of Tokyo Interbank Offered Rate (“TIBOR”) plus 0.80% per annum. As of January 30, 2016 we had no outstanding borrowings under Tranche 1A, with $78 million of remaining availability. Tranche 1B is available in amounts of up to ¥2.0 billion ($17 million at January 30, 2016), expires on June 30, 2016 and bears an interest rate of TIBOR plus 0.80% per annum. As of January 30, 2016 we had no outstanding borrowings under Tranche 1B, with $17 million of remaining availability. In addition, a commitment fee accrues

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on any unused portion of Tranche 1A and Tranche 1B at a rate of 0.250% per annum. We paid fees of $2 million to refinance Tranche 1, of which $1 million is capitalized as deferred debt issuance costs and amortized over the term of the agreement.

Tranche 2 is available in amounts of up to ¥3.5 billion ($29 million at January 30, 2016), expires on June 30, 2016 and bears an interest rate of TIBOR plus 0.80% per annum. As of January 30, 2016, we had no outstanding borrowings under Tranche 2, with $29 million of remaining availability. Additionally, on June 30, 2015, Toys-Japan amended an uncommitted line of credit reducing its total availability from ¥1.5 billion to ¥1.0 billion ($8 million at January 30, 2016), which renews August 1 of each year unless otherwise canceled. The uncommitted line of credit continues to bear an interest rate of TIBOR plus 0.50%. As of January 30, 2016 we had no outstanding borrowings under the uncommitted line of credit.

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 accounting principles generally accepted in Japan (“JGAAP”), as defined in the credit agreements. The agreements also restrict Toys-Japan from paying dividends or making loans to affiliates without lender consent.

Toys-Japan has an additional uncommitted line of credit with total availability of ¥0.5 billion ($4 million at January 30, 2016). As of January 30, 2016, we had no outstanding borrowings under the uncommitted line of credit.

$1.85 billion secured revolving credit facility, expires fiscal 2019 ($80 million at January 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 provides 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.

At January 30, 2016, under our ABL Facility, we had $80 million of outstanding borrowings, a total of $99 million of outstanding letters of credit and excess availability of $1,009 million. We are also subject to a minimum excess availability covenant of $125 million, with remaining availability of $884 million in excess of the covenant at January 30, 2016. Deferred debt issuance costs for this credit facility were $19 million and $38 million as of January 30, 2016 and January 31, 2015, 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 $1,026 million due fiscal 2020 (“Secured Term B-4 Loan”) and $280 million due fiscal 2019 (“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).

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European and Australian asset-based revolving credit facility, expires fiscal 2020 ($0 million at January 30, 2016)

On December 18, 2015, certain of our foreign subsidiaries amended and restated the credit agreement for the European ABL Facility in order to extend the maturity date of the facility and amend certain other provisions. The European ABL Facility, as amended, provides for a five-year £138 million ($197 million at January 30, 2016) asset-based senior secured revolving credit facility which will expire on December 18, 2020. Loans under the European ABL Facility as amended bear interest at a rate of LIBOR or Euro Interbank Offered Rate (“EURIBOR”) plus a margin of 2.50% through the first fiscal quarter of 2016 and thereafter 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. In connection with the amended and restated credit agreement, we incurred transaction fees of $4 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 amendment, unamortized debt issuance costs were less than$1 millionand the remaining amount will be amortized over the term of the amended and restated credit agreement.

At January 30, 2016, under our European ABL Facility, we had no outstanding borrowings, with $81 million of remaining availability under the European ABL Facility. Deferred debt issuance costs for this credit facility were $4 million and $2 million as of January 30, 2016 and January 31, 2015, 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 our foreign subsidiaries organized in Australia, England, Wales and France. The terms of the European ABL Facility include a customary cash dominion trigger requiring the cash of certain of our foreign 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 TRU Europe Limited, TRU Iberia Holdings 1, S.L.U., TRU Australia Holdings, LLC (collectively, the “Parent Guarantors”) 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 the Parent Guarantors and the UK, Wales 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 the Parent Guarantors 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.

10.375% senior notes, due fiscal 2017 ($448 million at January 30, 2016)

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. Deferred debt issuance costs for these notes were $5 million and $8 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The indenture governing the 2017 Notes contain covenants that, among other things, restrict the ability of the Parent 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 30, 2016, 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 30, 2016, the 2017 Notes were not “investment grade.” In addition, the indenture contains customary terms and covenants, including certain events of default upon which the 2017 Notes may be due and payable immediately.

The 2017 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, we will be required to make an offer to repurchase all of the 2017 Notes at a

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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 ($722 million at January 30, 2016)

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. Deferred debt issuance costs for these notes were $7 million and $10 million as of January 30, 2016 and January 31, 2015, 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 ($50 million at January 30, 2016)

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 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this credit facility were $1 million and $2 million as of January 30, 2016 and January 31, 2015, 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 30, 2016)

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

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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 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Senior unsecured term loan facility, due fiscal 2019 ($923 million at January 30, 2016)

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 $16 million and $17 million of the Propco I Term Loan Facility as of January 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this loan were $12 million and $23 million as of January 30, 2016 and January 31, 2015, 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 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”). As a result, TRU Propco I made a prepayment of $25 million on May 11, 2015. 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 a result, on August 28, 2015, TRU Propco I made a prepayment of $16 million. As of January 30, 2016, an aggregate amount of $38 million has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 30, 2016. Propco I may optionally prepay the outstanding principal balance of the loan at any time.

The Propco I Term Loan Facility contains certain 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 to 1.0 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 ($273 million at January 30, 2016)

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. Deferred debt issuance costs for this loan were $2 million and $7 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheet.

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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%).

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 ($130 million at January 30, 2016)

Second incremental secured term loan, due fiscal 2018 ($65 million at January 30, 2016)

Secured term B-4 loan facility, due fiscal 2020 ($1,002 million at January 30, 2016)

On October 24, 2014, Toys-Delaware amended the credit agreement for our secured term loan facilities (“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.  KKR owned an aggregate of $2 million and $96 million of the Secured Term B-4 Loan as of January 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this loan were $16 million and $26 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

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 2018 (“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 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 30, 2016. 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

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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 of the Incremental Secured Term Loan as of January 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this loan were $1 million as of January 30, 2016 and January 31, 2015, 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 30, 2016. 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 of the Second Incremental Secured Term Loan as of January 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this loan was $1 million as of January 30, 2016 and January 31, 2015, 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 30, 2016. 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. The October 24, 2014 amendment to the agreement waived the excess cash flow provision that would have applied to fiscal 2014 and no repayment was therefore required during fiscal 2015. We do not believe we will need to make a payment for fiscal 2015 excess cash flows in fiscal 2016. 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.

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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 ($375 million at January 30, 2016)

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. 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 ($19 million and $20 million as of January 30, 2016 and January 31, 2015, respectively) 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. The fair value of the Company’s investment in these notes at January 30, 2016 and January 31, 2015 was $19 million and $20 million, respectively. 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 $11 million and $16 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Toys-Japan bank loans (1.85% to 2.18%), due fiscals 2016-2021 ($49 million at January 30, 2016)

Toys-Japan had four bank loans with various financial institutions totaling $49 million at January 30, 2016. 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 30, 2016). As of January 30, 2016, the outstanding balance of this loan was ¥80 million or $1 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 30, 2016). As of January 30, 2016, the outstanding balance of this loan was ¥0.4 billion or $3 million. On January 29, 2016, Toys-Japan entered into a bank loan with a syndicate of financial institutions for ¥4.1 billion. The loan will mature on January 29, 2021 and bears an interest rate of TIBOR plus 1% per annum. Toys-Japan is required to make semi-annual principal payments of ¥410 million ($3 million at January 30, 2016). As of January 30, 2016 the outstanding balance of this loan was ¥4.1 billion or $34 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 30, 2016). As of January 30, 2016, the outstanding balance of this loan was ¥1.4 billion or $11 million. For these

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loans, the semi-annual principal payments due within one year totaling $7 million are classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 30, 2016. Deferred debt issuance costs for these loans were $1 million and less than $1 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets. In addition, during fiscal 2015, one of the previously outstanding loans matured, and contemporaneous with the maturity, the associated interest rate swap expired.

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 30, 2016)

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 30, 2016 and January 31, 2015, 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 30, 2016, we had one interest rate cap which is designated as a cash flow hedge 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; 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 2015, 2014 and 2013, respectively. Reclassifications from Accumulated other comprehensive loss to Interest expense primarily relate to realized Interest expense on interest rate swaps and caps and the amortization of gains recorded on de-designated caps. We expect to reclassify a net loss of less than $1 million in fiscal 2016 to Interest expense from Accumulated other comprehensive loss.

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 2015, we held no interest rate contracts which were designated for fair value hedging. 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. In conjunction with the de-designation of the fair value hedge, 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 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

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million of accrued interest receivable. We recorded net gains of less than $1 million in earnings related to ineffectiveness for fiscal 2013.

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 30, 2016 and January 31, 2015, there were no interest rate derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 30, 2016 and January 31, 2015, we were not required to post collateral for any of these derivatives.

The following table presents our outstanding interest rate contracts as of January 30, 2016 and January 31, 2015:

			January 30, 2016		January 31, 2015
(In millions)	Effective Date	Maturity Date	Notional Amount		Notional Amount
Interest Rate Swaps
6 Month JPY TIBOR Float to Fixed Interest Rate Swap (1)	January 2011	January 2016	$	—	$	42
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (1)	January 2011	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap	January 2011	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap (2)	January 2012	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap	January 2012	April 2015	—		500
3 Month EURIBOR Interest Rate Cap (1)	January 2013	January 2016	—		34
3 Month EURIBOR Interest Rate Cap (1)	February 2013	February 2018	50		53
1 Month USD LIBOR Interest Rate Cap	January 2014	April 2015	—		311

(1) These derivatives were designated for hedge accounting.

(2) The Company de-designated a portion of this interest rate cap in fiscal 2010. Prior to its April 2015 maturity, 40% of the $500 million interest rate cap was 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. As of January 30, 2016, there were no foreign exchange derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 31, 2015, derivative liabilities related to agreements that contain credit-risk related contingent features had a fair value of $2 million. We were not required to post collateral for any of these derivative contracts.

The following table presents our outstanding foreign exchange contracts as of January 30, 2016 and January 31, 2015:

			January 30, 2016		January 31, 2015
(In millions)	Effective Date	Maturity Date	Notional  Amount		Notional  Amount
Foreign-Exchange Forwards
Short-term cross-currency intercompany loans	Varies	Varies	$	128	$	98
Merchandise purchases	Varies	Varies	18		—

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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 on our Consolidated Statements of Stockholders’ (Deficit) Equity for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015			February 1, 2014
Derivatives designated as cash flow hedges:
Beginning balance	$	—	$	(1	)	$	(2	)
Change in fair value recognized in Accumulated other comprehensive loss - Interest Rate Contracts	—		—			—
Reclassifications from Accumulated other comprehensive loss - Interest Rate Contracts	1		1			1
Ending balance	$	1	$	—		$	(1	)

The following table sets forth the impact of derivatives on Interest expense on our Consolidated Statements of Operations for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Derivatives not designated for hedge accounting:
Loss on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	$	(5	)	$	(9	)	$	(1	)
Loss on the change in fair value - Interest Rate Contracts	—			(2		)	—
Gain on the change in fair value - Merchandise Purchases Program Foreign Exchange Contracts	9			9			2
	4			(2		)	1
Derivatives designated as cash flow hedges:
Amortization of hedged caps	(1		)	(2		)	(1		)
	(1		)	(2		)	(1		)
Derivative designated as a fair value hedge:
Amortization of swap basis adjustment - Interest Rate Contract	—			—			(1		)
Loss on the change in fair value - Interest Rate Contract	—			(2		)	(5		)
Gain recognized in Interest expense on hedged item	—			2			5
	—			—			(1		)
Total Interest expense	$	3		$	(4	)	$	(1	)

(1) 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 30, 2016 and January 31, 2015:

	January 30, 2016				January 31, 2015
(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	$	—	$	—	$	734	$	—
Other assets	50		—		53		—
Accrued expenses and other current liabilities	—		—		42		—
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	—		—		1,611		—
Foreign Currency Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	53		1		8		—
Accrued expenses and other current liabilities	93		—		90		(2		)
Total derivative contracts outstanding:
Prepaid expenses and other current assets	53		1		2,353		—
Other assets	50		—		53		—
Total derivative assets (1)	103		1		2,406		—
Accrued expenses and other current liabilities	93		—		132		(2		)
Total derivative liabilities (1)	$	93	$	—	$	132	$	(2	)

(1) Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the classification of our derivative instruments 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. There was no aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets as of January 30, 2016. The aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets was nominal as of January 31, 2015. The aggregate gross fair value of derivative assets which could be net settled against our derivative liabilities was nominal as of January 30, 2016 and January 31, 2015, respectively. As of January 30, 2016 and January 31, 2015, 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.

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

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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 30, 2016 and January 31, 2015, aggregated by level in the fair value hierarchy within which those measurements fall.

Fiscal 2015

(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	$	—	$	—	$	—	$	—
Foreign exchange contracts	—		1		—		1
Total assets	$	—	$	1	$	—	$	1

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

For the fiscal years ended January 30, 2016 and January 31, 2015, 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. Impairment of long-lived assets is included in Other income, net on our Consolidated Statements of Operations.

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

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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.

There have been no changes in valuation technique or related inputs for long-lived assets for the fiscal years ended January 30, 2016 and January 31, 2015. The table below presents our long-lived assets evaluated for impairment and measured at fair value on a nonrecurring basis for the fiscal years ended January 30, 2016 and January 31, 2015, 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 30, 2016 and January 31, 2015. As of January 30, 2016 and January 31, 2015, we did not have any long-lived assets classified as Level 1 or Level 2 within the fair value hierarchy, respectively.

Fiscal 2015

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3)		Impairment Losses (1)
Long-lived assets held and used	$	11	$	4	$	7
Long-lived assets held for sale	25		16		9
Total	$	36	$	20	$	16

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

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

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 30, 2016 and January 31, 2015. The table below presents the carrying values and fair values of our Long-term debt including current portion as of January 30, 2016 and January 31, 2015, 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 30, 2016	$	4,743	$	4,107	$	1,309	$	2,037	$	761
January 31, 2015	4,788		4,416		1,346		2,315		755

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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 30, 2016		January 31, 2015
Land		$	676	$	695
Buildings	45-50	1,932		1,967
Furniture and equipment	3-20	1,472		1,639
Property and leasehold improvements	5-25	2,493		2,500
Costs of computer software	5	224		210
Construction in progress		71		32
Leased equipment under capital lease	3-5	32		51
		6,900		7,094
Less: accumulated depreciation and amortization		3,721		3,759
		3,179		3,335
Less: net assets held for sale		16		—
Total		$	3,163	$	3,335

Assets held for sale

Assets held for sale represent assets owned by us that we have committed to sell. In fiscal 2015, we entered into a contract to sell surplus real estate property. The sale is contingent upon the buyer obtaining municipal approval to re-zone the property and may extend the period required to complete the sale beyond one year. As a result, the asset has been classified as non-current and included in Other assets on our Consolidated Balance Sheet. As of January 31, 2015, there were no assets held for sale. The following assets were classified as held for sale as of January 30, 2016:

(In millions)	January 30, 2016
Land	$	25
Less: accumulated impairment	9
Net assets held for sale	$	16

Net gains on sales of properties

During fiscals 2015, 2014 and 2013, we sold certain properties and assets for cash proceeds of $13 million, $18 million and $35 million, respectively, resulting in net gains of $20 million, $5 million and $8 million, respectively, which were recorded in Other income, net on our Consolidated Statements of Operations.

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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 30, 2016 and January 31, 2015 is outlined in the table below:

(In millions)	January 30, 2016		January 31, 2015
Merchandise accounts payable (1)	$	1,488	$	1,373
Non-merchandise accounts payable (2)	211		198
Accounts payable	$	1,699	$	1,571
Gift card and certificate liability	$	222	$	205
Accrued bonus	109		110
Sales and use tax and value added tax payable	87		84
Accrued interest	63		55
Accrued property taxes	48		52
Accrued payroll	41		42
Accrued vacation	29		44
Accrued sponsor transaction fees (3)	—		47
Other (4)	395		393
Accrued expenses and other current liabilities	$	994	$	1,032

(1) Includes $44 million and $36 million of book overdraft cash as of January 30, 2016 and January 31, 2015, respectively.

(2) Includes $90 million and $84 million of book overdraft cash as of January 30, 2016 and January 31, 2015, respectively.

(3) January 31, 2015 includes fees payable to the Sponsors as a result of certain financing transactions. In December 2015, the Company’s Advisory Agreement was amended to waive all Transaction Fees including any prior accrued and unpaid transaction fees. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

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

NOTE 7 — STOCK-BASED COMPENSATION

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. 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 stockholders of the Company. 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.

On May 31, 2015, the Board of Directors adopted amendments to the 2010 Incentive Plan and Amended and Restated Certificate of Incorporation, which were adopted by the stockholders of the Company on June 1, 2015. Amendment No. 3 to the 2010 Incentive Plan increased the number of shares available thereunder by 3,000,000 shares and Amendment No. 1 to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of Common Stock by 5,000,000 shares.

All outstanding options issued under the 2010 Incentive Plan are scheduled to expire on dates ranging from August 6, 2017 to October 16, 2025. We expect to satisfy future option exercises by issuing shares held in treasury or authorized but unissued new shares.

Subsequent Event

On March 9, 2016, the Board of Directors of the Company adopted amendments to the 2010 Incentive Plan and the Amended and Restated Certificate of Incorporation, as amended, which were adopted by the stockholders of the Company on March 22,

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2016. The amendment to the Company’s 2010 Incentive Plan increased the number of shares of the Company’s common stock available thereunder by 1,000,000 shares and the amendment to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of the Company’s common stock by 5,000,000 shares.

Stock options

In fiscals 2015, 2014 and 2013, 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 2015, except for those granted to David A. Brandon, Chairman of the Board and Chief Executive Officer, and those granted under the Award Exchange described below, 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. 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. Options granted in fiscal 2013, 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. These awards are subject to the participants continued employment with us and will vest automatically upon change of control of the Company.

Additionally, certain options issued in fiscals 2015 and 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 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 fiscals 2015 and 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 fiscal 2013, concurrent with the grant of options, additional awards were granted under the 2010 Incentive Plan consisting of service-based restricted stock units, which were valued at a fair market value on the date of grant of $30.00 per share. 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 vested 100% on the second anniversary of the award, subject to the participant’s continued employment with the Company, and were scheduled to vest automatically upon a change in control of the Company.

In September 2014, the Company accelerated the vesting of certain restricted share units and restricted share awards issued under the 2010 Incentive Plan. 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.

Certain of the awards have provided holders with rights to put shares to the Company in certain circumstances. The Company currently 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 fiscal 2014, in accordance with ASC 718 and ASC 480, the shares were reclassified from temporary equity to permanent equity as redemption of these equity awards was no longer considered probable or redeemable at the option of the holder.

Award 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.

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In September 2014, certain participants were offered an opportunity to exchange their outstanding stock options that were granted prior to fiscal 2014 (“2014 Old Options”) under the Toys “R” Us, Inc. 2005 Management Equity Plan or the 2010 Incentive Plan for new stock options granted under the 2010 Incentive Plan (“2014 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 2014 Old Options canceled and an equal amount of 2014 New Options issued under the 2010 Incentive Plan. The 2014 New Options have an exercise price of $8.00 and vest as follows: (i) 2014 New Options granted in exchange for 2014 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) 2014 New Options granted in exchange for 2014 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 less than $1 million and $2 million in fiscals 2015 and 2014, respectively, which were recorded in SG&A.

In June 2015, certain participants under the 2010 Incentive Plan were offered an opportunity to exchange their unvested outstanding restricted stock units granted May 24, 2013 (“RSUs”) for a grant of two new stock options (“2015 New Options”) for every one RSU canceled. The 2015 New Options have an exercise price of $8.00. On July 31, 2015, the Company closed its offer with a total of 64,381 RSUs canceled and a total of 128,762 2015 New Options issued under the 2010 Incentive Plan. The 2015 New Options have a grant date of August 3, 2015 and vest 50% on each of May 24, 2016 and May 24, 2017, subject to the participant’s continued employment with the Company, and will vest automatically upon change of control of the Company. These options expire ten years from the date of grant, subject to the earlier expiration in accordance with the 2015 New Option award agreement. We accounted for the modification in accordance with ASC Topic 718, “Compensation – Stock Compensation”. Management has concluded that the modification had no impact on compensation costs.

2015 One-time awards

On June 1, 2015, the Company entered into an employment agreement with David A. Brandon to serve as Chairman of the Board and Chief Executive Officer. The employment agreement provided a one-time award of stock options under the 2010 Incentive Plan subject to time and performance based vesting conditions, which had a grant date of July 1, 2015. The award will vest ratably over forty-eight months commencing on the first month anniversary of the grant date and will only be deemed fully vested when the performance based obligations pursuant to Mr. Brandon’s employment agreement are satisfied. The one-time award has a grant date fair value of $9 million, at $8.00 per share.

Valuation Assumptions

The fair value of each option award modified or granted under the 2010 Incentive 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 30, 2016		January 31, 2015		February 1, 2014
Volatility	45.0	%	45.0	%	40.0%-45.0%
Risk-free interest rate	2.0% - 2.4%		1.4%-2.4%		2.0%-2.7%
Expected term	4.0 years		4.0-5.5 years		3.8-5.2 years
Dividend Yield	—		—		—
Weighted-average grant-date fair value per option:	$3.05		$2.55		$9.67

For fiscals 2015, 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.

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Options

A summary of option activity under the 2010 Incentive Plan and Management Equity Plan during fiscals 2015, 2014 and 2013 is presented below:

	Fiscal Years Ended
	January 30, 2016				January 31, 2015				February 1, 2014
	Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price
Outstanding at beginning of fiscal year	3,922,371		$	8.23	2,661,025		$	29.40	3,483,283		$	36.02
Granted	3,245,012		8.00		3,901,217		8.00		1,587,057		25.25
Exercised	—		—		—		—		(1,057,773	)	26.37
Forfeited/Canceled	(1,127,521	)	8.00		(2,639,871	)	29.23		(1,351,542	)	43.97
Outstanding at end of fiscal year	6,039,862		$	8.15	3,922,371		$	8.23	2,661,025		$	29.40

	Options	Weighted-average Exercise Price		Weighted-average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Options vested or expected to vest at January 30, 2016	6,014,672	$	8.00	8.5	$	—
Options exercisable at January 30, 2016	—	$	—	—	$	—

There were no options exercised in fiscals 2015 and 2014. The aggregate intrinsic value of options exercised, which includes options exercised on a net settlement basis, was $4 million in fiscal 2013. The total fair value of options vested was $2 million, $2 million and $19 million in fiscals 2015, 2014 and 2013, respectively. We received no proceeds from the exercise of options in fiscals 2015, 2014 and 2013. We did not cash settle share-based liability awards in fiscals 2015 and 2014. We paid $2 million in fiscal 2013 to cash settle share-based liability awards. We paid less than $1 million and $8 million in fiscals 2015 and 2013, respectively, to repurchase shares. We did not repurchase shares in fiscal 2014.

As of January 30, 2016, there was $10 million of total unrecognized compensation cost related to option share-based compensation arrangements granted under the 2010 Incentive Plan. This cost is expected to be recognized over a weighted-average period of 2.7 years.

Restricted Shares and Units

A summary of outstanding restricted stock unit activity under the 2010 Incentive Plan during fiscals 2015, 2014 and 2013 is presented below:

	Fiscal Years Ended
	January 30, 2016				January 31, 2015				February 1, 2014
	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	290,000		$	14.01	945,878		$	29.05	215,849		$	46.04
Granted	50,000		8.00		50,000		8.00		791,165		25.40
Units converted	(185,453	)	26.29		(156,079	)	45.20		(20,694	)	51.93
Forfeited/Canceled	(142,047	)	11.32		(549,799	)	30.49		(40,442	)	36.66
Outstanding units at end of fiscal year	12,500		$	8.00	290,000		$	14.01	945,878		$	29.05

As of January 30, 2016, there was less than $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 less than 1 year.

The fair value of restricted shares vested and restricted stock units converted was $5 million, $9 million and $4 million for fiscals 2015, 2014 and 2013, respectively, and we did not recognize any tax benefits as a result of the vesting and conversion.

Performance-Based Shares and Units

As of January 30, 2016 and January 31, 2015, we did not have outstanding performance-based share awards as the performance-based share awards and units granted on May 26, 2011 and May 21, 2012 were canceled as of the third anniversary date of the award due to the inability to meet the performance criteria for vesting.

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The amount of stock-based compensation expense recognized in SG&A and the tax benefit recognized in Income tax expense in fiscals 2015, 2014 and 2013 was as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
SG&A	$	5	$	15	$	15
Total recognized tax benefit	—		—		—

NOTE 8 — ACCUMULATED OTHER COMPREHENSIVE LOSS

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 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) gains, net of tax			Accumulated other comprehensive loss
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		)
Current period change	(47		)	1			20			(26		)
Balance, January 30, 2016	$	(249	)	$	1		$	(22	)	$	(270	)

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 30, 2016 are as follows:

	Operating Leases (1)						Capital Leases and Financing Obligations
(In millions)	Gross Minimum Rentals		Sublease Income		Net Minimum Rentals		Lease Obligation
2016	$	505	$	14	$	491	$	33
2017	445		12		433		30
2018	377		11		366		27
2019	316		9		307		22
2020	262		7		255		19
2021 and subsequent	952		18		934		71
Total	$	2,857	$	71	$	2,786	$	202

(1) Excluded from the minimum rental commitments displayed above are $1.4 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 2021 and thereafter.

Total rent expense, net of sublease income, was $546 million, $601 million and $609 million in fiscals 2015, 2014 and 2013, respectively. Sublease income was $17 million, $18 million and $19 million in fiscals 2015, 2014 and 2013, 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.

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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 $354 million and $359 million at January 30, 2016 and January 31, 2015, respectively, of which $9 million and $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 $12 million for fiscal 2015 and $10 million for fiscals 2014 and 2013, 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 30, 2016 and January 31, 2015, the carrying amounts of our financing obligations, which primarily represent properties for which we are the deemed the “owner”, were $183 million and $189 million, respectively. These carrying amounts approximate fair value. 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 30, 2016			January 31, 2015			February 1, 2014
U.S.	$	(169	)	$	(263	)	$	(851	)
Foreign	121			7			(16		)
Loss before income taxes	$	(48	)	$	(256	)	$	(867	)

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Income tax expense (benefit) is as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015			February 1, 2014
Current:
U.S. Federal	$	1	$	(13	)	$	(7	)
Foreign	54		46			46
State	4		—			(3		)
Total current income tax expense	$	59	$	33		$	36
Deferred:
U.S. Federal	$	—	$	1		$	42
Foreign	17		(2		)	72
State	—		—			19
Total deferred income tax expense (benefit)	$	17	$	(1	)	$	133
Total income tax expense	$	76	$	32		$	169

Included within Income tax expense is an expense of $2 million, benefit of less than $1 million and benefit of less than $1 million related to interest and penalties in fiscals 2015, 2014 and 2013, 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 30, 2016		January 31, 2015		February 1, 2014
U.S. Federal statutory tax rate	35.0	%	35.0	%	35.0	%
State taxes, net of U.S. Federal benefit	(5.4	)%	—	%	(1.2	)%
Foreign operations (1)	(183.7	)%	(13.5	)%	(12.3	)%
U.S. Federal valuation allowance	(10.4	)%	(36.6	)%	(27.9	)%
Unrecognized tax benefits (2)	—	%	3.0	%	—	%
Goodwill impairment (3)	—	%	—	%	(13.4	)%
Other	6.2	%	(0.4	)%	0.3	%
Effective tax rate	(158.3	)%	(12.5	)%	(19.5	)%

(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 enacted changes in the tax laws or rates or a change in the status of the enterprise.

(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. Refer to “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 30, 2016			January 31, 2015
Deferred tax assets:
U.S. Federal tax loss and other carryforwards	$	358		$	385
State tax loss and other carryforwards	83			84
Foreign tax loss and other carryforwards	164			169
Straight line rent	127			127
Inventory	60			52
Insurance loss reserve	38			35
Restructuring charges	5			7
Other	148			158
Gross deferred tax assets before valuation allowance	983			1,017
Valuation allowance	(656		)	(621		)
Total deferred tax assets	$	327		$	396
Deferred tax liabilities:
Fixed assets (1)	$	(39	)	$	(67	)
Undistributed earnings of foreign subsidiaries	(214		)	(222		)
Foreign currency translation	(28		)	(24		)
Other	(14		)	(21		)
Total deferred tax liabilities	$	(295	)	$	(334	)
Net deferred tax assets	$	32		$	62

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

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

(In millions)	January 30,  2016 (1)			January 31, 2015
Current deferred tax assets	$	—		$	45
Current deferred tax liabilities (2)	—			(4		)
Non-current deferred tax assets	96			133
Non-current deferred tax liabilities	(64		)	(112		)
	$	32		$	62

(1) In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The guidance is effective for interim and annual periods beginning after December 15, 2016, and may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. As permitted, the Company elected to early adopt this guidance effective January 30, 2016, and has applied the guidance prospectively. The adoption of this guidance did not have a significant impact on the Company’s financial statements, other than the prospective classification of deferred tax liabilities and assets as noncurrent in accordance with the new presentation requirements.

(2) The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities on our prior year Consolidated Balance Sheet.

Our gross deferred tax assets above include an offset of $8 million and $7 million of unrecognized tax benefits related to tax loss carryforwards as of January 30, 2016 and January 31, 2015, 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.

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Of our $358 million of U.S. Federal tax loss and other carryforwards, none will expire during the next 5 years, $172 million will expire during the next 6 to 20 years and $186 million may be carried forward indefinitely. Of our $83 million of state tax loss and other carryforwards, $10 million will expire during the next 5 years, $61 million will expire during the next 6 to 20 years and $12 million may be carried forward indefinitely. Of our $164 million of foreign tax loss and other carryforwards, $5 million will expire during the next 5 years, $2 million will expire during the next 6 to 20 years and $157 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 2015, we have incurred a pre-tax cumulative loss over the past three fiscal years. During fiscal 2015, our valuation allowance increased by $35 million. This includes a$17 million increase for U.S. Federal tax, a $4 million increase for state tax and a $14 million increase for foreign tax.

Of our total valuation allowance of $656 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 30, 2016			January 31, 2015			February 1, 2014
Beginning balance	$	30		$	37		$	32
Additions for tax positions of the current year	2			4			4
Additions for tax positions of prior years	2			5			6
Reductions for tax positions of prior years (1)	—			(11		)	(1		)
Settlements	—			—			—
Currency translation adjustment	(1		)	(4		)	—
Lapse of statute of limitations	(1		)	(1		)	(4		)
Ending balance	$	32		$	30		$	37

(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 30, 2016, $25 million of the $32 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 $6 million and less than $1 million of accrued interest and penalties, respectively, at January 30, 2016. We had $4 million and less than $1 million of accrued interest and penalties, respectively, at January 31, 2015, and $5 million and less than $1 million of accrued interest and penalties, respectively, at February 1, 2014.

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 2008 and forward; Australia for fiscal 2009 and forward; Canada for fiscal 2008 and forward; France for fiscal 2012 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.

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We believe that it is reasonably possible that the total amount of unrecognized tax benefits of $38 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 a variety of toy and baby product offerings worldwide. We operate all of our “R” Us branded retail stores in the United States, Puerto Rico and Guam and 75% of our 1,008 “R” Us branded retail stores internationally excluding stores with a cumulative lease term of less than two years (“Temporary Express”). The balance of our “R” Us branded retail stores internationally are operated by licensees. Licensing revenue did not have a material impact on our Net sales and accounted for $17 million in fiscals 2015 and 2014 respectively, and $16 million in fiscal 2013. We also own and operate websites including Toysrus.com and Babiesrus.com, as well as other e-commerce sites 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 through 866 stores that operate in 49 states in the United States, Puerto Rico and Guam and through e-commerce. As of January 30, 2016, our Domestic stores consisted of 361 traditional toy stores, 224 baby stores, 213 side-by-side (“SBS”) stores and 68 smaller format stores with cumulative lease terms of at least two years (“Permanent Express”), as well as Temporary Express locations.

• International — Our International segment sells a variety of products through 756 operated and 252 licensed stores in 38 countries and jurisdictions and through e-commerce. As of January 30, 2016, our International stores consisted of 534 traditional toy stores, 202 SBS stores, 15 baby stores and 5 Permanent Express stores, as well as Temporary Express 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.

Our CEO, who is our 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 30, 2016		January 31, 2015		February 1, 2014
Baby	36.9	%	37.9	%	37.7	%
Core Toy	18.4	%	17.2	%	15.9	%
Entertainment	9.0	%	10.2	%	11.3	%
Learning	23.5	%	22.6	%	22.6	%
Seasonal	11.4	%	11.2	%	11.3	%
Other (1)	0.8	%	0.9	%	1.2	%
Total	100	%	100	%	100	%

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

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	Fiscal Years Ended
International:	January 30, 2016		January 31, 2015		February 1, 2014
Baby	20.5	%	20.2	%	20.4	%
Core Toy	23.2	%	23.5	%	22.7	%
Entertainment	7.1	%	8.5	%	10.0	%
Learning	32.8	%	31.1	%	30.8	%
Seasonal	15.7	%	15.9	%	15.3	%
Other (1)	0.7	%	0.8	%	0.8	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues, including licensing revenue 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 30, 2016			January 31, 2015			February 1, 2014
Net sales
Domestic	$	7,356		$	7,524		$	7,638
International	4,446			4,837			4,905
Total Net sales	$	11,802		$	12,361		$	12,543
Operating earnings (loss)
Domestic (1) (2)	$	484		$	332		$	(197	)
International (1)	271			229			203
Corporate and other	(377		)	(370		)	(356		)
Operating earnings (loss)	378			191			(350		)
Interest expense	(429		)	(451		)	(524		)
Interest income	3			4			7
Loss before income taxes	$	(48	)	$	(256	)	$	(867	)

(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.

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	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Depreciation and amortization
Domestic	$	180	$	210	$	216
International	107		116		123
Corporate	56		51		49
Total Depreciation and amortization	$	343	$	377	$	388
Capital expenditures
Domestic	$	74	$	67	$	113
International	74		83		86
Corporate	71		57		39
Total Capital expenditures	$	219	$	207	$	238

(In millions)	January 30, 2016		January 31, 2015
Merchandise inventories
Domestic	$	1,559	$	1,353
International	711		711
Total Merchandise inventories	$	2,270	$	2,064
Total Assets
Domestic	$	3,718	$	3,633
International	2,032		2,122
Corporate and other (1)	1,218		1,360
Total Assets	$	6,968	$	7,115

(1) Includes cash and cash equivalents, deferred tax assets and other corporate assets.

Our Net sales, inclusive of each market’s respective e-commerce operations, and long-lived assets by market are as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Net sales
United States (1)	$	7,356	$	7,524	$	7,638
Europe (2)	1,211		1,405		1,447
Japan	1,182		1,308		1,374
Canada	809		834		883
UK	666		710		680
China and Southeast Asia	365		333		277
Australia	196		230		228
Licensing revenue	17		17		16
Total Net sales	$	11,802	$	12,361	$	12,543

(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.

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(In millions)	January 30, 2016		January 31, 2015
Long-lived assets
United States (1)	$	2,275	$	2,372
Europe (2)	339		352
Japan	277		306
UK	266		281
Canada	157		180
China and Southeast Asia	43		41
Australia	12		14
Total Long-lived assets	$	3,369	$	3,546

(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.

The following tables provide information regarding our pension plans:

Obligation and Funded Status at End of Fiscal Year:

(In millions)	January 30, 2016			January 31, 2015
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	174		$	137
Service cost	5			5
Interest cost	5			5
Benefits paid	(3		)	(6		)
Actuarial (gain) loss	(25		)	52
Foreign currency impact	(8		)	(19		)
Projected benefit obligation at end of year	$	148		$	174

(In millions)	January 30, 2016			January 31, 2015
Change in fair value of plan assets:
Fair value of plan assets at beginning of year	$	123		$	118
Actual return on plan assets	(2		)	17
Employer contributions	11			7
Benefits paid	(3		)	(6		)
Foreign currency impact	(6		)	(13		)
Fair value of plan assets at end of year	$	123		$	123

(In millions)	January 30, 2016			January 31, 2015
Reconciliation of funded status to total amount recognized:
Funded status	$	(25	)	$	(51	)
Amounts recognized in Consolidated Balance Sheets:
Other non-current liabilities	$	(25	)	$	(51	)
Amounts recognized in Accumulated other comprehensive loss:
Unrecognized actuarial losses, net of tax	$	22		$	42

Of the $22 million of unrecognized actuarial losses, net of tax in Accumulated other comprehensive loss as of January 30, 2016, $1 million is expected to be amortized into net periodic benefit cost in fiscal 2016.

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Information for Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets:

(In millions)	January 30, 2016		January 31, 2015
Projected benefit obligation	$	148	$	174
Accumulated benefit obligation	129		150
Fair value of plan assets	123		123

Components of Net Periodic Benefit Cost During Each Fiscal Year:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Service cost	$	5		$	5		$	5
Interest cost	5			5			5
Expected return on plan assets	(4		)	(5		)	(5		)
Actuarial losses recognized	2			—			—
Net periodic benefit cost	$	8		$	5		$	5

Contributions

For fiscal 2016, 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
2016	$	1
2017	1
2018	1
2019	1
2020	1
2021 through 2025	7

Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs at Fiscal Year End:

	January 30, 2016		January 31, 2015		February 1, 2014
Discount rate	2.7	%	3.7	%	4.1	%
Expected rate of return on plan assets	3.4	%	4.5	%	4.9	%
Rate of compensation increase	2.6	%	2.6	%	2.7	%

Weighted-average Assumptions Used to Determine Benefit Obligations at Fiscal Year End:

	Fiscal Years Ended
	January 30, 2016		January 31, 2015
Discount rate	3.2	%	2.7	%
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 92% of the plan assets relate to the UK and Japan pension plans. The UK and Japan pension

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plans expected return on assets assumption for fiscal 2016 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 2016, as well as the actual asset allocations as of January 30, 2016 and January 31, 2015:

	2016 Target Allocation		January 30, 2016		January 31, 2015
Equity securities	29.6	%	29.6	%	28.3	%
Debt securities	56.6	%	56.6	%	58.3	%
Insurance contracts	7.4	%	7.4	%	7.3	%
Cash and cash equivalents	6.4	%	6.4	%	6.1	%
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 30, 2016 and January 31, 2015. 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 30, 2016 and January 31, 2015. In May 2015, the FASB issued ASU 2015-07, “Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)” (“ASU 2015-07”). The amendments apply to reporting entities that elect to measure the fair value of an investment using the net asset value (“NAV”) per share (or its equivalent) practical expedient. The amendments remove the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the NAV per share practical expedient. The Company early adopted the amendments in ASU 2015-07, effective February 2, 2015, and the prior period has been restated.

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Fiscal 2015

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Insurance Contracts (1)	$	—	$	9	$	9
Cash and cash equivalents (2)	8		—		8
Equity Securities: (3)
Domestic					11
International					25
Fixed Income: (3)
Domestic					6
International					64
Total	$	8	$	9	$	123

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Insurance Contracts (1)	$	—	$	9	$	9
Cash and cash equivalents (2)	7		—		7
Equity Securities: (3)
Domestic					11
International					24
Fixed Income: (3)
Domestic					4
International					68
Total	$	7	$	9	$	123

(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) In accordance with ASU 2015-07, securities which are measured at fair value using the NAV per share practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are to reconcile the fair value hierarchy to the total fair value of plan assets.

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 five years of employment with the Company. During fiscals 2015 and 2014 we recorded SERP expenses of less than $1 million, respectively. During fiscal 2013, we recorded SERP expenses of $1 million. As of January 30, 2016 and January 31, 2015, the SERP liability was $2 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

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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 $25 million in fiscal 2015 and $24 million in fiscals 2014 and 2013, respectively. The Board of Directors did not elect to contribute to the profit sharing portion of the Savings Plan in fiscals 2015, 2014 and 2013.

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 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 30, 2016.

As of January 30, 2016, 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 $51 million through September 2032. The impact of these obligations is not material to our Consolidated Financial Statements.

NOTE 16 — RELATED PARTY TRANSACTIONS

Sponsor Advisory Agreement

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, August 29, 2014, June 1, 2015 and December 1, 2015 (“Advisory Agreement”). The initial term of the Advisory Agreement was ten years, with the ability to extend annually for one year unless we or the Sponsors provide notice of termination to the other. 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 management and advisory fees (the “Advisory 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.

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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.  The amendment provided that 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.

In June 2015, the Advisory Agreement was further amended in order to reduce the Advisory Fees payable in fiscal 2015 and thereafter from $17 million to $6 million annually with no further adjustment upon an IPO for such reductions. We recorded Advisory Fees of $6 million, $17 million and $22 million for fiscals 2015, 2014 and 2013, respectively. During fiscals 2015, 2014 and 2013, we also paid the Sponsors for out-of-pocket expenses, which were less than $1 million, respectively.

Additionally, the original Advisory Agreement provided 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”). Transaction Fees were capitalized as deferred debt issuance costs and amortized over the term of the related debt agreement and included in Other assets on our prior year Consolidated Balance Sheet. In December 2015, the Advisory Agreement was further amended to waive all Transaction Fees including prior accrued and unpaid transaction fees of $47 million as well as any fees to be paid upon an IPO.

Other Relationships and Transactions with our Sponsors

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. KKR owned the following aggregate amounts of our debt as of January 30, 2016 and January 31, 2015. For further details, refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

(In millions)	January 30, 2016		January 31, 2015
Propco I Term Loan Facility	$	16	$	17
Incremental Secured Term Loan	12		12
Secured Term B-4 Loan	2		96
Second Incremental Secured Term Loan	2		2
2017 Notes	—		9
Total	$	32	$	136

During fiscals 2015, 2014 and 2013, affiliates of 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 $7 million in fiscal 2015 and $10 million in fiscals 2014 and 2013, respectively.

Additionally, under lease agreements with affiliates of Vornado Realty Trust (“Vornado”), we paid an aggregate amount of $8 million in fiscals 2015, 2014 and 2013, respectively, with respect to 0.6%, 0.7% and 0.8%, respectively, of our operated stores, which include Express stores. Of the aggregate amount paid in fiscals 2015, 2014 and 2013, $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. After a competitive bidding process, on February 1, 2015, we entered into an agreement with SquareTrade Inc. (“SquareTrade”), which is a Portfolio Company of Bain Capital Partners, LLC. SquareTrade provides protection plans for electronic and other products that cover the repair, replacement or refund of such products. Under the agreement, we are licensed to sell protection plans on behalf of SquareTrade and receive a fixed percentage commission fee for each sale. For fiscal 2015, we recorded $21 million in commissions within Net sales. Receivables from SquareTrade were less than $1 million as of January 30, 2016 and included in Accounts and other receivables on our Consolidated Balance Sheet. Payables to SquareTrade were $3 million as of January 30, 2016 and included in Accrued expenses and other current liabilities on our Consolidated Balance Sheet. 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 Asia JV 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, as amended, provide us with the future option to acquire Li & Fung’s 30% interest in the business and also provides Li & Fung

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the option to require us to buy their 30% interest in the business beginning on April 30, 2017. 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. During fiscal 2015, we further amended the agreement to extend the future option to commence after April 30, 2017.

The Company paid the final $2 million and $1 million of contingent consideration related to the Asia JV acquisition during fiscals 2015 and 2014, respectively, which was previously accrued for in our Consolidated Balance Sheets. The Company did not make any payments during fiscal 2013.

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. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for a reconciliation of the change in Noncontrolling interest to redemption value as of January 30, 2016 and January 31, 2015.

NOTE 18 — RECENT ACCOUNTING PRONOUNCEMENTS

In March 2016, the FASB issued ASU 2016-07 “Investments - Equity Method and Joint Ventures (Topic 323), Simplifying the Transition to the Equity Method of Accounting” (“ASU 2016-07”). ASU 2016-07 eliminates the requirement that when an investment subsequently qualifies for use of the equity method as a result of an increase in level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. This ASU requires that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and to adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. In addition, ASU 2016-07 requires that an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting recognize through earnings the unrealized gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method. The amendments of this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Management is currently assessing the impact the adoption of ASU 2016-07 will have on our Consolidated Financial Statements.

In March 2016, the FASB issued ASU 2016-06 “Derivatives and Hedging (Topic 815), Contingent Put and Call Options in Debt Instruments” (“ASU 2016-06”). ASU 2016-06 clarifies the requirements for assessing whether contingent put or call options that can accelerate the payment of principal on debt instruments are clearly and closely related. Under current GAAP, two divergent approaches developed. Under the first approach, the assessment of whether contingent put or call options are clearly and closely related to the debt host only requires an analysis of the four-step decision sequence of ASC 815-15-25-42. Under the second approach, in addition to the four-step decision sequence of ASC 815-15-2-42, some entities evaluate whether the ability to exercise the put or call options are triggered by the entities interest rates or credit risk. ASU 2016-06 clarifies that an entity is required to assess whether the economic characteristics and risks of embedded put or call options are clearly and closely related to those of their debt hosts only in accordance with the four-step decision sequence of ASC 815-15-2-42. An entity should not assess whether the event that triggers the ability to exercise a put or call option is related to interest rates or credit risk of the entity. ASU 2016-06 does not change the existing criteria for determining when bifurcation of an embedded put or call option in a debt instrument is required. The amendments of this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Entities are required to apply the guidance to existing debt instruments using a modified retrospective transition method as of the period of adoption. Management is currently assessing the impact the adoption of ASU 2016-06 will have on our Consolidated Financial Statements.

In March 2016, the FASB issued ASU 2016-05 “Derivatives and Hedging (Topic 815), Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships” (“ASU 2016-05”). ASU 2015-05 provides guidance clarifying that the novation of a derivative contract (i.e. a change in counterparty) in a hedge accounting relationship does not, in and of itself, require dedesignation of that hedge accounting relationship. This ASU amends ASC 815 to clarify that such a change does not, in and of itself, represent a termination of the original derivative instrument or a change in the critical terms of the hedge relationship. ASU 2016-05 allows the hedging relationship to continue uninterrupted if all of the other hedge accounting criteria are met, including the expectation that the hedge will be highly effective when the creditworthiness of the new counterpart to the derivative contract is considered. The amendments of this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Entities may adopt the guidance prospectively or use a modified retrospective approach. Management is currently assessing the impact the adoption of ASU 2016-05 will have on our Consolidated Financial Statements.

In March 2016, the FASB issued ASU 2016-04 “Liabilities - Extinguishments of Liabilities (Subtopic 405-20), Recognition of Breakage for Certain Prepaid Stored-Value Products” (“ASU 2016-04”). ASU 2015-04 requires entities that sell prepaid

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stored-value products redeemable for goods, services or cash at third-party merchants to recognize breakage (i.e. the value that is ultimately not redeemed by the consumer) in a way that is consistent with how it will be recognized under the new revenue recognition standard. Under current GAAP, there is diversity in practice in how entities account for breakage that results when a consumer does not redeem the entire product balance. Some entities view liabilities for prepaid stored-value products that can be redeemed only for goods or services from a third-party as nonfinancial because the issuer’s obligation to the consumer will be settled by the transfer of goods or services (albeit by a third-party), not cash. Others view these liabilities as financial, given that the issuer is ultimately obligated to transfer cash to a third-party. This ASU clarifies that an entity’s liability for prepaid stored-value products within its scope meets the definition of a financial liability. The amendments of this ASU are effective for reporting periods beginning after December 15, 2017, with early adoption permitted. Entities will apply the guidance using either a modified retrospective approach or a full retrospective approach. Management is currently assessing the impact the adoption of ASU 2016-04 will have on our Consolidated Financial Statements.

In February 2016, the FASB issued ASU 2016-02 “Leases (Topic 842)” (“ASU 2016-02”). The FASB issued ASU 2016-02 to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Under ASU 2016-02, a lessee will recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-to-use asset representing its right to use the underlying asset for the lease term. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from current GAAP. ASU 2016-02 retains a distinction between finance leases (i.e. capital leases under current GAAP) and operating leases. The classification criteria for distinguishing between finance leases and operating leases will be substantially similar to the classification criteria for distinguishing between capital leases and operating leases under current GAAP. The accounting applied by the lessor is largely unchanged from that applied under current GAAP. The amendments of this ASU are effective for reporting periods beginning after December 15, 2018, with early adoption permitted. An entity will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. Management is currently assessing the impact the adoption of ASU 2016-02 will have on our Consolidated Financial Statements.

In January 2016, the FASB issued ASU 2016-01 “Financial Instruments-Overall (Subtopic 825-10), Recognition and measurement of Financial Assets and Financial Liabilities” (“ASU 2016-01”). ASU 2016-01 requires the fair value measurement of equity investments that do not result in consolidation and are not accounted for under the equity method. Entities will recognize the changes in fair value through net income. ASU 2016-01 eliminates an entity’s ability to be able to recognize unrealized holding gains and losses on equity securities that are classified as available-for-sale in other comprehensive income. Entities will also no longer be able to use the cost method of accounting for equity securities that do not have readily determinable fair values. A practical expedient will be available for equity investments that do not have readily determinable fair values and do not qualify for the practical expedient to estimate fair value under ASC 820, Fair Value Measurement (i.e. net asset value practical expedient). ASU 2016-01 does not change the guidance for classifying and measuring investments in debt securities and loans. In addition, for financial liabilities measured using the fair value option in ASC 825, ASU 2016-01 requires the change in fair value caused by a change in instrument-specific credit risk to be presented separately in other comprehensive income. Under ASU 2016-01, entities will be required to present financial assets and financial liabilities separately, grouped by measurement category and form of financial asset in the statement of financial position or in the accompanying notes to the financial statements. The amendments of this ASU are effective for reporting periods beginning after December 15, 2017, with early adoption permitted for certain provisions. The adoption of ASU 2016-01, is not expected to have an impact on our Consolidated Financial Statements.

In September 2015, the FASB issued ASU 2015-16 “Business Combinations (Topic 805), Simplifying the Accounting for Measurement-Period Adjustments” (“ASU 2015-16”). ASU 2015-16 eliminates the requirement that an acquirer in a business combination account for measurement-period adjustments retrospectively. Under the previous guidance, an acquirer must recognize adjustments to provisional amounts during the measurement period retrospectively (i.e. as if the accounting for the business combination had been completed at the acquisition date). That is, the acquirer must revise comparative information on the income statement and balance sheet for any prior periods affected. Under ASU 2015-16, acquirers must recognize measurement-period adjustments in the period in which they determine the amounts, including the effect on earnings of any amounts they would have recorded in previous periods if the accounting had been completed at the acquisition date. The amendments in ASU 2015-16 require an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earning by line item that would have been in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. ASU 2015-16 did not change the criteria for determining whether an adjustment qualifies as a measurement-period adjustment and does not change the length of the measurement period. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. The adoption of ASU 2015-16, is not expected to have an impact on our Consolidated Financial Statements.

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In July 2015, the FASB issued ASU 2015-12 “Plan Accounting: Defined Benefit Pension Plans (Topic 960), Defined Contribution Plans (Topic 962), Health and Welfare Benefit Plans (Topic 965)” (“ASU 2015-12”). The amendments in Part I of ASU 2015-12 eliminated the requirements that employee benefit plans measure the fair value of fully benefit-responsive investment contracts and provide the related fair value disclosures, rather these contracts will be measured and disclosed only at contract value. The amendments in Part II of this ASU will require plans to disaggregate their investments measured using fair value only by general type, either on the financial statements or in the notes. Part II of this ASU also eliminated the requirement to disclose the net appreciation/depreciation in fair value of investments by general type and the requirement to disclose individual investments that represent 5% or more of net assets available for benefits. The amendments in Part III of ASU 2015-12 provides a practical expedient to permit plans to measure its investments and investment related accounts as of a month-end date closest to its fiscal year for a plan with a fiscal year end that does not coincide with the end of a calendar month. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. The adoption of ASU 2015-12, is not expected to have an impact on our Consolidated Financial Statements.

In April 2015, the FASB issued ASU No. 2015-05, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement (“ASU 2015-05”). Existing GAAP does not include explicit guidance about a customer’s accounting for fees paid in a cloud computing arrangement. The amendments in this ASU provide guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software licenses element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. As a result of the amendments, all software licenses within the scope of Subtopic 350-40 will be accounted for consistent with other licenses of intangible assets. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. An entity can elect to adopt the amendments either (1) prospectively to all arrangements entered into or materially modified after the effective date; or (2) retrospectively. For prospective transition, the only disclosure requirements at transition are the nature of and reason for the change in accounting principle, the transition method, and a qualitative description of the financial statement line items affected by the change. For retrospective transition, the disclosure requirements at transition include the requirements for prospective transition and quantitative information about the effects of the accounting change. The adoption of ASU 2015-05 is not expected to have an impact on our Consolidated Financial Statements.

In April 2015, the FASB issued ASU 2015-04, “Compensation - Retirement Benefits (Topic 715): Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets” (“ASU 2015-04”). For entities with a fiscal year-end that does not coincide with a month-end, ASU 2015-04 provides a practical expedient that permits the entity to measure defined benefit plan assets and obligations using the month-end that is closest to the entity’s fiscal year-end and apply that practical expedient consistently from year-to-year. Under the previous practice, entities with fiscal year-ends that did not coincide with a month-end, had to adjust the fair value of the plan assets reported by the third-party service provider to reflect the fair value of plan assets as of their fiscal year. The practical expedient should be applied consistently to all plans if an entity has more than one plan. An entity is required to disclose the accounting policy election and the date used to measure defined benefit plan assets and obligations in accordance with the amendments in this ASU. Additional disclosures are required if a contribution or significant event caused by the entity occurs between the month-end date used to measure the defined benefit plan assets and obligations and an entity’s fiscal year-end. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. Entities should apply the amendments in this update prospectively. The adoption of ASU 2015-04 is not expected to have an impact on our Consolidated Financial Statements.

In April 2015, the FASB issued ASU No. 2015-03, “Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”). ASU 2015-03 simplifies the presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Under the previous practice, debt issuance costs were recognized as a deferred charge (that is, an asset). This ASU will create consistencies with the guidance in International Financial Reporting Standards as well as the guidance in FASB Concepts Statement No. 6, “Elements of Financial Statements”, which states that debt issuance costs are similar to debt discounts and in effect reduce the proceeds of borrowing, thereby increasing the effective interest rate. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. In August 2015, the FASB issued ASU 2015-15 “Interest - Imputed Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements” (“ASU 2015-15”), which clarifies that the guidance in ASU 2015-03 does not apply to line-of-credit arrangements. According to ASU 2015-15, line-of-credit arrangements will continue to defer and present debt issuance costs as an asset and subsequently amortize the deferred debt costs ratably over the term of the arrangement. Upon transition, an entity is required to comply with the applicable disclosures for a change in an accounting principle. The amendments in ASU 2015-03 are effective for reporting

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periods beginning after December 15, 2015, with early adoption permitted. A reporting entity should apply the amendments on a retrospective basis to all prior periods presented in the financial statements. Other than the revised balance sheet presentation of debt issuance costs from an asset to a deduction from the carrying amount of the debt liability and related disclosures, the adoption of ASU 2015-03 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 of ASU 2014-09 were effective for reporting periods beginning after December 15, 2016, with early adoption prohibited. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption.

Subsequent to issuing ASU 2014-09, the FASB issued the following amendments concerning the adoption and clarification of ASU 2014-09. In August 2015, the FASB issued ASU 2015-14 “Revenue from Contracts with Customers (Topic 606), Deferral of the Effective Date,” which deferred the effective date one year. As a result, the amendments of ASU 2014-09 are effective for reporting periods beginning after December 15, 2017, with early adoption permitted only as of annual reporting periods beginning after December 15, 2016. In March 2016, the FASB issued ASU 2016-08 “Revenue from Contracts with Customers (Topic 606), Principal versus Agent Considerations (Reporting Revenue versus Net)” (“ASU 2016-08”), which clarifies the implementation guidance on principal versus agent considerations in the new revenue recognition standard. ASU 2016-08 clarifies how an entity should identify the unit of accounting (i.e. the specified good or service) for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements. Management is currently assessing the adoption methodology and the impact the adoption of these ASUs 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 2, 2015			August 1, 2015			October 31, 2015			January 30, 2016 (1)
Fiscal 2015
Net sales	$	2,325		$	2,293		$	2,331		$	4,853
Gross margin	862			875			832			1,657
Selling, general and administrative expenses	827			796			827			1,143
Depreciation and amortization	87			86			80			90
Other income, net	(22		)	(22		)	(21		)	(23		)
Operating (loss) earnings	(30		)	15			(54		)	447
Net (loss) earnings	(139		)	(97		)	(166		)	278
Net (loss) earnings attributable to Toys “R” Us, Inc.	$	(140	)	$	(99	)	$	(167	)	$	276
	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

(1) Our Domestic and International businesses are highly seasonal with sales highest in the fourth quarter. During fiscals 2015, 2014 and 2013, 41%, 40% and 42%, 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.

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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 30, 2016			January 31, 2015			February 1, 2014
Revenues	$	—		$	—		$	—
General and administrative expenses	58			25			21
Depreciation and amortization	—			1			3
Other expense, net	—			—			1
Total operating expenses	58			26			25
Operating loss	(58		)	(26		)	(25		)
Interest expense, net	(81		)	(78		)	(76		)
Intercompany interest expense, net	(78		)	(54		)	(63		)
Equity (deficit) in pre-tax earnings (loss) of consolidated subsidiaries	163			(102		)	(706		)
Loss before income taxes	(54		)	(260		)	(870		)
Income tax expense	76			32			169
Net loss	$	(130	)	$	(292	)	$	(1,039	)
Comprehensive loss	$	(156	)	$	(452	)	$	(1,120	)

See accompanying Notes to the Condensed Financial Statements.

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Toys “R” Us, Inc.

Schedule I — Condensed Balance Sheets

(In millions)	January 30, 2016			January 31, 2015
ASSETS
Current Assets:
Cash and cash equivalents	$	1		$	11
Income taxes receivable	18			20
Prepaid expenses and other current assets	16			9
Due from subsidiary	364			376
Total current assets	399			416
Property and equipment, net	1			1
Deferred tax assets	—			2
Other assets	11			12
Total Assets	$	411		$	431
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accrued expenses and other current liabilities	$	77		$	121
Income taxes payable	2			2
Total current liabilities	79			123
Long-term debt	872			872
Due to subsidiaries, net	638			461
Other non-current liabilities	87			70
Stockholders’ deficit	(1,265		)	(1,095		)
Total Liabilities and Stockholders’ Deficit	$	411		$	431

See accompanying Notes to the Condensed Financial Statements.

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Toys “R” Us, Inc.

Schedule I — Condensed Statements of Cash Flows

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Cash Flows from Operating Activities	$	(25	)	$	(13	)	$	(21	)
Cash Flows from Investing Activities:
Investments in subsidiaries	7			5			(180		)
Intercompany loan repayments by subsidiaries	1,548			2,056			1,956
Loans to subsidiaries	(1,540		)	(2,116		)	(2,251		)
Proceeds from redemption of debt securities	—			—			52
Net cash provided by (used in) investing activities	15			(55		)	(423		)
Cash Flows from Financing Activities	—			—			(7		)
Cash and cash equivalents:
Net decrease during period	(10		)	(68		)	(451		)
Cash and cash equivalents at beginning of period	11			79			530
Cash and cash equivalents at end of period	$	1		$	11		$	79
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	77		$	77		$	78

See accompanying Notes to the 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.

Due to Subsidiaries, Net - Due to subsidiaries, net, on the Condensed Balance Sheets, is comprised of the Parent Company’s net investment in its subsidiaries under the equity method of accounting, as well as other non-current receivables from and liabilities to subsidiaries. As of January 30, 2016 and January 31, 2015, the Parent Company had net investments in subsidiaries of $21 million and $119 million, respectively under the equity method.

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 30, 2016 and January 31, 2015, Due to subsidiaries, net included the outstanding net intercompany receivable balance from Toys Limited of $176 million and $175 million, respectively.

Additionally included within Due to subsidiaries, net, as of January 30, 2016 and January 31, 2015 is a net intercompany payable to Toys-Delaware of $835 million and $755 million, respectively, which includes accrued interest. The intercompany payable to Toys-Delaware primarily consists of long-term notes payable by Parent to Toys-Delaware for which the amounts are listed in the table below. All of the notes are documented, unsecured, and include a market rate of interest. As of January 30, 2016 and January 31, 2015, the long-term notes payable by Parent to Toys-Delaware were offset by $92 million and $89 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 as of January 30, 2016 and January 31, 2015, respectively.

(In millions)	January 30, 2016		January 31, 2015
Note issued by Parent in fiscal 2005	$	326	$	299
Note issued by Parent in fiscal 2009	253		222
Note issued by Parent in fiscal 2012 (1)	254		229
Note issued by Parent in fiscal 2012	90		90
Total Long-term notes payable by Parent to Toys-Delaware (2)	$	923	$	840

(1) Note is expressly subordinated in right of payment to the senior obligations of the Parent.

(2) Includes accrued and unpaid interest.

Due from Subsidiary - As of January 30, 2016 and January 31, 2015, an outstanding short-term loan of $364 million and $376 million, respectively, to Toys-Delaware was recorded in Due from subsidiary on the Condensed Balance Sheets.

Income Taxes - For fiscals 2015, 2014 and 2013, the income tax expense of $76 million, $32 million and $169 million, respectively, represents the Parent Company’s consolidated income tax expense. Such amounts include income tax expense of $143 million, $91 million and $127 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 30, 2016 and January 31, 2015 is outlined in the table below:

(In millions)	January 30, 2016		January 31, 2015
10.375% senior notes, due fiscal 2017	$	448	$	448
7.375% senior notes, due fiscal 2018	402		402
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 30, 2016 and January 31, 2015, respectively, were $653 million and $639 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 30, 2016 are as follows:

(In millions)	Annual Maturities
2016	$	—
2017	450
2018	400
2019	—
2020	—
2021 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 that all future principal and interest payments will be funded through the operating cash flows of Toys-Delaware. During fiscals 2015, 2014 and 2013, Toys-Delaware recorded interest expense related to the outstanding debentures due fiscal 2021 of $2 million, respectively, which is reflected as part of Equity (deficit) in pre-tax earnings (loss) 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 Asia JV in an aggregate amount up to HK$194 million ($25 million at January 30, 2016) for future borrowings.

For a discussion of the debt obligations of the Parent Company and its subsidiaries, refer to Note 2 to our 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 related contingent features and are subject to master netting arrangements. As of January 30, 2016, we had no open derivative contracts as all of our interest rate contracts had matured.

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At January 31, 2015, we had no derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 31, 2015, 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:

			January 31, 2015
(In millions)	Effective Date	Maturity Date	Notional  Amount
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (1)	January 2011	April 2015	$	500
1 Month USD LIBOR Interest Rate Cap (1)	January 2012	April 2015	500
1 Month USD LIBOR Interest Rate Cap (1)	January 2014	April 2015	311

(1) These interest rate caps were 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. 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. We are not required to post collateral for these contracts. As of January 30, 2016 and January 31, 2015, we had no outstanding foreign exchange 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 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015			February 1, 2014
Derivatives previously designated as cash flow hedges:
Beginning balance	$	—	$	1		$	1
Reclassifications from Accumulated other comprehensive      (loss) income - Interest Rate Contracts	—		(1		)	—
Ending balance	$	—	$	—		$	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 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	$	2	$	—	$	(1	)
Derivatives previously designated as cash flow hedges:
Amortization of hedged caps	—		1		—
Total Interest expense, net	$	2	$	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.”

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The following table contains the notional amounts and fair values of Parent Company’s outstanding derivative contracts as of January 31, 2015:

	January 31, 2015
(In millions)	Notional Amount		Fair Value Assets/ (Liabilities)
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	$	1,311	$	—

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. The aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets was nominal as of January 31, 2015. The aggregate gross fair value of derivative assets which could be net settled against our derivative liabilities was nominal as of January 31, 2015. As of January 31, 2015, 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, refer to Note 9 to our Consolidated Financial Statements entitled “LEASES.”

NOTE E — DISTRIBUTIONS AND CAPITAL CONTRIBUTIONS

Distributions

The Parent Company received cash distributions (inclusive of returns of capital) from certain of its subsidiaries as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Property subsidiaries
TRU Propco I	$	100	$	86	$	115
Other	7		7		8
Total property subsidiaries	107		93		123
Toys-Delaware	—		—		79
Total cash distributions	$	107	$	93	$	202
Distributions included:
Return of capital from property subsidiaries	$	11	$	—	$	109

Capital Contributions

During fiscals 2015 and 2014, the Parent Company made capital contributions of $4 million and $5 million, respectively, to TRU Asia, Ltd., of which $2 million and $1 million, respectively, was used to pay contingent consideration related to the Asia JV acquisition.

During fiscal 2013, the 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 in the fourth quarter of fiscal 2013. Refer to Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

(a)Dismissal of Prior IndependentRegistered Public Accounting Firm

On June 16, 2015, the Audit Committee of the Board of Directors of the Company approved the replacement of the Company’s independent registered public accounting firm, Deloitte & Touche LLP (“D&T”), and engaged Ernst & Young LLP (“EY”) as the new independent registered public accounting firm of the Company and its subsidiaries, including Toys “R” Us – Delaware, Inc., Toys “R” Us Property Company I, LLC and Toys “R” Us Property Company II, LLC. The dismissal and appointment was a result of a competitive bidding process involving several accounting firms, including D&T.

The audit reports of D&T on the consolidated financial statements of the Company as of and for the fiscal years ended January 31, 2015 and February 1, 2014, did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles. During the Company’s two most recent fiscal years ended January 31, 2015 and February 1, 2014, and the subsequent interim period through June 16, 2015, there were no disagreements between the Company and D&T on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure (within the meaning of Item 304(a)(1)(iv) of Regulation S-K), which, if not resolved to the satisfaction of D&T would have caused D&T to make reference to the subject matter of the disagreement in connection with its report and there were no “reportable events” (as defined by Item 304(a)(1)(v) of Regulation S-K). 

(b) Engagement of New Independent Registered Public Accounting Firm

During the Company’s two most recent fiscal years and the subsequent interim period preceding the EY engagement, neither the Company nor anyone on behalf of the Company consulted with EY regarding the application of accounting principles to any specific completed or contemplated transaction, or the type of audit opinion that might be rendered on the Company’s financial statements, and EY did not provide any written or oral advice that was an important factor considered by the Company in reaching a decision as to any accounting, auditing or financial reporting issue or any matter that was the subject of a “disagreement” or a “reportable event” (as defined by Item 304(a)(1) of Regulation S-K).

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.

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).

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Based on this assessment, management concluded that, as of January 30, 2016, the Company’s internal control over financial reporting was effective.

Ernst & Young 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 2015 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 Toys “R” Us, Inc. and subsidiaries’ internal control over financial reporting as of January 30, 2016, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). Toys “R” Us, Inc. and subsidiaries’ 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 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 its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that 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, Toys “R” Us, Inc. and subsidiaries maintained, in all material respects, effective internal control over financial reporting as of January 30, 2016, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of Toys “R” US, Inc. and subsidiaries as of January 30, 2016, and the related consolidated statement of operations, comprehensive loss, stockholders' (deficit) equity and cash flows for the year ended January 30, 2016 and our report dated March 24, 2016 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

New York, New York

March 24, 2016

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ITEM 9B. OTHER INFORMATION

On March 9, 2016, the Board of Directors of Toys “R” Us, Inc. adopted amendments to the Toys “R” Us, Inc. 2010 Incentive Plan (the “2010 Incentive Plan”) and the Amended and Restated Certificate of Incorporation, as amended, which were adopted by the stockholders of the Company on March 22, 2016. The amendment to the Company’s 2010 Incentive Plan increased the number of shares of the Company’s common stock available thereunder by 1,000,000 shares and the amendment to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of the Company’s common stock by 5,000,000 shares.

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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, 2016. 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.

Name	Age	Principal Occupation and Business Experience During Past Five Years and Other Directorships
Joshua Bekenstein	57	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.
David A. Brandon	63	Mr. Brandon has served as both our Chairman of the Board and Chief Executive Officer since July 2015. From June 2015 to July 2015, Mr. Brandon served as CEO - Designate of the Company. Mr. Brandon served as Chief Executive Officer of Domino’s Pizza from March 1999 to March 2010, and as Director of Intercollegiate Athletics at the University of Michigan from March 2010 to November 2014. Mr. Brandon currently serves as a member of the boards of directors of Domino’s Pizza, Inc., Herman Miller, Inc. and DTE Energy, Inc. Mr. Brandon also previously served as a member of the boards of directors of Kaydon Corporation, The TJX Companies, Inc. and Burger King Corporation.
Richard Goodman	67	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.
Matthew S. Levin	49	Mr. Levin has been our director since July 2005. Mr. Levin is a Senior Advisor of Bain Capital in the private equity business. From 2000 through 2015, Mr. Levin was a Managing Director of Bain. Prior to joining Bain in 1992, Mr. Levin was a consultant at Bain & Company where he consulted in the consumer products and manufacturing industries. Mr. Levin received an M.B.A. from Harvard Business School where he was a Baker Scholar, and a B.S. from the University of California Berkley. Mr. Levin currently serves on the board of directors of Michaels Stores and Guitar Center, Inc. He previously served as a Director of Bombardier Recreational Products Inc., Dollarama Capital Corporation, Edcon Holding (Pty) Ltd., Jupiter Shop Channel and Unisource Worldwide, Inc.
Joseph Macnow	70	Mr. Macnow has been our director since May 2013. Mr. Macnow has served as Executive Vice President - Finance and Chief Administrative Officer of Vornado Realty Trust (“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.
Paul E. Raether	69	Mr. Raether has been our director since October 2015. Mr. Raether is an executive of Kohlberg, Kravis Roberts & Co., L.P. and/or one of its affiliates (“KKR”) and has served in various positions and played a significant role in numerous portfolio companies since he joined KKR in 1980. Mr. Raether has served on the board of directors of WMI Holdings Corp since May 2015.
Wendy Silverstein	55	Ms. Silverstein has been our director since September 2005. Ms. Silverstein served as Executive Vice President and Co-Head of Acquisitions and Capital Markets of Vornado from November 2010 to April 2015. She served as Executive Vice President — Capital Markets of Vornado from 1998 to October 2010.
Nathaniel H. Taylor	39	Mr. Taylor has been our director since January 2011. Mr. Taylor is an executive of KKR and he has been an investment professional at KKR since November 2005.

In appointing Mr. Brandon to the Board, the Board considered his significant retail business experience gained while serving in various positions at Valassis Communications Inc. over a twenty year period including as its Chief Executive Officer. In addition, the Board considered the significant accomplishments achieved at Domino’s Pizza during Mr. Brandon’s eleven year term as its Chief Executive Officer. The Board also considered the intimate knowledge of the Company’s business and operations that Mr. Brandon will bring to the Board from his experience as the Chief Executive Officer of the Company.

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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. Brandon and Goodman, each of the Directors were 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 and Levin were appointed to the Board as a consequence of their respective relationships with Bain; Messrs. Raether and Taylor were appointed to the Board as a consequence of their respective relationships with KKR; and Ms. Silverstein and Mr. Macnow 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, 2016, having been elected to their respective offices by the Board:

Name	Age	Position with the Registrant
David A. Brandon (1)	63	Chairman of the Board; Chief Executive Officer
Michael J. Short	55	Executive Vice President — Chief Financial Officer
Richard Barry	49	Executive Vice President — Global Chief Merchandising Officer
Timothy Grace	52	Vice Chairman; Executive Vice President — Global Chief Talent Officer
Dr. Wolfgang Link	48	President — Toys “R” Us, Europe
Kevin Macnab	55	Executive Vice President — Special Assistant/Office of the Chairman
Monika M. Merz	66	President — Toys “R” Us, Asia Pacific
David J. Schwartz	48	Executive Vice President — General Counsel & Corporate Secretary
Patrick J. Venezia	52	Executive Vice President — Global Store Operations

(1) Refer to “Directors” above for Mr. Brandon’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.

Mr. Grace has served as our Executive Vice President — Global Chief Talent Officer since September 2015. From March 2014to September 2015, Mr. Grace served as Group Vice President — Human Resources of L’Oreal Group. From April 2002 to March 2014, Mr. Grace served as Senior Vice President — Human Resources and Administration of Schindler Elevator Corporation.

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.

Mr. Macnab has served as our Executive Vice President — Special Assistant/Office of the Chairman since September 2015 and continues to provide leadership to Toys “R” Us (Canada) Ltd. (“Toys Canada”). From November 2007 to September 2015, Mr. Macnab served as President, Toys Canada. From May 2000 to October 2007, Mr. Macnab was Vice President of Finance, Real Estate and Information Technology for Toys Canada.

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 Canada. Prior to that, from October 1996 until January 2000, Ms. Merz served as Vice President and General Merchandise Manager for Toys Canada.

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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.

Mr. Venezia has served as our Executive Vice President — Global Store Operations since February 2016. From February 2014 to February 2016, Mr. Venezia served as our Senior Vice President — Store Operations. From August 2012 to February 2014, Mr. Venezia served as Head of Stores, Senior Vice President — Store Operations and Company Officer of The Pantry Inc., a convenience store chain. From February 2012 to August 2012, Mr. Venezia served as President of Title Max, a title lending business. From January 2008 to January 2012, he served in multiple operational roles for Walmart, culminating as Division President of the North East Division, SVP and Company Officer.

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 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 Messrs. Macnow and Goodman are “audit committee financial experts” within the meaning of the regulations adopted by the Securities and Exchange Commission. The Board has made the determination that Mr. Goodman is an independent member of the Audit Committee.

ITEM 11. EXECUTIVE COMPENSATION

We refer to the persons included in the Summary Compensation Table below as our “named executive officers.” References to “2015,” “2014,” and “2013” mean, respectively, our fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014, 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:

• David A. Brandon, Chairman of the Board and Chief Executive Officer;

• Michael J. Short, Executive Vice President — Chief Financial Officer;

• Richard Barry, Executive Vice President — Global Chief Merchandise Officer;

• Monika M. Merz, President — Toys “R” Us, Asia Pacific⁽¹⁾;

• David J. Schwartz, Executive Vice President — General Counsel & Corporate Secretary;

• Antonio Urcelay, Former Chairman of the Board and Chief Executive Officer⁽²⁾; and

• Deborah Derby, Former Vice Chairman and Executive Vice President⁽³⁾.

¹ Ms. Merz announced her retirement from the Company effective as of May 31, 2016.

² In connection with the appointment of Mr. Brandon, Mr. Urcelay stepped down from the Board in May 2015 and as Chief Executive Officer in July 2015. In addition, Mr. Urcelay, pursuant to his employment agreement, continued to make himself available from July 2015 until December 2015 to assist the Company in connection with Mr. Brandon’s transition to Chief Executive Officer.

³ Ms. Derby’s employment was terminated in August 2015.

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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.

Mr. Brandon’s immediate objective when he joined the Company in July 2015 was to have an incentive structure with common targets focused on the attainment of global financial targets and secondly to align key management into long-term company growth value.

Appointment of new Chief Executive Officer and Chairman of the Board

In July 2015, Mr. Brandon joined the Company as Chief Executive Officer and Chairman of the Board of Directors replacing Mr. Urcelay who notified the Company of his intention to retire from the Company effective December 15, 2015. The Company and Mr. Brandon entered into an employment agreement with an initial term of five years, with automatic renewals for successive one-year periods unless either party delivers a timely notice of non-renewal. Pursuant to his employment agreement, Mr. Brandon will be paid an initial annual base salary of $3,750,000 and he will be eligible to receive an annual bonus targeted at 120% of his annual base salary (with a maximum possible bonus of 160% of his annual base salary), subject to the achievement of certain performance criteria (prorated for 2015). In addition, Mr. Brandon received a one-time cash signing bonus of $4,250,000 and was also granted a long-term cash incentive award consisting of two payments of $18,750,000, which will vest and become earned in any fiscal year ending on or before January 2018 upon the achievement of certain performance criteria as further described below. In addition, Mr. Brandon was awarded 2,810,000 options under the Company's 2010 Incentive Plan, as amended (the “2010 Incentive Plan”), with an exercise price of $8.00 per share, which are subject to certain time-vesting and performance-vesting conditions, as further described below. Mr. Brandon is also entitled to additional severance benefits and perquisites and other arrangements described further below. The components of Mr. Brandon’s compensation was structured and determined by the Executive Committee of the Board. As noted earlier, the Board considered his significant retail experience gained while serving in various positions at Valassis Communications Inc. over a twenty year period including as its Chief Executive Officer. In addition, the Board considered the significant accomplishments achieved at Domino’s Pizza during Mr. Brandon’s eleven year term as its Chief Executive Officer.

Elements of Our Executive Compensation Program

Our executive compensation program consists of the following components:

• base salary;

• short-term annual incentive awards;

• long-term incentives;

• perquisites and other arrangements;

• other benefits; and

• benefits upon termination or change of control.

Mix of Total Compensation

Cash compensation includes base salary, annual incentive awards and certain long-term cash incentives. The annual incentive for top executive officers is targeted to be a significant portion of pay to emphasize compensation linked to company performance. In fiscal 2015, we also awarded long-term cash compensation incentive opportunities to select members of our

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Leadership Team. We also grant equity awards in connection with certain new hires. 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 fiscal 2015, we did not specifically engage in any additional benchmark analysis of 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 award eligibility and long term incentive award targets and eligibility. At that time, 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. For fiscal 2015, the recommendations from our human resources department (“Human Resources Department”) included consideration of prior year performance ratings, information contained in the Hay Group analysis and internal pay equity, and management presented its recommendations for overall compensation including the base salary, annual incentive awards and Long Term Incentive Program for fiscal 2015 to the Executive Committee of the Board.

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 2015, we hired Mr. Brandon as the Chief Executive Officer and Chairman of the Board of the Company. In determining his base salary, the Executive Committee of the Board considered Mr. Brandon’s previous roles as Chief Executive Officer at Valassis Communications Inc. and Domino’s Pizza as well as his demonstrated ability to contribute to the Company’s overall performance.

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 and the general economy. 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. In lieu of merit increases for fiscal 2015, Messrs. Barry, Schwartz and Urcelay and Mses. Merz and Derby were granted a one-time cash award of $63,336, $73,336, $70,880, $62,840 and $46,680, respectively. 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 2015, 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 was at the core of our strategic priorities for fiscal 2015, which were as follows:

• Make talent and culture a competitive advantage;

• Grow and build the TRU and BRU brands throughout the world;

• Create a world class experience for our customers - innovate and lead; and

• Create a strong financial foundation.

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. Brandon 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.

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The following table sets forth the personal business goals of our named executive officers for fiscal 2015:

Name	Personal Business Goals
Mr. Brandon	• Develop and deliver to market the 2015 Christmas campaign.
	• Develop 2016 Marketing Plan & Budget proposal to include retention and seasonal strategy.
	• Develop 2016 Q1 & Q2 Promotional and editorial calendar.
	• Develop BRU Campaign Idea and Architecture.
	•     Develop Corporate Identity recommendations.
	•     Investigate new model and strategy review for Customer Relationship Management.
	•     Develop case for change and recommendation in our social media strategy.
Mr. Short	•     Lead the Fit for Growth initiative and achieve cost savings target.
	•     Prepare a comprehensive, multi-year strategy to TRU’s capital structure and continue to work with advisors and lenders to evaluate opportunities.
	•     Enhance the Company’s planning and reporting capabilities including streamlining existing processes, improving reports, developing a more user friendly intuitive presentation of metrics, and incorporating advanced analytics.
	•     Improve the cost effectiveness of the Company’s core accounting and tax functions.
	•     Coordinate the development of a global system strategy beginning with the launch of our new website and extending into international ecommerce and core systems.
Mr. Barry	•     Achieve Sales and Margin plan, achieve dotcom sales and margin (including private label) and achieve budget inventory turn goal for global operations.
	•  Transform the customer experience in store and online.
	•  Develop high-performing, highly engaged, diverse teams.
	•  Deploy initiatives to become Fit for Growth.
Ms. Merz	•     Achieve 2015 budgeted EBITDA for her business and on a consolidated basis.
	•     Drive Asia Pacific Synergies to develop closer strategic cooperation and alignment across the region.
	•     Drive Fit For Growth initiatives to achieve budgeted savings.
	•     Continue to develop seamless retailing and the interactive store in the Asia Pacific Region to reflect the Toys “R” Us and Babies “R” Us brand.
Mr. Schwartz	•     Continuously provide timely, responsive, highest-quality legal and business advice, support and representation to the Company, the CEO, the Senior Leadership team, the Board of Directors and all global constituents.
	•     Coordinate efforts throughout the Company to maintain compliance with laws, regulations, our policies and procedures, our debt agreements and indentures, SEC requirements, shareholder agreements, and corporate governance policies and procedures.
	•     Provide leadership, guidance, and assistance for a transformational turn-around, including by leading capital structure revisions and refinancing efforts, new global expansion and other transformational efforts.
	•     Provide executive leadership and management to the Legal department, the Corporate Communications, Public Relations & Corporate Philanthropy department and the International Licensed Business department so that each group meets its goals and budgets for 2015.

We believe that the above criteria, when considered together, provide an appropriate method of measuring our executive officers’ personal performance. In March 2016, and based upon fiscal 2015 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

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believe that annual incentive awards encourage our executive officers to focus on specific short-term business and financial goals of the Company.

Each executive officer has an annual short term 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 established in their employment agreements and may be subsequently adjusted based upon market competitiveness and/or a promotion/demotion in responsibility. Our named executive officers’ fiscal 2015 award target payouts, expressed as a percentage of base salary, are as follows: Mr. Brandon, 120%; Mr. Short, 100%; Ms. Merz, 110%; Messrs. Barryand Schwartz, 100%; Mr. Urcelay, 150%; and Ms. Derby, 110%. Mr. Urcelay’s employment was terminated in December 2015 and he was eligible for a prorated annual short-term incentive award through October 31, 2015 for fiscal year 2015. Ms. Derby’s employment was terminated in August 2015 and she was eligible for a prorated annual short-term incentive award through August 3, 2015 for fiscal year 2015. Achievements range between a minimum of 0% and amaximum of 150%, with the exception of Mr. Brandon whose maximum is 160% of base salary, of target payout for each named executive officer, however, the Executive Committee of the Board has the sole discretion to determine whether a bonus is paid to an executive officer.

In fiscal 2015, consistent with previous years, our executive officers were awarded cash incentive awards with target annual cash incentive awards based substantially on financial components consisting primarily of the achievement of adjusted Earnings Before Interest Taxes Depreciation and Amortization (“Adjusted Compensation EBITDA”) targets on a Company-wide basis and for certain divisions of the Company, with weightings that varied from year to year. Following the appointment of Mr. Brandon during fiscal 2015, the Company determined to modify the annual incentive program in an effort to standardize the application of the program across executives and certain other employees, revising the targets to be based solely on the Company’s achievement of the Adjusted Compensation EBITDA target and such annual incentives became payable under the Team Achievement Dividend Plan (“TAD”).

We believe that this program motivates our executive officers to work to improve the growth potential of the Company and supports our long range goals and strategic business initiatives.

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, non-controlling interest, severance, gains or losses on sales of properties, asset impairments and accounting changes. More detail about the calculation of Adjusted Compensation EBITDA is set forth below.

We believe that focusing incentives on Adjusted Compensation EBITDA closely aligns the executive officers’ interests with those of our stakeholders. The Adjusted Compensation EBITDA targets for the Company as a whole 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 2016, we expect to maintain a design consistent with the fiscal 2015 design.

The Executive Committee of the Board sets the threshold, target and maximum funding levels for the Adjusted Compensation EBITDA metric. Achievements at the respective levels would result in a payment at, above, or below the target level of each executive officer’s percentage of base salary. If the actual Adjusted Compensation EBITDA performance is less than the minimum threshold, no payment would occur. If the actual Adjusted Compensation EBITDA performance is greater than the maximum threshold, payments would be capped at 150% of the executive officer’s annual award target (or in the case of Mr. Brandon, it would be capped at 160% of his base salary). Payouts of the actual annual award payments are interpolated between 0% and 100% for financial performance which falls between the minimum and target thresholds and 100% and 150% (or 160% of base salary in the case of Mr. Brandon) for financial performance which falls between the target and maximum thresholds.

Notwithstanding the formulas described above for the annual incentive, the Executive Committee of the Board has the discretion to adjust the annual incentive award payouts to executive officers.

The Adjusted Compensation EBITDA target for fiscal 2015 was $750,000,000 for the Company as a whole.

In fiscal 2015, the actual Adjusted Compensation EBITDA for the Company as a whole was higher than our Adjusted EBITDA due to adjustments of $12 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. For more information on the calculation of our Adjusted EBITDA, refer to Note 5 of Item 6 entitled “SELECTED FINANCIAL DATA” of this Annual Report on Form 10-K.

Based upon the achievement of the Adjusted Compensation EBITDA metric, the executive officers payout funded at 106% of their annual target bonus for fiscal 2015.

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Based on the Company’s performance the following are the final annual incentive payouts for fiscal 2015: $3,204,426 for Mr. Brandon (reflecting a pro rated payout), $743,614 for Mr. Short, $637,383 for Mr. Barry, $582,815 for Ms. Merz and $637,383 for Mr. Schwartz. Mr. Urcelay’s employment terminated in December 2015 and was entitled to a prorated annual payout of $1,318,188. Ms. Derby’s employment terminated in August 2015 and was entitled to a prorated annual payout of $413,482.

The “Grants of Plan-Based Awards in Fiscal 2015” table shows the threshold, target and maximum TAD awards that each of our named executive officers was eligible to receive in fiscal 2015. The actual payouts under TAD actually earned by our named executive officers in fiscal 2015 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. The Executive Committee of the Board has offered long-term incentives under 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 2015 Awards

In fiscal 2015, the shift toward granting cash awards rather than equity continued, with the exception of certain executives who received new hire equity grants.

Mr. Brandon

Pursuant to the term of his employment agreement, Mr. Brandon received a long-term cash incentive award, effective July 1, 2015, of two payments of $18,750,000 (the “Brandon Award”). The award will vest and become earned upon achievement of, in any fiscal year ending on or before the last day of the Company’s fiscal year ending January 2018, Adjusted EBITDA less average capital expenditures for the prior three fiscal years of $600,000,000. If earned, the first payment under the award will be made shortly following certification of achievement and the second payment under the award will be made one year following certification of achievement. This grant was awarded under the 2010 Incentive Plan.

Mr. Brandon was also awarded an option to purchase 2,810,000 shares of the Company’s common stock under the 2010 Incentive Plan with an exercise price of $8.00 per share, which option is subject to both a time-vesting and a performance-vesting condition (the “Brandon Options”). The time-vesting condition will be satisfied in equal monthly installments over 48 months following the grant date and the performance-vesting condition will be satisfied upon the Company’s achievement of, in any fiscal year ending on or before the last day of the Company’s fiscal year ending January 2021, Adjusted EBITDA less average capital expenditures for the prior three fiscal years of $750,000,000.

2015 Incentive Bonus

In November 2015, the Company granted Messrs. Short and Schwartz incentive bonuses of $3,000,000 and $1,200,000, respectively, under the 2010 Incentive Plan and in March 2016, the Company granted Mr. Barry an incentive bonus of $2,000,000 under the 2010 Incentive Plan (these awards and the Brandon Award, collectively referred to herein as the “2015 Incentive Bonus”). The target long-term performance cash awards were approved by the Executive Committee of the Board as recommended by Mr. Brandon. The performance vesting condition and payout structure for the 2015 Incentive Bonus is consistent with the Brandon Award, as described above. The Executive Committee of the Board determined these performance cash awards were advisable on the basis that this measurement period was in our best interests and sets realistic goals which will properly motivate our named executive officers.

2015 Award Exchange

In June 2015, certain participants were offered an opportunity to exchange their Old RSUs for New Options on a one RSU-for- two option basis (the “2015 Award Exchange”). On July 31, 2015, the Company closed its offer with a total of 64,381 Old RSUs canceled and 128,762 New Options issued under the 2010 Incentive Plan.

Messrs. Barry, Schwartz and Urcelay and Ms. Merz elected to participate in the 2015 Award Exchange, and exchanged 7,918, 9,168, 8,860 and 7,855 Old RSUs, respectively, for 15,836, 18,336, 17,720 and 15,710 New Options, respectively. Pursuant to the terms of the 2015 Award Exchange, New Options received in exchange for Old RSUs that were granted on May 24, 2013 will vest 50% on May 24, 2016 and 50% on May 24, 2017. As a condition to participating in the 2015 Award Exchange, each

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executive agreed that all shares issued to the executive under the 2010 Incentive Plan or the Toys “R” Us, Inc. 2005 Management Equity Plan (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.

2014 Long Term Performance Cash Awards and Previously Granted Retention Awards

In May 2014, the Company granted certain long term performance cash awards (the “2014 Long Term Incentive Awards”) under the 2010 Incentive Plan to our executive officers, including certain of our named executive officers, which were eligible for vesting based, in part, on our achievement of an Adjusted Compensation EBITDA target for fiscal 2015. In fiscal 2013 and fiscal 2014, the Company granted retention bonuses to certain of our executive officers. The 2014 Long Term Incentive Awards and these retention bonuses are described in more detail below under the section “NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND THE GRANTS OF PLAN-BASED AWARDS IN FISCAL 2015 TABLE.”

Perquisites and Other Arrangements

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. Pursuant to the terms of Mr. Brandon’s employment agreement, Mr. Brandon is also entitled to travel on a private aircraft provided by the Company for business travel, travel to meetings of the Company and to meetings of the boards of directors (and committees thereof on which he serves) of certain outside boards of directors, and once per calendar quarter, to Michigan, as well as certain payments to compensate Mr. Brandon for any resulting tax obligation. In addition, in connection with Mr. Brandon’s appointment to Chief Executive Officer, he has been granted additional perquisites as described in footnote 5 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 10 of the “SUMMARY COMPENSATION TABLE.” We believe that providing Mr. Brandon 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 named executive officers, refer to 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.

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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 2015, 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.

Pursuant to his employment agreement, Mr. Urcelay was entitled to receive annual contributions equal to 15% of his base salary (the “Contribution Amount”) until his retirement. The Contribution Amount was 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 and the 2010 Incentive Plan, 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.”

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 2015, 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.

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 2015, 2014 and 2013. Messrs. Barry and Schwartz were not named executive officers in 2013 and 2014 and Messrs. Brandon and Short joined the Company in 2015 and 2014, respectively; therefore, in accordance with SEC disclosure rules, information regarding compensation for the years that those individuals were not named executive officers is not included in the table below:

Name and Principal Position	Fiscal Year	Salary		Bonus(1)		Stock Awards(2)		Option Awards (2)		Non-Equity Incentive Plan Compensation(3)		Change in Pension Value and Nonqualified Deferred Compensation Earnings		All Other Compensation			Total
David A. Brandon, Chairman of the Board and Chief Executive Officer(4)	2015	$	2,452,023	$	4,250,000	$	—	$	8,536,541	$	3,204,426	$	—	$	161,549	(5)	$	18,604,539
Michael J. Short, EVP - Chief Financial Officer(6)	2015	700,000		—		—		—		743,614		—		647,775		(7)	2,091,389
	2014	417,308		—		—		1,444,838		550,000		—		2,766			2,414,912
Richard Barry, EVP - Global Chief Merchandise Officer	2015	600,000		1,263,336		—		—		1,441,383		—		80,714		(8)	3,385,433
Monika M. Merz, President - Toys “R” Us Asia Pacific (9)	2015	498,757		1,060,353		—		—		1,251,149		—		805,713		(10)	3,615,972
	2014	583,256		67,654		—		58,572		750,000		—		1,058,761			2,518,243
	2013	621,921		—		471,300		471,767		230,672		—		1,196,182			2,991,842
David J. Schwartz, EVP - General Counsel & Corporate Secretary	2015	600,000		1,273,336		—		—		1,722,783		—		77,806		(11)	3,673,925
Antonio Urcelay, Former Chairman of the Board and Chief Executive Officer(12)	2015	1,057,041		3,211,747		—		—		3,648,406		—		2,009,247		(13)	9,926,441
	2014	1,313,100		104,245		—		308,074		2,165,000		—		1,444,977			5,335,396
	2013	1,238,637		332,700		8,533,000		791,356		443,266		—		963,015			12,301,974
Deborah Derby, Former Vice Chairman & EVP(14)	2015	366,154		1,446,680		—		—		413,482		—		1,443,091		(15)	3,669,407
	2014	700,000		119,632		—		43,750		980,000		—		157,819			2,001,201
	2013	627,308		115,000		350,100		735,311		—		—		1,553,518			3,381,237

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(1) The amount for Mr. Brandon represents a sign-on bonus. For Messrs. Barry and Schwartz and Mses. Merz and Derby the 2015 amounts represent 2013 Retention Bonuses of $1,200,000, $1,200,000, $997,513 and $1,400,000, respectively, as well as lump sum bonuses in lieu of a 2015 merit increase of $63,336, $73,336, $62,840 and $46,680, respectively. For Mr. Urcelay the 2015 amount represents the 2013 Retention Bonus and 2014 Retention Bonus of $1,283,892 and $1,856,975, respectively, and a lump sum bonus in lieu of a 2015 merit increase of $70,880. Refer to “NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND THE GRANTS OF PLAN-BASED AWARDS IN FISCAL 2015 TABLE” below for further details on the retention bonuses.

(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.” Refer to the “OUTSTANDING EQUITY AWARDS AT 2015 FISCAL YEAR-END” table below for the vesting terms and conditions of these awards which are outstanding at the end of fiscal 2015. There was no incremental expense associated with the 2015 Award Exchange in which Messrs. Barry, Schwartz and Urcelay and Ms. Merz received New Options in place of Old RSUs. Amounts reported reflect the incremental expense recognized in fiscal 2014 (computed in accordance with ASC 718) related to option exchanges which was $58,572 for Ms. Merz, $308,074 for Mr. Urcelay, and $6,948 for Ms. Derby. Amounts reported also reflect the incremental expense recorded during fiscal 2013 (computed in accordance with ASC 718) related to certain awards that were required to be liability-classified as a result of certain amendments to the Management Equity Plan.  The incremental expense recognized in fiscal 2013 related to an option exchange and option extension which was $10,333 for Ms. Merz, $270,883 for Mr. Urcelay, and $172 for Ms. Derby.

(3) These amounts represent the annual incentive bonus, as well as the 2014 Long Term Incentive Award that was granted in 2014 and will be paid in April 2016 as a result of the Company meeting the performance targets. Messrs. Brandon, Short, Barry, Schwartz and Urcelay and Mses. Merz and Derby received an annual incentive bonus of $3,204,426, $743,614, $637,383, $637,383, $1,318,188, $582,815 and $413,482, respectively (pro-rated in the case of Mr. Urcelay and Ms. Derby). Messrs. Barry, Schwartz and Urcelay and Ms. Merz will receive $804,000, $1,085,400, $1,330,218 and $668,334, respectively, related to the 2014 Long Term Incentive Award, subject to continued service through April 2016 (except in the case of Mr. Urcelay due to his retirement). Additionally, Mr. Urcelay also received a Special Performance Bonus in Q3 2015 of $1,000,000 as a result of the Company meeting certain performance targets. Refer to “NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND THE GRANTS OF PLAN-BASED AWARDS IN FISCAL 2015 TABLE” below for further details on the 2014 Long Term Incentive Award and the Special Performance Bonus.

(4) Mr. Brandon was hired in June 2015. The amounts presented for fiscal 2015 represent his pro rata compensation.

(5) Includes $140,290 for relocation costs paid by the Company inclusive of gross-up amount of $62,010, $8,924 for car allowances and car lease, $11,467 for the incremental costs to the Company (calculated based upon the hourly rate, fuel costs and flight crew expenses) for Mr. Brandon’s personal usage of the corporate plane inclusive of gross-up amount of $3,335, and $868 of other items including for life insurance premiums and long-term disability premiums. Mr. Brandon is also permitted to have additional guests on the corporate plane for which there is no incremental cost to the Company.

(6) Mr. Short was hired in June 2014. The amounts presented for fiscal 2014 represent his pro rata compensation.

(7) Includes $585,666 for relocation costs paid by the Company inclusive of gross-up amount of $46,014, $39,400 of Company contribution to the SERP, $20,000 for financial planning, and $2,709 of other items including for life insurance premiums, Company contributions to a Health Savings Account and long-term disability premiums.

(8) Includes $41,400 of Company contribution to the SERP, $21,600 for car allowance, $13,154 of Company matching contribution to the Savings Plan and $4,560 of other items including for financial planning, life insurance premiums, Company contribution to Health Savings Account and long-term disability premiums.

(9) 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 2015 - 1.0000 CAD = 0.7685 USD

• Fiscal 2014 - 1.0000 CAD = 0.8987 USD

• Fiscal 2013 - 1.0000 CAD = 0.9633 USD

• For fiscal 2015, as it relates to the payments of the lump sum bonus in lieu of 2015 merit increase, the payout was converted using the exchange rate on the date of payment of 1.0000 CAD = 0.7923 USD.

• For fiscals 2014 and 2015, as it relates to the payment of the annual incentive, the payout was and will be, respectively, converted to Canadian dollars on the date of payment.

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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 2015 - 1.0000 JPY = 0.00827 USD

• Fiscal 2014 - 1.0000 JPY = 0.00937 USD

• Fiscal 2013 - 1.0000 JPY = 0.01012 USD

(10) Includes gross-up amounts of $264,347 for host country local benefits, $135,990 for Japanese estimated national income tax for fiscal 2015, $148,931 for housing, $98,396 Company contributions to the Deferred Profit Sharing Plan, $50,432 for a Cost of Living Allowance (COLA), $41,383 for home leave for Ms. Merz and her spouse, $24,396 for tax equalization, $15,370 for a car allowance, $7,097 for Executive Wellness (benefit expenses not covered by the health plan), $5,103 for premiums for ex-patriate health care coverage for Ms. Merz and her spouse, and $14,268 of other items including for Company contribution to the RRSP, utilities, club fees for the American Club, tax preparations, furniture rental and language lessons.

(11) Includes $41,400 of Company contribution to the SERP, $21,600 for car allowance, $10,600 of Company matching contributions to the Savings Plan, and $4,206 of other items including for an Executive Physical, life insurance premiums, Company contribution to the Health Savings Account and long-term disability premiums.

(12) 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 2015 - 1.0000 EURO = 1.1030 USD

• Fiscal 2014 - 1.0000 EURO = 1.3131 USD

• Fiscal 2013 - 1.0000 EURO = 1.3308 USD

• For fiscal 2015, as it relates to the payments of the lump sum bonus in lieu of 2015 merit increase, the payout was converted using the exchange rate on the date of payment of 1.0000 EURO = 1.076 USD, the Special Performance Bonus was converted using the exchange rate on the date of payment of 1.0000 EURO = 1.091 USD and the 2014 Retention Bonus was converted using the exchange rate on the date of payment of 1.0000 EURO = 1.1077 USD.

• For fiscals 2014 and 2015, as it relates to the payment of the annual incentive, the payout was and will be, respectively, converted to Euros on the date of payment.

(13) Includes gross-up amounts of $1,559,985 for United States taxes paid by the Company, $321,263 for the purchase of annuity products under the MAPFRE Policies inclusive of gross-up amount of $155,813, $66,032 for commuting expenses, $29,591 for executive life insurance premiums, $18,733 for a leased car, $13,086 for executive medical premiums and $557 for financial planning services.

(14) Ms. Derby’s employment was terminated in August 2015. The salary and annual incentive bonus amounts presented for fiscal 2015 represent her pro rata compensation.

(15) Includes $1,400,000 for severance earned in fiscal 2015, $16,461 for financial planning services, $8,770 for a leased car, $8,246 of Company matching contribution to the Savings Plan, $5,760 for COBRA costs, and $3,854 of other items including for an Executive Physical, Company contribution to a Health Savings Account, life insurance premiums and long-term disability premiums.

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GRANTS OF PLAN-BASED AWARDS IN FISCAL 2015

The following table provides information on grants of plan-based awards to our named executive officers in fiscal 2015:

					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)(1)		Grant Date Fair Value of Stock and Option Awards(2)
Name	Award Type		Approval Date	Grant Date	Threshold(#)	Target (#)		Maximum (#)		Threshold (#)	Target (#)			Maximum (#)
Brandon	TAD	(3)(4)			—	$	4,500,000	$	6,000,000	—	—			—	—	—		$	—	$	—
	LTIP	(5)(6)			—	37,500,000		—		—	—			—	—	—		—		—
			5/31/2015	7/1/2015	—	—		—		—	2,810,000	(7	)	—	—	—		8.00		8,536,541		(7)
Short	TAD	(3)(4)			—	700,000		1,050,000		—	—			—	—	—		—		—
	LTIP	(5)(6)			—	3,000,000		—		—	—			—	—	—		—		—
Barry	TAD	(3)(4)			—	600,000		900,000		—	—			—	—	—		—		—
			3/5/2015	8/3/2015	—	—		—		—	—			—	—	15,836	(8)	8.00		—		(8)
Merz	TAD	(3)(4)			—	548,632		822,948		—	—			—	—	—		—		—
			3/5/2015	8/3/2015	—	—		—		—	—			—	—	15,710	(8)	8.00		—		(8)
										—	—			—
Schwartz	TAD	(3)(4)			—	600,000		900,000		—	—			—	—	—		—		—
			3/5/2015	8/3/2015	—	—		—		—	—			—	—	18,336	(8)	8.00		—		(8)
	LTIP	(5)(6)			—	1,200,000		—		—	—			—	—	—		—		—
Urcelay	TAD	(3)(4)			—	1,585,562		2,378,343		—	—			—	—	—		—		—
			3/5/2015	8/3/2015	—	—		—		—	—			—	—	17,720	(8)	8.00		—		(8)
Derby(9)	TAD	(3)(4)			—	770,000		1,155,000		—	—			—	—	—		—		—
			3/5/2015	8/3/2015	—	—		—		—	—			—	—	11,670	(8)	8.00		—		(8)

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(1) We utilized a per share value of $8.00, which was the fair value of our shares of common stock as determined by the Board of Directors on May 4, 2015, the most recent valuation date prior to the date of the grant. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

(2) These awards were granted under the 2010 Incentive Plan. These amounts represent the aggregate grant date fair value, if any, 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.

(3) These amounts reflect estimated possible payouts under our TAD granted for fiscal 2015. Each named executive officer’s target payout was the following percentage of his or her base salary: 120% for Mr. Brandon, 110% for Ms. Merz, 100% for Mr. Short, Mr. Barry and Mr. Schwartz, 150% for Mr. Urcelay and 110% for Ms. Derby. Mr. Brandon is eligible for a prorated annual short-term incentive based on the actual number of days he is employed in fiscal year 2015, which would result in a target of $2,942,428 and a maximum of $3,923,237. Mr. Urcelay’s employment was terminated in December 2015 and he was eligible for a prorated annual short-term incentive award through October 31, 2015 for fiscal year 2015. Ms. Derby’s employment was terminated in August 2015 and she was eligible for a prorated annual short-term incentive award through August 3, 2015 for fiscal year 2015. The target payout is based solely on the Company's fiscal performance profitability metric, Adjusted Earnings Before Interest Taxes Depreciation and Amortization used for compensation purposes. For more information, refer to the “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—ANNUAL INCENTIVE AWARDS” section set forth above.

(4) The Executive Committee of the Board sets the threshold, target and maximum funding levels for the Adjusted Compensation EBITDA of the TAD. Achievements at the respective levels would result in a payment at, above, or below the target level of each executive officer’s percentage of base salary. If the actual Adjusted Compensation EBITDA performance is less than the minimum threshold, no payments would occur. If the actual Adjusted Compensation EBITDA performance is greater than the maximum threshold, payments would be capped at 150%, or 160% of base salary for Mr. Brandon, of the executive officer’s annual TAD award target. Payouts of the actual annual TAD award payments are interpolated between 0% and 100% for financial performance which falls between the minimum and target thresholds and 100% and 150%, or 160% of base salary for Mr. Brandon, for financial performance which falls between the target and maximum thresholds. For a further description of these awards, refer to the “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—ANNUAL INCENTIVE AWARDS” set forth above.

(5) These amounts reflect estimated possible payouts under our long-term incentive plan awards granted during fiscal 2015. For more information, refer to the “ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM—LONG TERM INCENTIVE” section set forth above.

(6) These awards were granted under the 2010 Incentive Plan and shall vest and become non-forfeitable if, in any fiscal year of the Company ending on or before the last day of the Company's fiscal year ending January 2018, the Company achieves $600,000,000 in Adjusted EBITDA less the average capital expenditures for the prior three fiscal years. Payout of 50% of the award is within 30 days following the date on which the annual audited financial statements of the Company are delivered to the Company and approved by the Board. The remaining 50% of the payout is on the first anniversary of the first payment date.

(7) This award was granted under the 2010 Incentive Plan and is subject to time-vesting and performance-vesting conditions. The performance-vesting condition shall be satisfied if, in any fiscal year of the Company ending on or before the last day of the Company's fiscal year ending 2021, the Company achieves $750,000,000 in Adjusted EBITDA less the average capital expenditures for the prior three fiscal years. The time-vesting condition will be satisfied in equal monthly installments over a period of forty-eight (48) months from the Grant Date.

(8) These options were granted under the 2010 Incentive Plan in exchange for forfeiting the remaining outstanding restricted stock units that were granted on May 24, 2013. There was no incremental expense associated with this exchange (computed in accordance with ASC 718).

(9) Ms. Derby’s options are included because they were granted on August 3, 2015. These options were unvested and therefore forfeited upon her termination on August 3, 2015.

NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND THE GRANTS OF PLAN-BASED AWARDS IN FISCAL 2015 TABLE:

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.

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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 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 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 2015 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.

In May 2015, the 2010 Incentive Plan was further amended to increase the number of shares available thereunder by 3,000,000 shares. Additionally, in March 2016, the 2010 Incentive Plan was further amended to increase the number of shares available thereunder by 1,000,000 shares.

2014 Option Exchange, 2015 Award Exchange and 2014 Short Option Award

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 (“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. Messrs. Barry, Schwartz and Urcelay and Ms. Merz elected to participate in the 2014 Option Exchange, and exchanged 40,309, 146,695, 181,877 and 48,896 old Options, respectively, for an equal number of new options.

In June 2014, 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. In addition, Mr. Short received a one-time award of 30,000 stock options, which will vest in four equal annual installments commencing October 10, 2015 (these options and the Additional Options collectively referred to herein as the “2014 Short Option Award”). For more information, see “OUTSTANDING EQUITY AWARDS AT 2015 FISCAL YEAR-END.”

Pursuant to the terms of the award agreements for the 2014 Option Exchange, the 2015 Award Exchange and the 2014 Short Option Award, the portion of an executive officer’s stock options that have fully vested as of such executive officer’s termination date (unless termination was due to cause) shall be exercisable up to the applicable expiration date as set forth in the respective award.

2014 Long Term Performance Cash Awards

In May 2014, we granted certain long-term performance cash awards (the “2014 Long Term Incentive Awards”) under the 2010 Incentive Plan to our executive officers, including certain of our named executive officers. The target long-term performance cash awards as a percentage of base salary for our named executive officers were as follows: 100% for Mr. Barry and Ms. Merz, 135% for Mr. Schwartz, 120% for Mr. Urcelay and 135% for Ms. Derby.

The long-term performance cash award will vest and become payable based on achievement of the performance metric for fiscal 2015 and continuous service over a two year period ending in April 2016 (with certain exceptions, including retirement).

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The 2014 Long Term Incentive Award’s target is Adjusted Compensation EBITDA of $800,000,000 for fiscal 2015, based upon achievement (further adjusted based on 2014 budgeted foreign exchange rates), the 2014 Long Term Incentive Award will pay out at 134% of target assuming continuous service through the period ending in April 2016 (other than for Mr. Urcelay who retired in 2015). Messrs. Barry, Schwartz and Urcelay and Ms. Merz shall be entitled to receive the following payments: $804,000, $1,085,400, $1,330,218 and $668,334, respectively. As Ms. Derby’s employment terminated in August 2015, she forfeited her 2014 Long Term Incentive Award.

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 his employment agreement with Toys Spain, dated March 3, 2014. Pursuant to the amendment, Mr. Urcelay was eligible to receive a performance bonus (the “Special Performance Bonus”) equal to $1,000,000 subject to the achievement of Consolidated Adjusted EBITDA of $600,000,000 for the twelve month period ending on the last day of the Company’s third fiscal quarter of 2015. The Special Performance Bonus was paid out in December 2015.

Retention Bonuses

In fiscal 2013, the Company granted Messrs. Barry, Schwartz and Urcelay and Ms. Merz retention bonuses (the “2013 Retention Bonus”) in the amount of $1,200,000, $1,200,000, €1,164,000 ($1,500,047 based on the Company’s average annual conversion rate in fiscal 2012 as specified in the award agreement) and CAD $1,298,000 ($1,300,856 million based on the Company’s average annual conversion rate in fiscal 2012 as specified in the award agreement), respectively, and Ms. Derby in the amount of $1,400,000 which was granted in fiscal 2014 pursuant to her amended employment agreement, which vested and were paid in March 2015.

In fiscal 2014, the Company granted Messrs. Barry and Schwartz and Mses. Derby and Merz retention bonuses (the “2014 Retention Bonus”) in the amount of $600,000, $600,000, $700,000 and CAD $649,000 ($583,256 based on the Company’s average annual conversion rate in fiscal 2014), respectively, which became payable on March 11, 2016 subject to their continued employment with the Company on such date. If their employment were to have been terminated by the Company for any reason other than Cause on or after September 11, 2015 and before final payout in March 2016, then the retention bonus would have been paid to the respective executive officer on a pro rata basis based on the number of full months that had elapsed from March 11, 2014. In making these grants, the Executive Committee of the Board determined these awards to be advisable in promoting retention and incentivizing these officers during a transition period. As Ms. Derby’s employment terminated in August 2015, she was not entitled to a pro rata payout under the 2014 Retention Bonus.

Pursuant to the amendment to his employment agreement, Mr. Urcelay was granted a 2014 Retention Bonus of $2,000,000, which was subsequently reduced to $1,856,975 in connection with Mr. Urcelay’s retirement and vested on October 31, 2015.

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OUTSTANDING EQUITY AWARDS AT 2015 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 Unexercisable (#)	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price		Option Expiration Date(8)	Number of Shares or Units of Stock That Have Not Vested	Market Value of Shares or Units of Stock That Have Not Vested	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
Brandon	7/1/2015	(1)	—	—	2,810,000	$	8.00	7/1/2025	—	—	—	—
Short	10/10/2014	(2)	7,500	22,500	—	8.00		10/10/2024	—	—	—	—
	10/10/2014	(2)	56,250	168,750	—	8.00		10/10/2024	—	—	—	—
	10/10/2014	(3)	—	—	225,000	8.00		10/10/2024	—	—	—	—
Barry	10/10/2014	(4)	11,214	3,738	—	8.00		10/10/2021	—	—	—	—
	10/10/2014	(2)	6,339	19,018	—	8.00		12/23/2023	—	—	—	—
	8/3/2015	(5)	—	15,836	—	8.00		8/3/2025	—	—	—	—
Merz(7)	10/10/2014	(2)	12,224	36,672	—	8.00		12/23/2023	—	—	—	—
	8/3/2015	(5)	—	15,710	—	8.00		8/3/2025	—	—	—	—
Schwartz	10/10/2014	(4)	17,604	5,868	—	8.00		10/10/2021	—	—	—	—
	10/10/2014	(4)	18,256	6,086	—	8.00		10/10/2021	—	—	—	—
	10/10/2014	(2)	12,103	36,312	—	8.00		12/23/2023	—	—	—	—
	10/10/2014	(4)	37,849	12,617	—	8.00		10/10/2021	—	—	—	—
	8/3/2015	(5)	—	18,336	—	8.00		8/3/2025	—	—	—	—
Urcelay(7)	10/10/2014	(4)	122,841	—	—	8.00		10/10/2021	—	—	—	—
	10/10/2014	(2)	59,036	—	—	8.00		12/23/2023	—	—	—	—
	10/14/2014	(6)	363,700	—	—	8.00		11/5/2023	—	—	—	—
	8/3/2015	(5)	17,720	—	—	8.00		8/3/2025	—	—	—	—
Derby(9)	—		—	—	—	—		—	—	—	—	—

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(1) These options are subject to both a time-vesting and a performance-vesting condition. The time-vesting condition will be satisfied in equal monthly installments over 48 months following the grant date and the performance-vesting condition will be satisfied upon the Company’s achievement, in any fiscal year ending on or before the last day of the Company’s fiscal year ending January 2021, of $750,000,000 of Adjusted EBITDA less average capital expenditures for the prior three fiscal years. 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 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.”

(3) 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 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) 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.”

(5) These awards vest 50% on May 24, 2016 and 50% on May 24, 2017. The vesting of these awards may accelerate under certain circumstances as further described below in “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL.”

(6) The options issued in replacement of restricted stock units are subject to the same vesting schedule that applied to the restricted stock units as of immediately prior to the cancellation (50% vested on October 31, 2014, and 12.5% vested on each of January 31, 2015, April 30, 2015, July 31, 2015 and October 31, 2015).

(7) The awards granted to Ms. Merz will become fully vested and exercisable upon retirement as she meets 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). Upon retirement in December 2015, the awards granted to Mr. Urcelay became fully vested and exercisable as he met the age and service criteria for retirement. Ms. Merz has announced her retirement from the Company effective May 31, 2016. Upon retirement, the awards granted to Ms. Merz will become fully vested and exercisable as she has met the age and service criteria for retirement.

(8) Pursuant to the terms of the award agreements for the 2014 Option Exchange and the 2015 Award Exchange, the portion of an executive officer’s stock options that have fully vested as of such executive officer’s termination date (unless termination was due to cause) shall be exercisable up to the applicable expiration date as set forth in the respective award.

(9) Ms. Derby’s employment was terminated in August 2015, therefore, all outstanding and unvested options were forfeited.

OPTION EXERCISES AND STOCK VESTED FOR FISCAL 2015

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 2015:

	Option Awards			Stock Awards
Name	Number of Shares Acquired on Exercise	Value Realized on Exercise (1)		Number of Shares Acquired on Vesting	Value Realized on Vesting
Brandon	—	$	—	—	$	—
Short	—	—		—	—
Barry	—	—		7,917	63,336
Merz	—	—		7,855	62,840
Schwartz	—	—		9,167	73,336
Urcelay	—	—		8,860	70,880
Derby	—	—		5,835	46,680

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(1) 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 determined by the Board of Directors on May 4, 2015, the most recent determination date prior to the date of vesting. As we are a privately held company, the value of shares of common stock is only available when a valuation is performed.

NONQUALIFIED DEFERRED COMPENSATION FOR FISCAL 2015

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(3)		Aggregate Balance at Last FYE (4)
Brandon	$	—	$	—	$	—		$	—	$	—
Short	—		39,400		(273		)	—		39,127
Barry	—		41,400		(4,650		)	—		167,683
Merz	—		—		—			—		—
Schwartz	—		41,400		(64,584		)	—		285,429
Urcelay (5)	—		321,263		66,137			—		1,289,890
Derby	—		—		1,751			31,991		—

(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. Brandon’s employment commenced in July 2015, 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. Due to the fact that Ms. Derby’s employment terminated in August 2015, she did not receive a contribution during fiscal 2015. 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 TAD 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 for fiscal 2015 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 U.S. 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. In conjunction with Ms. Derby’s employment with the Company being terminated in August 2015, Ms. Derby received a SERP distribution paid in a lump sum.

(4) Of the aggregate balance amount set forth in this column, $30,240 was previously reported in the Summary Compensation table for Ms. Derby for prior fiscal years and $1,608,615 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 which become payable upon retirement, although no distributions were made to Mr. Urcelay in fiscal 2015.

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.

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For Messrs. Brandon, Short, Barry and Schwartz

Termination for Cause, Resignation Without Good Reason (including Retirement).  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) including retirement, 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.

In addition, if the employment for Mr. Short is terminated for cause or he resigns without good reason, Mr. Short shall be required to reimburse the Company for 100% of relocation expenses if such termination occurs on or before the second anniversary of the commencement date of employment and 50% of such expenses if such termination occurs after the second anniversary of the commencement date of employment but before the third anniversary for of the commencement.

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.

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 Messrs. Brandon, Barry and Schwartz) 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.

Mr. Brandon shall also be entitled to the following:

• upon execution of a release of claims in favor of the Company, an amount equal to 1.6 times his then-current base salary, which amount is 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);

• if a change in control of the Company occurs prior to a public offering and Mr. Brandon receives payments and benefits that would cause him to be subject to the excise tax triggered under Section 4999 of the Internal Revenue Code, he will receive an additional amount sufficient to cover 50% of (i) the amount of such excise tax and (ii) any applicable federal, state income and employment taxes that may apply to the additional amounts paid; and

• reimbursement of all costs: (i) reasonably incurred in connection with relocating his family back to Michigan and (ii) all costs incurred in connection with the early termination of his lease for housing in the New Jersey area.

Messrs. Barry, Schwartz 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 two times the sum of (x) the executives then-current base salary and (y) executive’s target annual bonus (provided however, if Mr. Short’s employment terminates prior to the second anniversary of the commencement of his employment (June 23, 2016), he

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shall only be entitled to an amount equal to the two times the sum of his then-current base salary), which amount is 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).

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. Brandon, Barry, Schwartz and Short 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 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) including retirement, 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 or Resignation for Good Reason.  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 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

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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; and

• 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) time she accepts other employment and becomes eligible for dental and life insurance coverage.

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. Urcelay

Pursuant to the terms of his employment agreement and as a result of Mr. Urcelay’s retirement in December 2015, Mr. Urcelay will be entitled to a lump sum payment of €1,195,093 ($1,318,188 based on the Company’s average annual conversion rate in fiscal 2015), which represents his pro rata payout under the TAD for fiscal 2015. Additionally, Mr. Urcelay will be entitled to a lump sum payment of €1,206,000 ($1,330,218 based on the Company’s average annual conversion rate in fiscal 2015), which represents his pro rata payout for the 2014 Long Term Performance Cash Award. In addition, Mr. Urcelay’s prior grants of 92,708 stock options, with a $741,664 value as of January 30, 2016, based on an $8.00 per share value, became fully vested. In addition, pursuant to the terms of the employment agreement, Mr. Urcelay is subject to a non-compete covenant for a twenty four (24) month period.

For Ms. Derby

Prior to Ms. Derby’s termination in August 2015, we maintained an employment agreement with her with similar terms and restrictive covenants to the agreement described above for Mr. Short. The termination of her employment with us was treated as a termination without cause pursuant to her employment agreement. Pursuant to her employment agreement, Ms. Derby received a severance payment of a lump sum amount of $1,400,000. Ms. Derby will also be entitled to a lump sum payment of $413,482, which represents her pro rata payout under the TAD for fiscal 2015. In addition, Ms. Derby is entitled to continuation of medical, dental and life insurance benefits, with Ms. Derby paying a portion of such costs as if her employment had not terminated, until the earlier to occur of (i) August 2017 or (ii) the date on which Ms. Derby commences to be eligible for coverage under substantially comparable medical, dental and life insurance benefit plans from any subsequent employer (the “Benefit Continuation Period”). The estimated Company cost during the Benefit Continuation Period is $18,115. 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. The estimated Company cost for these continued benefits is $337,729. In addition, pursuant to the terms of the employment agreement, Ms. Derby is subject to certain restrictive covenants, including non-compete, non-solicit and confidentiality obligations for a twenty four (24) month period.

The 2010 Incentive Plan

The 2010 Incentive Plan and the award agreements thereunder govern the vesting and exercise of stock options, restricted stock, restricted stock units and cash-based incentives upon termination of employment.

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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, other than with respect to the 2015 Incentive Bonus and the Brandon Options, as described below. 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, other than with respect to the 2015 Incentive Bonus and the Brandon Options as described below, (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, 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 2016, Ms. Merz is currently retirement eligible and has notified the Company of her intention to retire effective May 2016.

Under the 2010 Incentive Plan and unless the award agreements thereunder states otherwise, 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 or for good reason; (ii) 90 days after such executive officer’s Termination Date if the executive officer terminates without good reason (unless such termination occurs after the executive officer has attained eligibility for retirement); and (iii) immediately upon termination if such executive officer is terminated with cause. Award agreements for awards issued in the 2014 Option Exchange, 2015 Award Exchange and the 2014 Short Option Award provide that vested awards will remain exercisable until the original expiration date of such awards.

Unless otherwise specified in an award agreement, if an executive officer’s employment with the Company or any of its subsidiaries is terminated for any reason (including a termination by the Company with or without cause, a resignation by the Participant for any reason, or a termination due to retirement, death or disability), then at any time during the one (1) year period commencing on the later of (i) the termination date of employment and (ii) for each share of stock acquired upon exercise of an option, the date on which such share was acquired upon such exercise, the Company may elect to purchase all or any portion of the shares of stock issued or issuable to such individual at a price per share equal to the fair market value thereof, in each case as determined as of a date determined by the Board that is the anticipated date of the closing of the repurchase. In addition, if the Company does not repurchase all of the executive’s shares, the Sponsors shall have the right to repurchase such shares of stock.

Unless otherwise specified in an employment agreement, upon the occurrence of a change in control (as defined in the 2010 Incentive Plan), (i) awards for outstanding time-based 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 (x) the performance-vesting conditions will not be waived for Mr. Short’s Additional Options and (y) all payments for the 2015 Incentive Bonus and the vesting of the Brandon Options shall be in full and shall not be pro-rated. Please refer to the “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.

For the expiration and vesting of option awards in connection with the 2014 Option Exchange and the 2015 Award Exchange, please “NARRATIVE SUPPLEMENT TO THE SUMMARY COMPENSATION TABLE AND THE GRANTS OF PLAN-BASED AWARD IN FISCAL 2015 TABLE”.

2015 Incentive Bonus

The 2015 Incentive Bonus will vest upon the achievement of specified performance criteria consistent with the Brandon Award granted in July 2015, including Consolidated Adjusted EBITDA less Capital Expenditure criteria in any fiscal year of the Company ending on or before January 2018, payable in two installments. The first installment is payable within thirty (30) days following the date on which the performance criteria is achieved with the second installment payable on the first anniversary of the first payment date. Assuming their employment terminates on or prior to the end of fiscal 2018 for any reason other than for cause or without good reason, Messrs. Brandon, Barry, Short and Schwartz will be entitled to the payout of their 2015 Incentive Bonus, provided that the performance metric is achieved during the fiscal year in which their employment terminates, all subject

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to the terms of their respective award agreements. Refer to “POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL—SUMMARY OF PAYMENTS AND BENEFITS UPON TERMINATION OR CHANGE IN CONTROL” below for further details.

Brandon Options

If Mr. Brandon’s employment is terminated by the Company without Cause (and not due to death or permanent disability) or by him for Good Reason (as such terms are defined in his employment agreement, where Good Reason includes notice by the Company that it is not extending the employment term), then the time-vesting condition will be deemed satisfied in full and the option will remain outstanding through the last day of the fiscal year subsequent to the fiscal year in which such termination occurs for purposes of determining whether the performance-vesting condition has been satisfied. If Mr. Brandon’s employment is terminated due to death or permanent disability, then the time-vesting condition will be deemed satisfied in full and, for purposes of determining whether the performance-vesting condition has been satisfied, the option will remain outstanding through the last day of the fiscal year in which such termination occurs. In either case, if the performance-vesting condition is satisfied during the applicable post-termination period, the option will vest in full, and if not satisfied during the applicable period, will be forfeited without consideration. If Mr. Brandon terminates his employment without Good Reason, the unvested portion of the option will be canceled without consideration. The option will vest and become exercisable in full upon a change in control. The vested portion of the option will remain exercisable until the tenth anniversary of the grant date. If Mr. Brandon’s employment is terminated by the Company for Cause, the vested and unvested portions of the option shall be immediately forfeited without consideration.

If the option has vested, Mr. Brandon has the right, exercisable at any time after June 29, 2020 and until the earlier of a change in control or a public offering of the Company, and subject to applicable law and restrictions in the Company’s debt and equity financing agreements, to sell back to the Company 50% of the shares of the Company’s common stock that he received upon exercise of the option or, to the extent not exercised, 50% of the shares remaining subject to the option, at the then current per share fair market value (less the exercise price for shares that remain subject to the option) as determined by the Board of Directors, which determination shall take into account, but not be bound by, certain specified factors.

Retention Bonus

If the employment of Messrs. Barry and Schwartz and Ms. Merz had been terminated by the Company without cause, the executive officer would have been entitled to receive a pro rata portion of their respective 2014 Retention Bonus, granted in fiscal 2014 (based upon the number of months elapsed since March 2014) in the event their employment would have terminated after September 11, 2015 and before March 11, 2016, and such amount would have been paid as a lump sum payment within thirty (30) days following the date of such termination.

Summary of Payments and Benefits Upon Termination or Change in Control

TAD Plan

Under the TAD plan, unless otherwise stated in an executive officer’s employment agreement, an executive officer, who retires after the plan year but before the payout date, will still be eligible to receive their TAD award if they retire after attaining age sixty (60) and more than ten (10) years of continuous service.

Also, and unless otherwise stated in an executive officer’s employment agreement, the beneficiary or estate of a deceased executive officer during a plan year shall be entitled to a pro rata portion of the TAD award, assuming applicable performance goals are achieved, based on the date of death and number of days the executive officer was employed during the plan year.

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The following tables summarize the estimated value of the termination payments and benefits that each of our named executive officers, other than Mr. Urcelay and Ms. Derby, would receive if there was a change in control and/or his or her employment was terminated on January 30, 2016 under the various circumstances described in the tables. Unless otherwise indicated in the tables below, the awards granted under the 2010 Incentive Plan are subject to the repurchase rights and other rights and obligations described above:

DAVID A. BRANDON

Type of Payment	Termination for Cause or Resignation Without Good Reason		Termination Without Cause or Resignation for Good Reason		Retirement(1)		Death		Long-Term Disability		Change  in Control		Termination or Specified Resignation Due to a Change of Control
Severance(2)	$	—	$	6,000,000	$	—	$	—	$	—	$	—	$	6,000,000
Fiscal 2015 TAD(3)	—		3,204,426		—		3,204,426		3,204,426		3,204,426		3,204,426
2015 Incentive Bonus(4)	—		37,500,000		—		37,500,000		37,500,000		37,500,000		37,500,000
Fiscal 2015 Stock Option Grant(5)	—		—		—		—		—		—		—
Benefit Continuation(6)	—		17,688		—		—		—		—		17,688
TOTAL	$	—	$	46,722,114	$	—	$	40,704,426	$	40,704,426	$	40,704,426	$	46,722,114

(1) Pursuant to the 2010 Incentive Plan, awards would vest upon retirement date. Because retirement eligibility is defined as attaining age 60 with at least ten (10) years of continuous service, Mr. Brandon is not retirement eligible.

(2) Severance amounts payable due to 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) In the event of a change in control and/or termination without cause or resignation for good reason, a lump sum payment would be made for any TAD that is earned but unpaid. Upon death or disability, a lump sum payment would be made for a pro rata portion of the TAD based on the percentage of the fiscal year that has elapsed through the date in which the death or disability occurs.

(4) Pursuant to the 2010 Incentive Plan, upon death or disability, the performance cash award will remain outstanding through the last day of the fiscal year in which such termination occurs and the award will vest if the performance conditions are actually met by the end of the period. Upon termination by the Company without Cause or a resignation for Good Reason, the performance cash award will remain outstanding through the last day of the fiscal year subsequent to the fiscal year in which such termination occurs and the award will vest if the performance conditions are actually met by the end of the period. In calculating the amounts set forth in the table, we assumed achievement of the financial metric. Upon a change in control, the performance cash award is deemed earned in full.

(5) In the event that Mr. Brandon is terminated by the Company without Cause or resigns for Good Reason, the time-vesting condition will be deemed satisfied in full and the options will remain outstanding through the last day of the fiscal year subsequent to the fiscal year in which such termination occurs for purposes of determining whether the performance-vesting conditions have been satisfied. If such termination is due to death or permanent disability, the option will remain outstanding through the last day of the fiscal year in which such death or permanent disability occurs. 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 determined by the Board of Directors on May 4, 2015. 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) Represents estimated Company costs based on fiscal 2015 actual amounts (and estimated amounts for the 2015 period prior to Mr. Brandon’s hiring) for medical, dental and life insurance coverage for the duration of the two (2) year severance period. The amount excludes estimates for certain relocation costs upon termination.

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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MICHAEL J. SHORT

	Termination for Cause or Resignation Without Good Reason(1)		Termination Without Cause or Resignation For Good  Reason		Retirement(2)		Death		Long-Term Disability		Change in Control		Termination Without  Cause or Resignation for Good Reason in Connection with a Change of Control
Severance(3)	$	—	$	1,400,000	$	—	$	—	$	—	$	—	$	1,400,000
Fiscal 2015 TAD(4)	—		743,614		—		743,614		743,614		743,614		743,614
Fiscal 2014 Stock Option Grant(5)	—		—		—		—		—		—		—
2015 Incentive Bonus(6)	—		3,000,000		—		3,000,000		3,000,000		3,000,000		3,000,000
Benefit Continuation(7)	—		19,277		—		—		—		—		19,277
TOTAL	$	—	$	5,162,891	$	—	$	3,743,614	$	3,743,614	$	3,743,614	$	5,162,891

(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) Pursuant to the 2010 Incentive Plan, awards would vest upon retirement date. Because retirement eligibility is defined as attaining age 60 with at least ten (10) years of continuous service, Mr. Short is not retirement eligible.

(3) 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.

(4) In the event of a change in control and/or termination without cause or resignation for good reason, a lump sum payment would be made for any TAD that is earned but unpaid. Upon death or disability, a lump sum payment would be made for a pro rata portion of the TAD based on the percentage of the fiscal year that has elapsed through the date in which the death or disability occurs.

(5) 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 determined by the Board of Directors on May 4, 2015. 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 2015.

(6) Pursuant to the 2010 Incentive Plan, upon death or disability, the performance cash award will remain outstanding through the last day of the fiscal year in which such termination occurs and the award will vest if the performance conditions are actually met by the end of the period. Upon termination by the Company without Cause or a resignation for Good Reason, the performance cash award will remain outstanding through the last day of the fiscal year subsequent to the fiscal year in which such termination occurs and the award will vest if the performance conditions are actually met by the end of the period. In calculating the amounts set forth in the table, we assumed achievement of the financial metric. Upon a change in control, the performance cash award is deemed earned in full.

(7) Represents estimated Company costs based on fiscal 2015 actual amounts 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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RICHARD BARRY

Type of Payment	Termination for Cause or Resignation Without Good  Reason		Termination Without Cause or Resignation For Good  Reason		Retirement(1)		Death		Long-Term Disability		Change in Control		Termination Without  Cause or Resignation for Good Reason in Connection with a Change of Control
Severance(2)	$	—	$	2,400,000	$	—	$	—	$	—	$	—	$	2,400,000
Fiscal 2015 TAD(3)	—		637,383		—		637,383		637,383		637,383		637,383
Fiscal 2015 Stock Option Grant(4)	—		—		—		—		—		—		—
Fiscal 2014 Stock Option Grant(4)	—		—		—		—		—		—		—
2014 LTIP(5)	—		—		—		268,112		268,112		268,112		268,112
Retention(6)	—		550,000		—		550,000		550,000		550,000		550,000
Benefit Continuation(7)	—		25,100		—		—		—		—		25,100
TOTAL	$	—	$	3,612,483	$	—	$	1,455,495	$	1,455,495	$	1,455,495	$	3,880,595

(1) Pursuant to the 2010 Incentive Plan, awards would vest upon retirement date. Because retirement eligibility is defined as attaining age 60 with at least ten (10) years of continuous service, Mr. Barry is not retirement eligible.

(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) In the event of a change in control and/or termination without cause or resignation for good reason, a lump sum payment would be made for any TAD that is earned but unpaid. Upon death or disability, a lump sum payment would be made for a pro rata portion of the TAD based on the percentage of the fiscal year that has elapsed through the date in which the death or disability occurs.

(4) Pursuant to the 2010 Incentive Plan, the unvested portion of options will accelerate and become vested upon retirement, death, disability or change of 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 determined by the Board of Directors on May 4, 2015. 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) Retention amount is prorated based on the number of months that have elapsed from the grant date through January 30, 2016.

(7) Represents estimated Company costs based on fiscal 2015 actual amounts for medical, dental and life insurance coverage for the duration of the two (2) year 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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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 (2)		Death		Long-Term Disability		Change in Control		Termination Without  Cause or Resignation for Good Reason in Connection with a Change of Control
Severance(3)	$	—	$	2,094,777	$	2,094,777	$	2,094,777	$	—	$	—	$	—	$	—	$	2,094,777
Fiscal 2015 TAD(4)	—		582,815		582,815		582,815		—		582,815		—		—		582,815
Fiscal 2015 Option Grant(5)	—		—		—		—		—		—		—		—		—
Fiscal 2014 Stock Option Grant(5)	—		—		—		—		—		—		—		—		—
2014 LTIP(6)	—		—		—		—		222,871		222,871		222,871		445,742		445,742
Retention(7)	—		457,193		457,193		457,193		457,193		457,193		457,193		457,193		457,193
Benefit Continuation(8)	—		24,400		24,400		24,400		—		—		—		—		24,400
TOTAL	$	—	$	3,159,185	$	3,159,185	$	3,159,185	$	680,064	$	1,262,879	$	680,064	$	902,935	$	3,604,927

(1) All amounts calculated in Canadian dollars have been converted to USD using the rate of 1.0000 CAD = 0.7685 USD.

(2) Pursuant to the 2010 Incentive Plan, awards would vest upon retirement date. Because retirement eligibility is defined as attaining age 60 with at least ten (10) years of continuous service, Ms. Merz has satisfied the retirement eligibility criteria.

(3) 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.

(4) In the event of a change in control, termination without cause or resignation for good reason (which includes expiration of employment term), termination due to reassignment of position or death, a lump sum payment would be made for any TAD that is earned but unpaid.

(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 determined by the Board of Directors on May 4, 2015. 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.

(6) 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.

(7) Retention amount is prorated based on the number of months that have elapsed from the grant date through January 30, 2016.

(8) 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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DAVID J. SCHWARTZ

Type of Payment	Termination for Cause or ResignationWithout Good  Reason		Termination Without Cause or Resignation For Good  Reason		Retirement(1)		Death		Long-Term Disability		Change in Control		Termination Without  Cause or Resignation for Good Reason in Connection with a Change of Control
Severance(2)	$	—	$	2,400,000	$	—	$	—	$	—	$	—	$	2,400,000
Fiscal 2015 TAD(3)	—		637,383		—		637,383		637,383		637,383		637,383
Fiscal 2015 Stock Option Grant(4)	—		—		—		—		—		—		—
2015 Incentive Bonus(5)	—		1,200,000		—		1,200,000		1,200,000		1,200,000		1,200,000
2014 LTIP(6)	—		—		—		361,951		361,951		361,951		361,951
Fiscal 2014 Stock Option Grant(4)	—		—		—		—		—		—		—
Retention(7)	—		550,000		—		550,000		550,000		550,000		550,000
Benefit Continuation(8)	—		25,100		—		—		—		—		25,100
TOTAL	$	—	$	4,812,483	$	—	$	2,749,334	$	2,749,334	$	2,749,334	$	5,174,434

(1) Pursuant to the 2010 Incentive Plan, awards would vest upon retirement date. Because retirement eligibility is defined as attaining age 60 with at least ten (10) years of continuous service, Mr. Schwartz is not retirement eligible.

(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) In the event of a change in control and/or termination without cause or resignation for good reason, a lump sum payment would be made for any TAD that is earned but unpaid. Upon death or disability, a lump sum payment would be made for a pro rata portion of the TAD based on the percentage of the fiscal year that has elapsed through the date in which the death or disability occurs.

(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 utilized a per share value of $8.00, which was the fair value of our shares of common stock as determined by the Board of Directors on May 4, 2015. 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 death or disability, the performance cash award will remain outstanding through the last day of the fiscal year in which such termination occurs and the award will vest if the performance conditions are actually met by the end of the period. Upon termination by the Company without Cause or a resignation for Good Reason, the performance cash award will remain outstanding through the last day of the fiscal year subsequent to the fiscal year in which such termination occurs and the award will vest if the performance conditions are actually met by the end of the period. In calculating the amounts set forth in the table, we assumed achievement of the financial metric. Upon a change in control, the performance cash award is deemed earned in full.

(6) 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 vesting of the award is based on performance conditions. 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.

(7) Retention amount is prorated based on the number of months that elapsed from the grant date through January 30, 2016.

(8) Represents estimated Company costs based on fiscal 2015 actual amounts for medical, dental and life insurance coverage for the duration of the two (2) year 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

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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.

DIRECTOR COMPENSATION IN FISCAL 2015

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. 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). In addition, Messrs. Markee and Sales also received a final board member payment and an additional option award in connection with their separation on September 15, 2015. The table below sets forth payments made to our non-management directors in fiscal 2015:

Name	Fees Earned or Paid in Cash ($)		Stock Awards (1) ($)		Option Awards (1) ($)		Non-Equity Incentive Plan Compensation ($)	Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)	All Other Compensation ($)	Total ($)
Joshua Bekenstein	—		—		—		—	—	—	—
Michael M. Calbert	—		—		—		—	—	—	—
Michael D. Fascitelli	—		—		—		—	—	—	—
Paul E. Raether	—		—		—		—	—	—	—
Richard Goodman(2)	150,000	(3)	100,000	(3)	—		—	—	—	250,000
Daniel Guglielmone	—		—		—		—	—	—	—
Matthew S. Levin	—		—		—		—	—	—	—
Joseph Macnow	—		—		—		—	—	—	—
Richard L. Markee(4)	177,000	(5)	150,000	(5)	300,000	(5)	—	—	—	627,000
Wayne C. Sales(6)	300,000	(7)	150,000	(7)	150,000	(7)				600,000
Wendy Silverstein	—		—		—		—	—	—	—
Nathaniel H. Taylor	—		—		—		—	—	—	—
Antonio Urcelay	—		—		—		—	—	—	—
Michael Ward	—		—		—		—	—	—	—
Adam Waglay	—		—		—		—	—	—	—
Gregory R. Why	—		—		—		—	—	—	—

(1) These amounts represent the aggregate grant date fair value of equity awards granted in fiscal 2015 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."

(2) At the end of fiscal 2015, Mr. Goodman held 12,500 unvested restricted stock units. In addition, Mr. Goodman has deferred receipt of shares deliverable upon settlement of 15,909 restricted stock units, which were awarded for his services in fiscal 2012 and 2014, 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 service in fiscal 2013, until the earlier of June 20, 2018 or his separation from service from the Company's Board of Directors.

(3) During fiscal 2015, Mr. Goodman was paid $150,000, 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 2015.

(4) At the end of fiscal 2015, Mr. Markee held 37,500 vested stock options and 3,410 vested restricted stock units.

(5) During fiscal 2015, Mr. Markee was paid $177,000, which amount represents his annual cash retainer as well as his final board member payment (per his separation on September 15, 2015). In addition, Mr. Markee was granted an award of $150,000 of restricted stock units, which amount represents his annual grant for fiscal 2015. These RSUs

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were forfeited on September 15, 2015. Mr. Markee was also granted an award of 37,500 stock options with a grant date fair value of $8.00 per share.

(6) At the end of fiscal 2015, Mr. Sales held 18,750 vested stock options and 18,750 vested restricted stock units.

(7) During fiscal 2015, Mr. Sales was paid $300,000, which amount represents his annual cash retainer as well as his final board member payment (per his separation on September 15, 2015). In addition, Mr. Sales was granted an award of $150,000 of restricted stock units, which amount represents his annual grant for fiscal 2015. These RSUs were forfeited on September 15, 2015. Mr. Sales was also granted an award of 18,750 stock options with a grant date fair value of $8.00 per share.

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, 2016, 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	32.50	%
Toybox Holdings, LLC (4)	16,040,405	16,040,405	32.50	%
Vornado Truck LLC (5)	16,040,405	16,040,405	32.50	%
Richard Barry	9,039	26,592	0.05	%
Joshua Bekenstein (3)	—	—	—	%
David A. Brandon	—	—	—	%
Deborah Derby	41,017	41,017	0.08	%
Richard Goodman	—	19,244	0.04	%
Matthew S. Levin (3)	—	—	—	%
Joseph Macnow (5)	—	—	—	%
Monika M. Merz	18,379	30,603	0.06	%
Paul E. Raether(4)	—	—	—	%
David J. Schwartz	14,116	99,928	0.20	%
Michael J. Short	—	63,750	0.13	%
Wendy Silverstein (5)	—	—	—	%
Nathaniel H. Taylor (4)	—	—	—	%
Antonio Urcelay	15,285	578,582	1.17	%
Directors and executive officers as a group (21 persons)	110,135	957,810	1.94	%

* 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, 2016 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, 2016, 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

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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 and Matthew S. Levin 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 and Levin may be deemed to be the beneficial owner of the shares held by the Bain Capital Entities. Each of Messrs. Bekenstein and Levin disclaims beneficial ownership of the shares held by the Bain Capital Entities.

(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. Raether and Taylor 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. Raether and Taylor 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, refer to 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. Raether and Taylor, 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, Mr. Macnow is a member of our Board of Directors and also an executive of Vornado Realty Trust. As such, he may be deemed to be a beneficial owner of these shares. He disclaims 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 30, 2016 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	6,039,862	(1)	$	8.15	1,960,254	(2)
Equity compensation plans not approved by security holders	—		—		—
Total	6,039,862		$	8.15	1,960,254

(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

Sponsor Advisory Agreement

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 August 29, 2014, June 1, 2015

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and December 1, 2015 (“Advisory Agreement”). The initial term of the Advisory Agreement was ten years, with the ability to extend annually for one year unless we or the Sponsors provide notice of termination to the other. 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 management and advisory fees (the “Advisory 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.

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.  The amendment provided that 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.

In June 2015, the Advisory Agreement was further amended in order to reduce the Advisory Fees payable in fiscal 2015 and thereafter from $17 million to $6 million annually with no further adjustment upon an IPO for such reductions. We recorded Advisory Fees of $6 million, $17 million and $22 million for fiscals 2015, 2014 and 2013, respectively. During fiscals 2015, 2014 and 2013, we also paid the Sponsors for out-of-pocket expenses, which were less than $1 million, respectively.

Additionally, the original Advisory Agreement provided 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”). Transaction Fees were capitalized as deferred debt issuance costs and amortized over the term of the related debt agreement and included in Other assets on our prior year Consolidated Balance Sheet. In December 2015, the Advisory Agreement was further amended to waive all Transaction Fees including prior accrued and unpaid transaction fees of $47 million as well as any fees to be paid upon an IPO.

Other Relationships and Transactions with our Sponsors

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. KKR owned the following aggregate amounts of our debt as of January 30, 2016 and January 31, 2015. For further details, refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

(In millions)	January 30, 2016		January 31, 2015
Propco I Term Loan Facility	$	16	$	17
Incremental Secured Term Loan	12		12
Secured Term B-4 Loan	2		96
Second Incremental Secured Term Loan	2		2
2017 Notes	—		9
Total	$	32	$	136

During fiscals 2015, 2014 and 2013, affiliates of 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 $7 million in fiscal 2015 and $10 million in fiscals 2014 and 2013, respectively.

Additionally, under lease agreements with affiliates of Vornado, we paid an aggregate amount of $8 million in fiscals 2015, 2014 and 2013, respectively, with respect to 0.6%, 0.7% and 0.8%, respectively, of our operated stores, which include Express stores. Of the aggregate amount paid in fiscals 2015, 2014 and 2013, $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.

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The 2010 Incentive Plan

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. On May 31, 2015, the Board of Directors adopted amendments to the 2010 Incentive Plan and Amended and Restated Certificate of Incorporation, which were adopted by the stockholders of the Company on June 1, 2015.  Amendment No. 3 to the 2010 Incentive Plan increased the number of shares available thereunder by 3,000,000 shares and Amendment No. 1 to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of Common Stock by 5,000,000 shares. For a description of the 2010 Incentive Plan, refer to Item 11 entitled “EXECUTIVE COMPENSATION” of this Annual Report on Form 10-K.

Subsequent Event

On March 9, 2016, the Board of Directors of the Company adopted amendments to the 2010 Incentive Plan and the Amended and Restated Certificate of Incorporation, as amended, which were adopted by the stockholders of the Company on March 22, 2016. The amendment to the Company’s 2010 Incentive Plan increased the number of shares of the Company’s common stock available thereunder by 1,000,000 shares and the amendment to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of the Company’s common stock by 5,000,000 shares.

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. Brandon, our Chief Executive Officer, and Mr. Goodman, 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.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Appointment of Independent Registered Public Accounting Firm

On June 16, 2015, the Audit Committee of the Board approved the replacement of the Company’s independent registered public accounting firm, Deloitte & Touche LLP (“D&T”), and engaged Ernst & Young LLP (“EY”) as the new independent registered public accounting firm of the Company and its subsidiaries, including Toys “R” Us – Delaware, Inc., Toys “R” Us

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Property Company I, LLC and Toys “R” Us Property Company II, LLC. The dismissal and appointment was a result of a competitive bidding process involving several accounting firms, including D&T.

The Audit Committee appointed EY as the Company’s independent registered public accounting firm to conduct the audit of the Company’s Consolidated Financial Statements for fiscal 2015. The Audit Committee appointed D&T to conduct the audit of the Company’s Consolidated Financial Statements for fiscal 2014.

Audit Fees and Non-audit Fees

The aggregate fees billed by EY and D&T along with their respective affiliates for professional services rendered for the audit of the annual Consolidated Financial Statements and for the reviews of the financial statements included in our Quarterly Reports on Form 10-Q for fiscals 2015 and 2014, respectively, and for other services rendered during those fiscal years were as follows:

	Fiscal 2015						Fiscal 2014
	EY		D&T		Total		D&T
Audit Fees (1)	$	4,067,000	$	219,000	$	4,286,000	$	4,880,000
Audit-Related Fees (2)	127,000		536,000		663,000		1,585,000
Tax Fees (3)	139,000		22,000		161,000		166,000
Total Fees	$	4,333,000	$	777,000	$	5,110,000	$	6,631,000

(1) For fiscals 2015 and 2014, the audit fees consisted of 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 2015, audit-related fees primarily consisted of fees related to special purpose audits. For fiscal 2014, audit-related fees primarily consisted of fees related to special purpose audits, the COSO 2013 implementation and refinancing transactions.

(3) For fiscals 2015 and 2014, tax fees consisted of a variety of U.S. Federal, state and non-U.S. tax advisory and compliance 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 EY and 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. Refer to 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 155 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/   DAVID A. BRANDON        

David A. Brandon

Chairman of the Board and

Chief Executive Officer

Date: March 24, 2016

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 24th day of March 2016.

Signature	Title
/s/    DAVID A. BRANDON David A. Brandon	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
* Matthew S. Levin	Director
* Joseph Macnow	Director
* Paul E. Raether	Director
* Wendy Silverstein	Director
* Nathaniel H. Taylor	Director

The foregoing constitutes all of the Board of Directors and the Principal Executive, Financial and Accounting Officers of the Registrant.

*By	/S/    DAVID A. BRANDON
	David A. Brandon
	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	Amendment No. 1 to the Amended and Restated Certificate of Incorporation of the Registrant filed with the Secretary of State of the State of Delaware on June 3, 2015 (filed as Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 12, 2015 and incorporated herein by reference).
3.3	Amendment No. 2 to the Amended and Restated Certificate of Incorporation of the Registrant filed with the Secretary of State of the State of Delaware on March 22, 2016.
3.4	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.
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).

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Exhibit No.	Document
4.12	Form of the 10.375% Senior Notes (included in Exhibit 4.11).
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) (filed as Exhibit 10.2 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2015, filed on March 26, 2015 and incorporated herein by reference).
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	Second Amended and Restated Syndicated Facility Agreement, dated as of December 18, 2015, among TRU Europe Limited, TRU Iberia Holdings 1, S.L. U. (formerly known as Nutley, S.L.U.), 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 Iberia, S.A.U and other Obligors party thereto from time to time, the Lenders party thereto, Deutsche Bank AG, New York Branch, as Administrative Agent, Security Agent and 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 International Bank, as Documentation Agents.

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Exhibit No.	Document
10.6	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).
10.7	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).
10.8	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).
10.9	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).
10.10	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) (filed as Exhibit 10.11 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 31, 2015, filed on March 26, 2015 and incorporated herein by reference).
10.11	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).
10.12	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).
10.13	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).
10.14	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).
10.15	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).

157

Exhibit No.	Document
10.16	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).
10.17	Amendment No. 2, dated October 14, 2015, to the Stockholders Agreement among the Registrant (as successor to Toys “R” Us Holdings, Inc.), 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.
10.18	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).
10.19	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).
10.20	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).
10.21	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).
10.22	Amendment No. 4, dated June 1, 2015, 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 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 12, 2015 and incorporated herein by reference).
10.23	Amendment No. 5, effective as of December 1, 2015, to the Advisory Agreement among the Registrant, Bain Capital Partners, LLC, Bain Capital, Ltd., Kohlberg Kravis Roberts & Co., L.P. and Vornado Truck LLC.
10.24	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).
10.25	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).
10.26	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).
10.27*	Form of TAD (Team Achievement Dividend) Plan of Toys “R” Us, Inc.
10.28*	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).
10.29*	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).

158

Exhibit No.	Document
10.30*	Amendment No. 3, effective as of June 1, 2015, to the 2010 Incentive Plan (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 12, 2015 and incorporated herein by reference).
10.31*	Amendment No. 4, dated as of March 22, 2016 to the 2010 Incentive Plan.
10.32*	October 2014 NonQualified 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).
10.33*	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).
10.34*	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).
10.35*	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).
10.36*	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).
10.37*	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).
10.38*	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).
10.39*	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).
10.40*	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).
10.41*	Form of Toys “R” Us, Inc. Incentive Award Agreement for David A. Brandon (filed as Exhibit A to Mr. Brandon’s employment agreement which was filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on June 4, 2015 and incorporated herein by reference).
10.42*	Form of Toys “R” Us, Inc. Performance Based Nonqualified Stock Option Agreement for David A. Brandon (filed as Exhibit B to Mr. Brandon’s employment agreement which was filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on June 4, 2015 and incorporated herein by reference).
10.43*	Form of Toys “R” Us, Inc. Nonqualified Stock Option Agreement, effective October 2015, for Executive Officers for awards under the 2010 Incentive Plan.
10.44*	Form of Leadership Team Cash LTIP Award Agreement under the Toys “R” Us, Inc. 2010 Incentive Plan, effective as of November 2015.
10.45*	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).

159

Exhibit No.	Document
10.46*	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).
10.47*	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).
10.48*	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).
10.49*	Employment Agreement between Toys “R” Us, Inc. and David A. Brandon, dated as of June 1, 2015 (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on June 4, 2015 and incorporated herein by reference).
10.50*	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).
10.51*	Employment Agreement between Toys “R” Us, Inc. and Richard Barry, dated as of December 10, 2012.
10.52*	Letter Agreement between Toys “R’ Us, Inc. and Richard Barry, dated as of October 20, 2014.
10.53*	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).
10.54*	Employment Agreement between Toys “R” Us, Inc. and David J. Schwartz, dated as of December 10, 2012 (filed as Exhibit 10.49 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 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).
10.56*	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).
10.57*	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).
10.58*	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).
10.59*	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).
10.60*	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).

160

Exhibit No.	Document
10.61*	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).
10.62*	Antonio Urcelay Forty-five (45) Day Transition Period Letter, dated May 28, 2015 (filed as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q, filed on June 12, 2015 and incorporated herein by reference).
10.63*	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).
10.64*	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).
10.65*	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 (filed as Exhibit 18 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).
21	Subsidiaries of the Registrant as of January 30, 2016.
24	Power of Attorney, dated March 17, 2016.
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.

161

EX-3.3

Exhibit 3.3

AMENDMENT NO. 2 TO THE

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

OF

TOYS “R” US, INC.

Toys “R” Us, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Corporation”), hereby certifies as follows:

1.    The name of the Corporation is Toys “R” Us, Inc. The Corporation filed its original Certificate of Incorporation with the Secretary of State of the State of Delaware on October 26, 1993, under the name Toys “R” Us – Headquarters, Inc., filed a Restated Certificate of Incorporation with the Secretary of State of the State of Delaware on January 2, 1996 under the name of Toys “R” Us, Inc., filed a Restated Certificate of Incorporation with the Secretary of State of the State of Delaware on July 21, 2005, filed Amendment No. 1 to the Restated Certificate of Incorporation of July 21, 2005 with the Secretary of State of the State of Delaware on June 10, 2008, filed an Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware on June 10, 2008 (the “2008 Amended and Restated Certificate”) and filed Amendment No. 1 to the 2008 Amended and Restated Certificate with the Secretary of State of the State of Delaware on June 3, 2015 (as so amended, the “Amended and Restated Certificate”).

2.     Effective on the date hereof, Article FOUR, clause (i) of the Amended and Restated Certificate is hereby amended and restated in its entirety as follows:

“(i) Authorized Shares. The total number of shares of stock which the Corporation has authority to issue is 65,000,000 shares of common stock, par value one-tenth of one cent ($0.001) per share (the “Common Stock”).”

3.     All other provisions of the Amended and Restated Certificate shall remain in full force and effect.

4.    Pursuant to Sections 228 and 242 of the Delaware General Corporation Law, the foregoing amendment to the Amended and Restated Certificate has been duly adopted and amends the provisions of the Amended and Restated Certificate of Incorporation of the Corporation as set forth herein.

IN WITNESS WHEREOF, the undersigned has executed this Amendment No. 2 to the Amended and Restated Certificate of Incorporation of Toys “R” Us, Inc. to be effective as of the date of the signature hereto, as indicated below.

TOYS “R” US, INC.

By: /s/ David J. Schwartz        

Name: David J. Schwartz

Title: Executive Vice President –

General Counsel and Corporate Secretary

Date signed: March 22, 2016

EX-4.3

EXHIBIT 4.3

TOYS "R" US, INC.

and

UNITED JERSEY BANK,

Trustee

----------------------------------------------------

First Supplemental Indenture

Dated as of January 1, 1996

------------------------------------------------------

To Evidence the Assumption by

TOYS "R" US, INC. (f/k/a TOYS "R" US-HEADQUARTERS, INC.)

of the Obligations of

TOYS "R" US-DELAWARE, INC. (f/k/a TOYS "R" US, INC.)

under the

INDENTURE

Dated as of August 29, 1991

----------------------------------------------------------

FIRST SUPPLEMENTAL INDENTURE, dated as of January 1, 1996 (the "First Supplement"), among TOYS "R" US-DELAWARE, INC. (f/k/a TOYS "R" US, INC.), a Delaware corporation (the "Predecessor"), TOYS "R" US, INC. (f/k/a TOYS "R" US-HEADQUARTERS, INC.), a Delaware corporation (the "Company"), and UNITED JERSEY BANK, a New Jersey banking corporation, as trustee (the "Trustee").

RECITALS

The Company's predecessor, the Predecessor, and the Trustee have heretofore executed an Indenture, dated as of August 29, 1991 (the "Indenture"), under which Securities (as defined in the Indenture) of the Predecessor were issued and are outstanding.

Effective as of 5:00 p.m. on the date hereof (the "Effective Time"), pursuant to Section 251(g) of the Delaware General Corporation Law and the Agreement and Plan of Merger, dated as of December 8, 1995 (the "Agreement and Plan of Merger"), among the Predecessor, the Company and TRU Interim, Inc., a wholly-owned Delaware subsidiary of the Company, each share of common stock, par value $.10 per share, of the Predecessor issued and outstanding or held in its treasury immediately prior to the Effective Time was converted into one share of common stock, par value $.10 per share, of the Company ("Company Common Stock"), the Predecessor became a direct wholly-owned subsidiary of the Company and the Company became the holding company for Toys "R" Us' operating subsidiaries.

Pursuant to Section 2.5.1 of the Agreement and Plan of Merger, at the Effective Time, the Company assumed the obligations of the Predecessor in respect the Predecessor's outstanding publicly-held debt that was issued under the Indenture. In addition, the Predecessor and the Company executed an Instrument of Assumption, dated as of December 8, 1995, pursuant to which the Company will assume, as of the Effective Time, the obligations of the Predecessor arising from the terms, covenants, conditions and provisions of the Indenture.

The Company, as a successor corporation, desires to succeed to the Predecessor's rights and obligations under the Securities and the Indenture and to comply with the requirements of the Indenture with respect to the execution of a supplemental indenture in connection with such succession and assumption of obligations.

NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:

For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Securities, as follows:

1.Assumption. The Company hereby assumes from the Predecessor and undertakes to perform, pay or discharge all obligations of the Predecessor, in lieu of and in substitution for the Predecessor, arising from the terms, covenants, conditions and provisions

2

of the Indenture, including the due and punctual payment of the principal of (and premium, if any) and interest on all the Securities (as defined in the Indenture) and the performance of every covenant of the Indenture on the part of the Predecessor to be performed or observed.

2.Substitution of Successor Corporation. The Company shall succeed to, and be substituted for, and may exercise every right and power of, the Predecessor under the Indenture with the same effect as if the Company had been named as the Predecessor therein.

3.Governing Law. This First Supplement shall be construed in accordance with and governed by the laws of the State of New York.

4.Counterparts. This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

5.Trustee Not Responsible. The recitals contained herein shall be taken as the statements of the Company and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this First Supplement.

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of the day and year first above written.

TOYS "R" US, INC.

By: /s/ Louis Lipschitz        

Name: Louis Lipschitz        

Title: Senior Vice President – Finance and Chief Financial Officer

Attest:

/s/ Andre Weiss            

Secretary

TOYS “R” US-DELAWARE, INC.

By: /s/ Louis Lipschitz        

Name: Louis Lipschitz        

Title: Senior Vice President – Finance and Chief Financial Officer

Attest:

/s/ Andre Weiss            

Secretary

3

UNITED JERSEY BANK

By: /s/ Donna J. Flanagan        

Name: Donna J. Flanagan

Title: Vice President

Attest:

/s/ Debra Schwalb        

Title: Assistant Secretary

4

EX-10.5

EXHIBIT 10.5

Execution Version

SECOND AMENDED AND RESTATED SYNDICATED FACILITY AGREEMENT

among

TRU EUROPE LIMITED,

CERTAIN OF ITS SUBSIDIARIES FROM TIME TO TIME PARTY HERETO,

TRU IBERIA HOLDINGS 1, S.L.U. (FORMERLY KNOWN AS NUTLEY, S.L.U.),

CERTAIN OF ITS SUBSIDIARIES FROM TIME TO TIME PARTY HERETO

TRU AUSTRALIA HOLDINGS, LLC,

CERTAIN OF ITS SUBSIDIARIES FROM TIME TO TIME PARTY HERETO,

VARIOUS LENDERS,

DEUTSCHE BANK AG NEW YORK BRANCH,
as ADMINISTRATIVE AGENT, SECURITY AGENT and FACILITY AGENT,

and

DEUTSCHE BANK AG NEW YORK BRANCH

and

BANK OF AMERICA, N.A.,
as CO-COLLATERAL AGENTS

_____________________________

Dated as of October 15, 2009,
as amended and restated as of March 8, 2011,
as amended as of March 20, 2013,
and as further amended and restated as of December 18, 2015

________________________________

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 INTERNATIONAL BANK

as DOCUMENTATION AGENTS

Americas 90821884

Table of Contents

Section 1.	Definitions and Accounting Terms	1
1.01	Defined Terms	1
1.02	Interpretation	56
1.03	Terms Generally	57
Section 2.	Amount and Terms of Credit	57
2.01	The Commitments	57
2.02	Minimum Amount of Each Borrowing	58
2.03	Notice of Borrowing	58
2.04	Disbursement of Funds	59
2.05	Notes	59
2.06	Continuations	60
2.07	Pro Rata Borrowings	60
2.08	Interest	60
2.09	Interest Periods	61
2.10	Increased Costs, Illegality, etc	62
2.11	Compensation	65
2.12	Change of Lending Office	65
2.13	Replacement of Lenders	65
2.14	Incremental Loan Commitments	67
2.15	Obligors’ Agent as Agent for Obligors	68
Section 3.	Letters of Credit	69
3.01	Letters of Credit	69
3.02	Maximum Letter of Credit Outstandings; Currencies Final Maturities	70
3.03	Letter of Credit Requests; Minimum Stated Amount	70
3.04	Letter of Credit Participations	71
3.05	Agreement to Repay Letter of Credit Drawings	73
3.06	Increased Costs	73
Section 4.	Commitment Commission; Fees; Reductions of Commitment	74
4.01	Fees	74
4.02	Voluntary Termination of Unutilized Commitments	75
4.03	Mandatory Reduction of Commitments.	75
Section 5.	Prepayments; Payments; Taxes	76
5.01	Voluntary Prepayments	76
5.02	Mandatory Repayments; Cash Collateralization	76
5.03	Method and Place of Payment	79
5.04	Tax Gross-Up and Indemnities.	83
5.05	Public Offer	96
5.06	Net Payments	96
Section 6.	Conditions Precedent to the Second Restatement Effective Date and to Credit Events on the Second Restatement Effective Date	96
6.01	Second Restatement Effective Date; Notes	97
6.02	Officer’s Certificate	97
6.03	Opinions of Counsel	97

Americas 90821884

6.04	Company Documents; Proceedings; etc.	98
6.05	Fees, etc	99
6.06	Supplemental Information Certificate	99
6.07	Adverse Change, Approvals	99
6.08	Litigation	99
6.09	Collateral and Guaranty Requirements	99
6.10	Financial Statements; Pro Forma Balance Sheet; Projections	100
6.11	Solvency Certificate; Insurance Certificates, etc.	100
6.12	Initial Borrowing Base Certificates; etc.; Excess Availability	100
6.13	Patriot Act	100
6.14	Consent Letter	100
Section 7.	Conditions Precedent to All Credit Events	101
7.01	No Default; Representations and Warranties	101
7.02	Notice of Borrowing; Letter of Credit Request	101
7.03	Borrowing Base Limitations	101
Section 8.	Representations, Warranties and Agreements	102
8.01	Company Status	102
8.02	Power and Authority	102
8.03	No Violation	102
8.04	Approvals	103
8.05	Financial Statements; Financial Condition; Undisclosed Liabilities; Projections	103
8.06	Litigation	104
8.07	True and Complete Disclosure	104
8.08	Use of Proceeds; Margin Regulations	104
8.09	Tax Returns and Payments	104
8.10	Compliance with Pensions/ERISA	105
8.11	Collateral Matters	106
8.12	Properties	106
8.13	Subsidiaries	106
8.14	Compliance with Statutes, etc.	107
8.15	Investment Company Act	107
8.16	Insurance	107
8.17	Environmental Matters	107
8.18	Employment and Labor Relations	107
8.19	Intellectual Property, etc	108
8.20	Indebtedness	108
8.21	Borrowing Base Calculation	108
8.22	Anti-Terrorism Law	108
8.23	Solvency	109
8.24	Not a Trustee	110
8.25	Corporate Benefit	110
8.26	No Immunity	110
8.27	Own Enquiries	110
8.28	New South Wales Resident	110
8.29	Centre of Main Interests	110
Section 9.	Affirmative Covenants	110
9.01	Information Covenants	110
9.02	Books, Records and Inspections; Annual Meetings	115

9.03	Maintenance of Property; Insurance	115
9.04	Existence; Conduct of Business	115
9.05	Compliance with Statutes, etc	116
9.06	Compliance with Environmental Laws	116
9.07	Pension Schemes	116
9.08	End of Fiscal Years; Fiscal Quarters	117
9.09	Performance of Obligations	117
9.10	Payment of Taxes	118
9.11	Use of Proceeds	118
9.12	Information Regarding Collateral	118
9.13	Additional Subsidiaries; Ownership of Subsidiaries; Additional Borrowers	118
9.14	Further Assurances	120
9.15	Retention of Financial Consultant	120
9.16	Permitted Acquisitions	120
9.17	Maintenance of Company Separateness	121
9.18	Holding Company Obligations	122
9.19	Operation of Cash Pooling Accounts during Dominion Period	122
9.20	Cash Management for Toys SARL during Dominion Period	122
Section 10.	Negative Covenants	123
10.01	Liens	123
10.02	Consolidation, Merger, or Sale of Assets, etc.	126
10.03	Dividends	128
10.04	Indebtedness	130
10.05	Advances, Investments and Loans	133
10.06	Transactions with Affiliates	137
10.07	Consolidated Fixed Charge Coverage Ratio	138
10.08	Modifications of Certificate of Incorporation, By-Laws and Certain Other Agreements; Limitations on Voluntary Payments, etc.	138
10.09	Limitation on Certain Restrictions on Subsidiaries	139
10.10	Limitation on Issuance of Equity Interests	139
10.11	Business; etc	140
10.12	Limitation on Creation of Subsidiaries	140
10.13	No Additional Deposit Accounts; etc.	140
10.14	Cash Pooling Accounts	141
Section 11.	Events of Default	141
11.01	Events of Default	141
11.02	Application of Proceeds	145
Section 12.	The Agents	147
12.01	Appointment	147
12.02	Nature of Duties	147
12.03	Lack of Reliance on the Agents	148
12.04	Certain Rights of the Administrative Agent	148
12.05	Reliance	148
12.06	Indemnification	148
12.07	Agents in their Individual Capacities	149
12.08	Holders	149
12.09	Resignation by, and Removal of, the Administrative Agent	149
12.10	Collateral Matters	150

12.11	Lower Ranking Share Pledges	152
12.12	Delivery of Information	152
12.13	Co-Collateral Agent	152
12.14	Amendments to Guaranties and Security Documents on the Second Restatement Effective Date	153
Section 13.	Miscellaneous	153
13.01	Payment of Expenses, etc.	153
13.02	Right of Setoff	154
13.03	Notices	155
13.04	Benefit of Agreement; Assignments; Participations	155
13.05	No Waiver; Remedies Cumulative	157
13.06	Payments Pro Rata	157
13.07	Calculations; Computations	158
13.08	GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL	158
13.09	Counterparts	159
13.10	Effectiveness	159
13.11	Headings Descriptive	160
13.12	Amendment or Waiver; etc.	160
13.13	Survival	162
13.14	Domicile of Loans	162
13.15	Register	162
13.16	Confidentiality	163
13.17	Patriot Act	164
13.18	Judgment Currency	164
13.19	European Monetary Union	164
13.20	Australian Code of Banking Practice	165
13.21	Qualified Secured Hedging Agreements and Qualified Secured Cash Management Agreements	165
13.22	No Fiduciary Duty	166
13.23	Post-Closing Actions	166
13.24	Conflicting Provisions in Security Documents	167
13.25	Continuing Effect	167
Section 14.	Nature of Obligations	167
14.01	Nature of Obligations	167
14.02	Independent Obligation	167
14.03	Authorization	167
14.04	Reliance	168
14.05	Contribution; Subrogation	168
14.06	Waiver	168
14.07	Lender’s Rights and Obligations	168
Section 15.	Loans; Intra-Lender Issues	169
15.01	Specified Foreign Currency Participations	169
15.02	Settlement Procedures for Specified Foreign Currency Participations	169
15.03	Obligations Irrevocable	171
15.04	Recovery or Avoidance of Payments	171
15.05	Indemnification by Lenders	171
15.06	Specified Foreign Currency Loan Participation Fee	172

15.07	Defaulting Lenders; etc.	172
Section 16.	Parallel Debt and Special Appointment of Security Agent	174
13.01	Parallel Debt owed to Security Agent	174
13.02	Appointment of Security Agent for German Security	175
13.08	Appointment of the Security Agent for the Credit Documents Governed by Spanish Law	175
Section 17.	Guaranty	176
17.01	Guaranty	176
17.02	Liability of Guarantors Absolute	177
17.03	Obligations of Guarantors Independent	177
17.04	Waivers by Guarantors	177
17.05	Rights of Secured Creditors	178
17.06	Continuing Guaranty	179
17.07	Subordination of Indebtedness Held by Guarantors	180
17.08	Guaranty Enforceable by Administrative Agent or Security Agent	180
17.09	Expenses	180
17.10	Benefit and Binding Effect	181
17.11	Set Off	181
17.12	Reinstatement	181
17.13	Contribution	181
17.14	Limitations for US Guarantors	182
17.15	Limitations for French Obligors	182
17.16	Limitations for German Guarantors	183
17.17	Limitations for Spanish Guarantors	185
17.18	Guarantee Limitations for BVI Guarantor	186
17.19	Additional Limitations for Guarantors	186
17.20	Payments	186
17.21	Application of Payments for Australian Obligors	186
17.22	Additional Guarantors	187
17.23	Right to Prove	187
17.24	Secured Money Limitations	187
17.25	Keepwell	187
Section 18.	Release of Liens and Guaranties	188
Section 19.	Security Trust Provisions	189

SCHEDULES

SCHEDULE I --    Obligor Notice Addresses

SCHEDULE 1.01(a) --    Commitments

SCHEDULE 1.01(c) --    Agreed Security Principles

SCHEDULE 1.01(d) --    Security Documents

SCHEDULE 3.01(a) --    Existing Letters of Credit

SCHEDULE 8.10 --    ERISA

SCHEDULE 8.13 --    Subsidiaries; Joint Ventures; Obligors

SCHEDULE 8.20 --    Indebtedness; Intercompany Debt

SCHEDULE 10.01 --    Existing Liens

SCHEDULE 10.05(iii) --    Permitted Investments

SCHEDULE 10.05(xiii) --    Investment Policy

SCHEDULE 13.03 --    Lender Addresses/Lending Offices

SCHEDULE 13.23 --    Post Closing Actions

SCHEDULE 19 --    Security Trustee Provisions

EXHIBITS

EXHIBIT A-1 --    Form of Notice of Borrowing

EXHIBIT A-2 --    Form of Notice of Continuation

EXHIBIT B --    Form of Note

EXHIBIT C --    Form of Letter of Credit Request

EXHIBIT D-1 --    Form of Australian Perfection Certificate

EXHIBIT D-2 --    Form of English Perfection Certificate

EXHIBIT D-3 --    Form of Pledged Securities Perfection Certificate

EXHIBIT E --    Form of French Proceeds Loan Agreement

EXHIBIT F-1 --    Form of Officers’ Certificate

EXHIBIT F-2 --    Form of Managing Directors’ Certificate

EXHIBIT G --    Form of Perfection Certificate Supplement

EXHIBIT H-1 --    Form of Tri-Party Agreement (Australia)

EXHIBIT H-2 --    Form of Tri-Party Agreement (UK)

EXHIBIT I --    Form of Joinder Agreement

EXHIBIT J --    Form of Solvency Certificate

EXHIBIT K --    Form of Compliance Certificate

EXHIBIT L --    Form of Assignment and Assumption Agreement

EXHIBIT M --    Form of Intercompany Note

EXHIBIT N --    Intercompany Subordination Agreement

EXHIBIT O --    Form of Process Letter

EXHIBIT P --    Form of Borrowing Base Certificate

EXHIBIT Q --    Form of Incremental Commitment Agreement

EXHIBIT R --    Form of Credit Document Acknowledgement and Amendment

EXHIBIT S-1 --    Form of Credit Card Notification (Australia)

EXHIBIT S-2 --    Form of Credit Card Notification (UK)

EXHIBIT T-1 --    Form of Customs Broker Agreement (Australia)

EXHIBIT T-2 --    Form of Customs Broker Agreement (UK)

EXHIBIT U --    Form of Subsidiary Borrower Assumption Agreement

SECOND AMENDED AND RESTATED SYNDICATED FACILITY AGREEMENT, dated as of October 15, 2009, as amended and restated as of March 8, 2011, as amended as of March 20, 2013 and as further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026) (the “Australian Borrower”), Toys “R” Us GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, the Australian Borrower and the German Borrower, and any entity that becomes a borrower pursuant to Section 9.13(c), collectively, the “Borrowers”, and individually, a “Borrower”), TRU (UK) H7 Limited (“Midco1”), TRU (UK) H8 Limited (“Midco2”), Toys “R” Us Holdings Limited (“TRU Holdings”), Toys “R” Us Financial Services Limited (“TRU Financial Services”), Toys “R” Us Properties Limited (“TRU Properties”), TRU (UK) H4 Limited (“TRU H4”), TRU (France) Finance Ltd. (“TRU France Finance”), TRU (France) Holdings Ltd. (“TRU France Holdings” and, together with the European Parent Guarantor, Midco1, Midco2, the Australian Parent Guarantor, TRU Holdings, TRU Financial Services, TRU Properties, TRU H4 and TRU France Finance, collectively the “U.K. Guarantors”), Babies “R” Us (Australia) Pty Ltd (ABN 56 073 394 117) (“Babies “R” Us (Australia)”), Toys “R” Us SARL (“Toys SARL”), TRU (BVI) Finance II, Ltd. (the “BVI Guarantor”), TRU (UK) H6, LLC (the “U.S. Guarantor”), TRU Iberia Holdings 2, S.L.U. (formerly known as Avenal Investment, S.L.) (“Midco4”, together with the Spanish Parent Guarantor, the “Spanish Guarantors”), the other Obligors party hereto from time to time (including any additional Guarantors who join pursuant to Section 17.22),the Lenders party hereto from time to time, Deutsche Bank AG New York Branch, as Administrative Agent, Security Agent and as Facility Agent, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents. All capitalized terms used herein and defined in Section 1 are used herein as therein defined.

W I T N E S S E T H :

WHEREAS, the proceeds of Loans and the Commitments hereunder will be used for general corporate purposes;

WHEREAS, the Borrowers, the Existing Lenders and the Administrative Agent are parties to a facility agreement, dated as of October 15, 2009, as amended and restated as of March 8, 2011 and amended as of March 20, 2013 (as the same has been amended, modified or supplemented to, but not including the Second Restatement Effective Date, the “Existing Facility Agreement”);

WHEREAS, (a) the Borrowers have requested that the Existing Facility Agreement be amended and restated in its entirety and, subject to and upon the terms and conditions set forth herein and (b) this Agreement shall not constitute a novation of the obligations and liabilities existing under the Existing Facility Agreement or evidence payment of all or any of such obligations and liabilities; and

WHEREAS, subject to and upon the terms and conditions set forth herein, the Lead Arrangers have arranged, and the Lenders are willing to make available to the Borrowers, the senior secured revolving credit facility provided for herein;

NOW, THEREFORE, IT IS AGREED:

Section 1.Definitions and Accounting Terms.

1.01    Defined Terms. As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined):

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“Account” shall mean an “account” as such term is defined in Article 9 of the UCC and any and all supporting obligations in respect thereof 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.

“Acquired Entity or Business” shall mean either (x) the assets constituting a business, division or product line of any Person not already an Obligor or (y) 100% of the Equity Interests of any such Person, which Person shall, as a result of the acquisition of such Equity Interests, become a Wholly-Owned Subsidiary of an Obligor (or shall be merged with and into an Obligor, with such Obligor being the surviving or continuing Person).

“Adjustable Applicable Margins” shall have the meaning provided in the definition of Applicable Margin.

“Administrative Agent” shall mean Deutsche Bank AG New York Branch, in its capacity as Administrative Agent for the Lenders hereunder and under the other Credit Documents, and shall include any successor to the Administrative Agent appointed pursuant to Section 12.09.

“Advisory Agreement” shall mean 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.

“Advisory Fees” shall mean annual advisory fees, closing fees and transaction fees payable by the Obligors pursuant to the Advisory Agreement, but not to exceed the amounts payable thereunder as in effect on the Restatement Effective Date.

“Affiliate” shall mean, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with such Person.

“Agents” shall mean and include the Administrative Agent, the Facility Agent, the Security Agent, the Co-Collateral Agents, the Lead Arrangers, the Syndication Agent and the Documentation Agents.

“Aggregate Cap Amount” shall mean £200,000,000.

“Aggregate Consideration” shall mean, with respect to any Permitted Acquisition, the sum (without duplication) of (i) the aggregate amount of all cash paid (or to be paid) by any Group Member in connection with such Permitted Acquisition (including, without limitation, payments of fees and costs and expenses in connection therewith) and all contingent cash purchase price, earn-out, non-compete and other similar obligations of any Group Member incurred and reasonably expected to be incurred in connection therewith (as determined in good faith by the Obligors’ Agent), (ii) the aggregate principal amount of all Indebtedness assumed, incurred, refinanced and/or issued in connection with such Permitted Acquisition to the extent permitted by Section 10.04, and (iii) the Fair Market Value of all other consideration payable in connection with such Permitted Acquisition.

“Aggregate Exposure” shall mean, at any time, the sum of (a) the aggregate principal amount of all Loans then outstanding (for this purpose, using the Pounds Sterling Equivalent of amounts not denominated in Pounds Sterling) and (b) the aggregate amount of all Letter of Credit Outstandings at such

2

time (exclusive of Letter of Credit Outstandings which are repaid with the proceeds of, and simultaneously with the incurrence of, the respective incurrence of Loans).

“Agreed Security Principles” shall mean those principles set forth on Schedule 1.01(c) hereto.

“Agreement” shall mean this Second Amended and Restated Syndicated Facility Agreement, as modified, supplemented, amended, restated (including any amendment and restatement hereof), extended or renewed from time to time.

“Agreement Value” shall mean 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 Obligor to its counterparty to such Hedge Agreement, as if (i) such Hedge Agreement was being terminated early on such date of determination, (ii) such Obligor 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 Obligor 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 Obligor 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 Obligor exceeds (ii) the present value of the future cash flows to be received by such Obligor in each case pursuant to such Hedge Agreement.

“Anti-Terrorism Laws” shall have the meaning provided in Section 8.22(a).

“Applicable Commitment Fee Percentage” shall mean (i) for any day on which the Aggregate Exposure is less than or equal to 50.0% of the Total Commitment then in effect, 0.50%, and (ii) for any day on which the Aggregate Exposure exceeds 50% of the Total Commitment then in effect, 0.375%.

“Applicable Eligible Jurisdiction” shall mean (a) in the case of Eligible Credit Card Receivables of the Qualified Obligors, England and Wales and Australia, as applicable, and (b) in the case of Eligible Inventory of the Qualified Obligors, (i) England and Wales in respect of the Qualified Obligors organized under the laws of England and Wales, (ii) Australia in respect of the Qualified Obligors organized under the laws of Australia and (iii) France in respect of the Qualified Obligors organized under the laws of France, as applicable.

“Applicable Law” shall mean 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 Margin” initially shall mean a percentage per annum equal to the Adjustable Applicable Margin at Level II below. From and after each day of delivery of any certificate delivered in accordance with the first sentence of the following paragraph indicating an entitlement to a different margin for any Loans than that described in the immediately preceding sentence (each, a “Start Date”) to and including

3

the applicable End Date described below, the Applicable Margins for such Loans (hereinafter, the “Adjustable Applicable Margins”) shall be those set forth below opposite the Historical Excess Availability indicated to have been achieved in any certificate delivered in accordance with the following sentence:

Level	Historical Excess Availability	Loans Maintained as Euro Rate Loans
I	Greater than 66% of Historical Borrowing Base	2.25%
II	Equal to or less than 66% of Historical Borrowing Base but greater than 33% of Historical Borrowing Base	2.50%
III	Equal to or less than 33% of Historical Borrowing Base	2.75%

The Historical Excess Availability used in a determination of Adjustable Applicable Margins shall be determined, from and after the end of the first full Fiscal Quarter ending after the Second Restatement Effective Date, based on the delivery of a certificate of the Obligors’ Agent (each, a “Quarterly Pricing Certificate”) by an Authorized Officer of the Obligors’ Agent to the Administrative Agent (with a copy to be sent by the Administrative Agent to each Lender and an additional copy to be sent by the Obligor’s Agent to the French Proceeds Loan Creditors), within 5 days of the last day of any Fiscal Quarter of the Obligors’ Agent which certificate shall set forth the calculation of the Historical Excess Availability as at the last day of the Fiscal Quarter ended immediately prior to the relevant Start Date. The Adjustable Applicable Margins so determined shall apply, except as set forth in the succeeding sentence, from the relevant Start Date to the earliest of (x) the date on which the next certificate is delivered to the Administrative Agent or (y) the date which is 5 days following the last day of the Fiscal Quarter in which the previous Start Date occurred (such earliest date, the “End Date”), at which time, if no certificate has been delivered to the Administrative Agent indicating an entitlement to new Adjustable Applicable Margins (and thus commencing a new Start Date), the Adjustable Applicable Margins shall be those that correspond to a Historical Excess Availability at Level III (such Adjustable Applicable Margins as so determined, the “Highest Adjustable Applicable Margins”). Notwithstanding anything to the contrary contained above in this definition, (x) the Adjustable Applicable Margins shall be the Highest Adjustable Applicable Margins at all times during which there shall exist any Event of Default and (y) so long as no Event of Default exists, at all times prior to the date of delivery of the Quarterly Pricing Certificate for the first full Fiscal Quarter ending after the Second Restatement Effective Date, the Adjustable Applicable Margins shall be maintained at Level II above. The Administrative Agent shall notify the Facility Agent in writing when the Applicable Margin changes.

“Applicable Percentage” means with respect to any Lender, the percentage of the total Commitments represented by such Lender’s Commitment. If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments.

“Approved Member State” shall mean any country which is the jurisdiction of incorporation or organization of any Group Member.

“Asset Sale” shall mean any sale, transfer or other disposition by any Obligor to any Person (including by way of redemption by such Person) other than to an Obligor of any asset (including, without limitation, any capital stock or other securities of, or Equity Interests in, another Person), but excluding (x) sales of assets pursuant to Sections 10.02(ii), (iii), (v), (vi), (vii), (viii), (ix), (x), (xi) and (xii) and (y) any

4

other sale, transfer or disposition (for such purpose, treating any series of related sales, transfers or dispositions as a single such transaction) that generates Net Sale Proceeds of less than £2,000,000.

“Assignment and Assumption Agreement” shall mean an Assignment and Assumption Agreement substantially in the form of Exhibit L.

“Associate” shall have the meaning given in section 128F(9) of the Australian Tax Act.

“Australian Borrower” shall have the meaning provided in the first paragraph of this Agreement.

“Australian Borrowing Limit” shall mean £55,000,000.

“Australian Collection Account” shall mean each account established at an Australian Collection Bank subject to a Cash Management Control Agreement into which funds shall be transferred as provided in Section 5.03(c).

“Australian Collection Banks” shall have the meaning provided in Section 5.03(c).

“Australian Disbursement Account” shall mean each checking and/or disbursement account maintained by the Australian Obligors for their respective general corporate purposes, including for the purpose of paying their trade payables and other operating expenses (other than a disbursement account that is an Excluded Account).

“Australian Dollar Loans” shall mean each Loan denominated in Australian Dollars at the time of the incurrence thereof.

“Australian Dollar Rate” shall mean (a) the applicable Australian Screen Rate; or (b) if (i) no Australian Screen Rate is available for the currency or period of that Loan or (ii) the basis on which the agreed Australian Screen Rate page is calculated or displayed is changed and the Required Lenders instruct the Administrative Agent (after consultation by the Administrative Agent with the Australian Borrower) that in their opinion it ceases to reflect the Lenders’ cost of funding to the same extent as at the date of this Agreement, and no new relevant page is specified under the definition of “Australian Screen Rate”, the rate for such Interest Period shall be the interest rate per annum reasonably determined by the Administrative Agent in good faith to be the rate per annum at which deposits in Australian Dollars for delivery on the first day of such Interest Period in immediately available funds in the approximate amount of the Australian Dollar Loan being made, continued or converted by the Administrative Agent and with a term equivalent to such Interest Period that would be offered to the Administrative Agent by major banks in the London interbank market at their request at approximately 11:00 a.m. (London time) on the applicable Interest Determination Date, provided that in the event the Administrative Agent has made any determination pursuant to Section 2.10(a)(i) in respect of Australian Dollar Loans, or in the circumstances described in clause (i) to the proviso to Section 2.10(b) in respect of such Australian Dollar Loans, the Australian Dollar Rate determined pursuant to this definition shall instead be the rate determined by the Administrative Agent as the all-in-cost of funds for the Administrative Agent to fund a Borrowing of Loans denominated in Australian Dollars with maturities comparable to the Interest Period applicable thereto; provided that, if the Australian Dollar Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.

“Australian Dollars” and “A$” shall mean freely transferable lawful currency of the Commonwealth of Australia (expressed in Australian dollars).

“Australian Employee Liability Reserves” shall mean, with respect to each Australian Obligor, such amount as the Co-Collateral Agents may from time to time determine in their Permitted

5

Discretion, which amount shall represent an amount payable by such Australian Obligor pursuant to sections 556(1)(e), 556(1)(g) and 556(1)(h) of the Corporations Act.

“Australian Obligor” shall mean any Obligor incorporated, organized or established under the laws of the Commonwealth of Australia.

“Australian Parent Guarantor” shall have the meaning set forth in the preamble hereto.

“Australian Perfection Certificate” shall mean the Australian Perfection Certificate in the form thereof included in Exhibit D-1 or any other form approved by the Administrative Agent, as the same may be supplemented from time to time by a Perfection Certificate Supplement or otherwise.

“Australian Screen Rate” shall mean in relation to Australian Dollar Rate, the Australian Bank Bill Swap Reference Rate (Bid) administered by the Australian Financial Markets Association (or any other person which takes over the administration of that rate) for the relevant currency and period displayed on page BBSY of the Thomson Reuters page which displays that rate for a term equivalent to the relevant period. If the agreed page is replaced, the service ceases to be available, or the basis on which that rate is calculated or displayed is changed and the Required Lenders instruct the Administrative Agent (after consultation by the Administrative Agent with the Obligors’ Agent) that in their opinion it ceases to reflect the Lenders’ cost of funding to the same extent as at the date of this Agreement, the Administrative Agent on the instructions of the Required Lenders may specify another page or service displaying the appropriate rate after consultation by the Administrative Agent with the Obligors’ Agent.

“Australian Tax Act” shall mean the Income Tax Assessment Act 1936 (Australia) or the Income Tax Assessment Act 1997 (Australia), as the context requires.

“Authorized Officer” shall mean, with respect to (a) delivering Notices of Borrowing, Notices of Continuation and similar notices, any person or persons that has or have been authorized by the board of directors of the respective Borrower to deliver such notices pursuant to this Agreement and that has or have appropriate signature cards on file with the Administrative Agent or the respective Issuing Lender, (b) delivering financial information and officer’s certificates pursuant to this Agreement, a director, chief financial officer, treasurer or the principal accounting officer of the Obligors’ Agent and (c) any other matter in connection with this Agreement or any other Credit Document, any executive officer or financial officer of the respective Obligor and any other officer or similar official with responsibility for the administration of the obligations in respect of this Agreement.

“Availability Condition” shall mean (A) in the case of determining whether a Dominion Period, Monthly Reporting Period or Weekly Borrowing Base Period is in effect, the greater of (i) £12,000,000 and (ii) 12.5% of the lesser of (x) the Total Commitment as then in effect and (y) the Borrowing Base at such time and (B) in the case of determining whether a Compliance Period is in effect, the greater of (i) £10,000,000 or (ii) 12.5% of the lesser of (x) the Total Commitment as then in effect and (y) the Borrowing Base at such time.

“Available Currency” shall mean U.S. Dollars, Australian Dollars, Pounds Sterling and Euros.

“Back-Stop Arrangements” shall have the meaning provided in Section 3.03(b).

“Bank Product Reserve” shall mean a reserve established by the Co-Collateral Agents from time to time in their Permitted Discretion in respect of the Obligors’ liabilities (or potential liabilities) as part of their cash management system under Cash Management Agreements such as, but not limited to, reserves for returned items, customary charges for maintaining Deposit Accounts and similar items. The Co-Collateral

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Agents shall establish reserves for any overdraft lines or similar arrangements which have been designated as Qualified Secured Cash Management Agreement pursuant to Section 13.21.

“Bankruptcy Code” shall have the meaning provided in Section 11.01(e).

“Board” shall mean the Board of Governors of the Federal Reserve System of the United States or any successor thereto.

“Borrower” and “Borrowers” shall have the meaning provided in the first paragraph of this Agreement.

“Borrowing” shall mean the borrowing of one Type of Loan from all the Lenders having Commitments on a given date (or resulting from a conversion or conversions on such date) having the same Interest Period.

“Borrowing Base” shall mean the sum of the French Borrowing Base and the UK/AUS Borrowing Base.

“Borrowing Base Certificate” shall have the meaning provided in Section 9.01(j).

“Borrowing Base Collateral” shall mean any Collateral used in calculating the Borrowing Base.

“Business” shall mean any corporation, limited liability company, unlimited liability company, limited or general partnership or other business entity (or the adjectival form thereof, where appropriate) or the equivalent of the foregoing in any foreign jurisdiction.

“Business Day” shall mean (a) for all purposes other than as covered by clauses (b), (c) and (d) below, any day except Saturday, Sunday and any day which shall be in New York, New York or London, England, a legal holiday or a day on which banking institutions are authorized or required by law or other government action to close, (b) with respect to all notices and determinations in connection with, and payments of principal and interest on, U.S. Dollar Loans, any day which is a Business Day described in clause (a) above and which is also a day for trading by and between banks in U.S. dollar deposits in the London interbank eurodollar market, (c) with respect to all notices and determinations in connection with, and payments of principal and interest on or with respect to, Sterling Loans and Euro Loans, any day which is a Business Day described in clause (a) and which is also (i) a day for trading by and between banks in the London interbank market and which shall not be a legal holiday or a day on which banking institutions are authorized or required by law or other government action to close in London, England and (ii) in relation to any payment in Euros, a day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer 2 (TARGET 2) System is open and (d) with respect to all notices and determinations in connection with, and payments of principal and interest on, Australian Dollar Loans, any day which is a Business Day described in clause (a) above and which is also a day which is not a legal holiday or a day on which banking institutions are authorized or required by law or other government action to close in Sydney, Australia.

“Calculation Period” shall mean, with respect to any Permitted Acquisition or any other event expressly required to be calculated on a ProForma Basis pursuant to the terms of this Agreement, the Test Period most recently ended prior to the date of such Permitted Acquisition or other event for which financial statements have been delivered to the Lenders pursuant to Section 9.01(b) or (c), as applicable.

“Capital Expenditures” shall mean, with respect to any Person, all expenditures by such Person which should be capitalized in accordance with GAAP and, without duplication, the amount of Capitalized Lease Obligations incurred by such Person; provided that “Capital Expenditures” shall not include (i) any additions to property, plant and equipment and other capital expenditures made with (A) the proceeds

7

of any equity securities issued or capital contributions received, or Indebtedness borrowed by any Group Member in connection with such capital expenditures (excluding borrowings under this Agreement), (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 Obligors’ assets (other than assets constituting Collateral consisting of Inventory and Accounts 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 Obligors in cash by a third party (including landlords) during such period of calculation.

“Capitalized Lease Obligations” shall mean, with respect to any Person, all rental obligations of such Person which, under GAAP, are or will be required to be capitalized on the books of such Person, in each case taken at the amount thereof accounted for as indebtedness in accordance with such principles. 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 Second Restatement Effective Date.

“Cash Equivalents” shall mean:

(i)    securities issued by, or unconditionally fully guaranteed by, the federal government of the United States, Australia, Switzerland, any Approved Member State or any agency or instrumentality thereof and in each case maturing within one year from the date of acquisition thereof;

(ii)    marketable direct obligations issued by any State of the United States of America or any political subdivision of any such State or any public instrumentality thereof maturing within one year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either S&P or Moody’s;

(iii)    commercial paper maturing no more than one year from the date of creation thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either S&P or Moody’s;

(iv)    (x) time deposits, demand deposits, bearer deposit notes, certificates of deposit, eurodollar time deposits, bankers’ acceptances or similar instruments of deposit, in each case, with maturities of not more than one year from the date of acquisition by such Person, and (y) overnight bank deposits, in the case of each of the foregoing clauses (x) and (y), issued by (i) any commercial bank organized under the laws of Australia, the United States of America or any State thereof or the District of Columbia having at the date of acquisition thereof combined capital and surplus of not less than $500,000,000 or (ii) any commercial bank organized under the laws of any member state of the European Union or any Approved Member State, as of the date hereof, or Switzerland having combined capital and surplus in excess of the applicable foreign currency equivalent of $500,000,000;

(v)    repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (i) above entered into with any bank meeting the qualifications specified in clause (iv) above or with any primary dealer;

(vi)    investments of the type and maturity described in clause (i) though (v) above of foreign obligors, which investments or obligors (or the parents of such obligors) have ratings described in such clauses or equivalent ratings from comparable foreign rating agencies;

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(vii)    investments in money market or mutual funds substantially all of whose assets are comprised of securities of the types described in clauses (i) through (vi) above; and

(viii)    deposits of cash in favor of banks or other depository institutions, solely to the extent incurred in connection with the maintenance of such deposit accounts in the ordinary course of business.

“Cash Management Agreement” shall mean any agreement to provide (x) cash management services, including treasury, depository, overdraft, credit or debt card, electronic funds transfer and other cash management arrangements and (y) supply chain financing services, including, without limitation, trade payable services and supplier accounts receivable purchases and factoring.

“Cash Management Control Agreement” shall mean a power of attorney, or signing rights “control agreement” or other agreement, in each case in form and substance reasonably acceptable to the Administrative Agent which, in the case of the English Obligors and Australian Obligors, can be incorporated within the relevant Security Document governed by the laws of England and Wales or Australia (as applicable) (unless a separate control agreement is deemed advisable by the Administrative Agent), and containing terms regarding the treatment of all cash and other amounts on deposit in (or credited to) the respective Deposit Account governed by such Cash Management Control Agreement consistent with the requirements of Section 5.03.

“Cash Management Creditors” shall mean, collectively, each Lender Counterparty and each person (other than a Group Member or Affiliate thereof) party to a Secured Cash Management Agreement.

“Cash Management Obligations” shall have the meaning specified in the definition of “Secured Obligations”.

“Cash Pooling Account” shall mean any deposit, savings, passbook or like account established and maintained with a bank or other financial institution reasonably satisfactory to the Security Agent by any Group Member from time to time solely for the purposes of any notional cash pooling, net balance or balance transfer arrangements to be made available to Group Members pursuant to arrangements reasonably satisfactory to the Security Agent, in each case as designated as such to the Security Agent in writing. Where the arrangements are reasonably satisfactory to Security Agent, it shall provide a written confirmation to the relevant account bank and the confirmation shall not be revoked without the relevant account bank’s prior written consent.

“Centre of Main Interests” shall have the meaning provided in Article 3(1) of Council Regulation (EC) No 1346/2000 of May 29, 2000 on Insolvency Proceedings.

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as the same has been amended and may hereafter be amended from time to time, 42 U.S.C. § 9601 et seq.

“CFC” shall have the meaning provided in Section 17.19(a).

“CFC Full Obligor” shall mean and include each Obligor that is a CFC, Subsidiary CFC or CFC Holdco and is not a CFC Limited Obligor.

“CFC Holdco” shall have the meaning provided in Section 17.19(a).

“CFC Limited Obligor” shall mean and include each Obligor that is a CFC, Subsidiary CFC or CFC Holdco that has provided written notice to the Administrative Agent that such Obligor has elected that Section 17.19 shall apply to it and, in the case where such Obligor has material assets at the time of such

9

election, has received the Administrative Agent’s written consent to such election. For the avoidance of doubt, “CFC Limited Obligor” includes as of the Second Restatement Effective Date, TRU France Finance, TRU France Holdings, the Spanish Parent Guarantor, Midco4, Toys SARL and the Spanish Borrower.

“Change of Control” shall mean 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 (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 Equity Interests 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 twenty-five percent (25%) or more (on a fully diluted basis) of the total then outstanding Equity Interests of the Parent entitled to vote for the election of directors of the Parent and (ii) Equity Interests 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 Obligors 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 Equity Interests of each Obligor free and clear of all Liens (other than those Liens specified in clauses (i), (iv), (xi) and (xviii) of Section 10.01), except where such failure is as a result of a transaction permitted by the Credit Documents.

“Chief Executive Office” shall mean, with respect to any Person, the location from which such Person manages the main part of its business operations or other affairs.

“Claims” shall have the meaning provided in the definition of “Environmental Claims”.

“Co-Collateral Agent” and “Co-Collateral Agents” shall mean Deutsche Bank AG New York Branch and Bank of America, N.A. in their capacity as co-collateral agents for the Secured Creditors pursuant to this Agreement.

“Code” shall mean the United States Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to the Code are to the Code, as in effect at the date of this Agreement and any subsequent provisions of the Code, amendatory thereof, supplemental thereto or substituted therefor.

“Collateral” shall mean all property (whether real or personal) with respect to which any security interests have been granted (or purported to be granted) pursuant to any Security Document, including, without limitation, all cash and Cash Equivalents delivered as collateral pursuant to Section 5.02 or Section 11.

“Collateral Access Agreement” shall mean any landlord waivers, mortgagee waivers, bailee letters and any similar usage, access or acknowledgment agreements of any Person, such as a warehouseman,

10

processor, lienholder or lessor, in possession of any assets of any Obligor, in each case in form and substance reasonably satisfactory to the Administrative Agent.

“Collateral and Guaranty Requirements” shall mean, at any time, the requirement that:

(a)    on or prior to the Second Restatement Effective Date and as a condition precedent to such date, the Administrative Agent shall have received from the Obligors that are not Borrowers (i) a duly executed counterpart of this Agreement or a Joinder Agreement in respect thereof acceding to the Agreement as a Guarantor, (ii) duly executed Security Documents and with respect to any Security Documents (other than the English Law governed Security Documents) previously delivered pursuant to the Existing Facility Agreement any amendments thereto (each, a “Security Document Amendment”) required to be delivered by each Obligor specified on Schedule 1.01(d) Part I and II, and (iii) the Second Restatement English Law governed Security Documents;

(b)    on the Second Restatement Effective Date (or such later date as the Administrative Agent may agree in its sole discretion), the Administrative Agent shall have received insurance certificates from the Parent’s insurance broker or other evidence reasonably satisfactory to it that all insurance required to be maintained pursuant to Section 9.03 is in full force and effect and such certificates shall (i) name the Security Agent, as collateral agent on behalf of the Secured Creditors, as an additional insured thereunder as its interests may appear and (ii) in the case of each casualty insurance policy, contain a loss payable clause or endorsement, reasonably satisfactory in form and substance to the Administrative Agent, that names the Security Agent, on behalf of the Lenders, as the loss payee and/or an additional insured thereunder and provides for at least thirty days’ prior written notice to the Administrative Agent of any cancellation of such policy;

(c)    subject to the Agreed Security Principles (which for the avoidance of doubt for purposes of this clause (c) takes into account the stamp duties and other potentially significant costs that may be incurred by a Spanish Obligor), within 30 days (or such later date as the Administrative Agent may agree in its sole discretion) after any Obligor creates, establishes or acquires a Subsidiary (other than an Immaterial Subsidiary) or a Subsidiary which was an Immaterial Subsidiary ceases to be an Immaterial Subsidiary, the Administrative Agent shall have received from such Subsidiary (i) a duly executed counterpart to this Agreement (or a joinder agreement in respect thereof duly joining such Subsidiary as a Guarantor hereunder), (ii) duly executed security agreements, documents and instruments reasonably satisfactory in form and substance to the Security Agent granting to the Security Agent as security for the Secured Obligations a valid and enforceable, first priority, perfected security interest in all or substantially all of the assets (including all tangible and intangible assets (other than Real Property), including receivables, contract rights, securities, inventory, equipment, insurances and material patents, trademarks and other intellectual property) of such Subsidiary and (iii) all related documentation (including, without limitation, opinions of counsel, corporate documents and proceedings and officer’s certificates) as such Subsidiary would have been required to deliver pursuant to Section 6 of this Agreement had such Subsidiary been an Obligor on the Second Restatement Effective Date; and, that in connection with the execution and delivery of such Security Documents, the Subsidiary shall take such actions as may be necessary or desirable under local law (as advised by local counsel) to create, maintain, effect, perfect, preserve and protect the security interests granted (or purported to be granted), in each case to the extent customary in connection with secured transactions under the laws of the respective jurisdiction or deemed necessary or desirable by the Administrative Agent based on the advice of local counsel;

(d)    subject to the Agreed Security Principles, within 30 days (or such later date as the Administrative Agent may agree in its sole discretion) after any Obligor creates, establishes or acquires a Subsidiary (other than an Immaterial Subsidiary), the Administrative Agent shall have

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received from the parent (or parents) of such Subsidiary, (i) a duly executed pledge agreement or agreements reasonably satisfactory in form and substance to the Administrative Agent pledging to the Security Agent as security for the Secured Obligations a valid and enforceable, first priority, perfected security interest over the Equity Interests of such Subsidiary and (ii) all related documentation (including, without limitation, opinions of counsel, corporate documents and proceedings and officer’s certificates) as the parent (and/or such Subsidiary) would have been required to deliver pursuant to Section 6 of this Agreement had such Security Documents been delivered on the Second Restatement Effective Date by an Obligor; and such parent or such Subsidiary, as applicable, shall have taken such actions as may be necessary (or reasonably requested by the Administrative Agent or its counsel) under local law (as advised by local counsel) to create, maintain, effect, perfect, preserve, maintain and protect the security interests granted (or purported to be granted) by each such pledge agreement;

(e)    unless otherwise agreed to by the Administrative Agent, all Indebtedness of any Obligor that is owing to any other Obligor or any other Group Member shall be evidenced by an Intercompany Note or by a promissory note or an instrument in form reasonably satisfactory to the Administrative Agent;

(f)    on or prior to the Second Restatement Effective Date (as such date may be extended from time to time by the Administrative Agent in its sole discretion), the Administrative Agent shall have received from each Qualified Obligor fully executed Cash Management Control Agreements with respect to their Core Concentration Accounts, Collection Accounts and other Deposit Accounts (other than Excluded Accounts and Disbursement Accounts); it being understood and agreed by the parties hereto that the Collection Accounts and the Core Concentration Accounts shall not be subject to cash pooling or other similar arrangements;

(g)    (i) on or prior to the Second Restatement Effective Date, each Qualified Obligor shall have delivered to the Administrative Agent notifications (each, a “Credit Card Notification”) substantially in the form attached hereto as Exhibit S which have been executed on behalf of such Obligor and addressed to such Obligor’s credit card services provider and (ii) unless consented to in writing by the Co-Collateral Agents, the Qualified Obligors shall not enter into any agreements with a credit card services provider other than the ones expressly contemplated herein unless, contemporaneously therewith, a Credit Card Notification is executed and delivered to the Administrative Agent;

(h)    subject to the Agreed Security Principles, all documents, instruments, forms and statements, required by law or reasonably requested by the Administrative Agent to be filed, registered or recorded to create the Liens intended to be created by the applicable Security Documents and perfect such Liens to the extent required by, and with the priority required by, such Security Document, shall have been filed, registered or recorded or delivered to the Security Agent for filing, registration or recording;

(i)    subject to the Agreed Security Principles, each Obligor shall have obtained all material consents and approvals required to be obtained by it in connection with the execution and delivery of all Security Documents to which it is a party, the performance of its obligations thereunder and the granting by it of the Liens thereunder;

(j)    the Administrative Agent shall have received from each Parent Guarantor and any of its Subsidiaries which is either an Obligor or which is an obligee with respect to any Indebtedness owing to it from (or guaranteed by) an Obligor, a counterpart of the Intercompany Subordination Agreement duly executed and delivered by each Parent Guarantor and each such Subsidiary; provided

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that in the case of any such Person which becomes an Obligor or an obligee with respect to any such Indebtedness after the Second Restatement Effective Date and which is not already a party to the Intercompany Subordination Agreement, such Person shall execute and deliver a supplement or joinder agreement to the Intercompany Subordination Agreement at the time it becomes such an Obligor or obligee; and

(k)    on or prior to the Second Restatement Effective Date, the Administrative Agent shall have received the Intellectual Property Rights Agreement.

Notwithstanding anything to the contrary above or elsewhere in this Agreement, no Eligible Inventory or Eligible Credit Card Receivable will be included in the relevant Borrowing Base unless the Security Agent has been granted a perfected first registered or first priority security interest in such Collateral to its satisfaction.

“Collection Accounts” shall mean, collectively, the English Collection Accounts, the Australian Collection Accounts and the French Collection Accounts.

“Collective Bargaining Agreement” shall mean any collective bargaining, union or similar collective agreement with any type of employees’ representatives applying or relating to any employee of any Group Member.

“Commercial Letter of Credit” shall mean 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 Qualified Obligor in the ordinary course of business of such Qualified Obligor.

“Commitment” shall mean, for each Lender, the amount set forth opposite such Lender’s name in Schedule 1.01(a) directly below the column entitled “Commitment”, as same may be (x) reduced from time to time or terminated pursuant to Sections 4.02, 4.03 and/or 11.01, as applicable, (y) adjusted from time to time as a result of assignments to or from such Lender pursuant to Section 2.13 or 13.04(b), or (z) increased from time to time pursuant to Section 2.14.

“Commitment Commission” shall have the meaning provided in Section 4.01(a).

“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.

“Company” shall mean any corporation, limited liability company, partnership or other business entity (or the adjectival form thereof, where appropriate) or the equivalent of the foregoing in any foreign jurisdiction.

“Compliance Period” shall mean any period (x) commencing on the date on which the Excess Availability is less than or equal to the Availability Condition and (y) ending on the first date thereafter on which the Excess Availability has been greater than the Availability Condition for 30 consecutive days.

“Confidential Information” shall mean all information and data, including, without limitation, technical, business, marketing and financial information, disclosed to the Agents (or any of them), any Issuing Lender or any Lender by any Parent Guarantor or any of its respective Subsidiaries in connection with this Agreement, any other Credit Document or any of the Transactions, whether tangible, intangible, electronic, verbal or written form or by observation and all memoranda, summaries, samples, notes, analyses, compilations, studies, or other documents prepared by the Agents (or any of them), any Issuing Lender or any Lender which contain, reflect or are derived from such information and/or data; provided,however, the term “Confidential Information” shall not include information or data which (a) is, or becomes, generally available other than as a result of a disclosure by the respective Agent, Issuing Lender or Lender in violation of any Credit Document, (b) is, or becomes, available to an Agent, any Issuing Lender or Lender from a

13

source other than any Parent Guarantor or any of their respective Subsidiaries or its representatives, provided that such source is not, and was not, actually known by such Agent, Issuing Lender or Lender, as the case may be, to be prohibited from transmitting such information or data by any contractual, fiduciary or other legal obligation of confidentiality to any Parent Guarantor or any of its respective Subsidiaries, (c) was available to an Agent, an Issuing Lender or a Lender on a non-confidential basis prior to disclosure by any Parent Guarantor or any of its respective Subsidiaries or their respective representatives or (d) is or was independently developed by an Agent, an Issuing Lender or a Lender without use of the Confidential Information.

“Consolidated EBITDA” shall mean, for any period, the sum (without duplication) of (a) Consolidated Net Income for such period, plus,

(a)    in each case to the extent deducted in determining Consolidated Net Income for such period:

(i)    depreciation and amortization,

(ii)    any other non-cash charges, including, but not limited to, any asset impairments, write-offs or write-downs (other than non-cash charges for which a cash payment will be required to be made in that period),

(iii)    provisions for taxes based on income, profits, revenue or capital, including federal, foreign and state income, franchise, and similar taxes based on income, profits, revenue or capital and foreign withholding taxes paid or accrued during such period (including in respect of repatriated funds) including penalties and interest related to such taxes or arising from any tax examinations,

(iv)    interest expense,

(v)    Advisory Fees,

(vi)    expenses in respect of intercompany agreements relating to licensing of intellectual property and management services consistent with current arm’s length accounting practices,

(vii)    unusual, non-recurring or extraordinary expenses, losses or charges as reasonably approved by the Administrative Agent, including, but not limited to, severance and one-time incentive awards,

(viii)    identified cost savings, operating expense reductions and synergies related to any restructuring, cost savings initiative or other initiative in an aggregate amount for all such periods not to exceed £15,000,000,

(ix)    the amount of any income attributable to non-controlling interests of third parties in any non-wholly-owned subsidiary deducted in such period (and not added back in such period), to Consolidated Net Income, excluding cash distributions in respect thereof,

(x)    any costs or expenses incurred by the Parent Guarantors or any of their Subsidiaries pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or agreement, any severance agreement or any stock subscription or shareholder agreement, to the extent that such costs or expenses are non-cash or otherwise funded with cash proceeds contributed to the capital of the Borrowers or net proceeds of an issuance of Equity Interests of the Borrowers,

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(xi)    any net pension or other post-employment benefit costs representing amortization of unrecognized prior service costs, actuarial losses, including amortization of such amounts arising in prior periods and any other items of a similar nature,

less,

(b)    without duplication and to the extent included in arriving at such Consolidated Net Income, the sum of the following amounts for such period:

(i)    non-cash gains (excluding any non-cash gain to the extent it represents the reversal of an accrual or reserve for a potential cash item that reduced Consolidated Net Income or Consolidated EBITDA), and

(ii)    the amount of any loss attributable to non-controlling interests of third parties in any non-wholly-owned subsidiary added to (and not deducted from) Consolidated Net Income in such period.

“Consolidated Fixed Charge Coverage Ratio” shall mean, for any period, the ratio of (a) Consolidated EBITDA of the Parent Guarantors and their respective Subsidiaries for such period,minusthe aggregate amount of all Capital Expenditures (which, for the avoidance of doubt shall never be less than zero for purposes of this definition) made by the Obligors during such period to (b) the sum of (1) the scheduled principal amount of all amortization payments made during such period on all Indebtedness of the Parent Guarantors and their respective Subsidiaries for such period (including the principal component of all Capitalized Lease Obligations but excluding the Secured 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) as determined on the first day of such period (or, with respect to a given issue of Indebtedness incurred thereafter, on the date of the incurrence thereof) plus (2) Consolidated Interest Expense of the Parent Guarantors and their respective Subsidiaries payable in cash for such period plus (3) the amount of all cash payments made by the Parent Guarantors and their respective Subsidiaries which are Obligors in respect of income taxes or income tax liabilities (net of cash income tax refunds) during such period (excluding such cash payments related to asset sales not in the ordinary course of business).

“Consolidated Interest Expense” shall mean, for any period, the total consolidated interest expense (including that attributable to Capitalized Lease Obligations in accordance with GAAP) of the Parent Guarantors and their respective Subsidiaries payable in cash (including, without limitation, all commissions, discounts and other commitment and banking fees and charges (e.g., fees with respect to letters of credit) for such period (calculated without regard to any limitations on payment thereof), adjusted to exclude (to the extent the same would otherwise be included in the calculation above in this clause) (w) any payments of interest in respect of the Specified Debt solely to the extent paid directly with the proceeds of a cash common equity contribution or shareholder loan (to the extent the same is subject to a subordination agreement in form and substance satisfactory to the Administrative Agent pursuant to which such shareholder loan is subordinated to the Secured Obligations), in each case made to any of the Borrowers by a direct or indirect shareholder thereof that is not an Obligor (any such cash common equity contribution and/or shareholder loans, the “Permitted Specified Debt Payment Sources”), provided that such payment of interest shall be made within 30 days upon the receipt of such proceeds (or such later date as may be agreed to by Administrative Agent in its sole discretion), (x) any payment of interest in respect of the Specified Debt made directly by an obligor thereunder that is not an Obligor, (y) the amortization of any deferred financing costs for such period and (z) any interest expense actually “paid in kind” or accreted during such period, all as determined on a consolidated basis in accordance with GAAP.

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“Consolidated Net Income” shall mean, for any period, the net income (or loss) of the Parent Guarantors and their respective Subsidiaries determined on a consolidated basis for such period (taken as a single accounting period) in accordance with GAAP, provided that the following items shall be excluded in computing Consolidated Net Income (without duplication): (i) the net income (or loss) of any Person in which a Person or Persons other than an Obligor and its Wholly-Owned Subsidiaries has an Equity Interest or Equity Interests to the extent of such Equity Interests held by Persons other than an Obligor and its Wholly-Owned Subsidiaries in such Person, (ii) except for determinations expressly required to be made on a ProForma Basis, the net income (or loss) of any Person accrued prior to the date it becomes a Subsidiary or all or substantially all of the property or assets of such Person are acquired by a Subsidiary and (iii) the net income of any Subsidiary to the extent that the declaration or payment of cash dividends or similar cash distributions by such Subsidiary of such net income is not at the time permitted by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Subsidiary.

“Consolidated Total Assets” shall mean, as of any date of determination, the aggregate total assets as set forth on the most recent consolidated balance sheets of each Parent Guarantor and its Subsidiaries delivered pursuant to Section 9.01(a) prepared in accordance with GAAP.

“Contingent Obligation” shall mean, as to any Person, any obligation of such Person as a result of such Person being a general partner of any other Person, unless the underlying obligation is expressly made non-recourse as to such general partner, and any obligation of such Person guaranteeing or intended to guarantee any Indebtedness, leases, dividends or other obligations (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (x) for the purchase or payment of any such primary obligation or (y) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the holder of such primary obligation against loss in respect thereof; provided, however, that the term Contingent Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith.

“Continued Loan” shall have the meaning provided such term in Section 2.01(a).

“Contribution Notice” shall mean a contribution notice issued by the Pensions Regulator under section 38 or section 47 of the Pensions Act 2004.

“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.

“Core Australian Concentration Account” shall have the meaning provided in Section 5.03(e).

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“Core Concentration Accounts” shall mean, collectively, the Core English Concentration Accounts, the Core Australian Concentration Accounts and the Core French Concentration Accounts.

“Core English Concentration Account” shall have the meaning provided in Section 5.03(e).

“Core French Concentration Account” shall have the meaning provided in Section 5.03(e).

“Corporations Act” shall mean the Corporations Act 2001 of Australia.

“Cost” shall mean the cost of purchases, as reported on the Obligors’ financial stock ledger based upon the Obligors’ accounting practices in effect on the Second Restatement 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 to the extent treated consistently with the Obligors’ accounting practices in effect on the Second Restatement Effective Date) used in the Obligors’ calculation of cost of goods sold.

“CRD IV” shall mean (i) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms; and (ii) Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC; or any law, rules or guidance by which either of them is implemented.

“Credit Account” shall have the meaning provided in Section 5.03(h).

“Credit Card Notifications” shall have the meaning provided in the definition of Collateral and Guaranty Requirements.

“Credit Document Acknowledgment and Amendment” shall mean the Credit Document Acknowledgment and Amendment substantially in the form of Exhibit R, as amended, modified, restated or supplemented from time to time.

“Credit Document Obligations” shall have the meaning specified in the definition of Secured Obligations.

“Credit Documents” shall mean this Agreement, the Intercompany Subordination Agreement, the Intellectual Property Rights Agreement, each Security Document, each French Proceeds Loan Document and, after the execution and delivery thereof pursuant to the terms of this Agreement, each Incremental Commitment Agreement, each Note, each Joinder Agreement and each Incremental Security Document.

“Credit Event” shall mean the making of any Loan or the issuance, amendment, extension or renewal of any Letter of Credit (other than any amendment, extension or renewal that does not increase the maximum Stated Amount of such Letter of Credit).

“Customer Credit Liabilities” shall mean, at any time, the aggregate remaining balance at such time of (a) outstanding gift certificates and gift cards of the Qualified Obligors 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 Qualified Obligors, net of any dormancy reserves maintained by the Qualified Obligors on their books and records in the ordinary course of business consistent with past practices.

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“Customer Credit Liabilities Reserve” shall mean as of any date, an amount equal to (A) forty-five percent (45%) of the Customer Credit Liabilitiesminus(B) dormancy fees, each as reflected in the books and records of the Qualified Obligors.

“Customs Broker Agreement” shall mean an agreement in substantially the form attached hereto as Exhibits T-1 and T-2 (or such other form acceptable to the Administrative Agent) among a Qualified Obligor, a customs broker or other carrier, and the Administrative Agent 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 Security Agent and agrees, upon notice from the Security Agent to hold and dispose of the subject Inventory and other property solely as directed by the Security Agent.

“DB Australian Account” shall have the meaning provided in Section 5.03(g).

“DB English Account” shall have the meaning provided in Section 5.03(f).

“DB French Account” shall have the meaning provided in Section 9.20.

“DB London” shall mean Deutsche Bank AG, London Branch, in its individual capacity, and any successor corporation or merger, consolidation or otherwise.

“DBNY” shall mean Deutsche Bank AG New York Branch, in its individual capacity, and any successor corporation by merger, consolidation or otherwise.

“Default” shall mean any event, act or condition which with notice or lapse of time, or both, would constitute an Event of Default.

“Defaulting Lender” shall mean, subject to Section 15.07(c), 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 unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, any Issuing 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) within two Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent or any Issuing Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (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 debtor relief laws of the United States or other applicable jurisdictions from time to time in effect, 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 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 equity interest 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

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immunity from the jurisdiction of courts within the United States 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 the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 15.07(c)) upon delivery of written notice of such determination to the Borrower, each Issuing Lender and each Lender.

“Deposit Account” shall mean a demand, time, savings, passbook or like account with a bank, savings and loan association, credit union or like organization. All funds in such Deposit Account shall be conclusively presumed to be Collateral and proceeds of Collateral and the Agents and the Lenders shall have no duty to inquire as to the source of the amounts on deposit in the Deposit Account.

“Disbursement Accounts” shall mean, collectively, the English Disbursement Accounts, the Australian Disbursement Accounts and the French Disbursement Accounts.

“Dividend” shall mean, with respect to any Person, that such Person has declared or paid a dividend, distribution or returned any equity capital to its stockholders, partners or members or authorized or made any other distribution, payment or delivery of property (other than common Equity Interests of such Person) or cash to its stockholders, partners or members in their capacity as such, or redeemed, retired, purchased or otherwise acquired, directly or indirectly, for a consideration any shares of any class of its capital stock or any other Equity Interests outstanding on or after the Second Restatement Effective Date (or any options or warrants issued by such Person with respect to its capital stock or other Equity Interests), or set aside any funds for any of the foregoing purposes, or shall have permitted any of its Subsidiaries to purchase or otherwise acquire for a consideration any shares of any class of the capital stock or any other Equity Interests of such Person outstanding on or after the Second Restatement Effective Date (or any options or warrants issued by such Person with respect to its capital stock or other Equity Interests). Without limiting the foregoing, “Dividends” with respect to any Person shall also include all payments made or required to be made by such Person with respect to any stock appreciation rights, plans, equity incentive or achievement plans or any similar plans or setting aside of any funds for the foregoing purposes.

“Documentation Agents” shall mean Citigroup Global Markets Inc. and Goldman Sachs Lending Partners LLC, in their capacities as Documentation Agents in respect of the credit facilities hereunder.

“Dominion Period” shall mean any period (i) commencing on the date on which either (x) a Specified Default has occurred and is continuing or (y) the Excess Availability is less than or equal to the Availability Condition for three consecutive Business Days and (ii) ending on the first date thereafter on which (x) no Specified Default exists or is continuing and (y) the Excess Availability has been greater than the Availability Condition for 30 consecutive days.

“Drawing” shall have the meaning provided in Section 3.05(b).

“Eligible Credit Card Receivables” shall mean, as of any date of determination, Accounts due to a Qualified Obligor from its credit and debit card services providers 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 and which have originated in an Applicable Eligible Jurisdiction. None of the following shall be deemed to be Eligible Credit Card Receivables:

(a)    Accounts due from its credit and debit card services providers that have been outstanding for more than five (5) Business Days from the date of sale, or for such longer period(s) as may be approved by the Co-Collateral Agents;

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(b)    Accounts due from its credit and debit card services providers with respect to which a Qualified Obligor does not have good, valid and marketable title thereto, free and clear of any Lien (other than Liens granted to the Security Agent for its own benefit and the benefit of the other Secured Creditors pursuant to the Security Documents and Permitted Encumbrances having priority by operation of Applicable Law over the Lien of the Administrative Agent) (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 its credit and debit card services providers that are not subject to a first registered or first priority (except as provided in clause (b), above) security interest in favor of the Security Agent for its own benefit and the benefit of the other Secured Creditors;

(d)    Accounts due from its credit and debit card services providers which are disputed, or with respect to which a claim, counterclaim, offset or chargeback has been asserted, by the related credit/debit 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/debit card processors shall not be deemed violative of this clause);

(e)    except as otherwise approved by the Co-Collateral Agents, Accounts due from its credit and debit card services providers as to which the credit or debit card processor has the right under certain circumstances to require a Qualified Obligor to repurchase the Accounts from such credit or debit card processor; or

(f)    Accounts due from major credit and debit 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 Permitted Discretion acting in good faith to be unlikely to be collected.

“Eligible In-Transit Inventory” shall mean, 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 Qualified Obligor in a Qualified Jurisdiction (other than France) within sixty (60) days of the date of determination, but which has not yet been received by a Qualified Obligor or (ii) which has been delivered to a carrier in a Qualified Jurisdiction (other than France) for receipt by a Qualified Obligor in such Qualified Jurisdiction within five (5) Business Days of the date of determination, but which has not yet been received by a Qualified Obligor;

(b)    for which the purchase order is in the name of a Qualified Obligor and title has passed to a Qualified Obligor;

(c)    except as otherwise agreed by the Co-Collateral Agents, for which a Qualified Obligor is designated as “shipper” and/or the consignor and the document of title or waybill reflects a Qualified Obligor as consignee (along with delivery to a Qualified Obligor or its customs broker of the documents of title, to the extent applicable, with respect thereto);

(d)    as to which the Security Agent 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 Security Agent;

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(f)    which is insured in accordance with the provisions of this Agreement and the other Credit Documents, including, without limitation, marine cargo insurance; and

(g)    which otherwise is not excluded from the definition of Eligible Inventory;

provided that 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 Obligors’ Agent, 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 equal and ratable with, the Lien of the Security Agent (such as, without limitation, a right of stoppage in transit) or may otherwise adversely impact the ability of the Security Agent to realize upon such Inventory.

“Eligible Inventory” shall mean as of any date of determination, without duplication, (a) Eligible Letter of Credit Inventory, (b) Eligible In-Transit Inventory and (c) items of Inventory of a Qualified Obligor that are finished goods, merchantable and readily saleable to the public in the ordinary course 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 Inventory:

(a)    Inventory that is not solely owned by a Qualified Obligor, or is leased by or is on consignment to a Qualified Obligor, or as to which the Qualified Obligors 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 a Qualified Jurisdiction;

(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 Qualified Obligors, except to the extent that the Qualified Obligors shall have used commercially reasonable efforts to furnish (in the case of each such location leased by a third party for which the Qualified Obligors contracted with such third party on or before the Second Restatement Effective Date), or shall have furnished (in the case of each such location leased by a third party for which the Qualified Obligors contracted with such third party after the Second Restatement Effective Date), the Security Agent with (i) any registrations or notifications that the Administrative Agent 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 any such location on terms reasonably acceptable to the Co‑Collateral Agents; provided that, with respect to any location which is leased by a third party as of the Second Restatement Effective Date and which contains Inventory to be utilized to fulfill internet orders or Inventory to be forwarded to stores or distribution centers of the Qualified Obligors, such Inventory shall not be deemed ineligible solely by virtue of this clause (c) if such an intercreditor agreement is not obtained by the Qualified Obligors (after having used commercially reasonable efforts to obtain same); provided, further, 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 Qualified Obligor at which Inventory of an English Obligor is located (or locations under the control of the same Person other than store leases) having a value of less than or equal to £6,000,000 at Cost (or, with respect to seasonal locations, at which Inventory is located having a value less than or equal to £12,000,000 at Cost for a period of not greater than 60 days), or (ii) any location that is not owned or leased by the Qualified Obligor at which Inventory of an Australian Obligor is located (or under the control of the same Person other than store leases) having a value of less than or equal to £2,000,000 at Cost (or, with respect to

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seasonal locations, at which Inventory is located having a value less than or equal to £4,000,000 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 Qualified Obligors, except to the extent that (unless otherwise agreed by the Co-Collateral Agents) the Qualified Obligors shall have used commercially reasonable efforts to furnish (in the case of each such distribution center for which the Qualified Obligors have entered into a lease on or before the Second Restatement Effective Date), or shall have furnished (in the case of each such distribution center for which the Qualified Obligors have entered into a lease after the Second Restatement Effective Date), the Administrative Agent with a landlord’s lien waiver and Collateral Access Agreement on terms reasonably acceptable to the Co-Collateral Agents executed by the Person owning any such distribution center; provided that 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 an English Obligor is located (or locations under the control of the same Person other than store leases) having a value of less than or equal to £6,000,000 at Cost (or, with respect to seasonal warehouses, at which Inventory is located having a value less than or equal to £12,000,000 at Cost for a period of not greater than 60 days), or (ii) any distribution center at which Inventory of an Australian Obligor is located (or under the control of the same Person other than store leases) having a value of less than or equal to £2,000,000 at Cost (or, with respect to seasonal warehouses, at which Inventory is located having a value less than or equal to £4,000,000 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 Qualified Obligor’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)    Inventory that 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;

(g)    Inventory that is not subject to a perfected first priority security interest in favor of the Security Agent, for its own benefit and the benefit of the other Secured Creditors (subject only to Permitted Liens having priority by operation of Applicable Law, for the avoidance of doubt, excluding any liens permitted pursuant to Section 10.01(v));

(h)    Inventory that consists of samples, labels, bags, packaging materials, and other similar non-merchandise categories;

(i)    Inventory that casualty insurance in compliance with the provisions of Section 9.03 is not in effect;

(j)    Inventory that has been sold but not yet delivered or Inventory to the extent that any Qualified Obligor has accepted a deposit therefor;

(k)    Inventory that is acquired in a Permitted Acquisition by a Qualified Obligor, 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;

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(l)    in the case of Inventory located in France, Inventory that is not located in a location indicated in the French Inventory Pledge Agreement (or supplements thereto or if required by the Co-Collateral Agents, a new pledge agreement) or which is not otherwise described in annex 2 to the French Inventory Pledge Agreement (or supplements thereto or if required by the Co-Collateral Agents, a new pledge agreement) or identified in the registration with the relevant French commercial court clerk (Greffe du Tribunal de commerce), provided that Inventory indicated in any supplement to the French Inventory Pledge Agreement or a new pledge agreement and registered with the relevant French commercial court clerk may not be deemed Eligible Inventory until the applicable registration has been duly completed; or

(m)    is otherwise unacceptable to the Co-Collateral Agents in their Permitted Discretion.

“Eligible Letter of Credit Inventory” shall mean, 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 Qualified Obligor in the United Kingdom or Australia within sixty (60) days of the date of determination, but which has not yet been received by a Qualified Obligor, or (ii) which has been delivered to a carrier in the United Kingdom or Australia for receipt by a Qualified Obligor in the United Kingdom or Australia within five (5) Business Days of the date of determination, but which has not yet been received by a Qualified Obligor;

(b)    the purchase order for which is in the name of a Qualified Obligor, title has passed to a Qualified Obligor 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; provided that ninety percent (90%) of the maximum Stated Amount of 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 Qualified Obligor is designated as “shipper” and/or consignor and the document of title or waybill reflects a Qualified Obligor as consignee (along with delivery to a Qualified Obligor or its customs broker of the documents of title, to the extent applicable, with respect thereto);

(d)    as to which the Security Agent 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 Credit Documents, including, without limitation, marine cargo insurance;

(f)    as to which a Tri-Party Agreement has been executed and delivered in favor of the Security Agent; and

(g)    which otherwise is not excluded from the definition of Eligible Inventory;

provided that 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 Obligors’ Agent, 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)

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senior to, or paripassu with, the Lien of the Security Agent (such as, without limitation, a right of stoppage in transit) or may otherwise adversely impact the ability of the Security Agent to realize upon such Inventory.

“Eligible Transferee” shall mean and include a commercial bank, an insurance company, a finance company, a financial institution, any fund that invests in loans or any other “accredited investor” (as defined in Regulation D of the Securities Act); provided that such Person, together with its Affiliates, has a combined capital and surplus in excess of $500,000,000; provided, further, that an Eligible Transferee shall exclude (w) any natural person, (x) the Parent Guarantors and their respective Subsidiaries, (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 Total Commitment; providedthat, (1) to the extent that the Sponsor Group or any of their respective Affiliates hold in the aggregate more than 10% of the Total Commitment, 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 Commitments which exceeds 10% of the Total Commitments, 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.

“EMU Legislation” shall mean the legislative measures of the European Union for the introduction of changeover to or operation of the Euro in one or more member states being in part legislative measures to implement the third stage of the European Monetary Union.

“End Date” shall have the meaning provided in the definition of Applicable Margin.

“Enforcement Event” shall mean the occurrence of an Event of Default which is continuing and which has resulted in the Administrative Agent or the Security Agent (as the case may be) giving notice along with its intention to take enforcement action pursuant to the Credit Documents; provided that no such notice shall be required for an Enforcement Event to have occurred if an Event of Default of the type described in Section 11.01(e) has occurred and is continuing.

“English Collection Account” shall mean each account established at an English Collection Bank subject to a Cash Management Control Agreement into which funds shall be transferred as provided in Section 5.03(b).

“English Collection Bank” shall have the meaning provided in Section 5.03(b).

“English Disbursement Account” shall mean each checking and/or disbursement account maintained by each English Obligor for their respective general corporate purposes, including for the purpose of paying their trade payables and other operating expenses (other than a disbursement account that is an Excluded Account).

“English Employee Liability Reserves” shall mean, with respect to each English Obligor, such amount as the Co-Collateral Agents may from time to time determine in their Permitted Discretion, which amount shall represent the aggregate amount payable by such English Obligor to creditors in respect of the categories of preferential debts set out in Schedule 6 of the Insolvency Act 1986.

“English Obligor” shall mean any Obligor incorporated, organized or established under the laws of England and Wales.

“English Perfection Certificate” shall mean the English Perfection Certificate in the form thereof included in Exhibit D‑2 or any other form approved by the Administrative Agent, as the same may be supplemented from time to time by a Perfection Certificate Supplement or otherwise.

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“Enterprise Act Reserves” shall mean, at any time, with respect to each English Obligor, the maximum amount which would be required to be made available by such English Obligor to unsecured creditors if Section 176A of the Insolvency Act of 1986 applied (with such amount being equal to £600,000 as at the date of this Agreement) without duplication of any such amounts used in determining Net Orderly Liquidation Value.

“Environment” shall mean all gases, air, vapors, liquids, water, land, surface and sub-surface soils, rock, flora, fauna, wetlands and all other natural resources or part thereof including artificial or manmade buildings, structures or enclosures.

“Environmental Claims” shall mean any and all administrative, regulatory or judicial actions, suits, demands, demand letters, directives, claims, liens, notices of non‑compliance or violation, investigations or proceedings relating in any way to any Environmental Law or any permit issued, or any approval given, under any such Environmental Law (hereafter, “Claims”), including, without limitation, (a) any and all Claims by Governmental Authorities for enforcement, cleanup, removal, response, remedial or other actions or damages pursuant to any applicable Environmental Law, and (b) any and all Claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation or injunctive relief in connection with alleged injury or threat of injury to health, safety or the environment due to the presence of Hazardous Materials.

“Environmental Law” shall mean any applicable law or directive concerning the Environment or health and safety which is at any time binding upon a Group Member in the jurisdictions in which such Group Member carries on business or operates (including, without limitation, by the export of its products or its waste thereto).

“Equity Interests” of any Person shall mean any and all shares, interests, rights to purchase, warrants, options, participation or other equivalents of or interest in (however designated) equity of such Person, including any common stock, preferred stock, any limited or general partnership interest and any limited liability company membership interest.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to ERISA are to ERISA, as in effect at the date of this Agreement and any subsequent provisions of ERISA, amendatory thereof, supplemental thereto or substituted therefor.

“ERISA Affiliate” shall mean each person (as defined in Section 3(9) of ERISA) which together with an Obligor or a Subsidiary of an Obligor would be deemed to be a “single employer” (i) within the meaning of Section 414(b), (c), (m) or (o) of the Code or (ii) as a result of either an Obligor or a Subsidiary of an Obligor being or having been a general partner of such person.

“Euro LIBOR” shall mean, with respect to each Borrowing of Euro Loans, (i) the applicable screen rate, the same being the percentage rate per annum determined by the Banking Federation of the European Union for the relevant Interest Period, displayed on Reuters Page EURIBOR-01. If the agreed page is replaced or service ceases to be available, the Facility Agent may specify another page or service displaying the appropriate rate after consultation with the Obligors’ Agent and the Lenders; or (ii) (if no screen rate is available for the Interest Period of that Loan) ”, the rate for such Interest Period shall be the interest rate per annum reasonably determined by the Administrative Agent in good faith to be the rate per annum at which deposits in Euros for delivery on the first day of such Interest Period in immediately available funds in the approximate amount of the Euro Loan being made, continued or converted by the Administrative Agent and with a term equivalent to such Interest Period that would be offered to the Administrative Agent by major banks in the London interbank market at their request at approximately 11:00 a.m. (London time)

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on the applicable Interest Determination Date, provided that in the event the Administrative Agent has made any determination pursuant to Section 2.10(a)(i) in respect of Euro Loans, or in the circumstances described in clause (i) to the proviso to Section 2.10(b) in respect of such Euro Loans, the Euro LIBOR determined pursuant to this definition shall instead be the rate determined by the Administrative Agent as the all-in-cost of funds for the Administrative Agent to fund a Borrowing of Loans denominated in Euros with maturities comparable to the Interest Period applicable thereto; provided that in the event the Administrative Agent has made any determination pursuant to Section 2.10(a)(i) in respect of Euro Loans, or in the circumstances described in clause (i) to the proviso to Section 2.10(b) in respect of such Euro Loans, the Euro LIBOR determined pursuant to this definition shall instead be the rate determined by the Administrative Agent as the all-in-cost of funds for the Administrative Agent (or such other Lender) to fund a Borrowing of Loans denominated in Euros with maturities comparable to the Interest Period applicable thereto; provided that, if Euro LIBOR shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.

“Euro Loans” shall mean each Loan denominated in Euros at the time of the incurrence thereof.

“Euro Rate” shall mean and include each of the Australian Dollar Rate, Eurodollar Rate, the Sterling Rate and Euro LIBOR.

“Euro Rate Loan” shall mean each U.S. Dollar Loan, each Sterling Loan, each Euro Loan and each Australian Dollar Loan.

“Eurodollar Rate” shall mean with respect to each Borrowing of U.S. Dollar Loans, (x) the applicable screen rate, the offered rate that appears on the appropriate page of the Reuters screen that displays the ICE Benchmark Administration Limited rate for deposits in Dollars (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period (or the successor thereto if ICE Benchmark Administration Limited is no longer making the applicable interest settlement rate available), determined as of approximately 11:00 a.m. (London time) on the applicable Interest Determination Date; or (y) (if no screen rate is available for the currency or Interest Period of that Loan) (a) the rate for such Interest Period shall be the interest rate per annum reasonably determined by the Administrative Agent in good faith to be the rate per annum at which deposits in Dollars for delivery on the first day of such Interest Period in immediately available funds in the approximate amount of the U.S. Dollar Loan being made, continued or converted by the Administrative Agent and with a term equivalent to such Interest Period that would be offered to the Administrative Agent by major banks in the London interbank market for Dollars at their request at approximately 11:00 a.m. (London time) on the applicable Interest Determination Date, by (b) a percentage equal to 100%minusthe then stated maximum rate of all reserve requirements (including, without limitation, any marginal, emergency, supplemental, special or other reserves required by applicable law) applicable to any member bank of the Federal Reserve System in respect of Eurocurrency funding or liabilities as defined in Regulation D (or any successor category of liabilities under Regulation D); and if the Eurodollar Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.

“European Parent Guarantor” shall have the meaning set forth in the preamble hereto.

“Euros” and the designation “€” shall mean the single currency of the Participating Member States.

“Event of Default” shall have the meaning provided in Section 11.

“Excess Availability” shall mean, as of any date of determination, the remainder of (i) the lesser of (x) the Total Commitment at such time and (y) the Borrowing Base at such time minus (ii) the Aggregate Exposure at such time.

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“Excluded Accounts” shall mean (v) any Cash Pooling Accounts, (w) cash deposit accounts existing on the Second Restatement Effective Date maintained by an Obligor solely for the purpose of holding cash collateral for bank guarantees or other security deposits (it being understood that the amounts held in such accounts cannot be increased pursuant to this clause (w) and such accounts are only “Excluded Accounts” so long as such Obligor maintains the corresponding bank guarantees), (x) all disbursement accounts established solely for the payment of medical, dental, disability or other similar expenses in connection with insurance or benefit programs for employees of the Obligors, (y) all trust accounts established (or otherwise maintained) solely with respect to withholding, sales, use, value added or similar taxes and all payroll accounts (which are solely for such purposes) and (z) any cash accounts established (or otherwise maintained) by any Obligor that do not have cash balances at any time exceeding the Pounds Sterling Equivalent of £5,000,000 in the aggregate for all such cash accounts of the Obligors which funds in such Excluded Accounts shall not be funded from, or when withdrawn from such Excluded Accounts, shall not be replenished by, funds constituting proceeds of Collateral so long as a Dominion Period exists and continues; provided in no event shall Excluded Accounts include any Collection Accounts, Disbursement Accounts, Core Concentration Accounts or any other account pursuant to which an account control agreement has been executed and delivered to the Security Agent pursuant to any Security Document.

“Excluded Swap Obligation” shall mean, with respect to any Guarantor, any Swap Obligation if, and to the extent that, and only for so long as, 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 Guarantee 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) (i) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the Guarantee of such Guarantor or the grant of such security interest becomes effective with respect to such Swap Obligation or (ii) in the case of a Swap Obligation that is subject to a clearing requirement pursuant to section 2(h) of the Commodity Exchange Act, because such Guarantor is a “financial entity,” as defined in section 2(h)(7)(C) the Commodity Exchange Act, at the time the guarantee of (or grant of such security interest by, as applicable) such Guarantor becomes or would become 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 illegal.

“Executive Order” shall have the meaning provided in Section 8.22(a).

“Existing Commitment” shall mean a “Commitment” under, and as defined in, the Existing Facility Agreement.

“Existing Facility Agreement” shall mean the Amended and Restated Syndicated Facility Agreement, dated as of October 15, 2009, as amended and restated as of March 8, 2011 and as amended as of March 20, 2013 among Toys “R” Us Europe, LLC, the Australian Parent Guarantor, the Borrowers the other obligors and guarantors party thereto from time to time, the lenders party hereto 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 (as amended, restated, supplemented or otherwise modified through but not including the Second Restatement Effective Date).

“Existing Indebtedness” shall have the meaning provided in Section 10.04(ii).

“Existing Lender” shall mean each “Lender” under, and as defined in, the Existing Facility Agreement as of the Second Restatement Effective Date.

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“Existing Letters of Credit” shall have the meaning provided in Section 3.01(a)(B).

“Existing Loan” shall mean a “Loan” under, and as defined in, the Existing Facility Agreement.

“Expenses” shall mean all present and future reasonable expenses incurred by or on behalf of the Administrative Agent, the Security Agent, the Co-Collateral Agents or any Issuing Lender in connection with this Agreement, any other Credit Document or otherwise in its capacity as the Administrative Agent under this Agreement, a Co-Collateral Agent under the Credit Documents, or the Security Agent under any Security Document or as an Issuing Lender under this Agreement, whether incurred heretofore or hereafter, which expenses shall include, without limitation, the cost of record searches, the reasonable fees and expenses of attorneys and paralegals, all reasonable and invoiced costs and expenses incurred during a Dominion Period by the Administrative Agent (and the Security Agent and the Co-Collateral Agents) in opening bank accounts, depositing checks, electronically or otherwise receiving and transferring funds, and any other charges imposed on the Administrative Agent (and the Security Agent and the Co-Collateral Agents), collateral examination fees and expenses, reasonable fees and expenses of accountants, appraisers or other consultants, experts or advisors employed or retained by the Administrative Agent, the Security Agent and the Co-Collateral Agents, fees and taxes related to the filing of financing statements, costs of preparing and recording any other Credit Documents, all expenses, costs and fees set forth in this Agreement and the other Credit Documents, all other fees and expenses required to be paid pursuant to any other letter agreement and all fees and expenses incurred in connection with releasing Collateral and the amendment or termination of any of the Credit Documents.

“Facility Agent” shall mean Deutsche Bank AG New York Branch in its role as Facility Agent for the Lenders hereunder or such other institution as may be appointed by the Administrative Agent.

“Facing Fee” shall have the meaning provided in Section 4.01(c).

“Fair Market Value” shall mean, with respect to any asset (including any Equity Interests of any Person), the price at which a willing buyer and a willing seller (who are not Affiliates of each other) who does not have to sell would agree to purchase and sell such asset, as determined in good faith by the board of directors or other governing body or an Authorized Officer of the Obligors’ Agent, or the Obligor selling such asset.

“FATCA” shall mean 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 promulgated thereunder, official interpretations thereof, or published administrative guidance implementing such sections, any agreement entered into pursuant to section 1471(b)(1) of the Code, and any laws, regulations, rules or practices adopted pursuant to any intergovernmental agreement entered into with respect to the foregoing.

“Federal Funds Rate” shall mean, for any period, a fluctuating interest rate equal for each day during such period to the weighted average of the rates on overnight Federal Funds transactions with members of the Federal Reserve System, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions reasonably determined by the Administrative Agent (rounded upward, if necessary, to a whole multiple of 1/100 of 1.00%).

“Fees” shall mean all amounts payable pursuant to or referred to in Section 4.01.

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“Financial Support Direction” shall mean a financial support direction issued by the Pensions Regulator under section 43 of the Pensions Act 2004.

“Fiscal Month” shall mean 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 Obligors.

“Fiscal Quarter” shall mean 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 Obligors.

“Fiscal Year” shall mean any period of twelve consecutive months ending on the Saturday closest to January 31 of any calendar year.

“French Borrowing Base” shall mean, as of any date of calculation, the amount calculated pursuant to the Borrowing Base Certificate most recently delivered to the Administrative Agent and each of the Co-Collateral Agents in accordance with Section 9.01(j), equal to, without duplication, the sum of (a) 85% of the then extant Net Orderly Liquidation Value of French Eligible Inventory of Toys SARL minus (b) the sum (without duplication) of the Reserves then established by the Co-Collateral Agents with respect to the French Borrowing Base. The Co-Collateral Agents shall have the right (but no obligation) to review such computations and if such computations have not been calculated in accordance with the terms of this Agreement, the Co-Collateral Agents shall have the right to correct any such errors.

“French Borrowing Base Loans” shall mean all Loans incurred by the U.K. Borrowers made in reliance of the French Borrowing Base and the proceeds of which are used solely to make French Proceeds Loans.

“French Collection Account” shall mean each account established at a French Collection Bank into which funds shall be transferred as provided in Section 5.03(d).

“French Collection Bank” shall have the meaning provided in Section 5.03(d).

“French Disbursement Account” shall mean each checking and/or disbursement account maintained by each French Obligor for their respective general corporate purposes, including for the purpose of paying their trade payables and other operating expenses (other than a disbursement account that is an Excluded Account).

“French Eligible Inventory” shall mean Eligible Inventory other than Eligible Letter of Credit Inventory and Eligible In-Transit Inventory owned by Toys SARL.

“French Employee Liability Reserves” shall mean with respect to Toys SARL, such amount as the Co-Collateral Agents may from time to time determine in their Permitted Discretion, which amount represents the aggregate amount payable by Toys SARL in respect of employees’ super-priority claims described in the provisions of the French labor code (Code du travail) which are listed in Articles L.622-17 II and L.641-13 II of the French commercial code (Code de commerce).

“French Inventory Pledge Agreement” shall mean the pledge listed under paragraph 3(d) of Part I of Schedule 1.01(d).

“French Locally Supported Aggregate Exposure” shall mean, at any time, the lesser of (x) the French Borrowing Base and (y) the aggregate principal amount of all French Borrowing Base Loans then outstanding (for this purpose, using the Pounds Sterling Equivalent of amounts not denominated in Pounds Sterling).

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“French Obligor” shall mean Toys SARL and any Obligor incorporated or organized under the laws of France.

“French Pledged Shares” shall mean the shares (parts sociales) pledged pursuant to the French Share Pledge and, as the case may be, any subsequent share pledge in accordance with Section 12.11.

“French Proceeds Loan Agent” shall mean the Administrative Agent in its capacity as security agent for the U.K. Borrowers pursuant to the French Proceeds Loan Documents appointed in such capacity in the French Proceeds Loan Documents.

“French Proceeds Loan Collateral” shall mean all property (whether real or personal) with respect to which any security interests have been granted (or purported to be granted) pursuant to any French Proceeds Loan Document.

“French Proceeds Loan Documents” shall mean the loan agreement dated as of December 18, 2015 among Toys SARL as borrower, the U.K. Borrowers as lenders and the French Proceeds Loan Agent governing the French Proceeds Loans in the form of Exhibit E together with each French Proceeds Loan Security Document and each other ancillary document related thereto, in each case, as amended, restated, modified and/or supplemented from time to time.

“French Proceeds Loan Creditors” shall mean, collectively, the French Proceeds Loan Agent as security agent and the U.K. Borrowers as lenders under the French Proceeds Loan Documents.

“French Proceeds Loan Obligations” shall mean all obligations and liabilities of Toys SARL which may arise under or in connection with the French Proceeds Loan Documents, in each case whether on account of principal, premium (if any), reimbursement obligations, fees, penalties, indemnities, costs, expenses or otherwise (including (x) all fees and disbursements of counsel of the French Proceeds Loan Creditors that are required to be paid by Toys SARL pursuant to the terms of the French Proceeds Loan Documents and (y) all interest that accrues after the commencement of any case, proceeding or other action relating to the bankruptcy, insolvency, reorganization, moratorium or similar proceeding of Toys SARL at the rate provided for in the respective documentation, whether or not a claim for post-petition interest is allowed in any such proceeding).

“French Proceeds Loan Secured Obligations” shall mean and include all of the following:

(i)    the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of all French Proceeds Loan Obligations of Toys SARL to the French Proceeds Loan Creditors, whether now existing or hereafter incurred under, arising out of, or in connection with, each French Proceeds Loan Document to which Toys SARL is a party;

(ii)    any and all sums advanced by the French Proceeds Loan Agent in order to preserve the French Proceeds Loan Collateral or preserve its security interest in the French Proceeds Loan Collateral;

(iii)    in the event of any proceeding for the collection or enforcement of any indebtedness, obligations, or liabilities of Toys SARL referred to in clauses (i) and (ii) above, after an Event of Default (under and defined in the French Proceeds Loan Documents) shall have occurred and be continuing, the expenses of retaking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the French Proceeds Loan Collateral, or of any exercise by Toys SARL of its rights hereunder, together with reasonable attorneys’ fees and court costs; and

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(iv)    all amounts paid (or incurred) by the French Proceeds Loan Agent as to which such has the right to reimbursement or French Proceeds Loan Agent indemnity contained in the French Proceeds Loan Documents;

it being acknowledged and agreed that the “French Proceeds Loan Secured Obligations” shall include extensions of credit of the types described above, whether outstanding on the date of the French Proceeds Loan Documents or extended from time to time after the date of the French Proceeds Loan Documents.

“French Proceeds Loans” shall mean intercompany loans made by a U.K. Borrower to Toys SARL solely with the proceeds of French Borrowing Base Loans incurred by such U.K. Borrower pursuant to the French Proceeds Loan Documents which such loans and rights of the U.K. Borrowers under the French Proceeds Loan Documents have been pledged to the Security Agent pursuant to the terms of the applicable Security Documents.

“French Proceeds Loan Security Documents” means, collectively, that certain pledge over the bank accounts of Toys SARL in favor of the French Proceeds Loan Creditors, the pledge over receivables with respect to insurance claims made by Toys SARL in favor of the French Proceeds Loan Creditors, the nonpossessory inventory pledge over inventory of Toys SARL in favor of the French Proceeds Loan Creditors and the U.K. equitable charge over shares in TRU (France) Finance Ltd in favor of the French Proceeds Loan Creditors, together with each other document pursuant to which security is granted by Toys SARL to secure the French Proceeds Loan Secured Obligations.

“French Share Pledge” shall mean the French law share pledge (nantissement de parts sociales de premier rang) over the shares of Toys “R” Us SARL as mentioned in Part II paragraph 5 (a) of Schedule 1.01(d).

“Fronting Exposure” means, at any time there is a Defaulting Lender, with respect to any Issuing Lender, such Defaulting Lender’s Applicable Percentage of the Letter of Credit Outstandings with respect to Letters of Credit issued by such Issuing Bank other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.

“Fronting Lender” shall mean DBNY, in its individual capacity or any Person serving as a successor Administrative Agent hereunder, in its individual capacity as a Fronting Lender.

“GAAP” shall mean generally accepted accounting principles in the United States as in effect from time to time; provided that determinations in accordance with GAAP for purposes of Sections 5.02, 9.16 and 10, including defined terms as used therein, and for all purposes of determining the Consolidated Fixed Charge Coverage Ratio, are subject (to the extent provided therein) to Section 13.07(a).

“German Borrower” shall have the meaning provided in the first paragraph of this Agreement.

“German Obligor” shall mean any Obligor incorporated, organized or established under the laws of the Federal Republic of Germany.

“German Security” shall have the meaning provided in Section 16.02(b).

“Governmental Authority” shall mean the government of the United States of America, England and Wales, the Commonwealth of Australia, any other nation or any political subdivision thereof, whether state, provincial or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

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“Group” shall mean, collectively, each Parent Guarantor and its respective Subsidiaries other than the Propcos.

“Group Member” shall mean any Obligor or any Subsidiary thereof that is a part of the Group.

“Guarantor” shall mean and include (a) each Parent Guarantor, (b) each Borrower (in its capacity as a guarantor under the Guaranty), (c) each Person identified on Schedule 8.13 as such, and (d) each Subsidiary of each Parent Guarantor required to execute this Agreement as a Guarantor as required by the Collateral and Guaranty Requirements, excluding, for the avoidance of doubt, on and after the occurrence of, and after giving effect to, the Second Restatement Effective Date, Toys SARL.

“Guaranty” shall mean the guaranty set forth in Section 17.

“Hazardous Materials” shall mean (a) any petroleum or petroleum products, radioactive materials, asbestos in any form that is or could become friable, urea formaldehyde foam insulation, dielectric fluid containing levels of polychlorinated biphenyls, and radon gas; (b) any chemicals, materials or substances defined as or included in the definition of “hazardous substances,” “hazardous waste,” “hazardous materials,” “extremely hazardous substances,” “restricted hazardous waste,” “toxic substances,” “toxic pollutants,” “contaminants,” or “pollutants,” or words of similar import, under any applicable Environmental Law; and (c) any other chemical, material or substance, the exposure to, or Release of which is prohibited, limited or regulated by any Governmental Authority.

“Hedge Agreements” shall mean any Interest Rate Protection Agreements and Other Hedging Agreements or other similar arrangements.

“Hedge Product Reserve” shall mean, as of the date of any determination, the Obligors’ aggregate exposure (as determined by the Co-Collateral Agents in their Permitted Discretion) under any Qualified Secured Hedging Agreement.

“Hedging/Cash Management Security Documents” shall have the meaning provided in Section 13.21.

“Hedging Creditors” shall mean, collectively, each Lender Counterparty and each person (other than a Group Member or Affiliate thereof) party to a Secured Hedging Agreement.

“Hedging Obligations” shall have the meaning specified in the definition of “Secured Obligations”.

“Highest Adjustable Applicable Margins” shall have the meaning provided in the definition of Applicable Margin.

“Historical Borrowing Base” shall mean, on any date of determination, the average daily Borrowing Base for the Fiscal Quarter most recently ended on or prior to such date.

“Historical Excess Availability” shall mean, on any date of determination, the average Excess Availability for the Fiscal Quarter most recently ended on or prior to such date.

“Immaterial Subsidiary” shall mean, at any date of determination, any Subsidiary, or group of Subsidiaries, of any Parent Guarantor (other than the Borrowers) that had, together with its Subsidiaries, consolidated assets representing less than 5% of the consolidated assets of the Group.

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“Incremental Commitment” shall mean, for any Lender, any Commitment provided by such Lender after the Second Restatement Effective Date in an Incremental Commitment Agreement delivered pursuant to Section 2.14; it being understood, however, that on each date upon which an Incremental Commitment of any Lender becomes effective, such Incremental Commitment of such Lender shall be added to (and thereafter become a part of) the Commitment of such Lender for all purposes of this Agreement as contemplated by Section 2.14.

“Incremental Commitment Agreement” shall mean each Incremental Commitment Agreement in substantially the form of Exhibit Q (appropriately completed, and with such modifications as may be reasonably satisfactory to the Administrative Agent) executed and delivered in accordance with Section 2.14.

“Incremental Commitment Date” shall mean each date upon which an Incremental Commitment under an Incremental Commitment Agreement becomes effective as provided in Section 2.14(b), as applicable.

“Incremental Commitment Requirements” shall mean, with respect to any provision of an Incremental Commitment on a given Incremental Commitment Date, the satisfaction of each of the following conditions on the Incremental Commitment Date of the respective Incremental Commitment Agreement: (i) no Default or Event of Default exists or would exist after giving effect thereto; (ii) all of the representations and warranties contained in the Credit Documents shall be true and correct in all material respects at such time (unless stated to relate to a specific earlier date, in which case such representations and warranties shall have been true and correct in all material respects as of such earlier date); (iii) the delivery by the Obligors’ Agent to the Administrative Agent of an acknowledgment, in form and substance reasonably satisfactory to the Administrative Agent and executed by each Obligor, acknowledging that such Commitment and all Loans subsequently incurred, and Letters of Credit issued, as applicable, pursuant to such Incremental Commitment shall constitute Secured Obligations under the Credit Documents and secured on an equal and ratable basis with the Secured Obligations under the Security Documents; (iv) the delivery by the Obligors’ Agent to the Administrative Agent of an opinion or opinions, in form and substance satisfactory to the Administrative Agent, from counsel to the Obligors satisfactory to the Administrative Agent and dated such date, covering such matters incident to the transactions contemplated thereby as the Administrative Agent may reasonably request; (v) the delivery by each Obligor to the Administrative Agent of such other officers’ certificates, board of director (or equivalent governing body) resolutions and evidence of good standing (to the extent available under applicable law) as the Administrative Agent shall reasonably request; (vi) the incurrence of Loans in an aggregate principal amount equal to the aggregate Incremental Commitments then being obtained shall be permitted at such time under any indenture, loan agreement or other material agreement to which any Obligor is a party or by which it or any of its property or assets is bound or to which it may be subject; (vii) the Obligors’ Agent shall have delivered a certificate executed by an Authorized Officer of the Obligors’ Agent, certifying to the best of such officer’s knowledge, compliance with the requirements of preceding clauses (i), (ii) and (vi); and (viii) the completion by each Obligor of such other actions as the Administrative Agent may reasonably request in connection with such Incremental Commitment in order to create, continue or maintain the security interests of the Security Agent in the Collateral and the perfection thereof (including, without limitation, any amendments to Security Documents, additional Security Documents, any mortgage amendments, title insurance policies and such other documents reasonably requested by the Administrative Agent to be delivered in connection therewith).

“Incremental Lender” shall have the meaning provided in Section 2.14(b).

“Incremental Security Documents” shall have the meaning provided in Section 2.14(b).

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“Indebtedness” shall mean, as to any Person, without duplication:

(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 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);

(e)    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 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;

(f)    all Contingent Obligations of such Person;

(g)    all Capitalized 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;

(h)    all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty;

(i)    all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances;

(j)    the Agreement Value of all Hedge Agreements;

(k)    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

(l)    Indebtedness consisting of obligations incurred or to be incurred in connection with Permitted Acquisitions under non-compete, consulting agreements, earn-out agreements and similar deferred purchase arrangements 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.

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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 Capitalized Lease Obligation, (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 Person” shall have the meaning provided in Section 13.01(a).

“Individual Exposure” of any Lender shall mean, at any time, the sum of (a) the aggregate principal amount of all Loans made by such Lender (and the aggregate principal amount of all Specified Foreign Currency Loans in which participations have been acquired by such Lender pursuant to Section 15) and then outstanding (for this purpose, using the Pounds Sterling Equivalent of amounts not denominated in U.S. Dollars) and (b) such Lender’s Percentage in the aggregate amount of all Letter of Credit Outstandings at such time. For purposes of this definition, the amount of Loans made by the Fronting Lender shall be reduced by the aggregate amount of Specified Foreign Currency Participations therein purchased by the other Lenders in such Loans pursuant to Section 15.

“Initial Borrowing Date” shall mean October 15, 2009.

“Insolvency Proceeding” shall mean any proceeding commenced by or against any Person under any provision of the Bankruptcy Code or under any state or foreign bankruptcy or insolvency law, assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or proceedings seeking reorganization, arrangement, or other similar relief.

“Intellectual Property Rights Agreement” shall mean the agreement dated as of the Initial Borrowing Date between Geoffrey LLC and the Security Agent, for its own benefit and the benefit of the Secured Parties.

“Intercompany Debt” shall mean any Indebtedness, payables or other obligations, whether now existing or hereafter incurred, owed by any Obligor or any Subsidiary of any Obligor to any other Obligor or any other Subsidiary of such Obligor.

“Intercompany Loans” shall have the meaning provided in Section 10.05(vii).

“Intercompany Note” shall mean a promissory note evidencing Intercompany Loans substantially in the form of Exhibit M (or such other form as shall be reasonably satisfactory to the Administrative Agent), with blanks completed in conformity herewith.

“Intercompany Subordination Agreement” shall mean that certain intercompany subordination agreement dated as of October 15, 2009, duly executed and delivered and attached hereto as Exhibit N as amended, modified, restated and/or supplemented from time to time in accordance with the terms hereof and thereof.

“Interest Determination Date” shall mean, in relation to any period for which an interest rate is to be determined, (a) if the currency is Pounds Sterling, the first day of that period; (b) if the currency is Euro, a Business Day that is two TARGET Days before the first day of that Interest Period; or (c) for any other currency, two Business Days before the first day of that Interest Period.

“Interest Period” shall have the meaning provided in Section 2.09.

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“Interest Rate Protection Agreement” shall mean any interest rate swap agreement, interest rate cap agreement, interest collar agreement, interest rate hedging agreement or other similar agreement or arrangement.

“Inventory” shall mean “inventory” as such term is defined in Article 9 of the UCC.

“Investment” shall mean, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans, credit or other advances to such Person or the purchase or acquisition of any stock, obligations or securities of, or any other Equity Interest in, or any capital contribution to, any other Person, or the purchase or ownership of a futures contract or otherwise be or becoming liable for the purchase or sale of currency or other commodities at a future date in the form of a futures contract, or holding any cash or Cash Equivalents. For the purposes of this Agreement, any extension of credit by the Parent Guarantors and their Subsidiaries pursuant to cash pooling, net balance or balance transfer arrangements shall be deemed to be an Investment by way of Intercompany Loan in the Person in which a negative balance is credited and the making of an Investment by the Person in which a positive balance is credited.

“ISDA Master Agreement” shall mean 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.

“Issuing Lender” shall mean DBNY (except as otherwise provided in Section 12.09), Bank of America, N.A., and any other Lender reasonably acceptable to the Administrative Agent and the Obligors’ Agent which agrees to issue Letters of Credit hereunder. Any Issuing Lender may, in its discretion, arrange for one or more Letters of Credit to be issued by one or more Affiliates of such Issuing Lender (and such Affiliate shall be deemed to be an “Issuing Lender” for all purposes of the Credit Documents).

“Joinder Agreement” shall mean a Joinder Agreement substantially in the form of Exhibit I, as amended, modified, restated and/or supplemented from time to time in accordance with the terms hereof and thereof.

“Joint Lead Arranger” shall mean each of Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, in their capacities as Lead Arrangers in respect of the credit facilities hereunder.

“Judgment Currency” shall have the meaning provided in Section 13.18(a).

“Judgment Currency Conversion Date” shall have the meaning provided in Section 13.18(a).

“L/C Supportable Obligations” shall mean (i) obligations of any Group Member with respect to workers compensation, surety bonds and other similar statutory obligations and (ii) such other obligations of any Group Member as are otherwise permitted to exist pursuant to the terms of this Agreement (other than obligations in respect of (y) any Indebtedness or other obligations that are subordinated in right of payment to the Secured Obligations and (z) any Equity Interests).

“Lead Arrangers” shall mean Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, in their capacities as Joint Lead Arrangers in respect of the credit facilities hereunder.

“Leaseholds” of any Person shall mean all the right, title and interest of such Person as lessee or licensee in, to and under leases or licenses of land, improvements and/or fixtures.

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“Lender” shall mean each financial institution listed on Schedule 1.01(a), as well as any Person that becomes a “Lender” hereunder pursuant to Section 2.13 or 13.04(b).

“Lender Counterparty” shall mean any counterparty to a Cash Management Agreement or Interest Rate Protection Agreement and/or Other Hedging Agreement that is a Lender or an affiliate thereof (even if such Lender is no longer a Lender under this Agreement for any reason) so long as such Lender or affiliate participates in such Cash Management Agreement, Interest Rate Protection Agreement and/or Other Hedging Agreement.

“Lender Creditors” shall mean, collectively, the Lead Arrangers, the Administrative Agent, the Facility Agent, the Security Agent, each Co-Collateral Agent, the Fronting Lender, the Lenders and each Issuing Lender.

“Letter of Credit” shall (i) have the meaning provided in Section 3.01(a), (ii) mean 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, and (iii) be in form reasonably satisfactory to the applicable Issuing Lender.

“Letter of Credit Fee” shall have the meaning provided in Section 4.01(b).

“Letter of Credit Outstandings” shall mean, at any time, the sum of (a) the Stated Amount of all outstanding Letters of Credit at such time and (b) the aggregate amount of all Unpaid Drawings in respect of all Letters of Credit at such time.

“Letter of Credit Request” shall have the meaning provided in Section 3.03(a).

“Lien” shall mean any mortgage, pledge, charge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), preference, priority or other security agreement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any financing or similar statement or notice filed under the UCC or any other similar recording or notice statute, any lease having substantially the same effect as any of the foregoing and any “security interest” as defined in sections 12(1) or (2) of the PPSA).

“Loan” shall have the meaning provided in Section 2.01(a).

“Local Law Financing Documents” shall mean all credit agreements, security documents, notes and other documents in respect of the Local Law Financings.

“Local Law Financings” shall mean working capital or other revolving credit facilities incurred by any Group Member (other than any Group Member that is a Qualified Obligor or a Parent Guarantor) in aggregate amounts not to exceed £28,000,000 and secured solely by Inventory or Accounts (or such other assets as may be agreed by the Administrative Agent) owned by such Group Member.

“Margin Stock” shall have the meaning provided in Regulation U.

“Material Adverse Effect” shall mean any event, change, condition, occurrence or circumstance which, either individually or in the aggregate, has had, or could reasonably be expected to have, a material adverse effect on (x) the property, assets, business, operations, liabilities or condition (financial or otherwise) of the Parent Guarantors and their respective Subsidiaries taken as a whole, (y) the rights or remedies of the Lenders, the Administrative Agent or the Security Agent hereunder or under any other Credit Document or (z) the ability of any Obligor to perform its obligations to the Lenders (including any Issuing Lender), the Administrative Agent, the Co-Collateral Agents or the Security Agent hereunder or under any

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other Credit Document; provided that a selective default (or substantially similar) rating in connection with Parent’s 10.375% senior notes due 2017 or 7.375% senior notes due 2018 shall not constitute a Material Adverse Effect.

“Material Asset Sale” shall mean any asset sale the net sale proceeds of which exceed £5,000,000.

“Maturity Date” shall mean that date that is five years from the Second Restatement Effective Date, which date is December 18, 2020.

“Maximum Letter of Credit Amount” shall have the meaning provided in Section 3.02(a).

“Midco1” shall have the meaning set forth in the preamble hereto.

“Midco2” shall have the meaning set forth in the preamble hereto.

“Midco4” shall have the meaning set forth in the preamble hereto.

“Minimum Borrowing Amount” shall mean (a) for U.S. Dollar Loans $1,000,000, (b) for Euro Loans, €1,000,000, (c) for Australian Dollar Loans A$1,000,000 and (d) for Sterling Loans £1,000,000.

“Monthly Reporting Period” shall mean any period (i) commencing on the date on which either (x) an Event of Default has occurred and is continuing or (y) the Excess Availability is less than or equal to the Availability Condition and (ii) ending on the first date thereafter on which (x) no Event of Default exists or is continuing and (y) the Excess Availability has been greater than the Availability Condition for 30 consecutive days.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Mortgage” shall mean a mortgage, leasehold mortgage, debenture, immovable hypothec, deed of trust, leasehold deed of trust, deed to secure debt, leasehold deed to secure debt or similar security instrument in form and substance reasonably satisfactory to the Administrative Agent.

“Mortgaged Property” shall mean each parcel of Real Property and improvements thereto with respect to which a Mortgage, if any, is granted pursuant to Sections 9.13 and/or 9.14.

“Multiemployer Plan” shall mean a “multiemployer plan” within the meaning of Section 3(37) or 4001(a)(3) of ERISA which is maintained or contributed to by (or to which there is an obligation to contribute of) any Obligor or an ERISA Affiliate (or is deemed under Section 4212(c) of ERISA to have contributed to or to have had an obligation to contribute to, or otherwise to have liability with respect to such plan).

“NAIC” shall mean the National Association of Insurance Commissioners.

“Net Equity Proceeds” shall mean, as of any date of determination, the cash proceeds (net of underwriting discounts and commissions and other reasonable costs associated therewith) received by the Parent Guarantors in the six months prior to such date from a direct or indirect common equity contribution from the Parent or from the sale or issuance to the Parent of common equity interests of a Parent Guarantor.

“Net Equity Proceeds Amount” shall mean, at any time, an amount equal to the aggregate Net Equity Proceeds received by the Parent Guarantors after the Second Restatement Effective Date, with the Net Equity Proceeds Amount to be immediately reduced by the sum of (without duplication) (i) the amount of Investments made pursuant to Section 10.05(xxii), (ii) the amount of Permitted Acquisitions made with Net Equity Proceeds and (iii) the amount of any Dividends made pursuant to Section 10.03(ix).

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“Net Insurance Proceeds” shall mean, with respect to any Recovery Event, the cash proceeds received by the respective Person in connection with such Recovery Event (net of (a) reasonable costs and taxes incurred in connection with such Recovery Event and (b) required payments of any Indebtedness (other than Indebtedness secured pursuant to the Security Documents) which is secured by the respective assets the subject of such Recovery Event).

“Net Orderly Liquidation Value” shall mean the “net orderly liquidation value” determined by an unaffiliated valuation company acceptable to the Co-Collateral Agents after performance of an inventory valuation to be done at the Co-Collateral Agents’ request and the Borrowers’ expense,lessthe amount estimated by such valuation company for marshalling, reconditioning, carrying, and sales expenses designated to maximize the resale value of such Inventory and assuming that the time required to dispose of such Inventory is customary with respect to such Inventory and expressed as a percentage of the net book value of such Inventory.

“Net Sale Proceeds” shall mean for any sale or other disposition of assets, the gross cash proceeds (including any cash received by way of deferred payment pursuant to a promissory note, receivable or otherwise, but only as and when received) received from such sale or other disposition of assets, net of (i) reasonable transaction costs (including, without limitation, any underwriting, brokerage or other customary selling commissions, reasonable legal, advisory and other fees and expenses (including title and recording expenses), associated therewith and sales, VAT and transfer taxes arising therefrom), (ii) payments of unassumed liabilities relating to the assets sold or otherwise disposed of at the time of, or within 30 days after, the date of such sale or other disposition, (iii) the amount of such gross cash proceeds required to be used to permanently repay any Indebtedness (other than Indebtedness of the Lenders pursuant to this Agreement) which is secured by the respective assets which were sold or otherwise disposed of and (iv) 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).

“Non-Cooperative Jurisdiction” shall mean a non-cooperative State or territory (Etat ou territoire non coopératif) as set out in the list referred to in Article 238-0A of the French Code général des impôts, as such list may be amended from time to time.

“Non-Defaulting Lender” shall mean and include each Lender, but shall exclude a Defaulting Lender; provided, however, solely for purposes of Section 4.01(a), a Lender that is a Defaulting Lender solely under clause (iii), (iv) or (v) (but, in the case of such clause (v), only to the extent relating to either clause (iii) or (iv)) of the definition thereof shall be treated as a Non-Defaulting Lender and not as a Defaulting Lender.

“Non-U.S. Plan” shall mean any plan, fund (including, without limitation, any superannuation fund) or other similar program established or maintained outside the United States of America by an Obligor or any Subsidiary of an Obligor residing outside the United States of America, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and which plan is not subject to ERISA or the Code.

“Non-Wholly-Owned Subsidiary” shall mean, as to any Person, each Subsidiary of such Person which is not a Wholly-Owned Subsidiary of such Person.

“Note” shall have the meaning provided in Section 2.05(a).

“Notice of Borrowing” shall have the meaning provided in Section 2.03.

“Notice of Continuation” shall have the meaning provided in Section 2.06.

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“Notice Office” shall mean (i) for credit notices, the office of the Administrative Agent located at 60 Wall Street, New York, New York 10005-2858, Attention: Dusan Lazarov, Telephone No.: (212) 250-0211, Telecopier No.: (212) 797-5695, and email: dusan.lazarov@db.com and (ii) for operational notices, the office of the Administrative Agent located at 60 Wall Street, New York, New York 10005-2858, Attention: Dusan Lazarov, Telephone No.: (212) 250-0211, Telecopier No.: (212) 797-5695, and email: dusan.lazarov@db.com; and the office of the Facility Agent located at 60 Wall Street, New York, New York 10005-2858, Attention: Mark Kellam, Telephone No.: (904)271-2469, Telecopier No.: (904)779-3080, and email: Agency.Transactions@db.com and mark.kellam@db.com or (in either case) such other office or person as the Administrative Agent or the Facility Agent, may hereafter designate in writing as such to the other parties hereto.

“Obligation Currency” shall have the meaning provided in Section 13.18(a).

“Obligations” shall mean with respect to any Obligor, all obligations and liabilities of such Obligor which may arise under or in connection with this Agreement or any other Credit Document to which such Obligor is a party, in each case whether on account of principal, premium (if any), guaranty obligations, reimbursement obligations (including Unpaid Drawings with respect to Letters of Credit), fees, penalties, indemnities, costs, expenses (including Expenses) or otherwise (including (x) all fees and disbursements of counsel to any Secured Creditor that are required to be paid by such Obligor pursuant to the terms of this Agreement or any other Credit Document and (y) all interest that accrues after the commencement of any case, proceeding or other action relating to the bankruptcy, insolvency, reorganization, moratorium or similar proceeding of any Obligor at the rate provided for in the respective documentation, whether or not a claim for post-petition interest is allowed in any such proceeding).

“Obligor” shall mean each Borrower, each Guarantor and Toys SARL.

“Obligors’ Agent” shall mean the European Parent Guarantor in the capacity in which it has been appointed to act on behalf of each Obligor pursuant to Section 2.15.

“OFAC” shall have the meaning provided in Section 8.22(a)(v).

“Offshore Associate” shall mean an Associate (a) which is a non-resident of Australia and does not acquire, or would not acquire, the participations in the Loans and/or Commitments in carrying on a business in Australia at or through a permanent establishment of the Associate in Australia or (b) which is a resident of Australia and which acquires, or would acquire, the participations in the Loans and/or Commitments in carrying on a business in a country outside Australia at or through a permanent establishment of the Associate in the country, and which, in either case, is not acquiring the participations in the Loans and/or Commitments or receiving payment in the capacity of a clearing house, custodian, funds manager or responsible entity of a registered managed investment scheme.

“Other Hedging Agreements” shall mean any foreign exchange contracts, currency swap agreements, commodity agreements or other similar arrangements, or arrangements designed to protect against fluctuations in currency values or commodity prices.

“Parent” shall mean Toys “R” Us Inc., a Delaware corporation.

“Parent Guarantors” shall mean, collectively, the European Parent Guarantor, the Australian Parent Guarantor and the Spanish Parent Guarantor.

“Participant” shall have the meaning provided in Section 3.04(a).

“Participant Register” shall have the meaning provided in Section 13.15.

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"Participating Member State" shall mean any member state of the European Union that has the euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union.

“Participating Specified Foreign Currency Lender” shall have the meaning provided in Section 15.01.

“Patriot Act” shall have the meaning provided in Section 13.17.

“Payment Conditions” shall mean, 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 or making of such transaction or payment, respectively; (b) after giving pro forma effect to such transaction or payment, (i) the Excess Availability on the date of the action or proposed action, (ii) the average Excess Availability for each Fiscal Month during the preceding 60 days and (iii) the projected Excess Availability for each Fiscal Month during the six Fiscal Months following such transaction or payment shall each have been equal to or greater than the greater of (x) £15,000,000 (or, in the case of Fiscal Months four, five, six and seven, £14,000,000) or (y) 15% of the lesser of (i) the Total Commitment as then in effect and (ii) the Borrowing Base at such time; and (c) after giving pro forma effect to such transaction or payment, the Consolidated Fixed Charge Coverage Ratio, as of the most recently ended Test Period, will be equal to or greater than 1.00:1.00 (or, in the case of any authorization, declaration or payment of Dividends, 1.10:1.00); provided, that the Consolidated Fixed Charge Coverage Ratio test above shall not apply if the Excess Availability as provided in clause (b)(i), (ii) and (iii) above shall have been equal to or greater than the greater of (x) £20,000,000 (or, in the case of Fiscal Months four, five, six and seven, £14,000,000) or (y) 20% of the lesser of (i) the Total Commitment as then in effect and (ii) the Borrowing Base at such time. Prior to undertaking any transaction or payment which is subject to the Payment Conditions and subject to the proviso in clause (c) above, the Obligors shall deliver to the Administrative Agent evidence of satisfaction of the conditions contained in clauses (b) and (c) above in form and substance reasonably satisfactory to the Administrative Agent.

“Payment Office” shall mean the office of the Facility Agent located at located at 60 Wall Street, New York, New York 10005-2858, Attention: Mark Kellam, Telephone No.: (904) 271-2469, Telecopier No.: (904)779-3080, and email: Agency.Transactions@db.com and mark.kellam@db.com or such other office as the Facility Agent may hereafter designate in writing as such to the other parties hereto.

“PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant to Section 4002 of ERISA, or any successor thereto.

“Pensions Act 2004” shall mean the United Kingdom Pensions Act 2004.

“Pensions Regulator” shall mean the body corporate called the Pensions Regulator established under Part I of the Pensions Act 2004.

“Percentage” of any Lender at any time shall mean a fraction (expressed as a percentage) the numerator of which is the Commitment of such Lender at such time and the denominator of which is the Total Commitment at such time, provided that if the Percentage of any Lender is to be determined after the Total Commitment has been terminated, then the Percentages of such Lender shall mean a fraction (expressed as a percentage) the numerator of which is such Lender’s Individual Exposure at such time and the denominator of which is the Aggregate Exposure at such time.

“Perfection Certificate” shall mean each of the English Perfection Certificate, the Australian Perfection Certificate and the Pledged Securities Perfection Certificate.

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“Perfection Certificate Supplement” shall mean a Perfection Certificate supplement in the form thereof included in Exhibit G or any other form approved by the Administrative Agent.

“Permitted Acquisition” shall mean the acquisition by an Obligor of an Acquired Entity or Business (including by way of merger of such Acquired Entity or Business with and into such Obligor (so long as such Obligor is the surviving corporation)), provided that (in each case) (A) the consideration paid or to be paid by such Obligor consists solely of cash (including proceeds of Loans), the issuance or incurrence of Indebtedness otherwise permitted by Section 10.04 and the assumption/acquisition of any Indebtedness (calculated at face value) which is permitted to remain outstanding in accordance with the requirements of Section 10.04, (B) in the case of the acquisition of 100% of the Equity Interests of any Acquired Entity or Business (including by way of merger), such Acquired Entity or Business shall own no Equity Interests of any other Person unless either (x) such Acquired Entity or Business owns 100% of the Equity Interests of such other Person or (y) if such Acquired Entity or Business owns Equity Interests in any other Person which is a Non-Wholly Owned Subsidiary of such Acquired Entity or Business, (1) such Acquired Entity or Business shall not have been created or established in contemplation of, or for purposes of, the respective Permitted Acquisition, (2) any such Non-Wholly Owned Subsidiary of the Acquired Entity or Business shall have been a Non-Wholly Owned Subsidiary of such Acquired Entity or Business prior to the date of the respective Permitted Acquisition and shall not have been created or established in contemplation thereof and (3) such Acquired Entity or Business and/or its Wholly-Owned Subsidiaries own at least 90% of the total value of all the assets owned by such Acquired Entity or Business and its subsidiaries (for purposes of such determination, excluding the value of the Equity Interests of Non-Wholly Owned Subsidiaries held by such Acquired Entity or Business and its Wholly-Owned Subsidiaries), (C) all of the business, division or product line acquired pursuant to the respective Permitted Acquisition, or the business of the Person acquired pursuant to the respective Permitted Acquisition and its Subsidiaries taken as a whole, is in a jurisdiction of an Obligor or any such other jurisdiction reasonably acceptable to the Administrative Agent, (D) the Acquired Entity or Business acquired pursuant to the respective Permitted Acquisition is in a business permitted by Section 10.11 and (E) all requirements of Sections 9.16, 10.02 and 10.12 applicable to Permitted Acquisitions are satisfied. Notwithstanding anything to the contrary contained in the immediately preceding sentence, an acquisition which does not otherwise meet the requirements set forth above in the definition of “Permitted Acquisition” shall constitute a Permitted Acquisition if, and to the extent, the Required Lenders agree in writing, prior to the consummation thereof, that such acquisition shall constitute a Permitted Acquisition for purposes of this Agreement.

“Permitted Acquisition Basket Amount” shall mean for any Fiscal Year, the sum of (x) £10,000,000, provided, however, to the extent that the aggregate of such amounts paid or to be paid in any Fiscal Year is less than £10,000,000, such excess may be carried forward and utilized in succeeding Fiscal Years so long as no more than £25,000,000 in the aggregate is utilized in any Fiscal Year (with amounts in excess of such £25,000,000 being forfeited) and (y) the Net Equity Proceeds Amount.

“Permitted Discretion” shall mean the exercise of the Co-Collateral Agents’ good faith and reasonable business judgment consistent with industry standards for asset based lending in the retail industry in consideration of any factor which is reasonably likely to (i) adversely affect the value of any Borrowing Base Collateral, the enforceability or priority of the Liens thereon or the amount that the Administrative Agent and the Lenders would be likely to receive (after giving consideration to delays in payment and costs of enforcement) in the liquidation thereof or (ii) materially increase the likelihood that the Lenders would not receive payment in full in cash for all of the Secured Obligations. In exercising such judgment, the Co-Collateral Agents, as applicable, may consider such factors already included in or tested by the definition of Eligible In-Transit Inventory, Eligible Letter of Credit Inventory, Eligible Credit Card Receivables or Eligible Inventory, as well as any of the following: (i) the changes in collection history and dilution or collectability with respect to the Eligible Credit Card Receivables; (ii) changes in demand for, pricing of, or product mix

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of Inventory; (iii) changes in any concentration of risk with respect to the respective Qualified Obligors’ Eligible Credit Card Receivables or Inventory; and (iv) any other factors that change the credit risk of lending to any Borrower on the security of any Qualified Obligors’ Eligible Credit Card Receivables or Inventory; provided that the Co-Collateral Agents shall not “double count.”

“Permitted Encumbrance” shall mean, with respect to any Mortgaged Property, such exceptions to title as are set forth in the mortgage policy delivered with respect thereto, all of which exceptions must be acceptable to the Administrative Agent in its reasonable discretion.

“Permitted Liens” shall have the meaning provided in Section 10.01.

“Permitted Specified Debt Payment Sources” shall have the meaning provided in the definition of Consolidated Interest Expense.

“Person” shall mean an individual, partnership, corporation (including a business trust), joint stock company, estate, trust, limited liability company, unlimited liability company, unincorporated association, joint venture or other entity or Governmental Authority.

“Plan” shall mean an “employee pension benefit plan” within the meaning of section 3(2) of ERISA subject to Title IV of ERISA maintained or contributed to by any Obligor or any ERISA Affiliate or to which any Obligor or any ERISA Affiliate is required to make any payment or contribution (or is deemed under Section 4069 of ERISA to have maintained or contributed to or to have had an obligation to contribute to, or otherwise to have liability with respect to such plan).

“Pledged Securities Perfection Certificate” shall mean the Pledged Securities Perfection Certificate in the form thereof included in Exhibit D‑3 or any other form approved by the Administrative Agent, as the same may be supplemented from time to time by a Perfection Certificate Supplement or otherwise.

“Pounds Sterling” and “£” shall mean freely transferable lawful currency of the United Kingdom (expressed in Pounds Sterling).

“Pounds Sterling Equivalent” shall mean, with respect to an amount of money denominated in a currency other than Pounds Sterling, at any time for the determination thereof, the amount of Pounds Sterling which could be purchased with the amount of such currency involved in such computation at the spot exchange rate therefor as quoted by the Facility Agent as of 11:00 A.M. (London time) on the date two Business Days prior to the date of any determination thereof for purchase on such date.

“PPSA” shall mean the Personal Property Securities Act 2009 (Cwlth) of Australia.

“Preferred Equity”, as applied to the Equity Interests of any Person, shall mean Equity Interests of such Person (other than common Equity Interests of such Person) of any class or classes (however designed) that ranks prior, as to the payment of dividends or as to the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up of such Person, to shares of Equity Interests of any other class of such Person.

“Primary Obligations” shall have the meaning provided in Section 11.02(b).

“Pro Forma Basis” shall mean, in connection with any calculation of compliance with any financial covenant or financial term, the calculation thereof after giving effect on a pro forma basis to (a) the incurrence of any Indebtedness (other than revolving Indebtedness, except to the extent the same is incurred to refinance other outstanding Indebtedness), to finance a Permitted Acquisition, to finance any other acquisition of an Acquired Entity or Business, to finance a Dividend pursuant to Section 10.03(vi) or to

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finance an Investment pursuant to Section 10.05(xxii)) after the first day of the relevant Calculation Period or Test Period, as the case may be, as if such Indebtedness had been incurred (and the proceeds thereof applied) on the first day of such Test Period or Calculation Period, as the case may be, (b) the permanent repayment of any Indebtedness (other than revolving Indebtedness, except to the extent accompanied by a corresponding voluntary permanent commitment reduction) after the first day of the relevant Test Period or Calculation Period, as the case may be, as if such Indebtedness had been retired or repaid on the first day of such Test Period or Calculation Period, as the case may be, and (c) any Permitted Acquisition, any other acquisition of an Acquired Entity or Business or any Material Asset Sale then being consummated as well as any other Permitted Acquisition, any such other acquisition or any other Material Asset Sale if consummated after the first day of the relevant Test Period or Calculation Period, as the case may be, and on or prior to the date of the respective Permitted Acquisition, other acquisition or Material Asset Sale, as the case may be, then being effected, with the following rules to apply in connection therewith:

(i)    all Indebtedness (A) (other than revolving Indebtedness, except to the extent the same is incurred to refinance other outstanding Indebtedness, to finance Permitted Acquisitions, to finance any other acquisition of an Acquired Entity or Business to finance Dividends pursuant to Section 10.03(vi) or to finance Investments pursuant to Section 10.05(xxii)) incurred or issued after the first day of the relevant Test Period or Calculation Period (whether incurred to finance a Permitted Acquisition or such other acquisition, another Investment or a Dividend, to refinance Indebtedness or otherwise) shall be deemed to have been incurred or issued (and the proceeds thereof applied) on the first day of such Test Period or Calculation Period, as the case may be, and remain outstanding through the date of determination and (B) (other than revolving Indebtedness, except to the extent accompanied by a corresponding voluntary permanent commitment reduction) permanently retired or redeemed after the first day of the relevant Test Period or Calculation Period shall be deemed to have been retired or redeemed on the first day of such Test Period or Calculation Period, as the case may be, and remain retired through the date of determination;

(ii)    all Indebtedness assumed to be outstanding pursuant to preceding clause (i) shall be deemed to have borne interest at (A) the rate applicable thereto, in the case of fixed rate indebtedness, or (B) the rates which would have been applicable thereto during the respective period when same was deemed outstanding, in the case of floating rate Indebtedness (although interest expense with respect to any Indebtedness for periods while same was actually outstanding during the respective period shall be calculated using the actual rates applicable thereto while same was actually outstanding); provided that all Indebtedness (whether actually outstanding or deemed outstanding) bearing interest at a floating rate of interest shall be tested on the basis of the rates applicable at the time the determination is made pursuant to said provisions; and

(iii)    in making any determination of Consolidated EBITDA on a Pro Forma Basis, pro forma effect shall be given to any Permitted Acquisition, any other acquisition of an Acquired Entity or Business if effected during the respective Calculation Period or Test Period as if same had occurred on the first day of the respective Calculation Period or Test Period, as the case may be, and taking into account factually supportable and identifiable cost savings and expenses which would otherwise be accounted for as an adjustment pursuant to Article 11 of Regulation S-X under the Securities Act, as if such cost savings or expenses were realized on the first day of the respective period.

“Propco” shall mean each of Toys “R” Us Properties (UK) Limited, Toys “R” Us France Real Estate SAS and Toys R Us Iberia Real Estate, S.L.U. and any other direct or indirect Subsidiary of a Parent Guarantor, the primary assets (other than cash or Cash Equivalents) of which consist of (x) rights, title and interest (including any leasehold, mineral or other estate) in and to parcels of or interests in Real Property, whether by ownership, lease, license or other means, or (y) the Equity Interests (held directly or

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indirectly) in any Subsidiary described in clause (x) or any passive holding company parent of such a Subsidiary.

“Propco Financing” shall mean any financing facilities entered into by any Propco from time to time.

“Qualified ECP Guarantor” shall mean, in respect of any Swap Obligation, each Obligor that, at the time the relevant Guarantee (or grant of the relevant security interest, as applicable) becomes effective with respect to such Swap Obligation, has total assets exceeding $10,000,000 or otherwise constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible contract participant” with respect to such Swap Obligation at such time by entering into a keepwell pursuant to Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Qualified Jurisdiction” shall mean the (i) United Kingdom (which, for purposes of Section 9.13(c)(ix) shall be limited to England and Wales), in respect of the Borrowers organized under the laws of England and Wales, (ii) Australia, in respect of the Borrowers organized under the laws of Australia, and (iii) France, in respect of Toys SARL.

“Qualified Obligor” shall mean and include each Obligor organized in England and Wales, Australia or France; provided that no Person organized in such jurisdiction shall be a Qualified Obligor until such Person has delivered, or caused to be delivered, appraisals of Inventory and a collateral examination of its Accounts and Inventory to the Administrative Agent, in each case, in scope reasonably satisfactory to the Agents, and the results of such appraisal and collateral examination shall be in form and substance reasonably satisfactory to the Agents.

“Qualified Preferred Stock” shall mean any Preferred Equity of each Parent Guarantor so long as the terms of any such Preferred Equity (v) do not contain any mandatory put, redemption, repayment, sinking fund or other similar provision prior to one year after the Maturity Date, (w) do not require the cash payment of dividends or distributions that would otherwise be prohibited by the terms of this Agreement or any other agreement or contract of each Parent Guarantor or any of its respective Subsidiaries, (x) do not contain any covenants (other than periodic reporting requirements), (y) do not grant the holders thereof any voting rights except for (I) voting rights required to be granted to such holders under applicable law and (II) limited customary voting rights on fundamental matters such as mergers, consolidations, sales of all or substantially all of the assets of each Parent Guarantor, or liquidations involving each Parent Guarantor, and (z) are otherwise reasonably satisfactory to the Administrative Agent.

“Qualified Secured Cash Management Agreements” shall have the meaning provided in Section 13.21.

“Qualified Secured Hedging Agreements” shall have the meaning provided in Section 13.21.

“Qualifying IPO” shall mean 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.

“Quarterly Payment Date” shall mean the last Business Day of each March, June, September and December occurring after the Restatement Effective Date.

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“Quarterly Pricing Certificate” shall have the meaning provided in the definition of Applicable Margin.

“Real Property” of any Person shall mean all the right, title and interest of such Person in and to land, improvements and fixtures, including Leaseholds.

“Recovery Event” shall mean the receipt by any Group Member of any cash insurance proceeds or condemnation awards payable (i) by reason of theft, loss, physical destruction, damage, taking or any other similar event with respect to any property or assets of any Group Member and (ii) under any policy of insurance required to be maintained under Section 9.03.

“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 in part, existing Specified Debt (the “Refinanced Debt”); provided that such exchanging, extending, renewing, replacing or refinancing Indebtedness (a) is in an original aggregate 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 such exchange, extension, renewal, replacement or refinancing) and (b) does not mature earlier than or have a weighted average life to maturity shorter than the Refinanced Debt.

“Register” shall have the meaning provided in Section 13.15.

“Regulation D” shall mean Regulation D of the Board as from time to time in effect and any successor to all or a portion thereof establishing reserve requirements.

“Regulation T” shall mean Regulation T of the Board as from time to time in effect and any successor to all or a portion thereof.

“Regulation U” shall mean Regulation U of the Board as from time to time in effect and any successor to all or a portion thereof.

“Regulation X” shall mean Regulation X of the Board as from time to time in effect and any successor to all or a portion thereof.

“Release” shall mean actively or passively disposing, discharging, injecting, spilling, pumping, leaking, leaching, dumping, emitting, escaping, emptying, pouring, seeping, migrating or the like, into or upon any land or water or air, or otherwise entering into the environment.

“Rent Reserve” shall mean a reserve established by the Co-Collateral Agents in their Permitted Discretion in respect of rent payments made by a Qualified Obligor for each location at which Inventory of a Qualified Obligor is located that is not subject to a Collateral Access Agreement (without duplication of any such amounts used in determining Net Orderly Liquidation Value) (as reported to the Co-Collateral Agents by the Obligors’ Agent from time to time as requested by the Co-Collateral Agents) as adjusted from time to time by the Co-Collateral Agents in their Permitted Discretion.

“Replaced Lender” shall have the meaning provided in Section 2.13.

“Replacement Lender” shall have the meaning provided in Section 2.13.

“Reportable Event” shall mean an event described in section 4043(c) of ERISA with respect to a Plan other than those events as to which the 30-day notice period is waived under subsection .22, .23, .25, .27 or .28 of PBGC Regulation section 4043.

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“Required Lenders” shall mean, at any time, Non-Defaulting Lenders the sum of whose Commitments (or, after the termination of all Commitments, outstanding Individual Exposures) at such time represents at least a majority of the Total Commitment in effect at such time less the Commitments of all Defaulting Lenders (or, after the termination of all Commitments, the sum of the total outstanding Individual Exposures of all Non-Defaulting Lenders, at such time.

“Reserves” shall mean reserves, if any, established by the Co-Collateral Agents from time to time hereunder in their Permitted Discretion against the Borrowing Bases, including, without limitation and duplication, (i) Bank Product Reserves, (ii) Hedge Product Reserves, (iii) Rent Reserves, (iv) Shrink Reserves, (v) ROT Reserves, (vi) freight costs related to Eligible Inventory in transit, (vii) Customer Credit Liabilities Reserves, (viii) the Australian Employee Liability Reserves, (ix) the Enterprise Act Reserves and the English Employee Liability Reserves, (x) amounts owing by any Obligor to any Person to the extent secured by a Lien on, or trust over, any Borrowing Base Collateral, (xi) French Employee Liability Reserves, (xii) Specified French Properties Reserves, and (xiii) such other events, conditions or contingencies as to which the Co-Collateral Agents, in their Permitted Discretion, determine reserves should be established from time to time hereunder.

“Restatement Effective Date” shall mean March 8, 2011.

“Restricted” shall mean, when referring to cash or Cash Equivalents of a Group Member, that such cash or Cash Equivalents (i) appears (or would be required to appear) as “restricted” on a consolidated balance sheet of a Group Member (unless such appearance is related to the Credit Documents or Liens created thereunder), (ii) are subject to any Lien in favor of any Person other than the Security Agent for the benefit of the Secured Creditors or (iii) are not otherwise generally available for use by such Group Member.

“Returns” shall have the meaning provided in Section 8.09.

“ROT Reserve” shall mean an amount reasonably estimated by the applicable Qualified Obligors in consultation with the Co-Collateral Agents to be equal to that amount of Inventory owned by the Qualified Obligors that is subject to retention of title but only to the extent of any payables due or outstanding that are secured by such Inventory.

“S&P” shall mean Standard & Poor’s Ratings Services, a division of McGraw‑Hill, Inc.

“SEC” shall have the meaning provided in Section 9.01(h).

“Second Restatement Effective Date” shall have the meaning provided in Section 13.10.

“Second Restatement English Law governed Security Documents” shall mean the documents listed in paragraph 2 of Part I of Schedule 1.01(d).

“Secured Cash Management Agreements” shall mean (i) each Cash Management Agreement entered into by an Obligor with any Lender Counterparty and (ii) each Cash Management Agreement entered into by an Obligor with any Person which is not a Lender Counterparty, provided that (x) such Cash Management Agreement expressly states that it constitutes a “Secured Cash Management Agreement” for purposes of this Agreement and the other Credit Documents, (y) the Obligor and the other parties thereto shall have delivered to the Administrative Agent a written notice specifying that such Cash Management Agreement constitutes a “Secured Cash Management Agreement” for purposes of this Agreement and the other Credit Documents and in the case of such Obligor, that such Secured Cash Management Agreement and the obligations of the Obligors thereunder have been, and will be, incurred in compliance with this Agreement and (z) such other Person has entered into an intercreditor agreement with respect to the relevant Cash Management Agreement on terms reasonably satisfactory to the Administrative Agent.

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“Secured Creditors” shall mean, collectively, the Lender Creditors, the Hedging Creditors and the Cash Management Creditors.

“Secured Debt Agreements” shall mean and include (w) this Agreement, (x) the other Credit Documents, (y) the Secured Hedging Agreements entered into with any Hedging Creditors and (z) the Secured Cash Management Agreements entered into with any Cash Management Creditors.

“Secured Hedging Agreements” shall mean (i) each Interest Rate Protection Agreement and/or Other Hedging Agreement entered into by an Obligor with any Lender Counterparty and (ii) each Other Hedging Agreement with respect to currencies entered into by an Obligor with a Person that is not a Lender Counterparty, provided that, in the case of clause (ii) above, (x) either the confirmation or the master agreement (however described therefor) governing such Other Hedging Agreement expressly states that it constitutes a “Secured Hedging Agreement” for purposes of this Agreement and the other Credit Documents, (y) the Obligor and the other parties thereto shall have delivered to the Administrative Agent a written notice specifying that such Other Hedging Agreement constitutes a “Secured Hedging Agreement” for purposes of this Agreement and the other Credit Documents and in the case of such Obligor, that such Secured Hedging Agreement and the obligations of the Obligors thereunder have been, and will be, incurred in compliance with this Agreement and (z) such other Person has entered into an intercreditor agreement with respect to the relevant Other Hedging Agreement on terms reasonably satisfactory to the Administrative Agent; provided, that in the case of each of clauses (i) and (ii) above, at the request of the Co-Collateral Agents, the Obligors shall notify the Administrative Agent in writing of the aggregate amount or exposure under such Secured Hedging Agreement.

“Secured Obligations” shall mean and include, as to any Obligor other than Toys SARL, all of the following:

(i)    the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of all Obligations of each Obligor to the Lender Creditors, whether now existing or hereafter incurred under, arising out of, or in connection with, each Credit Document to which any Obligor is a party (including, without limitation, in the event any Obligor is a Guarantor, all such obligations, liabilities and indebtedness of such Obligor under the Guaranty) (all such Obligations under this clause (i), except to the extent consisting of Hedging Obligations or Cash Management Obligations, being herein collectively called the “Credit Document Obligations”);

(ii)    the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of all obligations, liabilities and indebtedness (including, without limitation, all interest that accrues after the commencement of any case, proceeding or other action relating to the bankruptcy, insolvency, reorganization or similar proceeding of any Obligor at the rate provided for in the respective documentation, whether or not a claim for post-petition interest is allowed in any such proceeding) owing by any Obligor to the Hedging Creditors, whether now existing or hereafter incurred under, arising out of or in connection with any Secured Hedging Agreement, whether such Secured Hedging Agreement is now in existence or hereinafter arising (including, without limitation, in the event such Obligor is a Guarantor, all obligations, liabilities and indebtedness of such Obligor under the Guaranty, in respect of the Secured Hedging Agreements), and the due performance and compliance by such Obligor with all of the terms, conditions and agreements contained in each such Secured Hedging Agreement (all such obligations, liabilities and indebtedness under this clause (ii) being herein collectively called the “Hedging Obligations”);

(iii)    the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of all obligations, liabilities and indebtedness (including, without limitation, all interest that accrues after the commencement of any case, proceeding or other action relating to the

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bankruptcy, insolvency, reorganization or similar proceeding of any Obligor at the rate provided for in the respective documentation, whether or not a claim for post-petition interest is allowed in any such proceeding) owing by each Obligor to the Cash Management Creditors, whether now existing or hereafter incurred under, arising out of or in connection with any Secured Cash Management Agreement, whether such Secured Cash Management Agreement is now in existence or hereinafter arising (including, without limitation, in the event any Obligor is a Guarantor, all obligations, liabilities and indebtedness of such Obligor under the Guaranty, in respect of the Secured Cash Management Agreements), and the due performance and compliance by such Obligor with all of the terms, conditions and agreements contained in each such Secured Cash Management Agreement (all such obligations, liabilities and indebtedness under this clause (iii) being herein collectively called the “Cash Management Obligations”);

(iv)    any and all sums advanced by the Security Agent in order to preserve the Collateral or preserve its security interest in the Collateral;

(v)    in the event of any proceeding for the collection or enforcement of any indebtedness, obligations, or liabilities of each Obligor referred to in clauses (i), (ii) and (iii) above, after an Event of Default shall have occurred and be continuing, the expenses of retaking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, or of any exercise by the Security Agent of its rights hereunder, together with reasonable attorneys’ fees and court costs; and

(vi)    all amounts paid (or incurred) by any Indemnified Person as to which such Indemnified Person has the right to reimbursement under Section 13.01 or any indemnity contained in any Security Document;

it being acknowledged and agreed that the “Secured Obligations” shall include extensions of credit of the types described above, whether outstanding on the date of this Agreement or any Security Document or extended from time to time after the date of this Agreement or any Security Document provided that, with respect to any Guarantor, "Secured Obligations" shall exclude any Excluded Swap Obligations of such Guarantor.

“Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“Security Agent” shall mean the Administrative Agent in its capacity as (x) collateral agent for the Secured Creditors pursuant to the Security Documents, and shall include any successor to the Security Agent as provided in Section 12.09; and/or (y) security trustee for the Secured Creditors pursuant to Schedule 19 of this Agreement and shall include any successor as provided in clause 7 of Schedule 19 of this Agreement.

“Security Document” shall mean and include each of the documents listed on Schedule 1.01(d) (after the execution and delivery thereof), the Incremental Security Documents (after the execution and delivery thereof) each Cash Management Control Agreement and each other security agreement or other instrument, document, agreement or grant executed and delivered pursuant to the Collateral and Guaranty Requirements or pursuant to Section 9.13 or 9.14 to secure any of the Secured Obligations; provided, that any cash collateral or other agreements entered into pursuant to the Back-Stop Arrangements shall constitute “Security Documents” solely for purposes of (x) Sections 8.03 and 10.01(iv) and (y) the term “Credit Documents” as used in Sections 10.04(i), 10.09 and 13.01.

“Security Document Amendment” shall have the meaning provided in the definition of Collateral and Guaranty Requirements.

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“Shrink” shall mean Inventory identified by the Qualified Obligors as lost, misplaced or stolen.

“Shrink Reserve” shall mean an amount reasonably estimated by the Co-Collateral Agents in their Permitted Discretion to be equal to that amount which is required in order that the Shrink reflected in the Qualified Obligors’ stock ledger would be reasonably equivalent to the Shrink calculated as part of the Qualified Obligors’ most recent physical inventory.

“Solvent” shall mean, 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.

“Spanish Borrower” shall have the meaning provided in the first paragraph of this Agreement.

“Spanish Companies Act” shall have the meaning provided in Section 11.01(e).

“Spanish Insolvency Act” shall have the meaning provided in Section 11.01(e).

“Spanish Obligor” shall mean any Obligor incorporated or organized under the laws of Spain.

“Spanish Parent Guarantor” shall have the meaning set forth in the preamble hereto.

“Spanish Propco” shall mean Toys R Us Iberia Real Estate, S.L.U.

“Spanish Propco Facility Agreement” shall mean that certain facility agreement related to a portfolio of properties located in Spain, dated as of January 2013, by and among the Spanish Propco, Deutsche Bank AG, acting through its London branch, as Security Agent, and the lenders party thereto.

“Specified Debt” shall have the meaning provided in Section 10.04(xxii).

“Specified Debt Documents” shall mean each agreement governing the Specified Debt and any ancillary agreements related thereto, in each case, other than this Agreement and any Credit Document.

“Specified Debt Intercreditor Agreement” shall mean a customary “European market” intercreditor agreement that is reasonably acceptable to the Administrative Agent in form and substance, which contains customary “distressed disposal provisions” and provides that (x) the Security Agent (acting on behalf of the Required Lenders) shall retain instruction priority over the holders of the Specified Debt with respect to any enforcement action with respect to the Collateral until the date occurring six months after the occurrence of any event of default under the Specified Debt Documents; provided that, enforcement actions shall only be permitted to be taken by the holders of the Specified Debt after such standstill period if (i) the cash proceeds thereof are sufficient to satisfy all Secured Obligations in full at par and (ii) such enforcement action is consistent with a prompt and expeditious realization of value and is reasonably expected to realize such proceeds meeting the requirements of the proceeding clause (i) within six months, (y) all proceeds of enforcement with respect to the Collateral are applied first, to all outstanding Secured Obligations

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and second, only after repayment in full in cash at par of all Secured Obligations outstanding under this Agreement, to obligations in respect of the Specified Debt and (z) the holders of Specified Debt may purchase the Obligations in respect of this Agreement in cash at par on customary terms and conditions, provided that purchase may only be exercised in respect of all of the outstanding Obligations at the time exercised.

“Specified Default” shall mean the failure of any Obligor to comply with the terms of Section 5.03 or Section 10.13 or a default under Section 11.01(c) from the failure of any Obligor to comply with the terms of Section 10.07 or the occurrence of any Event of Default specified in Section 11.01(a) or (e).

“Specified Foreign Currency Funding Capacity” at any date of determination, for any Lender, shall mean the ability of such Lender to fund Loans denominated in Australian Dollars, Pounds Sterling and/or Euros, as set forth in the records of the Administrative Agent pursuant to the receipt by the Administrative Agent of a notification in writing by such Lender to the Administrative Agent within three (3) Business Days prior to such Lender becoming a Lender hereunder.

“Specified Foreign Currency Loan” shall have the meaning provided in Section 15.01.

“Specified Foreign Currency Participation” shall have the meaning provided in Section 15.01.

“Specified Foreign Currency Participation Fee” shall have the meaning provided in Section 15.06.

“Specified Foreign Currency Participation Settlement” shall have the meaning provided in Section 15.02(a).

“Specified Foreign Currency Participation Settlement Amount” shall have the meaning provided in Section 15.02(b).

“Specified Foreign Currency Participation Settlement Date” shall have the meaning provided in Section 15.02(a).

“Specified Foreign Currency Participation Settlement Period” shall have the meaning provided in Section 15.02(b).

“Specified French Properties” shall have the meaning provided in Section 9.12(d).

“Specified French Properties Reserve” shall mean a landlord lien reserve with respect to the Specified French Properties that are not subject to landlord lien waivers (or if the Co-Collateral Agents have otherwise agreed to waive the requirement for the landlord to enter into a landlord lien waiver with respect to such Specified French Property) in the amount equal to three months’ rent (or such other amount as agreed by the Co-Collateral Agents and the Obligor’s Agent) for such properties; providedthat, such reserve amount shall be reduced by any reserve held on deposit by the applicable landlord for such Specified French Property.

“Sponsor Group” shall mean the Sponsors and the Sponsor Related Parties.

“Sponsor Lender Limitations” shall mean, 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 Total Commitments and, to the extent that the Sponsor Group or any of their respective Affiliates hold in the aggregate more than 10% of the Total Commitments, Lenders other than the Sponsor Group or any of their respective Affiliates shall be permitted to vote the Commitments held by the Sponsor Group and/or any of

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their respective Affiliates in excess of such amount (the “Excess Sponsor Amount”) on a pro rata basis, based on their respective Percentage of the Total Commitments, (b) if the Obligors’ Agent requests that this Agreement or any other Credit 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 Credit 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 or any Lender 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 Credit 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” shall mean, 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 Equity Interests 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.

“Sponsors” shall mean, 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.

“Start Date” shall have the meaning provided in the definition of Applicable Margin.

“Stated Amount” of each Letter of Credit shall mean, at any time, the maximum amount available to be drawn thereunder (in each case determined without regard to whether any conditions to drawing could then be met); provided that the “Stated Amount” of each Letter of Credit denominated in Australian Dollars, U.S. Dollars or Euro shall be, on any date of calculation, the Pounds Sterling Equivalent of the maximum amount available to be drawn in the respective currency thereunder (determined without regard to whether any conditions to drawing could then be met).

“Sterling Loans” shall mean each Loan denominated in Pounds Sterling at the time of the incurrence thereof.

“Sterling Rate” shall mean, with respect to each Borrowing of Sterling Loans, (i) the applicable screen rate, the same being the London interbank offered rate administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) for the relevant currency and period displayed on pages LIBOR01 and LIBOR02 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate) or on the appropriate page of such other information service which published that rate from time to time in place of Thomson Reuters, provided that if such page or service ceases to be available, the Facility Agent may specify another page or service displaying

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the relevant rate after consultation with the Obligors’ Agent and the Lenders; or (ii) if no screen rate is available for the currency or Interest Period of that Loan, the rate for such Interest Period shall be the interest rate per annum reasonably determined by the Administrative Agent in good faith to be the rate per annum at which deposits in Pounds Sterling for delivery on the first day of such Interest Period in immediately available funds in the approximate amount of the Sterling Loan being made, continued or converted by the Administrative Agent and with a term equivalent to such Interest Period that would be offered to the Administrative Agent by major banks in the London interbank market for Sterling Loans at their request at approximately 11:00 a.m. (London time) on the applicable Interest Determination Date, provided that in the event the Administrative Agent has made any determination pursuant to Section 2.10(a)(i) in respect of Sterling Loans, or in the circumstances described in clause (i) to the proviso to Section 2.10(b) in respect of such Sterling Loans, the Sterling Rate determined pursuant to this definition shall instead be the rate determined by the Administrative Agent as the all-in-cost of funds for the Administrative Agent to fund a Borrowing of Loans denominated in Pounds Sterling with maturities comparable to the Interest Period applicable thereto; and if the Sterling Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.

“Subsidiary” shall mean, as to any Person, (i) any corporation more than 50% of whose stock of any class or classes having by the terms thereof ordinary voting power to elect a majority of the directors of such corporation (irrespective of whether or not at the time stock of any class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time owned by such Person and/or one or more Subsidiaries of such Person and (ii) any partnership, limited liability company, association, joint venture or other entity in which such Person and/or one or more Subsidiaries of such Person has more than a 50% equity interest at the time. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of each Parent Guarantor other than, for the avoidance of doubt, any Propco.

“Subsidiary CFC” shall have the meaning provided in Section 17.19(a).

“Supermajority Lenders” shall mean those, Non-Defaulting Lenders (other than Affiliated Lenders) which would constitute the Required Lenders under, and as defined in, this Agreement, if the reference to “a majority” contained therein were changed to “66 2/3%”.

“Supplemental Information Certificate” shall have the meaning provided in Section 6.06.

“Swap Obligation” shall mean, with respect to any person, 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 Agent” shall mean Bank of America, N.A., in its capacity as Syndication Agent in respect of the credit facilities hereunder, and any successors thereto.

“Synthetic Lease” shall mean a lease transaction under which the parties intend that (i) the lease will be treated as an “operating lease” by the lessee and (ii) the lessee will be entitled to various tax and other benefits ordinarily available to owners (as opposed to lessees) of like property.

“Taxes” or “Tax” shall mean all present or future taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed by any jurisdiction or by any political subdivision or taxing authority thereof or therein with respect to such payments and all interest, surcharges, penalties or similar liabilities with respect to such taxes, levies, imposts, duties, fees, assessments or other charges.

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“Termination Date” shall mean the date on which all Secured Obligations have been paid in full (other than obligations for taxes, costs, indemnifications, reimbursements, damages and other contingent liabilities in respect of which no claim or demand for payment has been made or, in the case of indemnifications, no notice been given (or reasonably satisfactory arrangements have otherwise been made)), no Letter of Credit is outstanding and all Commitments have been terminated.

“Tertiary Obligations” shall mean (i) all Hedging Obligations under Secured Hedging Agreements that are not Qualified Secured Hedging Agreements, (ii) all Cash Management Obligations under Secured Cash Management Agreements that are not Qualified Secured Cash Management Agreements and (iii) all Hedging Obligations and Cash Management Obligations under Qualified Secured Hedging Agreements and Qualified Secured Cash Management Agreements in excess of £30,000,000 in the aggregate for all such obligations (it being understood and agreed that the Qualified Secured Cash Management Agreements and the Qualified Secured Hedging Agreements will be secured on a first-in-time basis).

“Test Period” shall mean, on any date of determination, the period of four consecutive Fiscal Quarters then last ended (taken as one accounting period).

“Total Commitment” shall mean, at any time, the sum of the Commitments of each of the Lenders at such time, which is £138,000,000 as of the Second Restatement Effective Date.

“Total Unutilized Commitment” shall mean, at any time, an amount equal to the remainder of (a) the Total Commitment in effect at such time less (b) the Aggregate Exposure at such time.

“Toys SARL” shall have the meaning set forth in the preamble hereto.

“Toys UK” shall have the meaning set forth in the preamble hereto.

“Transaction” shall mean, collectively, (a) the execution, delivery and performance by each Obligor of the Credit Documents to which it is a party, the incurrence of Loans, if any, on the Second Restatement Effective Date and the use of proceeds thereof and (b) the payment of all Transaction Costs.

“Transaction Costs” shall mean the fees, costs and expenses (including legal fees and expenses, and (if any) title premiums, survey charges, and recording taxes and fees) payable to third-parties by the Obligors on or before the first anniversary of the Second Restatement Effective Date (including but not limited to legal fees and expenses, and (if any) title premiums, survey charges, and recording taxes and fees incurred after the Restatement Effective Date), and incurred in order to consummate the transactions contemplated by the Credit Documents.

“Tri-Party Agreement” shall mean an agreement substantially in the form of Exhibits H-1 and H-2 (or such other form acceptable to the Administrative Agent) among a Qualified Obligor, any Person providing freight, warehousing and consolidation services to such Qualified Obligor and the Security Agent, in which such Person acknowledges that (a) the Security Agent holds a first priority Lien on the Inventory of the Qualified Obligors, (b) such Person has furnished written acknowledgment to such Qualified Obligor that such Person holds Inventory in its possession as bailee for such Qualified Obligor and that such Qualified Obligor has title to such Inventory, (c) any Inventory delivered to a carrier for shipment will reflect a Qualified Obligor as consignor and consignee, (d) it will promptly notify the Administrative Agent and the Security Agent of its receipt of notice from the seller of such Inventory of the seller’s stoppage of delivery of such Inventory to the Qualified Obligor, and (e) agrees, upon notice from the Administrative Agent, to hold and dispose of the subject Inventory solely as directed by the Administrative Agent.

“TRU France Finance” shall have the meaning set forth in the preamble hereto.

“TRU France Holdings” shall have the meaning set forth in the preamble hereto.

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“Type” shall mean the type of Loan determined with regard to the interest option applicable thereto, i.e., whether a U.S. Dollar Loan, an Australian Dollar Loan, a Sterling Loan or a Euro Loan.

“UCC” shall mean the Uniform Commercial Code (or any similar or equivalent legislation) as from time to time in effect in the relevant jurisdiction.

“UK Holdco” shall have the meaning set forth in the preamble hereto.

“UK/AUS Borrowing Base” shall mean, as of any date of calculation, the amount calculated pursuant to the Borrowing Base Certificate most recently delivered to the Administrative Agent and each of the Co-Collateral Agents in accordance with Section 9.01(j), equal to, without duplication, the sum of (a) 90% of Eligible Credit Card Receivables of the Qualified Obligors organized in England and Wales or Australia, plus (b) 85% of the then extant Net Orderly Liquidation Value of Eligible Inventory of the Qualified Obligors organized in England and Wales or Australia minus (c) the sum (without duplication) of the Reserves then established by the Co-Collateral Agents with respect to the UK/AUS Borrowing Base; provided that no CFC Limited Obligor shall be a Qualified Obligor for the purposes of this definition. The Co-Collateral Agents shall have the right (but no obligation) to review such computations and if such computations have not been calculated in accordance with the terms of this Agreement, the Co-Collateral Agents shall have the right to correct any such errors.

“U.K. Borrowers” shall have the meaning set forth in the preamble hereto.

“Unfunded Current Liability” of any Plan shall mean the amount, if any, by which the value of the accumulated plan benefits under the Plan determined on a plan termination basis in accordance with actuarial assumptions at such time consistent with those prescribed by the PBGC for purposes of section 4044 of ERISA, exceeds the fair market value of all plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions).

“United States” and “U.S.” shall each mean the United States of America.

“United States Person” shall have the meaning given to such term under Section 7701(a)(30) of the Code.

“United States Tax Person” shall mean an Obligor that is (a) a United States Person, (b) an entity treated as a partnership for U.S. federal income tax purposes with one or more direct or indirect partners that are United States Persons, or (c) a “disregarded entity” of a United States Person or a “disregarded entity” of an entity described in (b).

“Unpaid Drawing” shall have the meaning provided in Section 3.05(a).

“Unrestricted” shall mean, when referring to cash or Cash Equivalents of any Group Member, that such cash or Cash Equivalents are not Restricted.

“Unutilized Commitment” shall mean, with respect to any Lender at any time, such Lender’s Commitment at such timelessthe sum of (a) the aggregate outstanding principal amount of all Loans (taking the Pounds Sterling Equivalent of any such Loans denominated in a currency other than Pounds Sterling) made by such Lender at such time and (b) such Lender’s Percentage of the Letter of Credit Outstandings at such time (taking the Pounds Sterling Equivalent of any such Letters of Credit denominated in a currency other than Pounds Sterling).

“U.S. Dollar Loans” shall mean each Loan denominated in U.S. Dollars at the time of the incurrence thereof bearing interest at a rate determined by reference to the Eurodollar Rate.

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“U.S. Dollars” and the sign “$” shall each mean freely transferable lawful money of the United States.

“U.S. Obligations” shall have the meaning provided in Section 17.19(a).

“U.S. Obligor” shall mean any Obligor that (i) is a United States Person or (ii) is treated as an entity that is disregarded as separate from a United States Person for U.S. federal income tax purposes.

“VAT” shall mean:

(a) any tax imposed in compliance with the Council Directive of 28 November 2006 on the common system of value added tax (EC Directive 2006/112); and

(b) any other tax of a similar nature, whether imposed in a member state of the European Union in substitution for, or levied in addition to, such tax referred to in paragraph (a) above, or imposed elsewhere.

“Weekly Borrowing Base Period” shall mean any period (x) commencing on the date on which an Event of Default exists and is continuing or when the Excess Availability is less than or equal to the Availability Condition and (y) ending on the first date thereafter on which no Event of Default exists and is continuing and when the Excess Availability has been greater than the Availability Condition for 30 consecutive days.

“Wholly-Owned Subsidiary” shall mean, as to any Person, (i) any corporation 100% of whose capital stock is at the time owned by such Person and/or one or more Wholly-Owned Subsidiaries of such Person and (ii) any partnership, limited liability company, unlimited liability company, association, joint venture or other entity in which such Person and/or one or more Wholly-Owned Subsidiaries of such Person has a 100% equity interest at such time (other than directors’ qualifying shares and/or other nominal amounts of shares required to be held by Persons other than any Group Member under applicable law).

1.02    Interpretation. (a) In this Agreement, where it relates to a French entity, a reference to:

(i)    a guarantee includes, without limitation, any cautionnement, aval and any garantie which is independent from the debt to which it relates;

(ii)    a lease includes, without limitation, a bail and an opération de crédit-bail;

(iii)    a reconstruction includes, without limitation, any contribution of part of this business in consideration of shares (apport partiel d’actifs) and any demerger (scission) implemented in accordance with Articles L.236-1 to L.236-24 of the French Code de commerce;

(iv)    a security interest includes, without limitation, any type of security (privilege, sûreté réelle) (including any “security interest” as defined in sections 12(1) or (2) of the PPSA); and

(b)    unless the contrary intention appears, in a Credit Document, where the following terms are used in a Credit Document in the context of the PPSA or in relation to an Australian Obligor, they have the meanings they have in the PPSA: account, amendment demand, chattel paper, commercial consignment, control, financing statement, financing change statement, perfect, personal property, PPS lease, purchase money security interest, serial number, verification statement.

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1.03    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 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) any reference to any law or regulation herein shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, and (f) 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.

Section 2.    Amount and Terms of Credit.

2.01    The Commitments. (a) Subject to and upon the terms and conditions set forth herein (including, without limitation, the conditions set forth in Section 7), (I) each Existing Commitment (as in effect on the Second Restatement Effective Date immediately prior to giving effect thereto) of each Existing Lender is hereby continued on the Second Restatement Effective Date into a Commitment of such Existing Lender, and (II) each Lender severally agrees (A) that, on the Second Restatement Effective Date, each Existing Loan made by each Existing Lender to a Borrower pursuant to the Existing Facility Agreement and outstanding on the Second Restatement Effective Date shall continue as a revolving loan, without novation, owing by such Borrower (each, a “Continued Loan”) and (B) subject to and upon the terms and conditions set forth herein (including, without limitation, the conditions set forth in Sections 7.01, 7.02 and 7.03) each Lender with a Commitment severally agrees to make, at any time and from time to time on or after the Second Restatement Effective Date and prior to the Maturity Date, a revolving loan or revolving loans to each Borrower (together with each Continued Loan, each, a “Loan” and collectively, the “Loans”), which Loans:

(i)    shall be made and maintained in the respective Available Currency permitted for the Borrowers, as the case may be;

(ii)    except as hereafter provided, shall, at the option of the Borrowers, be incurred and maintained as one or more Borrowings of U.S. Dollar Loans, Australian Dollar Loans, Sterling Loans or Euro Loans; provided that, except as otherwise specifically provided in Section 2.10(b), all Loans made as part of the same Borrowing shall at all times consist of Loans of the same Type;

(iii)    may be repaid and reborrowed in accordance with the provisions hereof;

(iv)    shall not be made (and shall not be required to be made) by any such Lender in any instance where the incurrence thereof (after giving effect to the use of the proceeds thereof on the date of the incurrence thereof to repay any amounts theretofore outstanding pursuant to this Agreement) would cause (u) the Individual Exposure of such Lender to exceed the amount of its Commitment at such time, (v) the Aggregate Exposure to exceed the Total Commitment at such time, (w) the Aggregate Exposure (other than the French Locally Supported Aggregate Exposure) to exceed the UK/AUS Borrowing Base, (x) the aggregate principal amount of outstanding French Borrowing Base Loans (using the Pounds Sterling Equivalent of amounts not denominated in Pounds Sterling) to exceed the lesser of (I) the French Borrowing Base and (II) 20% of the Borrowing Base, (y) the

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Aggregate Exposureplusthe principal amount of any outstandings under the Local Law Financings (for this purpose, using the Pounds Sterling Equivalent of amounts not denominated in Pounds Sterling) to exceed the Aggregate Cap Amount, or (z) the outstanding amount of Loans made to the Australian Borrower to exceed the Australian Borrowing Limit; and

(v)    are denominated in Australian Dollars, Pounds Sterling or Euros and are required to be made by a Participating Specified Foreign Currency Lender, shall, subject to Section 15, be made by the Fronting Lender.

Notwithstanding anything to the contrary in this Section 2.01(a), no French Borrowing Base Loans may be made unless Excess Availability solely with respect to the UK/AUS Borrowing Base is less than or equal to ₤5,000,000 at such time after giving effect to such Borrowing and the use of proceeds thereof.

(b)    Notwithstanding anything to the contrary in Section 2.01(a), Section 7.03 or elsewhere in this Agreement, the Co-Collateral Agents shall have the right to establish Reserves in such amounts, and with respect to such matters, as the Co-Collateral Agents in their Permitted Discretion shall deem necessary or appropriate, against any Borrowing Base (which Reserves shall reduce such then existing applicable Borrowing Base in an amount equal to such Reserves); provided that 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) and during which such five Business Day period the Borrowers shall be unable to borrow an amount equal to such proposed Reserves; provided, further, 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 Reserves 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 (y) of the definition thereof has occurred or it would be reasonably likely that a Material Adverse Effect under clause (y) of the definition thereof would occur were such Reserves not changed or established prior to the expiration of such five Business Day period.

2.02    Minimum Amount of Each Borrowing. The aggregate principal amount of each Borrowing of Loans of a specific Type shall not be less than the Minimum Borrowing Amount applicable to such Type of Loans. More than one Borrowing may occur on the same date, but at no time shall there be outstanding more than ten Borrowings of Euro Rate Loans (or such greater number of Borrowings of Euro Rate Loans as may be agreed to from time to time by the Administrative Agent) in the aggregate.

2.03Notice of Borrowing. Whenever a Borrower desires to incur Loans hereunder, such Borrower shall give the Facility Agent at the Notice Office (with a copy to the Administrative Agent) at least (x) four Business Days’ prior notice of each Australian Dollar Loan to be incurred hereunder, (y) three Business Days’ prior notice of each U.S. Dollar Loan and Euro Loan to be incurred hereunder and (z) one Business Day’s prior written notice of each Sterling Loan to be incurred hereunder; provided that any such notice shall be deemed to have been given on a certain day only if given before (x) 9:30 A.M. (London time) on such day, in the case of Sterling Loans and (y) 9:30 A.M. (London time) on such day, in the case of Australian Dollar Loans, U.S. Dollar Loans and Euro Loans. Each such notice (each, a “Notice of Borrowing”), except as otherwise expressly provided in Section 2.10, shall be irrevocable and shall be in writing, in the form of Exhibit A-1, appropriately completed to specify: (i) the aggregate principal amount of the Loans to be incurred pursuant to such Borrowing (stated in the Available Currency), (ii) the date of such Borrowing (which shall be a Business Day) and (iii) the initial Interest Period to be applicable thereto. The Facility Agent shall promptly give each Lender notice of such proposed Borrowing (with a copy to the Administrative Agent), of such Lender’s proportionate share thereof and of the other matters required by the immediately preceding sentence to be specified in the Notice of Borrowing.

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2.04Disbursement of Funds. No later than 2:00 P.M. (London time) on the date specified in each Notice of Borrowing, each Lender, subject to Section 15, will make available its pro rata portion (determined in accordance with Section 2.07) of each such Borrowing requested to be made on such date. All such amounts will be made available in U.S. Dollars (in the case of U.S. Dollar Loans), in Australian Dollars (in the case of Australian Dollar Loans), in Pounds Sterling (in the case of Sterling Loans) or Euros (in the case of Euro Loans), as the case may be, and in immediately available funds at the Payment Office, and the Facility Agent will make available to the relevant Borrower or Borrowers at the Payment Office the aggregate of the amounts so made available by the Lenders. Unless the Administrative Agent and the Facility Agent shall have been notified by any Lender prior to the date of Borrowing that such Lender does not intend to make available to the Facility Agent such Lender’s portion of any Borrowing to be made on such date, the Facility Agent may assume that such Lender has made such amount available to the Facility Agent on such date of Borrowing and the Facility Agent may (but shall not be obligated to), in reliance upon such assumption, make available to the relevant Borrower or Borrowers a corresponding amount. If such corresponding amount is not in fact made available to the Facility Agent by such Lender, the Facility Agent shall be entitled to recover such corresponding amount on demand from such Lender. If such Lender does not pay such corresponding amount forthwith upon the Facility Agent’s demand therefor, the Facility Agent shall promptly notify the relevant Borrower or Borrowers, and the relevant Borrower or Borrowers shall immediately pay such corresponding amount to the Facility Agent. The Facility Agent also shall be entitled to recover on demand from such Lender or the relevant Borrower or Borrowers, as the case may be, interest on such corresponding amount in respect of each day from the date such corresponding amount was made available by the Facility Agent to the relevant Borrower or Borrowers until the date such corresponding amount is recovered by the Facility Agent, at a rate per annum equal to (i) if recovered from such Lender, the overnight Federal Funds Rate (or, in the case of Australian Dollar Loans, Sterling Loans or Euro Loans, the cost to the Facility Agent of acquiring overnight funds in Australian Dollars, Pounds Sterling or Euros, as the case may be) for the first three days and at the interest rate otherwise applicable to such Loans for each day thereafter and (ii) if recovered from the relevant Borrower or Borrowers, the rate of interest applicable to the respective Borrowing, as determined pursuant to Section 2.08. Nothing in this Section 2.04 shall be deemed to relieve any Lender from its obligation to make Loans hereunder or to prejudice any rights which any Borrower may have against any Lender as a result of any failure by such Lender to make Loans hereunder. Notwithstanding this Section 2.04 and subject to the provisions of Section 15, (x) the Fronting Lender shall be obligated to make each Participating Specified Foreign Currency Lender’s pro rata portion of a Specified Foreign Currency Loan and (y) each Participating Specified Foreign Currency Lender shall not be obligated to make its pro rata portion of a Specified Foreign Currency Loan.

2.05Notes. (a) Each Borrower’s obligation to pay the principal of, and interest on, the Loans made by each Lender to such Borrower shall be evidenced in the Register maintained by the Administrative Agent pursuant to Section 13.15 and shall, if requested by such Lender, also be evidenced by a promissory note duly executed and delivered by such Borrower substantially in the form of Exhibit B (except in the case of any Spanish Obligor to the extent execution of a promissory note would give rise to payment of stamp duty), with blanks appropriately completed in conformity herewith (each, a “Note” and, collectively, the “Notes”).

(b)Each Lender will note on its internal records the amount of each Loan made by it and each payment in respect thereof and prior to any transfer of any of its Notes will endorse on the reverse side thereof the outstanding principal amount of Loans evidenced thereby. Failure to make any such notation or any error in such notation shall not affect any Borrower’s obligations in respect of such Loans.

(c)Notwithstanding anything to the contrary contained above in this Section 2.05 or elsewhere in this Agreement, Notes shall only be delivered to Lenders which at any time specifically request the delivery of such Notes. No failure of any Lender to request, obtain, maintain or produce a Note evidencing

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its Loans to any Borrower shall affect, or in any manner impair, the obligations of any Borrower to pay the Loans (and all related Secured Obligations) incurred by such Borrower which would otherwise be evidenced thereby in accordance with the requirements of this Agreement, and shall not in any way affect the security or guaranties therefor provided pursuant to any Credit Document. Any Lender which does not have a Note evidencing its outstanding Loans shall in no event be required to make the notations otherwise described in preceding clause (b). At any time when any Lender requests the delivery of a Note to evidence any of its Loans, the respective Borrower shall promptly execute and deliver to the respective Lender, at such Borrower’s expense, the requested Note in the appropriate amount or amounts to evidence such Loans.

(d)On and after the Second Restatement Effective Date, each Existing Lender which holds a promissory note with respect to its Existing Loans to any Borrower shall be entitled to surrender such promissory note to the applicable Borrower against delivery of a new promissory note with respect to its new Loans completed in conformity with this Section 2.05; provided that if any such promissory note is not so surrendered, then from and after the Second Restatement Effective Date such promissory note shall be deemed to evidence the new Loans into which the Existing Loans theretofore evidenced by such promissory note have been converted and any Loans made in respect of such Existing Lender’s Commitments after the Second Restatement Effective Date.

2.06Continuations. Any Loan may be continued upon the expiration of the then current Interest Period with respect thereto by the applicable Borrower (or the Obligors’ Agent) giving notice substantially in the form of Exhibit A-2 attached hereto to the Facility Agent (with a copy to the Administrative Agent), in accordance with the applicable provisions for Interest Period set forth in Section 2.09 (such notice a “Notice of Continuation”), of the length of the next Interest Period to be applicable to such Loan.

2.07Pro Rata Borrowings. Except as provided in Section 15, all Borrowings of Loans under this Agreement shall be incurred from the Lenders pro rata on the basis of their Commitments. It is understood that no Lender shall be responsible for any default by any other Lender of its obligation to make Loans hereunder and that each Lender shall be obligated to make the Loans provided to be made by it hereunder, regardless of the failure of any other Lender to make its Loans hereunder.

2.08Interest. (a) Each Borrower agrees to pay interest in respect of the unpaid principal amount of each Loan made to such Borrower maintained as a U.S. Dollar Loan from the date of Borrowing thereof until the maturity thereof (whether by acceleration or otherwise) at a rate per annum which shall, during each Interest Period applicable thereto, be equal to the sum of the Applicable Margin as in effect from time to time during such Interest Periodplusthe Eurodollar Rate for such Interest Period.

(b)Each Borrower agrees to pay interest in respect of the unpaid principal amount of each Loan made to such Borrower maintained as a Sterling Loan from the date of Borrowing thereof until the maturity thereof (whether by acceleration or otherwise) at a rate per annum which shall, during each Interest Period applicable thereto, be equal to the sum of the Applicable Margin as in effect from time to time during such Interest Period plus the Sterling Rate for such Interest Period.

(c)Each Borrower agrees to pay interest in respect of the unpaid principal amount of each Loan made to such Borrower maintained as a Euro Loan from the date of Borrowing thereof until the maturity thereof (whether by acceleration or otherwise) at a rate per annum which shall, during each Interest Period applicable thereto, be equal to the sum of the Applicable Margin as in effect from time to time during such Interest Period plus the Euro LIBOR for such Interest Period.

(d)Each Borrower agrees to pay interest in respect of the unpaid principal amount of each Loan maintained as a Australian Dollar Loan from the date of Borrowing thereof until the maturity thereof (whether by acceleration or otherwise) at a rate per annum which shall, during each Interest Period

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applicable thereto, be equal to the sum of the relevant Applicable Margin as in effect from time to time during such Interest Period plus the Australian Dollar Rate for such Interest Period.

(e)Overdue principal and, to the extent permitted by law, overdue interest in respect of each Loan and any other overdue amount payable hereunder and under any other Credit Document shall, in each case, bear interest at a rate per annum (1) in the case of overdue principal of, and overdue interest on, Sterling Loans and any other overdue amounts owing in Pounds Sterling, equal to the rate which is 2% in excess of the Applicable Margin in effect from time to time for Sterling Loans plus the Sterling Rate for such successive periods not exceeding three months as the Facility Agent may determine from time to time in respect of amounts comparable to the amount not paid, (2) in the case of overdue principal of, and overdue interest on, Euro Loans and any other overdue amounts owing in Euros, equal to the rate which is 2% in excess of the Applicable Margin in effect from time to time for Euro Loans plus the Euro LIBOR for such successive periods not exceeding three months as the Facility Agent may determine from time to time in respect of amounts comparable to the amount not paid, (3) in the case of overdue principal of, and overdue interest on, Australian Dollar Loans and any other overdue amounts owing in Australian Dollars, equal to the rate which is 2% in excess of the Applicable Margin in effect from time to time for Australian Dollar Loans plus the Australian Dollar Rate for such successive periods not exceeding three months as the Facility Agent may determine from time to time in respect of amounts comparable to the amount not paid, and (4) in the case of overdue principal of, and overdue interest on, U.S. Dollar Loans and any other overdue amounts owing in U.S. Dollars, equal to the rate which is equal to the rate which is 2% in excess of the rate then borne by such Loans. Interest that accrues under this Section 2.08(e) shall be payable on demand.

(f)Accrued (and theretofore unpaid) interest shall be payable (i) in respect of each Loan, on the last day of each Interest Period applicable thereto and, in the case of an Interest Period in excess of three months, on each date occurring at three month intervals after the first day of such Interest Period and (ii) in respect of each Loan, (x) on the date of any repayment or prepayment thereof (on the amount prepaid or repaid), (y) at maturity (whether by acceleration or otherwise) and (z) after such maturity, on demand.

(g)Upon each Interest Determination Date, the Facility Agent shall determine the Euro Rate for each Interest Period applicable to the respective Loans and shall promptly notify the respective Borrowers and the Lenders thereof (with a copy to the Administrative Agent). Each such determination shall, absent manifest error, be final and conclusive and binding on all parties hereto.

2.09Interest Periods. At the time any Borrower gives any Notice of Borrowing or Notice of Continuation in respect of the making of, or continuing into, any Loan (in the case of the initial Interest Period applicable thereto) or prior to (x) in the case of an Australian Dollar Loan, 9:30 A.M. (London time) on the fourth Business Day, (y) in the case of Euro Loan or a U.S. Dollar Loan, 9:30 A.M. (London time) on the third Business Day and (z) in the case of a Sterling Loan, 9:30 A.M. (London time) on the first Business Day, in each case prior to the expiration of an Interest Period applicable to such Loan (in the case of any subsequent Interest Period), such Borrower shall have the right to elect the interest period (each, an “Interest Period”) applicable to such Loan, which Interest Period shall, at the option of the Borrower, be (i) a one week period, (ii) a one, two, three or six month period or (iii) a nine or twelve month period to the extent agreed to by all Lenders, provided that (in each case):

(a)all Loans comprising a Borrowing shall at all times have the same Interest Period;

(b)the initial Interest Period for any Loan shall commence on the date of Borrowing of such Loan and each Interest Period occurring thereafter in respect of such Loan shall commence on the day on which the next preceding Interest Period applicable thereto expires;

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(c)if any Interest Period for a Loan begins on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period, such Interest Period shall end on the last Business Day of such calendar month;

(d)if any Interest Period for a Loan would otherwise expire on a day which is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided, however, that if any Interest Period for a Loan would otherwise expire on a day which is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the preceding Business Day;

(e)unless the Required Lenders otherwise agree or as otherwise provided below in the case of U.S. Dollar Loans, Australian Dollar Loans, Sterling Loans or Euro Loans, no Interest Period may be selected at any time when a Default or an Event of Default is then in existence; and

(f)no Interest Period in respect of any Borrowing of Loans shall be selected which extends beyond the Maturity Date.

If by 12:00 Noon (London time) on the third Business Day prior to the expiration of any Interest Period applicable to a Borrowing of Loans, any Borrower has failed to elect, or is not permitted to elect, a new Interest Period to be applicable to such Loans as provided above, such Borrower shall be deemed to have elected to select a one month Interest Period for such U.S. Dollar Loans, Australian Dollar Loans, Sterling Loans or Euro Loans, as the case may be, in any such case effective as of the expiration date of such current Interest Period.

2.10Increased Costs, Illegality, etc. (a) In the event that any Lender shall have determined (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto but, with respect to clause (i) below, may be made only by the Administrative Agent):

(i)(x) on any Interest Determination Date that, by reason of any changes arising after the date of this Agreement affecting the applicable interbank market, adequate and fair means do not exist for ascertaining the applicable interest rate on the basis provided for in the definition of the respective Euro Rate and/or (y) the applicable Euro Rate for any requested Interest Period with respect to a proposed Loan does not adequately and fairly reflect the cost to the Lenders of funding such Loan; or

(ii)at any time, that such Lender shall incur increased costs or reductions in the amounts received or receivable hereunder with respect to any Loan because of (x) any change since the Second Restatement Effective Date in any applicable law or governmental rule, regulation, order, guideline or request (whether or not having the force of law) or in the interpretation or administration thereof and including the introduction of any new law or governmental rule, regulation, order, guideline or request, such as, but not limited to: (1) a change in the basis of taxation of payments to any Lender of the principal of or interest on the Loans or the Notes or any other amounts payable hereunder (except for changes in the rate of tax on, or determined by reference to, the net income or net profits of such Lender pursuant to the laws of the jurisdiction in which it is organized or in which its principal office or applicable lending office is located or any subdivision thereof or therein or with respect to any taxes covered by Section 5.04) or (2) a change in official reserve requirements, but, in all events, excluding reserves required under Regulation D to the extent included in the computation of the Eurodollar Rate and/or (y) other circumstances arising since the Second Restatement Effective Date affecting such Lender, the interbank eurodollar market or the position of such Lender in such market; or

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(iii)at any time, that the making or continuance of any Loan has been made (A) unlawful by any law or governmental rule, regulation or order, (B) impossible by compliance by any Lender in good faith with any governmental request (whether or not having force of law) or (C) impracticable as a result of a contingency occurring after the Second Restatement Effective Date which materially and adversely affects the applicable eurodollar market;

then, and in any such event, such Lender (or the Administrative Agent, in the case of clause (i)) shall promptly give notice to the affected Borrowers and, except in the case of clause (i) above, to the Administrative Agent of such determination (which notice the Administrative Agent shall promptly transmit to each of the other Lenders and the Facility Agent). Thereafter (w) in the case of clause (i) above, (A) in the event that U.S. Dollar Loans are so affected, the applicable Eurodollar Rate shall be determined on the basis provided in clause (y) of the definition of Eurodollar Rate, (B) in the event that Sterling Loans are so affected, the applicable Euro Rate shall be determined on the basis provided in the proviso to the definition of Sterling Rate, (C) in the event that Euro Loans are so affected, the applicable Euro Rate shall be determined on the basis provided in the proviso to the definition of Euro LIBOR and (D) in the event that Australian Dollar Loans are so affected, the applicable Euro Rate shall be determined on the basis provided in the proviso to the definition of Australian Dollar Rate, (x) in the case of clause (ii) above, the Borrowers agree to pay to such Lender, upon such Lender’s written request therefor, such additional amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Lender in its sole discretion shall determine) as shall be required to compensate such Lender for such increased costs or reductions in amounts received or receivable hereunder (a written notice as to the additional amounts owed to such Lender, showing in reasonable detail the basis for the calculation thereof, submitted to the respective Borrowers by such Lender shall, absent manifest error, be final and conclusive and binding on all the parties hereto) and (y) in the case of clause (iii) above, the respective Borrower or Borrowers shall take one of the actions specified in Section 2.10(b) as promptly as possible and, in any event, within the time period required by law.

(b)At any time that any Loan is affected by the circumstances described in Section 2.10(a)(ii), the affected Borrower may, and in the case of a Loan affected by the circumstances described in Section 2.10(a)(iii), the affected Borrower shall, either (i) if the affected Loan is then being made initially, cancel such Borrowing by giving the Facility Agent telephonic notice (confirmed in writing) on the same date that such Borrower was notified by the affected Lender or the Administrative Agent pursuant to Section 2.10(a)(ii) or (iii) or (ii) if the affected Loan is then outstanding, upon at least three Business Days’ written notice to the Administrative Agent, repay all outstanding Borrowings which include such affected Euro Rate Loans in full in accordance with the applicable requirements of Section 5.01; provided that (i) if the circumstances described in Section 2.10(a)(iii) apply to any Euro Rate Loan, the respective Borrower may, in lieu of taking the actions described above, maintain such outstanding Euro Rate Loans, as the case may be, in which case, (w) in the case of U.S. Dollar Loans, the applicable Eurodollar Rate shall be determined on the basis provided in clause (y) of the definition of “Eurodollar Rate”, (x) in the case of Sterling Loans, the applicable Euro Rate shall be determined on the basis provided in the proviso to the definition of Sterling Rate (y) in the case of Euro Loans, the applicable Euro Rate shall be determined on the basis provided in the proviso to the definition of Euro LIBOR and (z) in the case of Australian Dollar Loans, the applicable Euro Rate shall be determined on the basis provided in the proviso to the definition of Australian Dollar Rate, as the case may be, unless the maintenance of such outstanding Australian Dollar Loans, Sterling Loan or Euro Loan, as the case may be, on such basis would not stop the conditions described in Section 2.10(a)(iii) from existing (in which case the actions described above, without giving effect to this proviso, shall be required to be taken) and (ii) if more than one Lender is affected at any time, then all affected Lenders must be treated the same pursuant to this Section 2.10(b).

(c)If any Lender determines that after the Second Restatement Effective Date the introduction of or any change in any Applicable Law concerning capital adequacy, or any change in

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interpretation or administration thereof by the NAIC or any Governmental Authority, central bank or comparable agency, will have the effect of increasing the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender based on the existence of such Lender’s Commitment hereunder or its obligations hereunder, then the respective Borrower agrees to pay to such Lender, upon its written demand therefor, such additional amounts as shall be required to compensate such Lender or such other corporation for the increased cost to such Lender or such other corporation or the reduction in the rate of return to such Lender or such other corporation as a result of such increase of capital. In determining such additional amounts, each Lender will act reasonably and in good faith and will use averaging and attribution methods which are reasonable; provided that such Lender’s determination of compensation owing under this Section 2.10(c) shall, absent manifest error, be final and conclusive and binding on all the parties hereto. Each Lender, upon determining that any additional amounts will be payable pursuant to this Section 2.10(c), will give prompt written notice thereof to the Borrowers, which notice shall show in reasonable detail the basis for calculation of such additional amounts, although the failure to give any such notice shall not release or diminish the Borrowers’ obligations to pay additional amounts pursuant to this Section 2.10(c) upon the subsequent receipt of such notice.

(d)In the event that any Lender shall in good faith determine (which determination shall, absent manifest error, be final and conclusive and binding on all parties hereto) at any time that such Lender is required to maintain reserves (including, without limitation, any marginal, emergency, supplemental, special or other reserves required by applicable law) which have been established by any Federal, state, local or foreign court or governmental agency, authority, instrumentality or regulatory body with jurisdiction over such Lender (including any branch, Affiliate or funding office thereof) in respect of any Loans or any category of liabilities which includes deposits by reference to which the interest rate on any Loan is determined or any category of extensions of credit or other assets which includes loans by a non-United States office of any Lender to non-United States residents, then, unless such reserves are included in the calculation of the interest rate applicable to such Loans or in Section 2.10(a)(ii), such Lender shall promptly notify the Borrowers in writing specifying the additional amounts required to indemnify such Lender against the cost of maintaining such reserves in respect of such Loans (such written notice to provide in reasonable detail a computation of such additional amounts) and the respective Borrowers shall be obligated to pay to such Lender such specified amounts as additional interest at the time that such Borrower is otherwise required to pay interest in respect of such Loans or, if later, on written demand therefor by such Lender.

(e)Notwithstanding anything in this Agreement to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements and directives thereunder, issued in connection therewith or in implementation thereof, and (ii) 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 and/or CRD IV, shall be deemed to be a change after the Second Restatement Effective Date in a requirement of law or government rule, regulation or order, regardless of the date enacted, adopted, issued or implemented, but only to the extent such requests, rules, guidelines, requirements or directives are applied to each Parent Guarantor and its Subsidiaries by the Administrative Agent or any Lender in substantially the same manner as applied to other similarly situated borrowers under comparable syndicated credit facilities (including for purposes of this Section 2.10 and Section 3.06).

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2.11Compensation. Each Borrower agrees to compensate each Lender, upon its written request (which request shall set forth in reasonable detail the basis for requesting such compensation), for all losses, expenses and liabilities (including, without limitation, any loss, expense or liability incurred by reason of the liquidation or reemployment of deposits or other funds required by such Lender to fund its Loans but excluding loss of anticipated profits) which such Lender may sustain: (a) if for any reason (other than a default by such Lender or the Administrative Agent) a Borrowing of, or continuation from or into, Loans does not occur on a date specified therefor in a Notice of Borrowing or Notice of Continuation (whether or not withdrawn by the respective Borrower or Borrowers or deemed withdrawn pursuant to Section 2.10(a)); (b) if any prepayment or repayment (including any prepayment or repayment made pursuant to Section 5.01, Section 5.02 or as a result of an acceleration of the Loans pursuant to Section 11) or continuation of any of its Euro Rate Loans occurs on a date which is not the last day of an Interest Period or maturity date, as applicable, with respect thereto; (c) if any prepayment of any of its Loans is not made on any date specified in a notice of prepayment given by the respective Borrowers; or (d) as a consequence of (i) any other default by the respective Borrowers to repay Loans when required by the terms of this Agreement or any Note held by such Lender or (ii) any election made pursuant to Section 2.10(b).

2.12Change of Lending Office. (a) Each Lender may at any time or from time to time designate, by written notice to the Administrative Agent (with a copy to the Facility Agent) to the extent not already reflected on Schedule 13.03, one or more lending offices (which, for this purpose, may include Affiliates of the respective Lender) for the various Loans made, and Letters of Credit participated in, by such Lender (including, without limitation, by designating a separate lending office (or Affiliate) to act as such with respect to such Loans and Letter of Credit Outstandings; provided that, for designations made after the Second Restatement Effective Date, to the extent such designation shall result in increased costs under Section 2.10, 3.06 or 5.04 in excess of those which would be charged in the absence of the designation of a different lending office (including a different Affiliate of the respective Lender), then the Borrowers shall not be obligated to pay such excess increased costs (although if such designation results in increased costs, the Borrowers shall be obligated to pay the costs which would have applied in the absence of such designation and any subsequent increased costs of the type described above resulting from changes after the date of the respective designation). Except as provided in the immediately preceding sentence, each lending office and Affiliate of any Lender designated as provided above shall, for all purposes of this Agreement, be treated in the same manner as the respective Lender (and shall be entitled to all indemnities and similar provisions in respect of its acting as such hereunder).

(b)Each Lender agrees that on the occurrence of any event giving rise to the operation of Section 2.10(a)(ii) or (iii), Section 2.10(c), Section 3.06 or Section 5.04 with respect to such Lender, it will, if requested by the Obligors’ Agent, use reasonable efforts (subject to overall policy considerations of such Lender) to mitigate the effects of such event, including by designating another lending office for any Loans or Letters of Credit affected by such event; provided that such designation is made on such terms that such Lender and its lending office suffer no economic, legal or regulatory disadvantage, with the object of avoiding the consequence of the event giving rise to the operation of such Section. Nothing in this Section 2.12(b) shall affect or postpone any of the obligations of any Borrower or the right of any Lender provided in Sections 2.10, 3.06 and 5.04.

2.13Replacement of Lenders. (a) (x) If any Lender becomes a Defaulting Lender, (y) upon the occurrence of any event giving rise to the operation of Section 2.10(a)(ii) or (iii), Section 2.10(c), Section 3.06 or Section 5.04 with respect to any Lender which results in such Lender charging to any Borrower increased costs in excess of those being generally charged by the other Lenders or (z) in the case of a refusal by a Lender to consent to a proposed change, waiver, discharge or termination with respect to this Agreement which has been approved by the Required Lenders as (and to the extent) provided in Section 13.12(b), the Obligors’ Agent shall have the right, in accordance with Section 13.04(b), to replace such Lender (the

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“Replaced Lender”) with one or more other Eligible Transferees, none of whom shall constitute a Defaulting Lender at the time of such replacement (collectively, the “Replacement Lender”) and each of which shall be reasonably acceptable to the Administrative Agent, Fronting Lender (unless such Person will not be a Participating Specified Foreign Currency Lender) and any Issuing Lender;provided that:

(i)at the time of any replacement pursuant to this Section 2.13, the Replacement Lender shall enter into one or more Assignment and Assumption Agreements pursuant to Section 13.04(b) (and with all fees payable pursuant to said Section 13.04(b) to be paid by the Borrowers) pursuant to which the Replacement Lender shall acquire the entire Commitment and all outstanding Loans and all participations in Letters of Credit by, the Replaced Lender and, in connection therewith, shall pay to (i) the Replaced Lender in respect thereof an amount equal to the sum of (A) an amount equal to the principal of, and all accrued interest on, all outstanding Loans of the respective Replaced Lender, (B) an amount equal to all Unpaid Drawings (if any) that have been funded by (and not reimbursed to) such Replaced Lender, together with all then unpaid interest with respect thereto at such time and (C) an amount equal to all accrued, but theretofore unpaid, Fees owing to the Replaced Lender pursuant to Section 4.01 and (ii) each Issuing Lender an amount equal to such Replaced Lender’s Percentage of any Unpaid Drawing relating to Letters of Credit issued by such Issuing Lender (which at such time remains an Unpaid Drawing) to the extent such amount was not theretofore funded by such Replaced Lender; and

(ii)all obligations of the Borrowers then owing to the Replaced Lender (other than those specifically described in clause (i) above in respect of which the assignment purchase price has been, or is concurrently being, paid, but including all amounts, if any, owing under Section 2.11 shall be paid in full to such Replaced Lender concurrently with such replacement) shall be paid in full to such Replaced Lender concurrently with such replacement.

(b)Upon receipt by the Replaced Lender of all amounts required to be paid to it pursuant to this Section 2.13, the Administrative Agent shall be entitled (but not obligated) and authorized to execute an Assignment and Assumption Agreement on behalf of such Replaced Lender, and any such Assignment and Assumption Agreement so executed by the Administrative Agent and the Replacement Lender shall be effective for purposes of this Section 2.13 and Section 13.04. Upon the execution of the respective Assignment and Assumption Agreement, the payment of amounts referred to in clauses (i) and (ii) above, recordation of the assignment on the Register by the Administrative Agent pursuant to Section 13.15 and, if so requested by the Replacement Lender, delivery to the Replacement Lender of the appropriate Note or Notes executed by the relevant Borrowers, (x) the Replacement Lender shall become a Lender hereunder and the Replaced Lender shall cease to constitute a Lender hereunder, except with respect to indemnification provisions under Sections 2.10, 2.11, 3.06, 5.04, 12.06, 13.01 and 13.06 and any others expressly stated to survive as to such Replaced Lender and (y) the Percentages of the Lenders shall be automatically adjusted at such time to give effect to such replacement.

(c)Notwithstanding the foregoing, if after a good faith effort in consultation with the Administrative Agent, the Obligor’s Agent is unable to procure a Replacement Lender pursuant to this Section 2.13 for a Lender affected by the circumstances described in Section 2.10(a)(ii), Section 2.10(c), Section 3.06 and Section 5.04, then the Obligor’s Agent shall have the right on giving not less than five (5) Business Days’ written notice to the Administrative Agent (which shall promptly so notify the applicable Replaced Lender) to prepay without premium or penalty to the Facility Agent for the account of such Lender all (but not in part only) of such Lender’s participation in the aggregate Loans then outstanding, together with accrued interest thereon and all other sums owing to such Lender hereunder and otherwise in accordance with and subject to the provisions of this Agreement; provided that such prepayment shall not relieve any applicable Borrower from its obligation to pay such additional interest that may be due or any other amount that is due

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and owing to such Replaced Lender under this Agreement as of the date of such payment. When such prepayments are made, the Commitment of such Lender shall be canceled and reduced to zero and no amount prepaid in connection therewith may be redrawn.

2.14Incremental Loan Commitments. (a) The Borrowers shall have the right, in consultation and coordination with the Administrative Agent as to all of the matters set forth below in this Section 2.14, but without requiring the consent of the Administrative Agent (except as otherwise provided in this Section 2.14) or the Lenders, to request at any time and from time to time after the Second Restatement Effective Date (or, if later, after the satisfaction of any condition previously agreed to among the Agents and the Obligors’ Agent) and prior to the Maturity Date that one or more Lenders (and/or one or more other Persons which are Eligible Transferees and which will become Lenders) provide Incremental Commitments and, subject to the applicable terms and conditions contained in this Agreement and the relevant Incremental Commitment Agreement, make Loans and participate in Letters of Credit pursuant thereto; provided that (i) no Lender shall be obligated to provide an Incremental Commitment, and until such time, if any, as such Lender has agreed in its sole discretion to provide an Incremental Commitment and executed and delivered to the Administrative Agent and the Borrowers an Incremental Commitment Agreement as provided in clause (b) of this Section 2.14, such Lender shall not be obligated to fund any Loans in excess of its Commitment (if any) or participate in any Letters of Credit in excess of its Percentage, in each case, as in effect prior to giving effect to such Incremental Commitment provided pursuant to this Section 2.14, (ii) any Lender (including any Person which is an Eligible Transferee who will become a Lender) may so provide an Incremental Commitment without the consent of the Administrative Agent or any other Lender; provided that any Person that is not a Lender prior to the effectiveness of its Incremental Commitment shall require the consent of the Administrative Agent, each Issuing Lender and the Fronting Lender (unless such Person will not be a Participating Specified Foreign Currency Lender) (which consents shall not be unreasonably withheld) to provide an Incremental Commitment pursuant to this Section 2.14, (iii) the aggregate amount of each request (and provision therefor) for Incremental Commitments shall be in a minimum aggregate amount for all Lenders which provide an Incremental Commitment pursuant to a given Incremental Commitment Agreement pursuant to this Section 2.14 (including Persons who are Eligible Transferees and will become Lenders) of at least £5,000,000 (or such lesser amount that is acceptable to the Administrative Agent), (iv) after giving effect to any such Incremental Commitments permitted to be provided pursuant to this Section 2.14, the Total Commitments shall not exceed in the aggregate £200,000,000, (v) the Borrowers shall not increase the Commitment pursuant to this Section 2.14 more than 3 times, (vi) such Incremental Commitments shall have the same terms as the Commitments, (vii) all Loans incurred pursuant to an Incremental Commitment (and all interest, fees and other amounts payable thereon) shall be Secured Obligations under this Agreement and the other applicable Credit Documents and shall be secured by the relevant Security Documents, and guaranteed under the relevant Guaranties, on a paripassu basis with all other Loans secured by each relevant Security Document and guaranteed under the Guaranty, and (viii) each Lender (including any Person which is an Eligible Transferee who will become a Lender) agreeing to provide an Incremental Commitment pursuant to an Incremental Commitment Agreement shall, subject to the satisfaction of the relevant conditions set forth in this Agreement, participate in Letters of Credit pursuant to Section 3.04, and make Loans as provided in Section 2.01(a) and such Loans shall constitute Loans for all purposes of this Agreement and the other applicable Credit Documents.

(b)At the time of the provision of Incremental Commitments pursuant to this Section 2.14, (I) each Borrower, each Guarantor, the Administrative Agent and each such Lender or other Eligible Transferee which agrees to provide an Incremental Commitment (each, an “Incremental Lender”) shall execute and deliver to the Borrowers and the Administrative Agent an Incremental Commitment Agreement, appropriately completed (with the effectiveness of the Incremental Commitment provided therein to occur on the date set forth in such Incremental Commitment Agreement, which date in any event shall be no earlier than the date on which (i) all fees required to be paid in connection therewith at the time of such

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effectiveness shall have been paid, (ii) all Incremental Commitment Requirements have been satisfied, (iii) all conditions set forth in this Section 2.14 shall have been satisfied and (iv) all other conditions precedent that may be set forth in such Incremental Commitment Agreement shall have been satisfied) and (II) each Borrower, each Guarantor and the Security Agent and each Incremental Lender (as applicable) shall execute and deliver to the Administrative Agent and the Security Agent such additional Security Documents and/or amendments to the Security Documents which are necessary to ensure that all Loans incurred pursuant to the Incremental Commitments and any Additional Margin are secured by each relevant Security Document (the “Incremental Security Documents”). The Administrative Agent shall promptly notify each Lender and the Facility Agent as to the effectiveness of each Incremental Commitment Agreement and, at such time, Schedule 1.01(a) shall be deemed modified to reflect the Incremental Commitments of such Incremental Lenders.

(c)It is understood and agreed that the Incremental Commitments provided by an Incremental Lender or Incremental Lenders, as the case may be, pursuant to each Incremental Commitment Agreement shall constitute part of, and be added to, the Total Commitment and each Incremental Lender shall constitute a Lender for all purposes of this Agreement and each other applicable Credit Document.

(d)At the time of any provision of Incremental Commitments pursuant to this Section 2.14, each Borrower shall, in coordination with the Administrative Agent, repay outstanding Loans of certain of the Lenders, and incur additional Loans from certain other Lenders (including the Incremental Lenders), in each case to the extent necessary so that all of the Lenders participate in each outstanding Borrowing of Loans prorata on the basis of their respective Commitments (after giving effect to any increase in the Total Commitment pursuant to this Section 2.14) and with the Borrowers being obligated to pay to the respective Lenders any costs of the type referred to in Section 2.11 in connection with any such repayment and/or Borrowing.

2.15Obligors’ Agent as Agent for Obligors. Each Obligor hereby irrevocably appoints the Obligors’ Agent as its agent and attorney-in-fact for all purposes under this Agreement and each other Credit Document, which appointment shall remain in full force and effect unless and until the Administrative Agent shall have received prior written notice signed by the respective appointing Obligor that such appointment has been revoked. Each Obligor hereby irrevocably appoints and authorizes the Obligors’ Agent (i) to provide the Administrative Agent and/or the Facility Agent, as applicable, with all notices with respect to Loans and Letters of Credit obtained for the benefit of any applicable Obligor and all other notices and instructions under this Agreement or any other Credit Document and (ii) to take such action as the Obligors’ Agent deems appropriate on its behalf to exercise such other powers as are reasonably incidental thereto to carry out the purposes of this Agreement and the other Credit Documents. It is understood that the handling of the Credit Account and the Collateral of the respective Obligors in a combined fashion, as more fully set forth herein, is done solely as an accommodation to such Obligors in order to utilize the collective borrowing powers of such Obligors in the most efficient and economical manner and at their request, and that the Lenders shall not incur liability to any Obligor as a result hereof. Each Obligor expects to derive benefit, directly or indirectly, from the handling of the Credit Account and the Collateral in a combined fashion since the successful operation of each Obligor is dependent on the continued successful performance of the consolidated group. To induce the Administrative Agent, the Facility Agent, the Security Agent, the Co-Collateral Agents and the Lenders to do so, and in consideration thereof, each Obligor hereby agrees to indemnify the Administrative Agent, the Facility Agent, the Security Agent, each Co-Collateral Agent and each Lender and hold the Administrative Agent, the Facility Agent, the Security Agent, each Co-Collateral Agent and each Lender harmless against any and all liability, expense, loss or claim of damage or injury, made against the Administrative Agent, the Facility Agent, the Security Agent or any Lender by any Obligor or by any third party whosoever, arising from or incurred by reason of (a) the handling of the Credit Account and Collateral of the applicable Obligors as provided in this Agreement or (b) the Administrative Agent’s,

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the Facility Agent’s, the Security Agent’s, the Co-Collateral Agents’ and the Lenders’ relying on any instructions of the Obligors’ Agent, or (c) any other action taken by the Lenders hereunder or under the other Credit Documents, except that the Obligors will have no liability to any Lender, the Administrative Agent, the Facility Agent, the Security Agent or any Co-Collateral Agent with respect to any such liability, expense, loss, claim, damage or injury to the extent the same has been finally determined by a court of competent jurisdiction to have resulted from the gross negligence, or willful misconduct of such Lender, the Administrative Agent, the Facility Agent, the Security Agent or such Co-Collateral Agent, as the case may be.

Each Obligor hereby releases the Obligors’ Agent from the restrictions imposed by Section 181 German Civil Code (Bürgerliches Gesetzbuch) and similar restrictions applicable to it pursuant to any other law.

Section 3.Letters of Credit.

3.01Letters of Credit. (a) (A) Subject to and upon the terms and conditions set forth herein (including, without limitation, the conditions set forth in Section 7), a Borrower may request that an Issuing Lender issue, at any time and from time to time on and after the Second Restatement Effective Date and prior to the 10^th day prior to the Maturity Date, for the account of the Borrowers and for the benefit of (x) any holder (or any trustee, agent or other similar representative for any such holders) of L/C Supportable Obligations, an irrevocable standby letter of credit, in a form customarily used by such Issuing Lender or in such other form as is reasonably acceptable to such Issuing Lender, and (y) sellers of goods to any Group Member, an irrevocable trade letter of credit, in a form customarily used by such Issuing Lender or in such other form as has been approved by such Issuing Lender (each such letter of credit, a “Letter of Credit” and, collectively, the “Letters of Credit”) (although without limiting the nature of the Borrowers’ obligations in respect of the Letters of Credit, any particular Letter of Credit may name only one or more of the Borrowers, as the case may be, as the applicant or obligor therein and, at the direction of such respective Borrower(s), may be issued for the benefit of one or more Group Members). All Letters of Credit shall be issued on a sight basis only.

(B)    Schedule 3.01(a) contains a description of letters of credit that were issued pursuant to the Existing Facility Agreement and which remain outstanding on the Second Restatement Effective Date (and setting forth, with respect to each such letter of credit, (i) the name of the issuing lender, (ii) the letter of credit number, (iii) the name(s) of the account party or account parties, (iv) the stated amount, (v) the currency in which the letter of credit is denominated, (vi) the name of the beneficiary, (vii) the expiry date and (viii) whether such letter of credit constitutes a standby letter of credit or a trade letter of credit). Each such letter of credit, including any extension or renewal thereof in accordance with the terms thereof and hereof (each, as amended from time to time in accordance with the terms thereof and hereof, an “Existing Letter of Credit”) shall constitute a “Letter of Credit” for all purposes of this Agreement and shall be deemed issued on the Second Restatement Effective Date.

(b)Subject to and upon the terms and conditions set forth herein (including, without limitation, the conditions set forth in Section 7), each Issuing Lender agrees that it will, at any time and from time to time on and after the Second Restatement Effective Date and prior to the 5^th day prior to the Maturity Date, following its receipt of the respective Letter of Credit Request, issue for, one or more Letters of Credit as are permitted to remain outstanding hereunder without giving rise to a Default or an Event of Default; provided that no Issuing Lender shall be under any obligation to issue any Letter of Credit of the types described above if at the time of such issuance:

(i)any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuing Lender from issuing such Letter of Credit or any requirement of law applicable to such Issuing Lender or any request or directive (whether or

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not having the force of law) from any Governmental Authority with jurisdiction over such Issuing Lender shall prohibit, or request that such Issuing Lender refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuing Lender with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuing Lender is not otherwise compensated hereunder) not in effect with respect to such Issuing Lender on the date hereof, or any unreimbursed loss, cost or expense which was not applicable or in effect with respect to such Issuing Lender as of the date hereof and which such Issuing Lender reasonably and in good faith deems material to it; or

(ii)such Issuing Lender shall have received from any Borrower, any other Obligor or the Required Lenders prior to the issuance of such Letter of Credit notice of the type described in the second sentence of Section 3.03(b).

3.02Maximum Letter of Credit Outstandings; Currencies Final Maturities. Notwithstanding anything to the contrary contained in this Agreement, (a) no Letter of Credit shall be issued (or required to be issued) if the Stated Amount of such Letter of Credit, when added to the Letter of Credit Outstandings (for this purpose, using the Pounds Sterling Equivalent of all amounts denominated in a currency other than Pounds Sterling) (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time would exceed £35,000,000 (the “Maximum Letter of Credit Amount”), (b) no Letter of Credit shall be issued (or required to be issued) at any time when the Aggregate Exposure exceeds (or would after giving effect to such issuance exceed) the Total Commitment at such time, (c) the issuance of any Letter of Credit shall be subject to the conditions set forth in this Agreement (including, without limitation, the conditions set forth in Section 7), (d) each Letter of Credit shall be denominated in either U.S. Dollars, Australian Dollars, Pounds Sterling or Euros, (e) each standby Letter of Credit shall by its terms terminate on or before the earlier of (i) the date which occurs 12 months after the date of the issuance thereof (although any such standby Letter of Credit shall be extendible for successive periods of up to 12 months, but, in each case, not beyond the fifth Business Day prior to the Maturity Date) and (ii) five Business Days prior to the Maturity Date and (f) each trade Letter of Credit shall by its terms terminate on or before the earlier of (i) the date which occurs 180 days after the date of issuance thereof and (ii) five Business Days prior to the Maturity Date.

3.03Letter of Credit Requests; Minimum Stated Amount. (a) Whenever a Borrower desires that a Letter of Credit be issued, such Borrower shall give the Administrative Agent, the Facility Agent and the respective Issuing Lender at least (x) in the case of Letters of Credit denominated in Pounds Sterling, Euro and U.S. Dollars, two Business Days’ (or such shorter period as is acceptable to such Issuing Lender) written notice thereof and (y) in the case of Letters of Credit denominated in Australian Dollars, four Business Days’ written notice thereof (including by way of facsimile). Each notice shall be in the form of Exhibit C, appropriately completed (each, a “Letter of Credit Request”).

(b)The making of each Letter of Credit Request shall be deemed to be a representation and warranty by such requesting Borrower to the Lenders that such Letter of Credit may be issued in accordance with, and will not violate the requirements of, Section 3.02. Unless the respective Issuing Lender has received notice from any Borrower, any other Obligor or the Required Lenders before it issues a Letter of Credit that one or more of the conditions specified in Section 6 or 7 are not then satisfied, or that the issuance of such Letter of Credit would violate Section 3.02, then such Issuing Lender shall, subject to the terms and conditions of this Agreement, issue the requested Letter of Credit in accordance with such Issuing Lender’s usual and customary practices. Upon the issuance of or modification or amendment to any standby Letter of Credit, each Issuing Lender shall promptly notify the Borrower to be named as account party therein and the Administrative Agent and the Facility Agent, in writing of such issuance, modification or amendment and such notice shall be accompanied by a copy of such Letter of Credit or the respective modification or

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amendment thereto, as the case may be. Promptly after receipt of such notice the Administrative Agent shall notify the Participants, in writing, of such issuance, modification or amendment. On the first Business Day of each week, each Issuing Lender shall furnish the Facility Agent and the Administrative Agent with a written (including via facsimile) report of the daily aggregate outstandings of Letters of Credit issued by such Issuing Lender for the immediately preceding week. Notwithstanding anything to the contrary contained in this Agreement, in the event that one or more Lenders is a Defaulting Lender, no Issuing Lender shall be required to issue any Letter of Credit or increase or extend any Letter of Credit unless such Issuing Lender has entered into arrangements satisfactory to it and the Borrowers to eliminate such Issuing Lender’s risk with respect to the participation in Letters of Credit by the Defaulting Lender or Defaulting Lenders, including by cash collateralizing (in Pounds Sterling or the Pounds Sterling Equivalent thereof in the case of a Letter of Credit denominated in a currency other than U.S. Dollars) such Defaulting Lender’s or Defaulting Lenders’ Percentage of the Letter of Credit Outstandings (such arrangements, the “Back-Stop Arrangements”).

(c)The initial Stated Amount of each Letter of Credit shall not be less than £100,000 (or, in the case of a Letter of Credit issued in a currency other than Pounds Sterling, the Pounds Sterling Equivalent thereof) or such lesser amount as is acceptable to the respective Issuing Lender.

3.04Letter of Credit Participations. (a) Immediately upon the issuance by an Issuing Lender of any Letter of Credit, such Issuing Lender shall be deemed to have sold and transferred to each Lender, and each such Lender (in its capacity under this Section 3.04, a “Participant”) shall be deemed irrevocably and unconditionally to have purchased and received from such Issuing Lender, without recourse or warranty, an undivided interest and participation, to the extent of such Participant’s Percentage, in such Letter of Credit, each drawing or payment made thereunder and the obligations of the Borrowers under this Agreement with respect thereto, and any security therefor or guaranty pertaining thereto. Upon any change in the Commitments or Percentages of the Lenders pursuant to Section 2.13 or 13.04(b), it is hereby agreed that, with respect to all outstanding Letters of Credit and Unpaid Drawings relating thereto, there shall be an automatic adjustment to the participations pursuant to this Section 3.04 to reflect the new Percentages of the assignor and assignee Lender, as the case may be.

(b)In determining whether to pay under any Letter of Credit, no Issuing Lender shall have any obligation relative to the other Lenders other than to confirm that any documents required to be delivered under such Letter of Credit appear to have been delivered and that they appear to substantially comply on their face with the requirements of such Letter of Credit. Any action taken or omitted to be taken by an Issuing Lender under or in connection with any Letter of Credit issued by it shall not create for such Issuing Lender any resulting liability to any Borrower, any other Obligor, any Lender or any other Person unless such action is taken or omitted to be taken with gross negligence or willful misconduct on the part of such Issuing Lender (as determined by a court of competent jurisdiction in a final and non-appealable decision).

(c)In the event that an Issuing Lender makes any payment under any Letter of Credit issued by it and the Borrowers shall not have reimbursed such amount in full to such Issuing Lender pursuant to Section 3.05(a), such Issuing Lender shall promptly notify the Facility Agent, which shall promptly notify each Participant of such failure, and each Participant shall promptly and unconditionally pay to such Issuing Lender the amount of such Participant’s Percentage of such unreimbursed payment in Pounds Sterling (or, in the case of any unreimbursed payment made in a currency other than Pounds Sterling, the Pounds Sterling Equivalent of such unreimbursed payment, as determined by the Issuing Lender on the date on which such unreimbursed payment was made by such Issuing Lender) in immediately available funds. If the Facility Agent so notifies, prior to 12:00 Noon (London time) on any Business Day, any Participant required to fund a payment under a Letter of Credit, such Participant shall make available to the respective Issuing Lender in Pounds Sterling (or, in the case of any unreimbursed payment made in a currency other than Pounds

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Sterling, the Pounds Sterling Equivalent thereof) such Participant’s Percentage of the amount of such payment on such Business Day in immediately available funds. If and to the extent such Participant shall not have so made its Percentage of the amount of such payment available to the respective Issuing Lender, such Participant agrees to pay to such Issuing Lender, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to such Issuing Lender at the overnight Federal Funds Rate (or, in the case of any unreimbursed payment made in a currency other than U.S. Dollars, at the respective Issuing Lender’s customary rate for interbank advances) for the first three days and at the interest rate applicable to U.S. Dollar Loans for each day thereafter. The failure of any Participant to make available to an Issuing Lender its Percentage of any payment under any Letter of Credit issued by such Issuing Lender shall not relieve any other Participant of its obligation hereunder to make available to such Issuing Lender its Percentage of any payment under any Letter of Credit on the date required, as specified above, but no Participant shall be responsible for the failure of any other Participant to make available to such Issuing Lender such other Participant’s Percentage of any such payment.

(d)Whenever an Issuing Lender receives a payment of a reimbursement obligation as to which it has received any payments from the Participants pursuant to clause (c) above, such Issuing Lender shall pay to each such Participant which has paid its Percentage thereof, in Pounds Sterling (or, in the case of any unreimbursed payment made in a currency other than Pounds Sterling, the Pounds Sterling Equivalent thereof) and in same day funds, an amount equal to such Participant’s share (based upon the proportionate aggregate amount originally funded by such Participant to the aggregate amount funded by all Participants) of the principal amount of such reimbursement obligation and interest thereon accruing after the purchase of the respective participations.

(e)Upon the request of any Participant, each Issuing Lender shall furnish to such Participant copies of any standby Letter of Credit issued by it and such other documentation as may reasonably be requested by such Participant.

(f)The obligations of the Participants to make payments to each Issuing Lender with respect to Letters of Credit shall be irrevocable and not subject to any qualification or exception whatsoever and shall be made in accordance with the terms and conditions of this Agreement under all circumstances, including, without limitation, any of the following circumstances:

(i)any lack of validity or enforceability of this Agreement or any of the other Credit Documents;

(ii)the existence of any claim, setoff, defense or other right which any Group Member may have at any time against a beneficiary named in a Letter of Credit, any transferee of any Letter of Credit (or any Person for whom any such transferee may be acting), the Administrative Agent, any Participant, or any other Person, whether in connection with this Agreement, any Letter of Credit, the transactions contemplated herein or any unrelated transactions (including any underlying transaction between any Group Member and the beneficiary named in any such Letter of Credit);

(iii)any draft, certificate or any other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;

(iv)the surrender or impairment of any security for the performance or observance of any of the terms of any of the Credit Documents; or

(v)the occurrence of any Default or Event of Default.

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3.05Agreement to Repay Letter of Credit Drawings. (a) Each Borrower hereby agrees to reimburse each Issuing Lender, by making payment to the Facility Agent in Pounds Sterling (or, in the case of any unreimbursed payment made in a currency other than Pounds Sterling, the Pounds Sterling Equivalent of such payment or disbursement as determined by the respective Issuing Lender on the date of such payment or disbursement) in immediately available funds at the Payment Office, for any payment or disbursement made by such Issuing Lender under any Letter of Credit issued by it for the account of such Borrower, as the case may be (each such amount (or the Pounds Sterling Equivalent thereof, as the case may be), so paid until reimbursed by such Borrower, as the case may be, an “Unpaid Drawing”), not later than one Business Day following receipt by any such Borrower, as the case may be, of notice of such payment or disbursement (provided that no such notice shall be required to be given if a Default or an Event of Default under Section 11.01(e) shall have occurred and be continuing, in which case the Unpaid Drawing shall be due and payable immediately without presentment, demand, protest or notice of any kind (all of which are hereby waived by the Borrowers)), with interest on the amount so paid or disbursed by such Issuing Lender, to the extent not reimbursed prior to 12:00 Noon (London time) on the date of such payment or disbursement, from and including the date paid or disbursed to but excluding the date such Issuing Lender was reimbursed by such Borrower, as the case may be, at a rate per annum equal to the applicable Euro Rate as in effect from time to time plus the Applicable Margin as in effect from time to time for U.S. Dollar Loans; provided, however, to the extent such amounts are not reimbursed prior to 12:00 Noon (London time) on the third Business Day following the receipt by any such Borrower, as the case may be, of notice of such payment or disbursement or following the occurrence of a Default or an Event of Default under Section 11.01(e), interest shall thereafter accrue on the amounts so paid or disbursed by such Issuing Lender (and until reimbursed by such Borrower, as the case may be, at a rate per annum equal to the applicable Euro Rate as in effect from time to time plus the Applicable Margin for U.S. Dollar Loans as in effect from time to time plus 2%, with such interest to be payable on demand. Each Issuing Lender shall give the Borrowers prompt written notice of each Drawing under any Letter of Credit issued by it for the account of such Borrower, as the case may be; provided that the failure to give any such notice shall in no way affect, impair or diminish the obligations of such Borrowers hereunder.

(b)The obligations of such Borrower under this Section 3.05 to reimburse each Issuing Lender with respect to drafts, demands and other presentations for payment under Letters of Credit issued by it (each, a “Drawing”) (including, in each case, interest thereon) shall be absolute and unconditional under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment which any Group Member may have or have had against any Lender (including in its capacity as an Issuing Lender or as a Participant), including, without limitation, any defense based upon the failure of any drawing under a Letter of Credit to conform to the terms of the Letter of Credit or any nonapplication or misapplication by the beneficiary of the proceeds of such Drawing; provided, however, that no Borrower shall be obligated to reimburse any Issuing Lender for any wrongful payment made by such Issuing Lender under a Letter of Credit issued by it as a result of acts or omissions constituting willful misconduct or gross negligence on the part of such Issuing Lender (as determined by a court of competent jurisdiction in a final and non-appealable decision).

(c)If any Lender becomes a Defaulting Lender at any time that any Letter of Credit is outstanding, such Borrowers shall enter into Back-Stop Arrangements with the relevant Issuing Lender or Issuing Lenders no later than two Business Days after the date such Lender becomes a Defaulting Lender.

3.06Increased Costs. If at any time after the Second Restatement Effective Date, the introduction of or any change in any applicable law, rule, regulation, order, guideline or request or in the interpretation or administration thereof by the NAIC or any Governmental Authority charged with the interpretation or administration thereof, or compliance by any Issuing Lender or any Participant with any request or directive by the NAIC or by any such Governmental Authority (whether or not having the force

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of law), shall either (a) impose, modify or make applicable any reserve, deposit, capital adequacy or similar requirement against letters of credit issued by any Issuing Lender or participated in by any Participant, or (b) impose on any Issuing Lender or any Participant any other conditions relating, directly or indirectly, to this Agreement or any Letter of Credit; and the result of any of the foregoing is to increase the cost to any Issuing Lender or any Participant of issuing, maintaining or participating in any Letter of Credit, or reduce the amount of any sum received or receivable by any Issuing Lender or any Participant hereunder or reduce the rate of return on its capital with respect to Letters of Credit (except for changes in the rate of tax on, or determined by reference to, the net income or net profits of such Issuing Lender or such Participant pursuant to the laws of the jurisdiction in which it is organized or in which its principal office or applicable lending office is located or any subdivision thereof or therein or with respect to any taxes covered by Section 5.04), then, upon the delivery of the certificate referred to below to the Borrowers by any Issuing Lender or any Participant (a copy of which certificate shall be sent by such Issuing Lender or such Participant to the Administrative Agent), each Borrower agrees to pay to such Issuing Lender or such Participant such additional amount or amounts as will compensate such Issuing Lender or such Participant for such increased cost or reduction in the amount receivable or reduction on the rate of return on its capital. Any Issuing Lender or any Participant, upon determining that any additional amounts will be payable to it pursuant to this Section 3.06, will give prompt written notice thereof to the Borrowers, which notice shall include a certificate submitted to the Borrowers by such Issuing Lender or such Participant (a copy of which certificate shall be sent by such Issuing Lender or such Participant to the Administrative Agent and the Facility Agent), setting forth in reasonable detail the basis for the calculation of such additional amount or amounts necessary to compensate such Issuing Lender or such Participant. The certificate required to be delivered pursuant to this Section 3.06 shall, absent manifest error, be final and conclusive and binding on the Borrowers.

Section 4.Commitment Commission; Fees; Reductions of Commitment.

4.01Fees. (a) The Borrowers agree to pay to the Administrative Agent for distribution to each Non-Defaulting Lender a commitment commission (the “Commitment Commission”) for the period from and including the Second Restatement Effective Date to and including the Maturity Date (or such earlier date on which the Total Commitment has been terminated) computed at a rate per annum equal to Applicable Commitment Fee Percentage of the Unutilized Commitment of such Non-Defaulting Lender as in effect from time to time. Accrued Commitment Commission shall be due and payable quarterly in arrears on each Quarterly Payment Date and on the date upon which the Total Commitment is terminated.

(b)Each Borrower hereby agrees to pay to the Administrative Agent for distribution to each Lender (based on each such Lender’s respective Percentage) a fee in respect of each Letter of Credit issued for the account of such Borrower (the “Letter of Credit Fee”) for the period from and including the date of issuance of such Letter of Credit to and including the date of termination or expiration of such Letter of Credit, computed at a rate per annum equal to the Applicable Margin as in effect from time to time during such period with respect to Loans that are maintained as Sterling Rate Loans on the daily Stated Amount of each such Letter of Credit. Accrued Letter of Credit Fees shall be due and payable quarterly in arrears on each Quarterly Payment Date and on the first day on or after the termination of the Total Commitment upon which no Letters of Credit remain outstanding.

(c)Each Borrower agrees to pay to each Issuing Lender, for its own account, a facing fee in respect of each Letter of Credit issued by it (the “Facing Fee”) for the period from and including the date of issuance of such Letter of Credit to and including the date of termination or expiration of such Letter of Credit, computed at a rate per annum equal to 1/4 of 1% on the daily Stated Amount of such Letter of Credit, provided that in any event the minimum amount of Facing Fees payable in any twelve-month period for each Letter of Credit shall be not less than £500, it being agreed that, on the day of issuance of any Letter of Credit and on each anniversary thereof prior to the termination or expiration of such Letter of Credit, if

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£500 will exceed the amount of Facing Fees that will accrue with respect to such Letter of Credit for the immediately succeeding twelve-month period, the full £500 shall be payable on the date of issuance of such Letter of Credit and on each such anniversary thereof. Except as otherwise provided in the proviso to the immediately preceding sentence, accrued Facing Fees shall be due and payable quarterly in arrears on each Quarterly Payment Date and upon the first day on or after the termination of the Total Commitment upon which no Letters of Credit remain outstanding.

(d)Each Borrower hereby agrees to pay to each Issuing Lender, for its own account, upon each payment under, issuance of, or amendment to, any Letter of Credit issued by it issued for the account of such Borrower, as the case may be, such amount as shall at the time of such event be the administrative charge and the reasonable expenses which such Issuing Lender is generally imposing in connection with such occurrence with respect to letters of credit.

(e)The Borrowers agree to pay to each Agent such fees as may have been, or are hereafter, agreed to in writing from time to time by the Obligors and such Agent.

4.02Voluntary Termination of Unutilized Commitments. (a) Upon at least three Business Days’ prior written notice to the Administrative Agent at the Notice Office (which notice the Administrative Agent shall promptly transmit to each of the Lenders and the Facility Agent), the Obligors’ Agent shall have the right, at any time or from time to time, without premium or penalty to terminate the Total Unutilized Commitment in whole, or reduce it in part, pursuant to this Section 4.02(a), in an integral multiple of £1,000,000 in the case of partial reductions to the Total Unutilized Commitment; provided that each such reduction shall apply proportionately to permanently reduce the Commitment of each Lender; provided, further, that a notice of termination of the Total Unutilized Commitment in whole delivered by the Obligors’ Agent may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Obligors’ Agent (by notice to the Administrative Agent on or prior to the specified effective date).

(b)In the event of certain refusals by a Lender to consent to certain proposed changes, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Lenders as (and to the extent) provided in Section 13.12(b), the Obligors’ Agent shall have the right, subject to obtaining the consents required by Section 13.12(b), upon five Business Days’ prior written notice to the Administrative Agent at the Notice Office (which notice the Administrative Agent shall promptly transmit to each of the Lenders and the Facility Agent), to terminate the entire Commitment of such Lender, so long as all Loans, together with accrued and unpaid interest, Fees and all other amounts, owing to such Lender (including all amounts, if any, owing pursuant to Section 2.11) are repaid concurrently with the effectiveness of such termination (at which time Schedule 1.01(a) shall be deemed modified to reflect such changed amounts) and such Lender’s Percentage of all outstanding Letters of Credit is cash collateralized in a manner satisfactory to the Administrative Agent and the respective Issuing Lenders, and at such time such Lender shall no longer constitute a “Lender” for purposes of this Agreement, except with respect to indemnifications under Sections 2.10, 2.11, 3.06, 5.04, 12.06, 13.01 and 13.06 and any others expressly stated to survive as to such repaid Lender.

4.03Mandatory Reduction of Commitments. (a) The Total Commitment (and the Commitment of each Lender) shall terminate in its entirety on March 8, 2016, unless the Second Restatement Effective Date has occurred on or prior to such date.

(b)In addition to any other mandatory commitment reductions pursuant to this Section 4.03, the Total Commitment (and the Commitment of each Lender) shall terminate in its entirety upon the Maturity Date.

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Section 5.Prepayments; Payments; Taxes.

5.01Voluntary Prepayments. (a) Each Borrower shall have the right to prepay the Loans made to such Borrower, without premium or penalty, in whole or in part at any time and from time to time on the following terms and conditions: (i) such Borrower shall give the Facility Agent (with a copy to the Administrative Agent) prior to 12:00 Noon (London time) at the Notice Office at least three Business Days’ prior written notice of its intent to prepay Loans which notice shall specify the amount of such prepayment and the Types of Loans to be prepaid and the specific Borrowing or Borrowings pursuant to which such Loans were made, and which notice the Facility Agent shall promptly transmit to each of the Lenders (with a copy to the Administrative Agent), provided that if a notice of optional prepayment is given in connection with a conditional notice of termination of the Total Unutilized Commitment in whole as contemplated by Section 4.02(a), then such notice of prepayment may be revoked if such notice of termination is revoked in accordance with Section 4.02(a); (ii) each partial prepayment of Loans pursuant to this Section 5.01(a) shall be in an aggregate principal amount of at least the Minimum Borrowing Amount applicable to the Type of Loans being repaid (or such lesser amount as is acceptable to the Administrative Agent); (iii) such Borrower shall use reasonable efforts to allocate such prepayments in a manner so that Borrowings do not remain outstanding in amounts less than the Minimum Borrowing Amount applicable thereto (and, to the extent such Borrowings would remain outstanding in amounts which are less than the Minimum Borrowing Amount applicable thereto, such Borrower shall repay any Borrowings which are less than the Minimum Borrowing Amount applicable thereto at the end of the then current Interest Period) and (iv) each prepayment pursuant to this Section 5.01(a) in respect of any Loans made pursuant to a Borrowing shall be applied pro rata among such Loans; provided that at such Borrower’s election in connection with any prepayment of Loans pursuant to this Section 5.01(a), such prepayment shall not, so long as no Default and no Event of Default then exists, be applied to any Loan of a Defaulting Lender unless and until the outstanding balance of the Loans of all Non-Defaulting Lenders equals such Non-Defaulting Lenders’ Percentage of such outstanding Loans.

(b)In the event of certain refusals by a Lender to consent to certain proposed changes, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Lenders as (and to the extent) provided in Section 13.12(b), the Borrowers may, upon five Business Days’ prior written notice to the Facility Agent at the Notice Office (which notice the Facility Agent shall promptly transmit to each of the Lenders (with a copy to the Administrative Agent)), repay all Loans of such Lender, together with accrued and unpaid interest, Fees and all other amounts then owing to such Lender (including all amounts, if any, owing pursuant to Section 2.11) in accordance with, and subject to the requirements of Section 13.12(b), so long as (i) in the case of the repayment of Loans of any Lender pursuant to this clause (b), (A) the Commitment of such Lender is terminated concurrently with such repayment pursuant to Section 4.02(b) (at which time Schedule 1.01(a) shall be deemed modified to reflect the changed Commitments) and (B) such Lender’s Percentage of all outstanding Letters of Credit is cash collateralized in a manner satisfactory to the Administrative Agent and the respective Issuing Lenders and (ii) the consents, if any, required by Section 13.12(b) in connection with the repayment pursuant to this clause (b) shall have been obtained.

5.02Mandatory Repayments; Cash Collateralization. (a) (i) On any day on which any one or more of the following conditions shall exist, the Borrowers shall repay the Loans and/or cash collateralize outstanding Letters of Credit (in Pounds Sterling or, to the extent any Letter of Credit is denominated in a currency other than Pounds Sterling, in the Pounds Sterling Equivalent thereof) pursuant to clause (ii) below in such amount as may be required to cause such conditions to cease to exist on such day:

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(u)    the aggregate principal amount of outstanding French Borrowing Base Loans (using the Pounds Sterling Equivalent of amounts not denominated in Pounds Sterling) exceeds the lesser of (I) the French Borrowing Base and (II) 20% of the Borrowing Base;

(v)    the Aggregate Exposure (other than the French Locally Supported Aggregate Exposure) at such time exceeds 100% of the UK/AUS Borrowing Base at such time;

(w)    the Aggregate Exposure at such time exceeds the Total Commitment at such time;

(x)    the aggregate Letter of Credit Outstandings at such time exceeds the Maximum Letter of Credit Amount;

(y)    the outstanding principal amount of Loans to the Australian Borrower exceeds the Australian Borrowing Limit; and/or

(z)    the aggregate principal amount of outstanding French Borrowing Base Loans (using the Pounds Sterling Equivalent of amounts not denominated in Pounds Sterling) exceeds the aggregate principal amount of French Proceeds Loans (using the Pounds Sterling Equivalent of amounts not denominated in Pounds Sterling).

For purposes of this Section 5.02(a)(i), the relevant Borrowing Bases will be based upon the Borrowing Base Certificate most recently deliveredlessany Reserves then in effect on the date of the calculation of the Aggregate Exposure and the French Locally Supported Aggregate Exposure, as applicable. The Borrowing Base Certificate will not be the basis for determining the amount of the Aggregate Exposure and the relevant French Locally Supported Aggregate Exposure, which shall be determined as of each day.

(ii)In connection with any repayment and/or cash collateralization required pursuant to Section 5.02(a)(i) on any day, the Borrowers shall prepay the Loans in the following order:

(A)in the case of a repayment and/or cash collateralization required pursuant to Section 5.02(a)(i)(w) on any day, the Borrowers shall repay on such day the principal of outstanding Loans in each case in such amount as may be required to cause the conditions giving rise to such mandatory repayment requirement to cease to exist on such day, and

(B)in the case of a repayment and/or cash collateralization required pursuant to Section 5.02(a)(i)(x) on any day, the Borrowers shall repay on such day the principal of outstanding Loans, in each case in such amount as may be required to cause the conditions giving rise to such mandatory repayment requirement to cease to exist on such day.

(C)If after giving effect to the prepayment of all Loans, the conditions set forth in Section 5.02(a)(i) continues to exist, the Borrowers shall pay to the Facility Agent at the Payment Office on such day an amount of cash and/or Cash Equivalents equal to 100% (or, if the Total Commitment has been terminated, 105%) of the amount of such excess, such cash and/or Cash Equivalents to be held as security for all Secured Obligations of the Borrowers to the Issuing Lenders and the Lenders hereunder in a cash collateral account to be established by, and under the sole dominion and control of, the Administrative Agent (and which cash and/or Cash Equivalents may, without limiting the Borrowers’ obligations in respect thereof, be paid to and applied by the Issuing Lenders and/or the Lenders in satisfaction of the Secured Obligations of the Borrowers to the Issuing Lenders and/or

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Lenders in respect of any Drawings made under any Letter of Credit issued for the account of a Borrower on the respective maturity dates thereof).

(D)Notwithstanding anything to the contrary contained above in this Section 5.02(a), so long as no Default or Event of Default has occurred and is continuing at the time of any prepayment or cash collateralization required pursuant to this Section 5.02(a), the Borrowers may prepay Loans and cash collateralize the relevant Letters of Credit as directed by the Borrowers (so long as such application cures the related conditions).

(b)In addition to any other mandatory repayments pursuant to this Section 5.02, on each date on or after the Second Restatement Effective Date upon which any Group Member receives any cash proceeds from any issuance or incurrence by any Group Member of Indebtedness (other than Indebtedness permitted to be incurred pursuant to Section 10.04), an amount equal to 100% of the net proceeds of the respective issuance or incurrence of Indebtedness shall be applied on such date as a mandatory repayment in accordance with the requirements of Sections 5.02(e) and (f).

(c)In addition to any other mandatory repayments pursuant to this Section 5.02 (but subject to Section 5.02(g)), on each date on or after the Second Restatement Effective Date upon which any Group Member receives any cash proceeds from any Asset Sale while a Compliance Period is in effect, an amount equal to 100% of the Net Sale Proceeds therefrom shall be applied on such date as a mandatory repayment in accordance with the requirements of Sections 5.02(e) and (f).

(d)In addition to any other mandatory repayments pursuant to this Section 5.02 (but subject to Section 5.02(g)), on each date on or after the Second Restatement Effective Date upon which any Group Member receives any cash proceeds from any Recovery Event, in respect of Inventory, while a Compliance Period is in effect, an amount equal to 100% of the Net Insurance Proceeds from such Recovery Event shall be applied on such date as a mandatory repayment in accordance with the requirements of Sections 5.02(e) and (f).

(e)Each amount required to be applied pursuant to Sections 5.02(b), (c) and (d) in accordance with this Section 5.02(e) shall be applied (i) first, to repay the outstanding principal amount of Loans without any reduction in the Total Commitment, and (ii) second, to the extent all amounts referred to in preceding clause (i) have been paid in full, to cash collateralize (on a ratable basis) all outstanding Letters of Credit (such cash collateral to be held by the Administrative Agent in a cash collateral account to be established by, and under the sole dominion and control of, the Administrative Agent and applied to the Secured Obligations of the Borrowers to the Issuing Lenders and/or Lenders in respect of any Drawings made under any such Letters of Credit).

(f)With respect to each repayment of Loans required by this Section 5.02, the Borrowers may designate the Types of Loans which are to be repaid and the specific Borrowing or Borrowings pursuant to which such Loans were made; provided that: (i) repayments of Euro Rate Loans pursuant to this Section 5.02 made on a day other than the last day of an Interest Period applicable thereto shall be subject to Section 2.11; (ii) if any repayment of Loans made pursuant to a single Borrowing shall reduce the outstanding Loans made pursuant to such Borrowing to an amount less than the Minimum Borrowing Amount applicable thereto, such Borrowing shall be repaid in full at the end of the then current Interest Period and (iii) each repayment of any Loans made pursuant to a Borrowing shall be applied pro rata among the Lenders holding such Loans. In the absence of a designation by a Borrower as described in the preceding sentence, the Administrative Agent shall, subject to the above, make such designation in its sole discretion.

(g)In addition to any other mandatory repayments pursuant to this Section 5.02, all then outstanding Loans shall be repaid in full on the Maturity Date.

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5.03Method and Place of Payment. (a) Except as otherwise specifically provided herein, all payments under this Agreement and under any Note shall be made to the Facility Agent for the account of the Lender or Lenders entitled thereto not later than 12:00 Noon (London time) on the date when due and shall be made in (w) Pounds Sterling (or, in the case of any Unpaid Drawings denominated in a currency other than Pounds Sterling, in an amount equal to the Pounds Sterling Equivalent thereof) in immediately available funds at the Payment Office in respect of any obligation of the Borrowers under this Agreement except as otherwise provided in the immediately following clauses (x), (y) and (z), (x) Australian Dollars in immediately available funds at the Payment Office, if such payment is made in respect of (i) principal of or interest on Australian Dollar Loans or (ii) any increased costs, indemnities or other amounts owing with respect to Australian Dollar Loans (including, without limitation, pursuant to Sections 2.10, 2.11, 3.06, 5.04, 12.06, 13.01 and 13.06), (y) U.S. Dollars in immediately available funds at the Payment Office, if such payment is made in respect of (i) principal of or interest on U.S. Dollar Loans or (ii) any increased costs, indemnities or other amounts owing with respect to U.S. Dollar Loans (including, without limitation, pursuant to Sections 2.10, 2.11, 3.06, 5.04, 12.06, 13.01 and 13.06) and (z) Euros in immediately available funds at the Payment Office, if such payment is made in respect of (i) principal of or interest on Euro Loans or (ii) any increased costs, indemnities or other amounts owing with respect to Euro Loans (including, without limitation, pursuant to Sections 2.10, 2.11, 3.06, 5.04, 12.06, 13.01 and 13.06). Whenever any payment to be made hereunder or under any Note shall be stated to be due on a day which is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day and, with respect to payments of principal, interest shall be payable at the applicable rate during such extension.

(b)Each English Obligor shall, along with the Security Agent, certain financial institutions selected by the Obligors’ Agent and approved by the Administrative Agent (the “English Collection Banks”), and each of those banks in which each Deposit Account (other than Excluded Accounts and Disbursement Accounts) are maintained by each such English Obligor, enter into on or prior to the Second Restatement Effective Date (as such date may be extended from time to time by the Administrative Agent in its sole discretion) and thereafter maintain separate Cash Management Control Agreements in respect of each such Collection Account and Deposit Account (other than Excluded Accounts and English Disbursement Accounts), which such Collection Accounts shall not be subject to cash pooling or other similar arrangements. All amounts received by any English Obligor and any English Collection Bank in respect of sales of Inventory and other Collateral and all cash proceeds from all credit or debit card charges, in addition to all other cash received by any English Obligor from any other source, shall upon receipt be deposited into an English Collection Account, directly into an English Core Concentration Account or, to the extent permitted hereunder in the case of amounts not constituting payments in respect of Accounts, sales of Inventory and other Collateral and all cash proceeds from all credit or debit card charges of any English Obligor, an Excluded Account.

(c)Each Australian Obligor shall, along with the Security Agent, certain financial institutions selected by the Obligors’ Agent and approved by the Administrative Agent (the “Australian Collection Banks”), and each of those banks in which each Deposit Account (other than Excluded Accounts and Australian Disbursement Accounts) are maintained by each such Australian Obligor, enter into on or prior to the Second Restatement Effective Date (as such date may be extended from time to time by the Administrative Agent in its sole discretion) and thereafter maintain separate Cash Management Control Agreements in respect of each such Collection Account and Deposit Account (other than Excluded Accounts and Australian Disbursement Accounts), which such Collection Accounts shall not be subject to cash pooling or other similar arrangements. All amounts received by any Australian Obligor and any Australian Collection Bank in respect of any sales of Inventory and other Collateral and all cash proceeds from all credit or debit card charges, in addition to all other cash received by any Australian Obligor from any other source, shall upon receipt be deposited into an Australian Collection Account, directly into a Core Australian Concentration Account or, to the extent permitted hereunder in the case of amounts not constituting payments in respect

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of Accounts, sales of Inventory and other Collateral and all cash proceeds from all credit or debit card charges of any Australian Obligor, an Excluded Account.

(d)If at any time Toys SARL owns assets that constitute Borrowing Base Collateral, Toys SARL shall ensure that each Collection Account and Deposit Account (other than Excluded Accounts and French Disbursement Accounts), maintained by Toys SARL, is not subject to cash pooling or other similar arrangements. All amounts received by Toys SARL and those certain financial institutions selected by the Obligor’s Agent and approved by the Administrative Agent (the “French Collection Banks”) in respect of sales of Inventory and other Collateral and all cash proceeds from all credit or debit card charges, in addition to all other cash received by Toys SARL from any other source, shall upon receipt be deposited into a French Collection Account, directly into a French Core Concentration Account or, to the extent permitted hereunder in the case of amounts not constituting payments in respect of Accounts, sales of Inventory and other Collateral and all cash proceeds from all credit or debit card charges of Toys SARL, an Excluded Account.

(e)(i) Any accounts with the Administrative Agent or a financial institution reasonably acceptable to the Administrative Agent (each, a “Core English Concentration Account” and, collectively, the “Core English Concentration Accounts”) (it being understood and agreed that such Core English Concentration Accounts shall not be subject to cash pooling or other similar arrangements) into which the amounts held in all of the English Collection Accounts, English Disbursement Accounts and other Deposit Accounts (other than Excluded Accounts) are transferred shall be subject to a Cash Management Control Agreement, provided that the aggregate amount retained in all such English Disbursement Accounts and Deposit Accounts pursuant to this clause shall not exceed that amount (as reasonably determined by the Obligors’ Agent) to cover all of the aggregate amount of all such outstanding obligations, (ii) any accounts with the Administrative Agent or a financial institution reasonably acceptable to the Administrative Agent (each, a “Core Australian Concentration Account” and, collectively, the “Core Australian Concentration Accounts”) (it being understood and agreed that such Core Australian Concentration Accounts shall not be subject to cash pooling or other similar arrangements) into which the amounts held in all of the Australian Collection Accounts, Australian Disbursement Accounts and other Deposit Accounts (other than Excluded Accounts) are transferred shall be subject to a Cash Management Control Agreement, provided that the aggregate amount retained in all such Australian Disbursement Accounts and Deposit Accounts pursuant to this clause shall not exceed that amount (as reasonably determined by the Obligors’ Agent) to cover all of the aggregate amount of all such outstanding obligations, (iii) any accounts with the Administrative Agent or a financial institution reasonably acceptable to the Administrative Agent (each, a “Core French Concentration Account” and, collectively, the “Core French Concentration Accounts”) (it being understood and agreed that such Core French Concentration Accounts shall not be subject to cash pooling or other similar arrangements) into which the amounts held in all of the French Collection Accounts, French Disbursement Accounts and other Deposit Accounts (other than Excluded Accounts) are transferred shall be subject to the requirements of Section 9.20 hereof, provided that the aggregate amount retained in all such French Disbursement Accounts and Deposit Accounts pursuant to this clause shall not exceed that amount (as reasonably determined by the Obligors’ Agent) to cover all of the aggregate amount of all such outstanding obligations. So long as no Dominion Period then exists, the Qualified Obligors shall be permitted to transfer cash from the Core Concentration Accounts to other Deposit Accounts and Disbursement Accounts to be used for working capital and general corporate purposes all subject to the requirements of this Section 5.03(e) and Section 10.13. If a Dominion Period exists, the Security Agent shall promptly notify the applicable Obligors hereunder and all collected amounts held in the Collection Accounts and the Core Concentration Accounts shall be applied as provided in Sections 5.03(f) and (g) and Section 9.20.

(f)Each Credit Card Notification and each Cash Management Control Agreement relating to an English Collection Account or Core English Concentration Account shall (unless otherwise

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agreed by the Administrative Agent in its sole discretion) include provisions that allow, during any Dominion Period, for all collected amounts held in such English Collection Account or Core English Concentration Account from and after the date requested by the Administrative Agent, to be sent by ACH or wire transfer or similar electronic transfer no less frequently than once per Business Day to one or more account maintained by the Facility Agent at DB London (or if DB London is not the Facility Agent, at the institution designated by such successor Facility Agent) or an affiliate thereof (each a “DB English Account”). Subject to the terms of the respective Security Document, all amounts received in a DB English Account during a Dominion Period shall be applied (and allocated) by the Administrative Agent on a daily basis in the following order (in each case to the extent the Administrative Agent has actual knowledge of the amounts owing or outstanding as described below, and after giving effect to the application of any such amounts (x) otherwise required to be applied pursuant to Section 5.02(b), (c) or (d), or (y) constituting proceeds from any Collateral otherwise required to be applied pursuant to the terms of the respective Security Document), subject to the provisions of the immediately succeeding sentence (to the extent applicable): (1) first, to the payment (on a ratable basis) of any outstanding Expenses actually due and payable to the Administrative Agent and the Security Agent under any of the Credit Documents; (2) second, to the extent all amounts referred to in preceding clause (1) have been paid in full, to pay (on a ratable basis) all outstanding Expenses actually due and payable to each Issuing Lender under any of the Credit Documents; (3) third, to the extent all amounts referred to in preceding clauses (1) and (2) have been paid in full, to pay (on a ratable basis) all accrued and unpaid interest actually due and payable on the Loans and then all accrued and unpaid Fees actually due and payable by any Borrower to the Administrative Agent, the Issuing Lenders and the Lenders under any of the Credit Documents; (4) fourth, to the extent all amounts referred to in preceding clauses (1) through (3), inclusive, have been paid in full, to pay (on a ratable basis) any and all unpaid principal of Loans and Unpaid Drawings in respect of Letters of Credit issued for the account of any Borrower in each case which are then actually due and payable; (5) fifth, to the extent all amounts referred to in preceding clauses (1) through (4), inclusive, have been paid in full, to repay (on a ratable basis) the outstanding principal of Loans, provided that, with respect to each repayment of Loans required by this Section 5.03(f)(5), so long as no Default or Event of Default then exists and less than all outstanding Loans would otherwise be required to be repaid pursuant to sub-clause (f)(6), the Obligors’ Agent may designate the Types of Loans which are to be repaid and the specific Borrowing or Borrowings pursuant to which such Loans were made; (6) sixth, to the extent all amounts referred to in preceding clauses (1) through (5), inclusive, have been paid in full, to cash collateralize (on a ratable basis) all outstanding Letters of Credit issued for the account of any Borrower (such cash collateral to be held by the Administrative Agent in a cash collateral account to be established by, and under the sole dominion and control of, the Administrative Agent and applied to the Secured Obligations of the Borrowers to the Issuing Lenders and/or Lenders in respect of any Drawings made under any such Letters of Credit); (7) seventh, to the extent all amounts referred to in preceding clauses (1) through (6), inclusive, have been paid in full, to pay (on a ratable basis) all other outstanding Secured Obligations of any Borrower then due and payable to the Administrative Agent and the Lenders under any of the Credit Documents; and (8) eighth, to the Borrowers. Each English Obligor agrees that it will not cause any proceeds of any Core Concentration Account to be otherwise redirected.

(g)Each Credit Card Notification and each Cash Management Control Agreement relating to an Australian Collection Account or Core Australian Concentration Account shall (unless otherwise agreed by the Administrative Agent in its sole discretion) include provisions that allow, during any Dominion Period, for all collected amounts held in such Australian Collection Account or such Core Australian Concentration Account from and after the date requested by the Administrative Agent, to be sent by ACH or wire transfer or similar electronic transfer no less frequently than once per Business Day to one or more accounts maintained by the Facility Agent at DB London (or if DB London is not the Facility Agent, at the institution designated by such successor Facility Agent) or an affiliate thereof (each a “DB Australian Account”). Subject to the terms of the respective Security Document, all amounts received in a DB Australian

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Account during a Dominion Period shall be applied (and allocated) by the Administrative Agent on a daily basis in the following order (in each case to the extent the Administrative Agent has actual knowledge of the amounts owing or outstanding as described below, and after giving effect to the application of any such amounts (x) otherwise required to be applied pursuant to Section 5.02(b), (c) or (d), or (y) constituting proceeds from any Collateral otherwise required to be applied pursuant to the terms of the respective Security Document), subject to the provisions of the immediately succeeding sentence (to the extent applicable): (1) first, to the payment (on a ratable basis) of any outstanding Expenses actually due and payable to the Administrative Agent and the Security Agent under any of the Credit Documents; (2) second, to the extent all amounts referred to in preceding clause (1) have been paid in full, to pay (on a ratable basis) all outstanding Expenses actually due and payable to each Issuing Lender under any of the Credit Documents; (3) third, to the extent all amounts referred to in preceding clauses (1) and (2) have been paid in full, to pay (on a ratable basis) all accrued and unpaid interest actually due and payable on the Loans and then all accrued and unpaid Fees actually due and payable by any Borrower to the Administrative Agent, the Issuing Lenders and the Lenders under any of the Credit Documents; (4) fourth, to the extent all amounts referred to in preceding clauses (1) through (3), inclusive, have been paid in full, to pay (on a ratable basis) any and all unpaid principal of Loans and Unpaid Drawings in respect of Letters of Credit issued for the account of any Borrower in each case which are then actually due and payable; (5) fifth, to the extent all amounts referred to in preceding clauses (1) through (4), inclusive, have been paid in full, to repay (on a ratable basis) the outstanding principal of Loans (whether or not then due and payable), provided that, with respect to each repayment of Loans required by this Section 5.03(g)(6), so long as no Default or Event of Default then exists and less than all outstanding Loans would otherwise be required to be repaid pursuant to sub-clause (f)(6), the Obligors’ Agent may designate the Types of Loans which are to be repaid and the specific Borrowing or Borrowings pursuant to which such Loans were made; (6) sixth, to the extent all amounts referred to in preceding clauses (1) through (5), inclusive, have been paid in full, to cash collateralize (on a ratable basis) all outstanding Letters of Credit issued for the account of any Borrower (such cash collateral to be held by the Administrative Agent in a cash collateral account to be established by, and under the sole dominion and control of, the Administrative Agent and applied to the Secured Obligations of the Borrowers to the Issuing Lenders and/or Lenders in respect of any Drawings made under any such Letters of Credit); (7) seventh, to the extent all amounts referred to in preceding clauses (1) through (6), inclusive, have been paid in full, to pay (on a ratable basis) all other outstanding Secured Obligations of any Borrower then due and payable to the Administrative Agent and the Lenders under any of the Credit Documents; and (8) eighth, to the Borrowers. Each Australian Obligor agrees that it will not cause any proceeds of any Core Concentration Account to be otherwise redirected.

(h)Without limiting the provisions set forth in Section 13.15, the Administrative Agent shall maintain accounts on its books in the name of each Borrower (collectively, the “Credit Account”) in which each Borrower will be charged with all loans and advances made by the Lenders to the respective Borrower for the respective Borrower’s account, including the Loans, the Letter of Credit Outstandings, and the Fees, Expenses and any other Secured Obligations relating thereto. Each Borrower will be credited, in accordance with this Section 5.03 and Section 9.20, with all amounts received by the Lenders from such Borrower or from others for its account, including, as set forth above, all amounts received by the Facility Agent and applied to the Secured Obligations. In no event shall prior recourse to any Accounts or other Collateral be a prerequisite to the Administrative Agent’s right to demand payment of any Secured Obligation upon its maturity. Further, the Administrative Agent shall have no obligation whatsoever to perform in any respect any of the Borrowers’ or other Obligors’ contracts or obligations relating to the Accounts.

(i)Any payments made by a French Qualifying Obligor under this Agreement and under any Note shall be made to the Facility Agent on an account which shall not be opened in a Non-Cooperative Jurisdiction. The Facility Agent shall distribute any such payments received from a French Qualifying Obligor on an account which shall not be opened in a Non-Cooperative Jurisdiction.

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5.04Tax Gross-Up and Indemnities.

5.04.1    Definitions.

(a)In this Agreement:

“Borrower DTTP Filing” means an HM Revenue & Customs' Form DTTP2 duly completed and filed by the relevant Borrower, which:

(i) where it relates to a Treaty Lender that is a Lender at the date of this Agreement, contains the scheme reference number and jurisdiction of tax residence provided by written confirmation to the relevant Borrower or its Agent on the same date as the date of this Agreement, and

(A) where the Borrower is a Borrower at the date of this Agreement, is filed with HM Revenue & Customs within 30 days of the date of this Agreement; or

(B) where the Borrower becomes a Borrower after the date of this Agreement (an “Additional Borrower”), is filed with HM Revenue & Customs within 30 days of the date on which that Borrower becomes an Additional Borrower; or

(ii) where it relates to a Treaty Lender that is a Replacement Lender or is a Party that becomes a Lender after the date of this Agreement (a “New Lender”), contains the scheme reference number and jurisdiction of tax residence stated in respect of that Lender in the relevant Assignment Agreement, and

(A) where the Borrower is a Borrower as at the date of the relevant Assignment Agreement, is filed with HM Revenue & Customs within 30 days of that date; or

(B) where the Borrower is not a Borrower as at the date of the relevant Assignment Agreement, is filed with HM Revenue & Customs within 30 days of the date on which that Borrower becomes an Additional Borrower.

“Change in Law” shall mean any change in the interpretation, administration, or application of any law, treaty, governmental rule, regulation, guideline, order, or any published practice or published concession of any relevant taxing authority.

“Exempt Lender” shall mean, in relation to a Qualifying Obligor, a Lender which is able (otherwise than by reason of being a “Treaty Lender”) under the domestic law of that Qualifying Obligor’s Tax Jurisdiction or the jurisdiction of source of the interest (if different) to receive interest of that jurisdiction free of any withholding or deduction for or on account of tax imposed by either jurisdiction.

“Facility Office” shall mean the office or offices notified by a Lender or an Issuing Lender to the Administrative Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five Business Days’ written notice) as the office or offices through which it will perform its obligations under this Agreement.

“Protected Party” shall mean in relation to any Qualifying Obligor;

(a)    a Lender which:

(i)    is a Qualifying Lender in respect of that Qualifying Obligor; or

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(ii)    has ceased to be a Qualifying Lender in respect of that Qualifying Obligor by reason of any Change in Law after the date it became a Lender under this Agreement but is (and was immediately prior to such change) lending from and tax resident in a Specified Sovereign; and

(b)    an Administrative Agent when acting on behalf of a Lender which is a Protected Party provided that such Administrative Agent is and has been at all relevant times in compliance with its obligations under Clause 5.04.5(b).

“Qualifying Lender” shall mean:

(a)    In relation to a Qualifying Obligor resident for tax purposes in the United Kingdom:

a Lender which is beneficially entitled to interest payable to that Lender in respect of an advance under a Credit Document and is:

(A)    a Lender:

(1)    which is a bank (as defined for the purpose of section 879 of the Income Tax Act 2007) making an advance under a Credit Document and is within the charge to United Kingdom corporation tax as respects any payments of interest made in respect of that advance or would be within such charge as respects such payments apart from section 18A of the Corporation Tax Act 2009; or

(2)    in respect of an advance made under a Credit Document by a person that was a bank (as defined for the purpose of section 879 of the Income Tax Act 2007) at the time that that advance was made and which is within the charge to United Kingdom corporation tax as respects any payments of interest made in respect of that advance; or

(B)    a Lender which is:

(1)    a company resident in the United Kingdom for United Kingdom tax purposes; or

(2)    a partnership each member of which is:

(i)    a company so resident in the United Kingdom; or

(ii)    a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account in computing its chargeable profits (within the meaning of section 19 of the Corporation Tax Act 2009) the whole of any share of interest payable in respect of that advance that falls to it by reason of Part 17 of the Corporation Tax Act 2009;

(3)    a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account interest payable in respect of that advance in computing the chargeable profits (within the meaning of section 19 of the Corporation Tax Act 2009) of that company; or

(C)    a Treaty Lender;

(b)    In relation to a Qualifying Obligor resident for tax purposes in Australia, a Lender which is not an Offshore Associate of an Australian Borrower;

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(c)    In relation to a Qualifying Obligor resident for tax purposes in France, a Lender which:

(A)    is a Treaty Lender; or

(B)    is exempt from withholding tax under French law on payments received under this Agreement or the Credit Documents from a Qualifying Obligor resident for tax purposes in France;

(d)    In relation to a Qualifying Obligor resident for tax purposes in Spain, a Lender which is beneficially entitled to interest payable under this Agreement and is:

(A)    a Spanish credit entity or financial credit establishment registered with the Bank of Spain to which the provisions set out in paragraph (C) of Article 61 of Spanish Royal Decree 634/2015, of 10 July 2015 apply;

(B)    a Spanish permanent establishment of a non-Spanish financial entity with which that Lender’s participation in that advance is effectively connected, and to which the provisions contained in the second paragraph of number 1 of Article 8 of Royal Decree 1776/2004, of 30 July 2004, apply;

(C)    a resident for tax purposes in a Member State of the European Union (other than Spain) or a permanent establishment of such Lender located in a Member State of the European Union (other than Spain) which in each case is not acting (in relation to that participation in that advance) through a permanent establishment in Spain and, furthermore, not acting through a territory considered as a tax haven (under Spanish law);

(D)    (a) a resident (as defined in the appropriate double taxation agreement) in a country with which Spain has a double taxation agreement giving residents of that country full exemption from taxation on interest imposed by Spain, or if such interest is recharacterized as income other than interest by either Spanish law or applicable double taxation agreement, a full exemption from or reduction to bill of taxation imposed by Spain on such recharacterized income; and (b) does not carry on a business in Spain through a permanent establishment with which the payment of interest under any Credit Document is effectively connected; or

(E)    a Spanish asset securitisation fund (Fondo de Titulización de Activos) to which the provisions set out in paragraph (K) of Article 61 of Spanish Royal Decree 634/2015, of 10 July 2015 apply; and

(e)    In relation to a Qualifying Obligor resident for tax purposes in Germany, a Lender which is:

(A)    resident in Germany for German tax purposes or lending through a Facility Office in Germany, provided that interest payments received through such Facility Office are included within the taxable profits of that Facility Office for the purpose of calculating that Lender's taxable income in Germany;

(B)    a Treaty Lender; or

(C)    an Exempt Lender; and

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(f)    In relation to any Qualifying Obligor resident for tax purposes in any other jurisdiction, a Lender which is:

(A)    an Exempt Lender; or

(B)    a Treaty Lender;

provided that, in each of the cases (a) to (e) inclusive above, such Lender has complied and continues to comply with those obligations under Clause 5.04.5 and 5.04.6 necessary to establish its status as a Qualifying Lender, including as regards obtaining the benefit of applicable Tax treaties and legislation.

Each Lender confirms that it is a Qualifying Lender in relation to each Qualifying Obligor as of the date of this Agreement.

“Qualifying Obligor” shall mean any Borrower and any Guarantor in the same jurisdiction as any Borrower.

“Qualifying Obligor’s Tax Jurisdiction” shall mean the jurisdiction in which a Borrower is resident for tax purposes as at the SecondRestatement Effective Date.

“Specified Sovereign” shall mean the United States of America, Switzerland, Japan and any member state of the European Union as comprised on 1 January, 2004.

“Tax Confirmation” shall mean a confirmation by a Lender that the person beneficially entitled to interest payable to that Lender in respect of an advance under a Credit Document is either:

(i)    a company resident in the United Kingdom for United Kingdom tax purposes;

(ii)    a partnership each member of which is:

(A)    a company so resident in the United Kingdom; or

(B)    a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account in computing its chargeable profits (within the meaning of section 19 of the Corporation Tax Act 2009) the whole of any share of interest payable in respect of that advance that falls to it by reason of Part 17 of the Corporation Tax Act 2009; or

(iii)    a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account interest payable in respect of that advance in computing the chargeable profits (within the meaning of section 19 of the Corporation Tax Act 2009) of that company.

“Tax Credit” shall mean a credit against, relief from or remission, rebate or repayment of any Tax.

“Tax Deduction” shall mean a deduction or withholding for or on account of Tax from a payment under a Credit Document.

“Tax Payment” shall mean either the increase in a payment made by a Qualifying Obligor to a Lender or Administrative Agent under Section 5.04.2 (Tax Gross-up) or a payment under Section 5.04.3 (Tax Indemnity).

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“Treaty Lender” shall mean a Lender which:

(i)    is treated as a resident of a Treaty State for the purposes of the Treaty referred to in paragraph (iii) below;

(ii)    does not carry on a business in the relevant Qualifying Obligor’s Tax Jurisdiction through a permanent establishment with which that Lender’s participation in the Loan is effectively connected; and

(iii)    is entitled under the provisions of an applicable double taxation agreement with the relevant Qualifying Obligor’s Tax Jurisdiction (subject to the completion of any necessary procedural formalities) to full exemption from Tax imposed by the relevant Qualifying Obligor’s Tax Jurisdiction on any and all payments under a Credit Document and to receive such payments without a Tax Deduction.

“Treaty State” shall mean a jurisdiction having a double taxation agreement (a “Treaty”) with the relevant Qualifying Obligor’s Tax Jurisdiction which makes provision for full exemption from tax imposed by the jurisdiction of the relevant Qualifying Obligor on any payment under the Credit Documents.

“UK Non-Bank Lender” shall mean a Lender which gives a Tax Confirmation either in this Agreement or in the Assignment Agreement which it executes on becoming a Party.

“Withholding Forms” shall mean, in the case of a U.S. Obligor, (a) United States Internal Revenue Service (“IRS”) Forms W-9, W-8BEN, W-8BEN-E, W-8ECI and/or W-8IMY (or, in each case, any successor form) by which a person may claim a complete exemption from backup withholding or withholding of U.S. federal income tax (if such forms are required to be provided on or before the Second Restatement Effective Date) or a complete exemption of or a reduction in United States backup withholding or withholding tax (if such forms are required to be provided after the Second Restatement Effective Date) on payments to that person and (b), in the case of a person claiming a complete exemption (as of the Second Restatement Effective Date) or a complete or partial exemption (after the Second Restatement Effective Date) under the “portfolio interest exemption,” a statement certifying that (i) such person is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the U.S. Obligor within the meaning of section 881(c)(3)(B) of the Code, and (C) a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code and (ii) that the interest payments in question are not effectively connected with the United States trade or business conducted by such person. In addition, “Withholding Forms” shall include such documentation prescribed by FATCA or similar legislation, regulations or guidance enacted in any jurisdiction which seeks to implement similar tax reporting and/or withholding tax regimes and any intergovernmental agreements entered into thereto, and such additional documentation reasonably requested as may be necessary for an Obligor to comply with its obligations under FATCA or any such similar regime (including, solely for this sentence, any amendments made to FATCA after the date of this Agreement) and to determine that such person has complied with such person’s obligations under FATCA or any such similar regime or to determine the amount to deduct and withhold from a payment to such person. Notwithstanding anything to the contrary in the preceding two sentences, the provision of such forms shall not be required if the Lender is not legally entitled to do so.

(b)    Unless a contrary indication appears, in this Section 5.04 a reference to “determines” or “determined” means a determination made by the person making the determination, acting reasonably and in good faith.

5.04.2    Tax Gross-up.

(a)    Each Obligor shall make all payments to be made by it without any Tax Deduction, unless a Tax Deduction is required by law.

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(b)    Each of the Obligors’ Agent and each Lender shall promptly upon it becoming aware that an Obligor must make a Tax Deduction (or that there is any change in the rate or the basis of a Tax Deduction) notify the Administrative Agent accordingly.

(c)    Each Lender shall provide to the Administrative Agent and the Obligors’ Agent (if requested by the Administrative Agent or the Obligors’ Agent):

(i)    a written confirmation that it is or, as the case may be, is not a Qualifying Lender and that it is or, as the case may be, is not tax resident in and lending through a Facility Office established in a Specified Sovereign; and

(ii)    such documents and other evidence as the Administrative Agent and/or the Obligors’ Agent may reasonably require pursuant to any enquiry from a relevant tax authority to support any confirmation given pursuant to sub-paragraph (i) above.

Until such time as a Lender has complied with any request made under sub-paragraph (i) or (ii) above the Administrative Agent and each Qualifying Obligor shall be entitled to treat such Lender as not being a Qualifying Lender for all purposes under the Credit Documents or as the case may be as not tax resident in and lending through a Facility Office established in a Specified Sovereign.

(d)    Except as provided in paragraphs (e), (i), (l) and (n), if a Tax Deduction is required by law to be made by an Obligor, the amount of the payment due from that Obligor shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required.

(e)    A payment by a Qualifying Obligor shall not be increased under paragraph (d) above by reason of a Tax Deduction on account of Tax that is imposed by the relevant Qualifying Obligor’s Tax Jurisdiction (A) on amounts payable to such Lender at the time such Lender becomes a party to this Agreement (except that the foregoing shall not apply (i) in the case of a Tax imposed by Australia and (ii) unless applicable by reason of Clause (B) below, to the extent that such Lender’s assignor, if any, was entitled at the time of assignment to receive an increased payment (see Section 5.04.5(c)) or (B) if on the date on which the payment falls due:

(i)    the payment could have been made to the relevant Lender without a Tax Deduction if the Lender had been a Qualifying Lender, but on that date that Lender is not or has ceased to be a Qualifying Lender unless (A) that Lender has ceased to be a Qualifying Lender or is not a Qualifying Lender as a result of any Change in Law after the date it became a Lender under this Agreement, and (B) that Lender was a Protected Party immediately prior to such change; or

(ii)    that Lender has not complied with its obligations under Clause 5.04.5 (Lender Status Confirmation) and/or Clause 5.04.6 (Filings); or

(iii)    in relation to a Qualifying Obligor resident for tax purposes in the United Kingdom, the relevant Lender is a Qualifying Lender solely by virtue of paragraph (a)(B) of the definition of “Qualifying Lender”; and

(A)    an officer of H.M. Revenue & Customs has given (and not revoked) a direction (a “Direction”) under section 931 of the Income Tax Act 2007 which relates to the payment and that Lender has received from the Qualifying Obligor making the payment or from the Obligors’ Agent a certified copy of that Direction; and

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(B)    the payment could have been made to the Lender without any Tax Deduction if that Direction had not been made; or

(iv)    in relation to a Qualifying Obligor resident for tax purposes in the United Kingdom, the relevant Lender is a Qualifying Lender solely by virtue of paragraph (a)(B) of the definition of “Qualifying Lender”; and

(A)    the relevant Lender has not given a Tax Confirmation to the Obligor’s Agent or it has revoked or otherwise retracted any Tax Confirmation given to the Obligors’ Agent or it has failed to comply with its obligations under Clause 5.04.5; and

(B)    the payment could have been made to the Lender without any Tax Deduction if the Lender had given a Tax Confirmation to the Obligors’ Agent which had not been so revoked or retracted and had complied with its obligations under clause 5.04.5; or

(v)    in relation to a Qualifying Obligor resident for tax purposes in Spain, such Lender has not complied with its obligations under paragraph (o) below; or

(vi)    in relation to a Qualifying Lender resident for tax purposes in France, such Tax Deduction is imposed by France solely because a payment is made to an account opened in the name of, or for the benefit of, that Lender in a financial institution situated in a Non-Cooperative Jurisdiction; or

(vii)    the relevant Lender is a Treaty Lender and the payment could have been made to the Lender without the Tax Deduction had that Lender complied with its obligations under paragraphs (h), (k), (l), (m) or 5.04.6 below.

(f)    If an Obligor is required to make a Tax Deduction, that Obligor shall make that Tax Deduction and any payment required in connection with that Tax Deduction within the time allowed and in the minimum amount required by law.

(g)    Within thirty days of making either a Tax Deduction or any payment required in connection with that Tax Deduction, the Obligor making that Tax Deduction shall deliver to the Administrative Agent for the Lender entitled to the payment a statement under section 975 of the ITA (or existing equivalent documentation in the relevant Obligor’s Tax Jurisdiction) or evidence reasonably satisfactory to that Lender that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.

(h)    

i. A Treaty Lender and each Qualifying Obligor which makes a payment to which that Treaty Lender is entitled shall co-operate in completing any procedural formalities (including making or obtaining filings, declarations and instructions) necessary for that Qualifying Obligor to obtain authorisation to make that payment without a Tax Deduction, provided that such Treaty Lender is legally entitled to complete any such procedural formalities.

ii.

A. A Treaty Lender which becomes a Party on the day on which this Agreement is entered into that holds a passport under the HMRC DT Treaty Passport scheme, and which wishes that scheme to apply to this Agreement, shall confirm its scheme reference number and its jurisdiction of tax residence

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by written confirmation to the relevant Borrower or its Agent on the same date as the date of this Agreement; and

B. a Replacement Lender (that becomes a “Lender” hereunder pursuant to Section 2.13 or 13.04(b)) or a New Lender, as defined at clause 5.04.1(a)(ii)that is a Treaty Lender that holds a passport under the HMRC DT Treaty Passport scheme, and which wishes that scheme to apply to this Agreement, shall confirm its scheme reference number and its jurisdiction of tax residence in the Assignment Agreement which it executes, and, having done so, that Lender shall be under no obligation pursuant to paragraph (h)(i) above.

iii. If a Lender has confirmed its scheme reference number and its jurisdiction of tax residence in accordance with paragraph (h)(ii) above and:

A. a Borrower making a payment to that Lender has not made a Borrower DTTP Filing in respect of that Lender; or

B. a Borrower making a payment to that Lender has made a Borrower DTTP Filing in respect of that Lender but:

a. that Borrower DTTP Filing has been rejected by HM Revenue & Customs;

b. HM Revenue & Customs has not given the Borrower authority to make payments to that Lender without a Tax Deduction within 60 days of the date of the Borrower DTTP Filing; or

c. HM Revenue & Customs has given authority for the Borrower to make payment to that Lender without a Tax Deduction and that authority expires or is withdrawn by HM Revenue & Customs,

and, in each case, the Borrower has notified that Lender in writing, that Lender and the Borrower shall co-operate in completing any additional procedural formalities necessary for that Borrower to obtain authorisation to make that payment without a Tax Deduction.

iv. If a Lender has not confirmed its scheme reference number and jurisdiction of tax residence in accordance with paragraph (h)(ii) above, no Obligor shall make a Borrower DTTP Filing or file any other form relating to the HMRC DT Treaty Passport scheme in respect of that Lender's Commitment(s) or its participation in any utilisation unless the Lender otherwise agrees.

v. A Borrower shall, promptly on making a Borrower DTTP Filing, deliver a copy of that Borrower DTTP Filing to the Agent for delivery to the relevant Lender.

(i)    No Obligor will be obliged to make any payment or increased payment pursuant to this Clause 5.04 in respect of a Tax Deduction where:

(A)    the Tax Deduction is required to be made, pursuant to European Council Directive 2003/48/EC, from a payment made or received by the Administrative Agent; and

(B)    the Tax Deduction arises as a result of a failure by the Administrative Agent to comply with the terms of Clause 5.04.5(b) (Location of Administrative Agent).

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(j)    A U.K. Non-Bank Lender which becomes a Party on the day on which this Agreement is entered into gives a Tax Confirmation to the Obligors’ Agent by entering into this Agreement.

(k)    A U.K. Non-Bank Lender shall promptly notify the Obligors’ Agent and the Administrative Agent if there is any change in the position from that set out in the Tax Confirmation.

(l)    A Lender which will be a Lender on the Second Restatement Effective Date shall provide the necessary Withholding Forms on or prior to the Second Restatement Effective Date; provided, however, that such Lender shall not be required to provide such Withholding Forms if it is not legally entitled to do so. No U.S. Obligor shall be obligated pursuant to Clause 5.04.2(d) to increase payments to be made to such Lender in respect of Taxes imposed by the United States if such Lender failed to provide the necessary Withholding Forms as so required, until such time as such Lender provides to the U.S. Obligor the necessary Withholding Forms as required by the preceding sentence.

(m)    Each Lender mentioned in (l) above agrees that from time to time after the Second Restatement Effective Date, when a lapse in time or change in circumstances renders the previous Withholding Forms obsolete or inaccurate in any material respect, such Lender will deliver to the applicable Obligors and the Administrative Agent two new, accurate and complete original signed Withholding Forms, or such Lender shall immediately notify the Obligor of its inability to deliver any such Withholding Forms, in which case such Lender shall not be required to deliver any such Withholding Forms, except if the Lender’s inability to deliver such Withholding Forms is solely as a result of a change in circumstance of such Lender and not a change in circumstance of the Obligor.

(n)    A payment by a Qualifying Obligor shall not be increased under paragraph (d) above by reason of a Tax Deduction (i) that is imposed on or measured by the net income or net profits of a Lender pursuant to the laws of the jurisdiction in which it is organized or the jurisdiction in which the principal office or applicable lending office of such Lender is located or any subdivision thereof or therein; or (ii) that would not have been imposed but for a failure by the relevant Lender (or any financial institution through which any payment is made to such Lender) to comply with the applicable requirements of FATCA to establish and maintain an exemption from withholding thereunder.

(o)    In relation to a Qualifying Obligor resident for tax purposes in Spain, a Lender which is a Qualifying Lender solely by virtue of paragraphs (d) (C) and (d) (D) of the definition of “Qualifying Lender” shall provide the Qualifying Obligor resident for tax purposes in Spain, before any payment of interest is due or effectively paid, with a certificate of tax residence duly issued by the competent Tax authorities of its jurisdiction of residence or with the corresponding form, if any, required under the applicable treaty for the avoidance of double taxation, evidencing such Lender as resident for Tax purposes in that jurisdiction and, if a Treaty Lender, accrediting such Treaty Lender as resident in the relevant jurisdiction and declaring that it is entitled to the benefits of the relevant treaty for the avoidance of double taxation. Each such Lender shall deliver a new certificate of tax residence or form, as the case may be, to the Qualifying Obligor resident for tax purposes in Spain each time the existing certificate or form expires in accordance with applicable Spanish legislation. For such purposes, the Qualifying Obligor shall notify the Qualifying Lender within at least two months prior to the expiration date of the former tax certificates in order for the Qualifying Lender to provide the renewed tax certificates to the competent Tax authorities of its jurisdiction in a timely fashion.

5.04.3    Tax Indemnity.

(a)    The Obligors’ Agent shall (within five Business Days of demand by the Administrative Agent) pay or procure that an Obligor pays to a Protected Party an amount equal to the loss,

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liability or cost which that Protected Party determines will be or has been (directly or indirectly) suffered for or on account of Tax by that Protected Party in relation to a Credit Document.

(b)    Paragraph (a) above shall not apply:

(i)    with respect to any Tax assessed on a Lender or Administrative Agent (or any corresponding losses, liability, or costs):

(A)    under the law of the jurisdiction in which that Lender or Administrative Agent is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Lender or Administrative Agent is treated as resident for tax purposes or from which the Administrative Agent acts for the purpose of this Agreement; or

(B)    under the law of the jurisdiction in which that Lender’s Facility Office or the Administrative Agent is located in respect of amounts received or receivable in that jurisdiction,

if that Tax is imposed on or calculated by reference to the net income or gross receipts received or receivable (but not any sum deemed to be received or receivable) by that Administrative Agent or Lender; or

(ii)    to the extent a loss, liability or cost:

(A)    is compensated for by an increased payment under Clause 5.04.2 (Tax gross-up); or

(B)    would have been compensated for by an increased payment under Clause 5.04.2 (Tax gross-up) but was not so compensated solely because one of the exclusions in paragraphs (e) or (n) of Clause 5.04.2 (Tax gross-up) applied; or

(C)    is suffered or incurred by a Lender that is a Qualifying Lender solely under paragraph (a)(B) of the definition of Qualifying Lender; or

(iii)    it has not given a Tax Confirmation to the Obligors’ Agent or it has revoked or otherwise retracted any Tax Confirmation given to the Obligors’ Agent or it has failed to comply with its obligations under Clause 5.04.2 (Tax Gross-Up) (h), (k) or (l) or Clause 5.04.5 (Lender Status Confirmation) or Clause 5.04.6 (Filings).

(c)    A Protected Party making, or intending to make a claim under paragraph (a) above shall promptly notify the Administrative Agent of the event which will give, or has given, rise to the claim, following which the Administrative Agent shall notify the Obligors’ Agent.

(d)    A Protected Party shall, on receiving a payment from an Obligor under this Clause 5.04.3, notify the Administrative Agent.

5.04.4    Tax Credit.

If an Obligor makes a Tax Payment and the relevant Lender or Administrative Agent determines that:

(a)    a Tax Credit is attributable either to an increased payment of which that Tax Payment forms part, or to that Tax Payment; and

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(b)    that Lender or Administrative Agent has obtained, utilised and retained that Tax Credit,

the Lender or Administrative Agent shall pay an amount to the Obligor which that Lender or Administrative Agent determines will leave it (after that payment) in the same after-Tax position as it would have been in had the Tax Payment not been required to be made by the Obligor, provided that if such Tax Credit is subsequently disallowed or reduced, such Obligor shall indemnify the relevant Lender or Administrative Agent, as the case may be, for or for the relevant portion of such amount. Nothing in this Section 5.04 or any other provision in any Credit Document shall require the Administrative Agent or any Lender to disclose any confidential information (including, without limitation, its tax returns or its calculations).

5.04.5    Lender Status Confirmation and Assignment.

(a)    Each Lender which becomes a Party to this Agreement after the date of this Agreement shall indicate, in the Assignment Agreement which it executes on becoming a Party, and for the benefit of the Administrative Agent and each Obligor, which of the following categories it falls within in relation to each Obligor:

(i)    not a Qualifying Lender;

(ii)    a Qualifying Lender (other than a Treaty Lender);

(iii)    a Treaty Lender; or

(iv)    lending from a Facility Office located in and tax resident in a Specified Sovereign.

Each Lender which becomes a Party to this Agreement after the date of this Agreement shall also specify, in the Assignment Agreement which it executes on becoming a Party, and for the benefit of the Administrative Agent and each Obligor, whether it is incorporated, domiciled, established or acting through a Facility Office situated in a Non-Cooperative Jurisdiction.

If a New Lender fails to indicate its status in accordance with this Clause 5.04.5 then such New Lender shall be treated for the purposes of this Agreement (including by each Qualifying Obligor) as if it is not a Qualifying Lender until such time as it notifies the Administrative Agent which category or categories apply (and the Administrative Agent, upon receipt of such notification, shall inform the Obligors’ Agent). For the avoidance of doubt, an Assignment Agreement shall not be invalidated by any failure of a Lender to comply with this Clause 5.04.5(a).

(b)    No Administrative Agent will, for the purposes of the European Council Directive 2003/48/EC and in relation to payments made or received under any Credit Document by it in its capacity as Administrative Agent, be established in, change its place of establishment to, act through any office situated or established in, maintain any account used for making or receiving payments in relation to the Credit Documents in, or delegate any of its duties, trusts, powers, authorities and discretions vested in it under the Credit Documents to, any person established in or acting from Austria.

(c)    Notwithstanding Section 5.04.2(e), if:

(i)    a Lender assigns or transfers any of its rights, benefits or obligations under the Credit Documents or changes its Facility Office; and

(ii)    as a result of circumstances existing at the date the assignment, transfer or change occurs, a Qualifying Obligor would be obliged to make a payment to the new Lender or Lender

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acting through its new Facility Office under Clause 5.04 (Tax Gross Up and Indemnities) or Clause 2.10 (Increased Costs, Illegality, etc.),

then the new Lender or Lender acting through its new Facility Office is not entitled to receive payment under those Clauses in an amount greater than the Existing Lender or Lender acting through its previous Facility Office would have been entitled to receive if the assignment, transfer or change had not occurred. The relevant Obligor, however, in accordance with and pursuant to the other provisions of this Agreement, shall be obligated to pay to such new Lender or Lender acting through its new Facility Office any other increased costs under Sections 2.10, 3.06 and 5.04.2 resulting from a change after the date of the respective assignment, to the extent such new Lender or Lender acting through its new Facility Office (A) was a Qualifying Lender at the time of such assignment or transfer (provided, however, that in the case of a U.S. Obligor, this clause (A) shall not be applicable), and (B) is entitled under the provisions of this Section 5.04 to payment of such amounts.

(d)    Upon request of the Obligors’ Agent, the Administrative Agent will promptly provide the Borrowers with an accurate and up-to-date list of the Lenders under the Facility and their respective Commitments.

(e)    Notwithstanding anything to the contrary contained in this Agreement, each assignee Lender, Participant, or Participating Specified Foreign Currency Lender which is entitled to receive a payment from an Obligor shall provide the necessary Withholding Forms. No U.S. Obligor shall be obligated pursuant to Clause 5.04.5(b) to increase payments to be made to a assignee Lender, Participant, or Participating Specified Foreign Currency Lender in respect of Taxes imposed by the United States (i) to the extent such increase payments are a result of such Assignee Lender, Participant, or Participating Specified Foreign Currency Lender’s failure to provide the necessary Withholding Forms or (ii) in the case of a payment, other than interest, to a Lender that is required to provide the certificate described in (b) of the definition of Withholding Forms, to the extent that such forms do not establish a complete exemption from withholding of such Taxes. Each assignee Lender, Participant, or Participating Specified Foreign Currency Lender agrees that from time to time after the Second Restatement Effective Date, when a lapse in time or change in circumstances renders the previous Withholding Forms obsolete or inaccurate in any material respect, such assignee Lender, Participant, or Participating Specified Foreign Currency Lender will deliver to the U.S. Obligors and the Administrative Agent two new accurate and complete original signed Withholding Forms, or such Lender shall immediately notify the U.S. Obligor of its inability to deliver any such Withholding Forms, in which case such Lender shall not be required to deliver any such Withholding Forms, except if the Lender’s inability to deliver such Withholding Forms is solely as a result of a change in circumstance of such Lender and not a change in circumstance of the U.S. Obligor.

5.04.6    Filings. At the reasonable request of a Borrower, each Lender shall promptly co-operate with such Borrower by submitting such forms and documents and completing such other procedural formalities as may be necessary for such Borrower to obtain authorisation to make that payment without having to make a Tax Deduction, provided such Lender is legally entitled to submit such forms and documents and complete such other procedural formalities. Each Lender which will become a Qualifying Lender only on completion of certain procedural requirements (whether to obtain the benefit of applicable Tax treaties and legislation or otherwise) shall notify the Facility Agent and the Obligors’ Agent promptly on completion of all such formalities provided, however, that once all formalities have been completed, such Lender shall not lose its right to receive additional amounts, gross-up payments or indemnity payments under this Section 5.04 as a result of its failure to make such notifications.

5.04.7    Stamp Taxes. The Obligors’ Agent shall pay and, within five Business Days of demand, indemnify each Lender or Administrative Agent against any cost, loss or liability that Lender or

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Administrative Agent incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Credit Document except for any such Tax payable in connection with any document relating to the assignment or transfer by any Lender of any of its rights and/or obligations under any Credit Documents, other than relating to an assignment or transfer under Section 2.13 or 13.12(b) or any other assignment or transfer that is requested by an Obligor.

5.04.8    VAT.

(i)    All amounts set out, or expressed in a Credit Document to be payable by any party to such agreement (a “Party”) to a Secured Creditor which (in whole or in part) constitute the consideration for a supply or supplies for VAT purposes shall be deemed to be exclusive of any VAT which is chargeable on such supply or supplies, and accordingly, subject to sub-paragraph (ii) below, if VAT is or becomes chargeable on any supply made by any Secured Creditor to any Party under a Credit Document and such Party is required to account to the relevant tax authority for the VAT, that Party shall pay to the Secured Creditor (in addition to and at the same time as paying any other consideration for such supply) an amount equal to the amount of such VAT (and such Secured Creditor shall promptly provide an appropriate VAT invoice to such Party) unless the reverse charge procedure applies.

(ii)    If VAT is or becomes chargeable on any supply made by any Secured Creditor (the “Supplier”) to any other Secured Creditor (the “Recipient”) under a Credit Document, and any Party other than the Recipient (the “Subject Party”) is required by the terms of any Credit Document to pay an amount equal to the consideration for such supply to the Supplier (rather than being required to reimburse the Recipient in respect of that consideration):

(i)(where the Supplier is the person required to account to the relevant tax authority for the VAT) the Subject Party must also pay to the Supplier (at the same time as paying that amount) an additional amount equal to the amount of the VAT. The Recipient must (where this paragraph (i) applies) promptly pay to the Subject Party an amount equal to any credit or repayment the Recipient receives from the relevant tax authority which the Recipient reasonably determines relates to the VAT chargeable on that supply; and

(ii)(where the Recipient is the person required to account to the relevant tax authority for the VAT) the Subject Party must promptly, following demand from the Recipient, pay to the Recipient an amount equal to the VAT chargeable on that supply but only to the extent that the Recipient reasonably determines that it is not entitled to credit or repayment from the relevant tax authority in respect of that VAT.

(iii)    Where a Credit Document requires any Party to reimburse or indemnify a Secured Creditor for any cost or expense, the Party shall reimburse or indemnify (as the case may be) such Secured Creditor for the full amount of such cost or expense, including such part thereof as represents VAT, save to the extent that such Secured Creditor reasonably determines that it is entitled to credit or repayment in respect of such VAT from the relevant tax authority.

(iv)    Any reference in this Section 5.04.8 to any Party shall, at any time when such Party is treated as a member of a group for VAT purposes, include (where appropriate and unless the context otherwise requires) a reference to the representative member of such group at such time (the term “representative member” to have the same meaning as in the Value Added Tax Act 1994 (United Kingdom), in the relevant legislation of any other jurisdiction having implemented Council Directive 2006/112/EC on the common system of value added tax and the A New Tax System (Goods and Services Tax) Act 1999 (Australia) as well as the equivalent meaning in any other jurisdiction where applicable).

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5.05Public Offer. (a) Each Lead Arranger represents and warrants that: (i) it will, jointly with each other Joint Lead Arranger, on behalf of the Australian Borrower make invitations to become a “Lender” under this agreement publically in an electronic form on either the Bloomberg or Reuters screen; or (ii) as dealer, manager, or underwriter, in relation to the placement of debt interests issued under this agreement, will, jointly with each other Joint Lead Arranger, make invitations to become a “Lender” under this agreement within 30 days after the date of this agreement in a way consistent with this Section 5.05(a)(i).

(b)Each Australian Borrower represents and warrants that it does not know, or have reasonable grounds to suspect, that an Offshore Associate of any Australian Borrower will become a “Lender” under this agreement and agrees to notify the Joint Lead Arranger immediately if any proposed substitute Lender disclosed to it is known or suspected by it to be an Offshore Associate of the Australian Borrower.

(c)Each Lender that became a Lender as a result of an invitation under Clause 5.05(a) represents and warrants that (i) an invitation to become “Lender” was made to it by the Joint Lead Arrangers under clause 5.05(a); and (ii) except as disclosed to the Australian Borrower and the Joint Lead Arrangers, it is not, so far as its relevant officers involved in the transaction on a day to day basis are actually aware, an Offshore Associate of the Australian Borrower.

(d)Notwithstanding Section 5.04 (other than with respect to Section 5.04.3(b)) and any other Section in this Agreement, all payments made by an Australian Borrower under any Credit Document will be made free and clear of, and without any Tax Deduction; provided that if the Australian Borrower is required to make a Tax Deduction from such payments, then (i) the amount of the payment due from that Australian Borrower (or its applicable Obligor, as the case may be) shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no such Tax Deduction had been required, (ii) the Australian Borrower shall make such Tax Deduction and (iii) the Australian Borrower shall pay the full amount of such Tax Deduction to the relevant Governmental Authority in accordance with applicable law. The Australian Borrower (or its applicable Obligor) shall (within five Business Days of demand by the Administrative Agent) pay to a Protected Party an amount equal to the loss, liability or cost which that Protected Party determines will be or has been (directly or indirectly) suffered for or on account of Tax by that Protected Party in respect of any payment made or required to be made by an Australian Borrower under any Credit Document.

5.06Net Payments. All payments made by the Obligors under Section 5.04 and under any other Credit Document will be made without setoff, counterclaim or other defense other than as relates to monies due and payable to an Obligor by a Defaulting Lender where the set-off, counterclaim or other defense is made or raised by an Obligor in relation to sums payable by an Obligor to that Defaulting Lender.

Section 6.Conditions Precedent to the Second Restatement Effective Date and to Credit Events on the Second Restatement Effective Date. The occurrence of the Second Restatement Effective Date and the obligation of each Lender to make Loans (including by way of conversion of the Existing Loans on the Second Restatement Effective Date as contemplated in Section 2.01(a)), and the obligation of each Issuing Lender to issue Letters of Credit (including any Existing Letters of Credit deemed issued on the Second Restatement Effective Date as contemplated in Section 3.01(a)(B)), in each case on the Second Restatement Effective Date, are subject at the time of the Second Restatement Effective Date and to the making or converting of such Loans or the issuance or deemed issuance of such Letters of Credit to the satisfaction of the following conditions:

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6.01Second Restatement Effective Date; Notes. (a) On or prior to the Second Restatement Effective Date, (i) this Agreement shall have been executed and delivered as provided in Section 13.10 and (ii) there shall have been delivered to the Administrative Agent for the account of each of the Lenders that has requested same the appropriate Notes executed by the appropriate Borrowers in the amount, maturity and as otherwise provided herein.

(b)On or prior to the Second Restatement Effective Date the U.K. Borrowers have delivered to the Administrative Agent the executed French Proceeds Loan Documents in a form and substance reasonably satisfactory to the Administrative Agent.

6.02Officer’s Certificate. On the Second Restatement Effective Date, the Administrative Agent shall have received a certificate, substantially in the form of Exhibit F-1, dated the Second Restatement Effective Date and signed on behalf of each Borrower by an Authorized Officer of such Borrower, certifying on behalf of such Borrower that all of the conditions in Sections 6.05 through 6.08, inclusive, and 7.01 have been satisfied on such date.

6.03Opinions of Counsel. On the Second Restatement Effective Date, the Administrative Agent shall have received (i) from Simpson Thacher & Bartlett LLP, special New York counsel to the Obligors, an opinion in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, the Co-Collateral Agents, the Security Agent and each of the Lenders and dated the Second Restatement Effective Date covering the matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request, (ii) from White & Case LLP, special England and Wales counsel to the Administrative Agent, an opinion in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, the Co-Collateral Agents, the Security Agent and each of the Lenders and dated the Second Restatement Effective Date covering the matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request, (iii) from King & Wood Mallesons, special Australian counsel to the Administrative Agent, an opinion in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, the Co-Collateral Agents, the Security Agent and each of the Lenders and dated the Second Restatement Effective Date covering the matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request, (iv) from White & Case LLP, special German counsel to the Administrative Agent, a customary validity opinion in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, the Co-Collateral Agents, the Security Agent and each of the Lenders and dated the Second Restatement Effective Date covering the matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request, (v) from Allen & Overy LLP, special German counsel to the Obligors, an opinion on the valid existence, capacity of and due execution by each German Obligor in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, the Co-Collateral Agents, the Security Agent and each of the Lenders and dated the Second Restatement Effective Date, (vi) from White & Case LLP, special French counsel to the Administrative Agent, an opinion in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, the Co-Collateral Agents, the Security Agent and each of the Lenders and dated the Second Restatement Effective Date covering the matters relating to the enforceability and validity of the French law Security Documents, (vii) from Allen & Overy LLP, special French counsel to the Obligors, an opinion on the valid existence, capacity of and due execution by each French Obligor in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent and each of the Lenders and dated the Second Restatement Effective Date, (viii) from White & Case LLP, special Spanish counsel to the Administrative Agent, an opinion in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, the Co-Collateral Agents, the Security Agent and each of the Lenders and dated the Second Restatement Effective Date covering the matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request, (ix) from Allen

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& Overy LLP, special Spanish counsel to the Obligors, an opinion on the valid existence, capacity of and due execution by each Spanish Obligor in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent and each of the Lenders and dated the Second Restatement Effective Date, (x) from Ogier, special British Virgin Islands counsel to the Obligors, an opinion in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, Co-Collateral Agents, the Security Agent and each of the Lenders and dated as of the Second Restatement Effective Date covering the matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request and (xi) without duplication, from such local counsel, reasonably acceptable to the Administrative Agent, in each jurisdiction where an Obligor is “located” for purposes of Section 9-307 of the UCC and/or organized, in each case, an opinion in form and substance reasonably satisfactory to the Administrative Agent addressed to the Administrative Agent, the Co-Collateral Agents, the Security Agent and each of the Lenders and dated the Second Restatement Effective Date covering such matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request including but not limited to the enforceability of each Security Document, as applicable.

6.04Company Documents; Proceedings; etc. (a) On the Second Restatement Effective Date, the Administrative Agent shall have received a certificate from each Obligor, dated the Second Restatement Effective Date, signed by the Chairman of the Board, the Chief Executive Officer, the President, any Vice President or any other Authorized Officer of such Obligor (or in the case of a German Obligor, the managing director (Geschäftsführer)), and, if applicable or customary in the jurisdiction of such Obligor, attested to by the Secretary or any Assistant Secretary of such Obligor, substantially in the form of Exhibit F-2 with appropriate insertions, certifying that (i) borrowing, guaranteeing or securing, as appropriate, the Total Commitments would not cause any borrowing, guarantee, security or similar limit binding on such Obligor to be exceeded and (ii) each copy document relating to such Obligor attached thereto is correct, complete and in full force and effect and has not been amended or superseded as at a date no earlier than the Second Restatement Effective Date, together with copies of the latest certificate or articles of incorporation and by-laws (or other equivalent organizational documents), as applicable, of such Obligor and, as applicable, the board and shareholder resolutions of such Obligor and the board resolutions of each corporate shareholder of such Obligor, approving the Transaction and authorizing signatories on its behalf as applicable, or in the case of the Australian Obligor, certified extracts of the minutes of a meeting of the Board of Directors or circulating resolutions of Directors (as the case may be) and in case of the German Obligor, an electronic printout (Ausdruck) of the commercial register extract (Handelsregisterauszug) (not more than 14 days old), the resolution by the shareholders and a copy of the list of shareholders (Gesellschafterliste), referred to in such certificate and incumbency certificates of such Obligor, and each of the foregoing shall be in form and substance reasonably acceptable to the Administrative Agent or in the case of a Spanish Obligor, (i) an original of a certificate (certificación) issued by the secretary of the board of directors or directors with powers to do so (as applicable) of such Spanish Obligor and the resolutions of the shareholders and the board of directors of such Spanish Obligor duly notarized before a Spanish Notary, each in form and substance satisfactory to the Administrative Agent, and (ii) an up-to-date literal certificate (certificación literal) issued by the relevant Mercantile Registry certifying its due incorporation and existence (constitución y existencia), lack of causes of liquidations or winding-up (ausencia de causas de liquidación o disolución), its up-to-date by-laws (estatutos actualizados) and the composition of its governing body (composición del órgano de administración) and any documents pending to be registered, if any.

(b)On the Second Restatement Effective Date, all Business and legal proceedings and all instruments and agreements in connection with the transactions contemplated by this Agreement and the other Documents shall be reasonably satisfactory in form and substance to the Administrative Agent, and the Administrative Agent shall have received all information and copies of all documents and papers, including records of Business proceedings, governmental approvals, good standing certificates and bring-down telegrams or facsimiles, bankruptcy searches and copies of share registers, if any, which the

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Administrative Agent reasonably may have requested in connection therewith, such documents and papers where appropriate to be certified by proper Business or Governmental Authorities.

6.05Fees, etc. On the Second Restatement Effective Date, the Borrowers shall have paid to the Agents (and their relevant affiliates) and each Lender all costs, fees and expenses (including, without limitation, legal fees and expenses) and other compensation contemplated hereby payable to the Agents (and/or their relevant affiliates) or such Lender to the extent then due.

6.06Supplemental Information Certificate. On the Second Restatement Effective Date, the Borrowers shall have delivered to the Agents a supplemental information certificate setting forth such information about the Obligors and their assets (including, for the avoidance of doubt, information on real property and deposit accounts) as the Agents may reasonably request (“Supplemental Information Certificate”).

6.07Adverse Change, Approvals.  (a) Since January 31, 2015, nothing shall have occurred (and neither the Administrative Agent nor any Lender shall have become aware of any facts or conditions not previously known) which the Administrative Agent or the Required Lenders shall determine has had, or could reasonably be expected to have a Material Adverse Effect.

(b)On or prior to the Second Restatement Effective Date, all necessary governmental (domestic and foreign) and material third party approvals and/or consents in connection with the Transaction, the other transactions contemplated hereby and the granting of Liens under the Credit Documents shall have been obtained and remain in effect, and all applicable waiting periods with respect thereto shall have expired without any action being taken by any competent authority which restrains, prevents or imposes materially adverse conditions upon the consummation of the Transaction or the other transactions contemplated by the Credit Documents or otherwise referred to herein or therein. On the Second Restatement Effective Date, there shall not exist any judgment, order, injunction or other restraint issued or filed or a hearing seeking injunctive relief or other restraint pending or notified prohibiting or imposing materially adverse conditions upon the Transaction or the other transactions contemplated by the Credit Documents or otherwise referred to herein or therein.

6.08Litigation.  On the Second Restatement Effective Date, there shall be no actions, suits, claims, demands, investigations, inspections, audits, charges or proceedings pending or threatened (i) with respect to the Transaction, this Agreement or any other Document, or (ii) which the Administrative Agent or the Required Lenders shall determine has had, or could reasonably be expected to have, a Material Adverse Effect.

6.09Collateral and Guaranty Requirements. (i) To the extent required to be satisfied on or prior to the Second Restatement Effective Date, the Collateral and Guaranty Requirements shall have been satisfied and evidence reasonably satisfactory to the Administrative Agent that the Liens indicated by the results of a search of each system that is, or is similar to, the UCC that filings made with respect to the Obligors in the jurisdictions contemplated by the applicable Perfection Certificate and copies of the financing statements (or similar documents) disclosed by such search (in each case to the extent such searches and copies are made available to such Obligors) are Permitted Liens or shall have been terminated and released or provisions satisfactory to the Administrative Agent for such termination and release shall have been made and (ii) the Administrative Agent shall have received from each Obligor the relevant completed Perfection Certificates (together with all attachments contemplated thereby) dated the Second Restatement Effective Date, in each case, signed by an Authorized Officer of such Obligor.

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6.10Financial Statements; Pro Forma Balance Sheet; Projections. On or prior to the Second Restatement Effective Date, the Administrative Agent shall have received true and correct copies of the historical financial statements, the proforma financial statements and the projections referred to in Sections 8.05(a) and (c).

6.11Solvency Certificate; Insurance Certificates, etc. On the Second Restatement Effective Date, the Administrative Agent shall have received:

(i)a solvency certificate from an Authorized Officer (with actual knowledge of the financial affairs of such entities) of each of the Parent Guarantors substantially in the form of Exhibit J hereto; and

(ii)certificates of insurance complying with the requirements of Section 9.03 for the business and properties of the Obligors, in form and substance reasonably satisfactory to the Administrative Agent and naming the Security Agent as an additional insured and/or as loss payee, and stating that such insurance shall not be canceled without at least 30 days’ prior written notice by the insurer to the Security Agent.

6.12Initial Borrowing Base Certificates; etc.; Excess Availability. (a) On the Second Restatement Effective Date, the Administrative Agent shall have received the initial Borrowing Base Certificate meeting the requirements of Section 9.01(j) from the chief financial officer or director of the Obligors’ Agent.

(b)On the Second Restatement Effective Date, after giving effect to the Transaction (and the Credit Events hereunder), Excess Availability shall equal or exceed £30,000,000.

6.13Patriot Act. On or prior to 5 Business Days prior to the Second Restatement Effective Date, and to the extent reasonably requested by each Lender, such Lender shall have received from the Obligors, to the extent requested, all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.

6.14Consent Letter. On the Second Restatement Effective Date, the Administrative Agent shall have received a letter from CT Corporation System, presently located at 111 Eighth Avenue, New York, New York, 10011, substantially in the form of Exhibit O, indicating its consent to its appointment by each Obligor as its agent to receive service of process as specified in Section 13.08.

In determining the satisfaction of the conditions specified in this Section 6, (x) to the extent any item is required to be satisfactory to any Lender, such item shall be deemed satisfactory to each Lender which has not notified the Administrative Agent in writing prior to the occurrence of the Second Restatement Effective Date that the respective item or matter does not meet its satisfaction and (y) in determining whether any Lender is aware of any fact, condition or event that has occurred and which would reasonably be expected to have a Material Adverse Effect, each Lender which has not notified the Administrative Agent in writing prior to the occurrence of the Second Restatement Effective Date of such fact, condition or event shall be deemed not to be aware of any such fact, condition or event on the Second Restatement Effective Date. Upon the Administrative Agent’s good faith determination that the conditions specified in this Section 6 have been met (after giving effect to the preceding sentence), then the Second Restatement Effective Date shall be deemed to have occurred, regardless of any subsequent determination that one or more of the conditions thereto had not been met (although the occurrence of the Second Restatement Effective Date shall not release any Obligor from any liability for failure to satisfy one or more of the applicable conditions contained in this Section 6).

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Section 7.Conditions Precedent to All Credit Events. The obligation of each Lender to make Loans (including Loans made on the Second Restatement Effective Date (including by way of conversion of Existing Loans on the Second Restatement Effective Date as contemplated by Section 2.01(a))), and the obligation of each Issuing Lender to issue Letters of Credit (including Letters of Credit issued on the Second Restatement Effective Date), is subject, at the time of the Second Restatement Effective Date and at the time of each such Credit Event (except as hereinafter indicated), to the satisfaction of the following conditions:

7.01No Default; Representations and Warranties. At the time of each such Credit Event and also after giving effect thereto (i) there shall exist no Default or Event of Default and (ii) all representations and warranties contained herein and in the other Credit Documents shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on the date of such Credit Event (it being understood and agreed that (x) any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date and (y) any representation or warranty that is qualified as to “materiality,” “Material Adverse Effect” or similar language shall be true and correct in all respects on such date).

7.02Notice of Borrowing; Letter of Credit Request. (a) Prior to the making of each Loan, the Facility Agent shall have received a Notice of Borrowing meeting the requirements of Section 2.03.

(b)Prior to the issuance of each Letter of Credit, the Facility Agent and the respective Issuing Lender shall have received a Letter of Credit Request meeting the requirements of Section 3.03(a).

7.03Borrowing Base Limitations. Notwithstanding anything to the contrary set forth herein (but subject to Section 2.01), it shall be a condition precedent to each Credit Event that after giving effect thereto (and the use of the proceeds thereof) that (x) the Aggregate Exposure (other than the French Locally Supported Aggregate Exposure) would not exceed the UK/AUS Borrowing Base at such time or (y) in the case of a Borrowing of French Borrowing Base Loans, the aggregate principal amount of French Borrowing Base Loans outstanding as such time (after giving effect to such Borrowing and the use of proceeds thereof) does not exceed the lesser of (I) the French Borrowing Base and (II) 20% of the Borrowing Base.

For purposes of this Section 7.03, the relevant Borrowing Bases will be based upon the Borrowing Base Certificate most recently deliveredlessany Reserves then in effect on the date of the calculation of the Aggregate Exposure and the relevant French Locally Supported Aggregate Exposure, as applicable. The Borrowing Base Certificate will not be the basis for determining the amount of the Aggregate Exposure and the relevant French Locally Supported Aggregate Exposure, which shall be determined as of each day.

The acceptance of the benefits of each Credit Event shall constitute a representation and warranty by the Obligors’ Agent and the Borrowers to the Administrative Agent and each of the Lenders that all the conditions specified in Section 6 (with respect to Credit Events on the Second Restatement Effective Date) and in this Section 7 (with respect to Credit Events on or after the Second Restatement Effective Date) and applicable to such Credit Event are satisfied as of that time. All of the Notes, certificates, legal opinions and other documents and papers referred to in Section 6 and in this Section 7, unless otherwise specified, shall be delivered to the Administrative Agent at the Notice Office for the account of each of the Lenders and, except for the Notes, in sufficient counterparts or copies for each of the Lenders and shall be in form and substance reasonably satisfactory to the Administrative Agent and the Required Lenders.

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Section 8.Representations, Warranties and Agreements. In order to induce the Lenders to enter into this Agreement and to make the Loans, and issue (or participate in) the Letters of Credit as provided herein, each Obligor makes the following representations, warranties and agreements, in each case after giving effect to the Transaction, all of which shall survive the execution and delivery of this Agreement and the Notes and the making of the Loans and the issuance of the Letters of Credit, with the occurrence of the Second Restatement Effective Date and each Credit Event on or after the Second Restatement Effective Date being deemed to constitute a representation and warranty that the matters specified in this Section 8 are true and correct in all material respects on and as of the Second Restatement Effective Date and on the date of each such other Credit Event (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date); provided that, with respect to Toys SARL only, Toys SARL shall make such representations, warranties and agreements solely with respect to itself and its Subsidiaries.

8.01Company Status. Each Group Member (i) is a duly organized and validly existing Company in good standing (or its equivalent, to the extent that such concept is applicable in the respective jurisdiction) under the laws of the jurisdiction of its incorporation or organization, (ii) has the Company power and authority to own its property and assets and to transact the business in which it is engaged and presently proposes to engage and (iii) is duly qualified and is authorized to do business and is in good standing or its equivalent in each jurisdiction where the ownership, leasing or operation of its property or the conduct of its business requires such qualifications except in the case of this clause (iii) for failures to do so or to be so qualified or authorized or to be in good standing which, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

8.02Power and Authority. Each Obligor has the Company power and authority to execute, deliver and perform the terms and provisions of each of the Credit Documents to which it is party and has taken all necessary Company action to authorize the execution, delivery and performance by it of each of such Documents. Each Obligor has duly executed and delivered each of the Credit Documents to which it is party, and each of such Documents constitutes its legal, valid and binding obligation enforceable in accordance with its terms, except to the extent that the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws generally affecting creditors’ rights and by equitable principles (regardless of whether enforcement is sought in equity or at law) and subject, further, to the qualifications included in the opinions delivered pursuant to Section 6.03.

8.03No Violation. Neither the execution, delivery or performance by any Obligor of the Credit Documents to which it is a party, nor compliance by it with the terms and provisions thereof, (i) will contravene any Applicable Law, (ii) will conflict with or result in a default under any indenture or other agreement or instrument binding upon any Group Member or any of their respective assets, or give rise to a right thereunder to require any payment to be made by any Group Member or give rise to a right of, or result in, termination, cancellation or acceleration of any obligation thereunder, (iii) will conflict with or result in any breach of any of the terms, covenants, conditions or provisions of, or constitute a default under, or result in the creation or imposition of (or the obligation to create or impose) any Lien (except pursuant to the Security Documents) upon any of the property or assets of any Group Member pursuant to the terms of any indenture, mortgage, deed of trust, credit agreement or loan agreement, or any other agreement, contract or instrument, in each case to which any Group Member is a party or by which it or any its property or assets is bound or to which it may be subject (including, without limitation, any Local Law Financing), or (iv) will violate any provision of the certificate or articles of incorporation, articles of association, certificate of formation, limited liability company agreement or by-laws (or equivalent organizational documents), as applicable, of any Group Member, except, in each case, to the extent that such contravention, conflict, violation, default or breach would not reasonably be expected to result in a Material Adverse Effect.

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8.04Approvals. No order, consent, approval, license, authorization or validation of, or filing, recording or registration with (except for (x) those that have otherwise been obtained or made on or prior to the Second Restatement Effective Date and which remain in full force and effect on the Second Restatement Effective Date, (y) filings which are necessary to perfect the security interests created under the Security Documents) and (z) those the failure of which to obtain would not reasonably be expected to result in a Material Adverse Effect, or exemption by, any Governmental Authority is required to be obtained or made by, or on behalf of, any Group Member to authorize, or is required to be obtained or made by, or on behalf of, any Group Member in connection with, (i) the execution, delivery and performance of any Document or (ii) the legality, validity, binding effect or enforceability of any such Document.

8.05Financial Statements; Financial Condition; Undisclosed Liabilities; Projections. (a) The audited consolidated balance sheet of each Borrower as at the last day of full Fiscal Years ended February 3, 2013, February 1, 2014 and January 31, 2015 and the related consolidated statements of income and cash flows and changes in stockholders’ equity of each Borrower as for the Fiscal Years ended on such dates, copies of which are in each case furnished to the Lenders prior to the Second Restatement Effective Date, present fairly in all material respects the consolidated financial position of each Borrower at the date of said financial statements and the results for the respective periods covered thereby. The unaudited consolidated balance sheet as of the last day of the Fiscal Quarter ended October 31, 2015 and the related consolidated statements of income and cash flows of Toys “R” Us Europe LLC and the Australian Parent Guarantor and each Borrower (as such term was defined in the Existing Facility Agreement immediately prior to the Second Restatement Effective Date) as for the nine month period ended on such date, copies of which were in each case furnished to the Lenders prior to the Second Restatement Effective Date, present fairly in all material respects the consolidated financial condition of each Parent Guarantor and each Borrower as at the date of said financial statements and the consolidated results of their operations for the period covered thereby, subject to normal year-end adjustments. All such financial statements have been prepared in accordance with local generally accepted accounting principles or with other local or internationally recognized accounting standards consistently applied except to the extent provided in the notes to said financial statements and subject, in the case of the unaudited financial statements, to normal year-end audit adjustments (all of which are of a recurring nature and none of which, individually or in the aggregate, would be material) and the absence of footnotes.

(b)Except as fully disclosed in the financial statements delivered pursuant to Section 8.05(a), and except for the Indebtedness incurred under this Agreement, there were as of the Second Restatement Effective Date no liabilities or obligations with respect to any Group Member of any nature whatsoever (whether absolute, accrued, contingent or otherwise and whether or not due) which, either individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.

(c)The projections delivered to the Administrative Agent and the Lenders prior to the Second Restatement Effective Date have been prepared in good faith and are based on assumptions that each Borrower believes reasonable at the time made and at the time such Projections were made available to the Administrative Agent, and there are no statements or conclusions in the projections which are based upon or include information known to the Parent Guarantors or the Borrowers to be misleading in any material respect or which fail to take into account material information known to the Parent Guarantors or the Borrowers regarding the matters reported therein, it being recognized by the Lenders, however, that projections as to future events are not to be viewed as facts and that the actual results during the period or periods covered by the projections may differ from the projected results included in such projections.

(d)After giving effect to the Transaction since January 31, 2015 nothing has occurred that has had, or could reasonably be expected to have or result in, either individually or in the aggregate, a Material Adverse Effect.

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8.06Litigation. There are no actions, suits, claims, demands, investigations, inspections, audits, charges, or proceedings by or before any Governmental Authority pending or, to the actual knowledge of an Authorized Officer of any Parent Guarantor or any other Obligor, threatened (i) with respect to the Transaction or any Document or (ii) that has had, or could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.

8.07True and Complete Disclosure. (a) All factual information (taken as a whole) furnished by or on behalf of any Parent Guarantor or any Borrower in writing to any Agent or any Lender (including, without limitation, all information contained in the Credit Documents) (other than the projections) for purposes of or in connection with this Agreement, the other Credit Documents or any transaction contemplated herein or therein is, and all other such factual information (taken as a whole) hereafter furnished by or on behalf of any Parent Guarantor or any Borrower in writing to any Agent or any Lender was true and accurate in all material respects on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material respect at such time in light of the circumstances under which such information was provided; and (b) the projections furnished by or on behalf of any Parent Guarantor or any Borrower in writing to any Agent or any Lender have been prepared in good faith based upon assumptions that each Obligor believes to be reasonable at the time made and at the time such projections are made available to the Agents or any Lender.

8.08Use of Proceeds; Margin Regulations. (a) All proceeds of the Loans will be used by the Borrowers (i) on the Second Restatement Effective Date, to pay fees and expenses incurred in connection with the Transaction and (ii) thereafter, for working capital, capital expenditures and general corporate purposes of the Obligors (including making intercompany Investments permitted under this Agreement in (including transfers and payments to Guarantors) Group Members for use by them for working capital, capital expenditures and general corporate purposes); provided that (x) in no event may proceeds of the Loan be utilized to refinance any Indebtedness incurred in connection with the direct or indirect acquisition of the Borrowers and Guarantors by the Sponsor or its Affiliates other than in connection with the Transaction, (y) the proceeds of French Borrowing Base Loans shall be used solely to make French Proceeds Loans and (z) no Borrowing or use of proceeds contemplated by this Agreement will violate Anti-Terrorism Laws.

(b)No part of any Credit Event (or the proceeds thereof) will be used to purchase or carry any Margin Stock or to extend credit for the purpose of purchasing or carrying any Margin Stock. Neither the making of any Loan nor the use of the proceeds thereof nor the occurrence of any other Credit Event will violate or be inconsistent with the provisions of Regulation T, U or X. No Borrower owns any Margin Stock.

8.09Tax Returns and Payments. Each Group Member has timely filed or caused to be timely filed with the appropriate taxing authority all material returns, statements, forms and reports for taxes (the “Returns”) required to be filed by, or with respect to the income, properties or operations of, each Group Member. The Returns accurately reflect in all material respects all liability for taxes of each Group Member, as applicable, for the periods covered thereby. Each Group Member has paid all taxes and assessments payable by it which have become due, other than those (a) that are being contested in good faith and adequately disclosed and for which adequate reserves have been established in accordance with GAAP or the accounting principles applicable in the jurisdiction of incorporation of the relevant Group Member or (b) to the extent that the failure to do so would not reasonably be expected to cause a Material Adverse Effect. There is no action, suit, proceeding, investigation, audit or claim now pending or, to the best knowledge of each Group Member, threatened by any authority regarding any taxes relating to any Group Member the extent of which would reasonably be expected to cause a Material Adverse Effect. As of the Second Restatement Effective Date, no Group Member has entered into an agreement or waiver or been requested to enter into an agreement

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or waiver extending any statute of limitations relating to the payment or collection of taxes of any Group Member, or is aware of any circumstances that would cause the taxable years or other taxable periods of any Group Member not to be subject to the normally applicable statute of limitations.

8.10Compliance with Pensions/ERISA. (a) The pension schemes of each Group Member are funded to the extent required by law or otherwise to comply in all material respects with the requirements of any law applicable in the jurisdiction in which the relevant pension scheme is maintained, in each case, where failure to do so would have a Material Adverse Effect.

(b)(i) Each Plan (and each related trust, insurance contract or fund) maintained by it is in substantial compliance with its terms and with all applicable laws, including without limitation ERISA and the Code; (ii) no Reportable Event has occurred in relation to a Plan maintained by it; (iii) no Group Member has received written notice that a Plan maintained by it which is a Multiemployer Plan is insolvent or in reorganization; (iv) no Plan maintained by it has an Unfunded Current Liability; (v) no Group Member has received written notice that a Plan maintained by it which is subject to section 412 of the Code or section 302 of ERISA has an accumulated funding deficiency, within the meaning of such sections of the Code or ERISA, or has applied for or received a waiver of an accumulated funding deficiency or an extension of any amortization period, within the meaning of section 412 of the Code or section 303 or 304 of ERISA; (vi) neither an Obligor nor any Subsidiary of an Obligor nor any ERISA Affiliate has incurred any material liability (including any direct, contingent or secondary liability) to or on account of any Plan or Multiemployer Plan pursuant to section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or section 436(f) of the Code or expects to incur any such liability under any of the foregoing sections with respect to any Plan or Multiemployer Plan; (vii) no condition exists which presents a material risk to any Obligor, any Subsidiary of an Obligor or any ERISA Affiliate of incurring a liability to or on account of a Plan or Multiemployer Plan pursuant to the foregoing provisions of ERISA and the Code; (viii) no proceedings have been instituted to terminate or appoint a trustee to administer any Plan maintained by it which is subject to Title IV of ERISA; and (ix) no lien imposed under the Code or ERISA on the assets of an Obligor or any Subsidiary of an Obligor or any ERISA Affiliate exists or is reasonably likely to arise on account of any Plan or Multiemployer Plan maintained by any of them.

(c)Each Non-U.S. Plan has been maintained in substantial compliance with its terms and with the requirements of any and all applicable laws, statutes, rules, regulations and orders and has been maintained, where required, in good standing with applicable regulatory authorities. Neither an Obligor nor any Subsidiary of an Obligor has incurred any obligation in connection with the termination of, or withdrawal from, any Non-U.S. Plan.

(d)Except for the Toys R Us Limited Staff Pension and Life Assurance Scheme, (a) no Group Member is or has at any time on or after April 27, 2004 been an employer (for the purposes of sections 38 to 51 of the Pensions Act 2004) of an occupational pension scheme which is not a money purchase scheme (both terms as defined in the Pension Schemes Act 1993); and (b) no Group Member is or has at any time on or after April 27, 2004 been “connected” with or an “associate” of (as those terms are used in sections 39 and 43 of the Pensions Act 2004) such an employer.

Notwithstanding anything to the contrary in this Section 8.10, the representations and warranties made in this Section 8.10 shall only be untrue if the effect of any or all conditions, violations, claims, restrictions, failures and non compliances of the types described above would have a Material Adverse Effect.

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8.11Collateral Matters. (a) After taking the actions specified for perfection therein, each Security Document, when executed and delivered, will be effective under applicable law to create in favor of the Security Agent for the ratable benefit of the Secured Creditors a valid and enforceable security interest in the Collateral subject thereto (the enforceability of the security interest in which is 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 will, constitute a fully perfected Lien on and security interest in all right, title and interest of the Obligors in the Collateral subject thereto, prior and superior to the rights of any other Person, except for rights and obligations secured by Permitted Liens and subject to claims with a preference as a matter of law (it being understood that no representation is made under this clause as to the creation, perfection or priority of any Lien to the extent that such creation, perfection or priority is determined under the law of a jurisdiction outside of the jurisdiction governing the laws of the applicable Security Document purporting to create, perfect or establish the priority of any such Lien).

(b)Each Mortgage, upon execution and delivery by the parties thereto, will create in favor of the Security Agent (or such other trustee as may be required or desired under local law), for the ratable benefit of the Secured Creditors, a legal, valid and enforceable security interest in and mortgage lien on the all the applicable mortgagor’s right, title and interest in and to the Mortgaged Properties subject thereto and the proceeds thereof, and when the Mortgages have been filed or registered in the appropriate jurisdiction, the Mortgages will constitute a fully perfected security interest in and mortgage lien on all right, title and interest of the mortgagors in the Mortgaged Properties and the proceeds thereof, prior and superior in right to any other Person (but subject to (i) Liens or other encumbrances for which exceptions are taken in the policies of title insurance delivered in respect of the Mortgaged Properties, (ii) Permitted Liens and (iii) Permitted Encumbrances).

(c)As of the Second Restatement Effective Date, there does not exist any Subsidiary of any Parent Guarantor which is not an Obligor, other than the Immaterial Subsidiaries. No Borrower is aware of any intellectual property that is owned by any Obligor that has not pledged its rights in such intellectual property under the Security Documents, other than intellectual property that is not material to any business of the Group.

8.12Properties. Each Group Member has good and indefeasible title to all material properties (and to all buildings, fixtures and improvements located thereon) owned by it, free and clear of all Liens, other than Permitted Liens, except for any defects of title which would not reasonably be expected to have a Material Adverse Effect. Each Group Member has a valid and indefeasible leasehold interest in the material properties leased by it free and clear of all Liens other than Permitted Liens except for any defects which would not reasonably be expected to have a Material Adverse Effect.

8.13Subsidiaries. On and as of the Second Restatement Effective Date, no Parent Guarantor has any Subsidiaries other than those Subsidiaries listed on Schedule 8.13. Schedule 8.13 sets forth, as of the Second Restatement Effective Date, the percentage ownership (direct and indirect) of any Parent Guarantor in each class of capital stock or other Equity Interests of each of its Subsidiaries and joint ventures and also identifies the direct owner thereof and which Subsidiaries are Obligors. All outstanding shares of Equity Interests of each Wholly-Owned Subsidiary of any Parent Guarantor and each Non-Wholly-Owned Subsidiary of any Parent Guarantor whose Equity Interests are pledged pursuant to the Collateral and Guaranty Requirements have been duly and validly issued, are fully paid and non-assessable and have been issued free of preemptive rights except as expressly indicated in the applicable Collateral documentation. No Subsidiary of any Parent Guarantor has outstanding any securities convertible into or exchangeable for its Equity Interests or outstanding any right to subscribe for or to purchase, or any options or warrants for the purchase of, or any agreement providing for the issuance (contingent or otherwise) of or any calls,

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commitments or claims of any character relating to, its Equity Interests or any stock appreciation or similar rights.

8.14Compliance with Statutes, etc. Each Group Member is in compliance with all applicable statutes, regulations and orders of, and all applicable restrictions imposed by, all Governmental Authorities in respect of the conduct of its business, the relationship with its employees and the ownership of its property (including, without limitation, applicable statutes, regulations, orders and restrictions relating to environmental standards and controls), except such non-compliances as could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

8.15Investment Company Act. No Group Member is an “investment company” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended.

8.16Insurance. As of the Second Restatement Effective Date, the Obligors’ Agent has provided the Agents with a listing of all material insurance maintained by each Group Member as of the Second Restatement Effective Date, with the amounts insured (and any deductibles) set forth therein.

8.17Environmental Matters. (a) Each Group Member is in compliance with all applicable Environmental Laws and the requirements of any permits issued under such Environmental Laws. There are no pending or, to the knowledge of any Parent Guarantor or any Borrower, threatened Environmental Claims against any Group Member or any Real Property owned, leased or operated by any Group Member (including any such claim arising out of the ownership, lease or operation by any Group Member of any Real Property formerly owned, leased or operated by any Group Member but no longer owned, leased or operated by any Group Member). There are no facts, circumstances, conditions or occurrences with respect to the business or operations of any Group Member, or any Real Property owned, leased or operated by any Group Member (including any Real Property formerly owned, leased or operated by any Group Member but no longer owned, leased or operated by any Group Member) or, to the knowledge of any Group Member, any property adjoining or adjacent to any such Real Property that could be reasonably expected (i) to form the basis of an Environmental Claim against any Group Member or any Real Property owned, leased or operated by any Group Member or (ii) to cause any Real Property owned, leased or operated by any Group Member to be subject to any restrictions on the ownership, lease, occupancy or transferability of such Real Property by any Group Member under any applicable Environmental Law.

(b)To the best knowledge of each Obligor, Hazardous Materials have not at any time been generated, used, treated or stored on, or transported to or from, or Released on or from, any Real Property owned, leased or operated by any Group Member or, to the knowledge of any Group Member, any property adjoining or adjacent to any Real Property, where such generation, use, treatment, storage, transportation or Release has violated or could be reasonably expected to violate any applicable Environmental Law or give rise to an Environmental Claim.

(c)Notwithstanding anything to the contrary in this Section 8.17, the representations and warranties made in this Section 8.17 and for all purposes of all Documents shall be untrue only if the effect of any or all conditions, violations, claims, restrictions, failures and non-compliances of the types described above could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

8.18Employment and Labor Relations. No Group Member is engaged in any unfair labor practice or has violated any applicable labour law that could reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect. There is (i) no unfair labor practice or labor law violation complaint pending against any Group Member or, to the knowledge of any Group Member,

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threatened against any of them, before the National Labor Relations Board or other Governmental Authority, and no grievance, arbitration or other proceeding arising out of or under any Collective Bargaining Agreement or any other similar collective agreement with any type of employees’ representative is so pending against any Group Member or, to the knowledge of any Group Member, threatened against any of them, (ii) no strike, labor dispute, slowdown or stoppage pending against any Group Member or, to the knowledge of any Group Member, threatened against any Group Member, (iii) no union representation question exists with respect to the employees of any Group Member, (iv) no equal employment opportunity charge or other claim of employment discrimination pending or, to the knowledge of any Group Member, threatened against any Group Member, (v) to the knowledge of any Group Member, no threatened or pending organizing activity or union, works council or any other type of employees’ representatives elections and (vi) no wage and hour department investigation that has been made of any Group Member and no violation of the Fair Labor Standards Act or any other applicable federal, state or foreign law dealing with the hours worked by and payments made to employees of any Group Member, except (with respect to any matter specified in clauses (i)–(vi) above, either individually or in the aggregate) such as could not reasonably be expected to have a Material Adverse Effect. To the knowledge of any Group Member, except as could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, the consummation of the Transaction will not give rise to a right of termination or right of renegotiation on the part of any union, works council or any other type of employees’ representatives under any Collective Bargaining Agreement to which any Group Member (or any predecessor) is currently a party or by which any Group Member (or any predecessor) is currently bound, unless otherwise expressly provided by applicable laws.

8.19Intellectual Property, etc. Each Group Member owns or has the right to use all the patents, trademarks, permits, domain names, service marks, trade names, copyrights, licenses, franchises, inventions, trade secrets, proprietary information and know-how of any type, whether or not written (including, but not limited to, rights in computer programs and databases) and formulas, or rights with respect to the foregoing, and has obtained assignments of all leases, licenses and other rights of whatever nature, necessary for the present conduct of its business, without any known conflict with the rights of others which, or the failure to own or have which, as the case may be, could reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

8.20Indebtedness. Schedule 8.20 sets forth a list of all Indebtedness for borrowed money (including Contingent Obligations in respect of Indebtedness) of each Group Member as of the Second Restatement Effective Date and which is to remain outstanding after giving effect to the Transaction (excluding the Loans and the Letters of Credit), in each case showing the aggregate principal amount thereof and the name of the respective borrower and any Group Member which directly or indirectly guarantees such debt.

8.21Borrowing Base Calculation. The calculation of the Borrowing Base pursuant to the most recent Borrowing Base Certificate delivered pursuant to Section 9.01(j) is complete and accurate (excluding any errors that are immaterial in nature).

8.22Anti-Terrorism Law. (a) No Group Member is in violation (other than immaterial, unknowing or unintentional violations) of any legal requirement relating to any Applicable Laws with respect 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 Patriot Act. No Group Member and, to the knowledge of each Borrower, no agent of any Group Member acting on behalf of any Group Member, as the case may be, 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;

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(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.

(b)No Group Member and, to the knowledge of each Borrower, no agent of any Group Member acting on behalf of any Group Member, as the case may be, (i) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of a Person described in Section 8.22(a), (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.

(c)The representations and warranties in this Section 8.22 given by any Obligor resident in Germany (Inländer), including its directors, managers, officers, agents and employees, within the meaning of Section 2 para. 15 of the German Foreign Trade Act (Außenwirtschaftsgesetz) (or any Obligor in relation to an Obligor so resident in Germany) are made only to the extent that they do not result in a violation of or conflict with Section 7 of the German Foreign Trade and Payments Regulation (Außenwirtschaftsverordnung) or any similar anti-boycott or blocking law, regulation or statue that is in force from time to time and applicable to such entity. The representations and warranties in this Section 8.22 given by any Obligor to any Lender resident in Germany (Inländer) within the meaning of Section 2 para. 15 of the German Foreign Trade Act (Außenwirtschaftsgesetz) are given only to the extent that any Lender resident in Germany (Inländer) within the meaning of Section 2 para. 15 of the German Foreign Trade Act (Außenwirtschaftsgesetz) would be permitted to give such representations and warranties pursuant to Section 7 of the German Foreign Trade and Payments Regulation (Außenwirtschaftsverordnung) or any similar anti-boycott or blocking law, regulation or statue that is in force from time to time and applicable to such entity.

8.23Solvency. (a) On and as of the Second Restatement Effective Date, the Obligors, on a consolidated basis, are Solvent. No transfer of property is being made by any Obligor and no obligation is being incurred by any Obligor in connection with the transactions contemplated by this Agreement or the other Credit Documents with the intent to hinder, delay, or defraud either present or future creditors of any Obligor.

(b)No Australian Obligor (i) is (or has stated that it is) insolvent under administration or insolvent (each as defined in the Corporations Act); (ii) is in liquidation, in provisional liquidation, under administration or wound up or has had a Controller appointed to its property; (iii) is subject to any arrangement, assignment, moratorium or composition, protected from creditors under any statute or dissolved (in each case, other than to carry out a reconstruction or amalgamation while solvent on terms approved by the Agent); (iv) has had an application or order made, resolution passed, proposal put forward, or any other action taken, in each case in connection with that person, which is preparatory to or could result in any of (i), (ii) or (iii) above (and, in the case of an application or similar action, it is not stayed, withdrawn or dismissed within 30 days); (v) is taken (under section 459F(1) of the Corporations Act) to have failed to comply with a statutory

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demand; (vi) is the subject of an event described in section 459C(2)(b) or section 585 of the Corporations Act (or it makes a statement from which the Agent reasonably deduces it is so subject); or (vii) is otherwise unable to pay its debts when they fall due.

(c)No (x) corporate action, legal proceeding or other procedure or step described in Section 11.01(e); or (y) creditors’ process described in Section 11.01(o), has been taken or, to the knowledge of any Parent Guarantor or any Borrower, threatened in relation to a Group Member; and none of the circumstances described in Sections 11.01(m) or 11.01(n) applies to a Group Member.

8.24Not a Trustee. The Obligors do not enter, and have not entered, into any Credit Document as trustee.

8.25Corporate Benefit. Each Obligor benefits by entering into the Credit Documents to which it is a party.

8.26No Immunity. No Obligor nor any of its Subsidiaries or their assets has immunity from the jurisdiction of a court or from legal process.

8.27Own Enquiries. The Obligors have relied on their own investigations and enquiries regarding the transactions contemplated by the Credit Documents and have not relied on any information, advice or opinion (including information, advice or opinions regarding interest rates, hedging arrangements or exchange rates) given or offered by or on behalf of the Administrative Agent or the Lenders even if in answer to any enquiry by or for it.

8.28New South Wales Resident. Each Australian Borrower is a resident in and managed and controlled from New South Wales, Australia.

8.29Centre of Main Interests. The Centre of Main Interest of each of the Obligors incorporated in the European Union, is situated in its jurisdiction of incorporation and it has no “establishment” (as that term is used in Article 2(h) of the regulations described in the definition of Centre of Main Interests) in any other jurisdiction.

Section 9.Affirmative Covenants. Each Obligor hereby covenants and agrees that on and after the Second Restatement Effective Date and until the Total Commitment and all Letters of Credit have terminated and the Loans, Notes and Unpaid Drawings (in each case together with interest thereon), Fees and all other Secured Obligations (other than indemnities and other contingent obligations which are not then due and payable) incurred hereunder and thereunder, are paid in full; provided that, with respect to Toys SARL only, Toys SARL shall make such covenants and agreements solely with respect to itself and its Subsidiaries:

9.01Information Covenants. The Obligors’ Agent will furnish to each Lender:

(a)    Monthly Reports. During any Monthly Reporting Period, within 30 days after the end of each of the first two Fiscal Months in each Fiscal Quarter, (x) the consolidated balance sheets of each Parent Guarantor and its Subsidiaries as at the end of such Fiscal Month and the related consolidated statements of income and statement of cash flows for such Fiscal Month and for the elapsed portion of the Fiscal Year ended with the last day of such Fiscal Month, in each case setting forth comparative figures for the corresponding Fiscal Month in the prior Fiscal Year and comparable budgeted figures for such Fiscal Month as set forth in the respective budget delivered pursuant to Section 9.01(e) beginning with the budget delivered for the Fiscal Year beginning in 2015, all of which shall be certified by an Authorized Officer (with actual financial knowledge) of the Obligors’ Agent that they fairly present in all material respects in accordance with GAAP the financial condition of each Parent Guarantor and its Subsidiaries as of the dates indicated

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and the results of their operations for the periods indicated, subject to normal year-end audit adjustments and the absence of footnotes and (y) monthly sales figures of each Obligor, including same store sales, in each case setting forth comparative figures for the corresponding Fiscal Month in the prior Fiscal Year.

(b)    Quarterly Financial Statements. Within 45 days after the close of each of the first three Fiscal Quarters in each Fiscal Year, (x) the consolidated and consolidating balance sheet of (i) each Parent Guarantor and its Subsidiaries and (ii) each Borrower as at the end of such quarterly accounting period and the related consolidated and consolidating statements of income and retained earnings and statement of cash flows for such quarterly accounting period and for the elapsed portion of the Fiscal Year ended with the last day of such quarterly accounting period, in each case setting forth comparative figures for the corresponding quarterly accounting period in the prior Fiscal Year and comparable budgeted figures for such quarterly accounting period as set forth in the respective budget delivered pursuant to Section 9.01(e), all of which shall be certified by an Authorized Officer (with actual financial knowledge) of the Obligors’ Agent that they fairly present in all material respects in accordance with the relevant GAAP the financial condition of (i) each Parent Guarantor and its Subsidiaries and (ii) each Borrower as of the dates indicated and the results of their operations for the periods indicated, subject to normal year-end audit adjustments and the absence of footnotes, and (y) management’s discussion and analysis of the important operational and financial developments during such quarterly accounting period.

(c)    Annual Financial Statements. (i) Within 150 days (or, in the case of any Obligor organized in Spain or France, within 180 days) after the close of each Fiscal Year, (x) the consolidated balance sheet of each Borrower and its Subsidiaries as at the end of such Fiscal Year and the related consolidated statements of income and retained earnings and statement of cash flows for such Fiscal Year setting forth comparative figures for the preceding Fiscal Year and certified by Deloitte & Touche LLP or other independent certified public accountants of recognized international standing, together with a report of such accounting firm (which certificate shall be without a “going concern” or like qualification or exception and without any qualification of exception as to the scope of the audit) stating with limitations required by accounting rules or guidelines that its regular audit of the financial statements of such Borrower and its Subsidiaries was conducted in accordance with generally accepted auditing standards of the relevant jurisdiction, and (y) management’s discussion and analysis of the important operational and financial developments during such Fiscal Year.

(ii)    Within 120 days after the close of each Fiscal Year, (x) the consolidated and consolidating balance sheet of each Parent Guarantor and its Subsidiaries as at the end of such Fiscal Year and the related consolidated and consolidating statements of income and retained earnings and statement of cash flows for such Fiscal Year setting forth comparative figures for the preceding Fiscal Year and certified by an Authorized Officer (with actual financial knowledge) of the Obligors’ Agent that they fairly present in all material respects in accordance with relevant GAAP the financial condition of each Parent Guarantor and its Subsidiaries as of the dates indicated and the results of their operations for the periods indicated and (y) management’s discussion and analysis of the important operational and financial developments during such Fiscal Year.

(d)    Management Letters. Promptly after any Parent Guarantor’s or any of its Subsidiaries’ receipt thereof, a copy of any “management letter” received from its certified public accountants and management’s response thereto.

(e)    Budgets. No later than 90 days following the first day of each Fiscal Year, a budget in form reasonably satisfactory to the Administrative Agent (including budgeted statements of operations and cash flow and balance sheets for each Parent Guarantor and its Subsidiaries on a consolidated, consolidating and combined basis) for each of the twelve months of such Fiscal Year prepared in detail and setting forth, with appropriate discussion, the principal assumptions upon which such budget is based. In addition, the

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Obligors’ Agent shall deliver along with the budgets referred to in this Section 9.01(e) a projected forecast of Excess Availability (including a borrowing base calculation net of outstanding Loans, Letters of Credit and Unrestricted cash) for each of the twelve months of such Fiscal Year.

(f)    Officer’s Certificates. At the time of the delivery of the financial statements provided for in Sections 9.01(b) and (c), (x) a compliance certificate from the chief financial officer or director of the Obligors’ Agent substantially in the form of Exhibit K certifying on behalf of the Obligors’ Agent that, to such officer’s knowledge after due inquiry, no Default or Event of Default has occurred and is continuing or, if any Default or Event of Default has occurred and is continuing, specifying the nature and extent thereof, which certificate shall set forth reasonably detailed calculations with respect to the Excess Availability for such period and (y) a completed Perfection Certificate Supplement substantially in the form of Exhibit G (together with all attachments contemplated thereby) dated the date of delivery of such financial statements, in each case signed by, an Authorized Officer of the Obligor, or the Obligors’ Agent (as the case may be) and certifying whether each Obligor has otherwise taken all actions required to be taken by them pursuant to such Security Documents in connection with any changes to any Perfection Certificate since the Second Restatement Effective Date, or, if later, since the date of the most recently delivered Perfection Certificate Supplement.

(g)    Notice of Default, Litigation and Material Adverse Effect. Promptly, and in any event within three Business Days, after any Authorized Officer of any Group Member obtains knowledge thereof, notice of (i) the occurrence of any event which constitutes a Default or an Event of Default, (ii) any litigation or governmental investigation or proceeding pending against any Group Member (x) which, either individually or in the aggregate, has had, or could reasonably be expected to have, a Material Adverse Effect or (y) with respect to any Document, or (iii) any other event, change or circumstance that has had, or could reasonably be expected to have, a Material Adverse Effect.

(h)    Other Reports and Filings. Promptly after the filing or delivery thereof, copies of all financial information, proxy materials and reports, if any, which any Group Member shall publicly file with the Securities and Exchange Commission or any successor thereto (the “SEC”) or with any equivalent national securities exchange or similar governing body; provided that 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 Obligors’ Agent has advised the Administrative Agent of the filing thereof; provided, further that upon the request of the Administrative Agent, the Obligors’ Agent shall deliver to the Administrative Agent such copies or financial information that were filed with the SEC or such other similar national securities exchange or governing body.

(i)    Environmental Matters.  Promptly after any Authorized Officer of any Group Member obtains knowledge thereof, notice of one or more of the following environmental matters to the extent that such environmental matters, either individually or when aggregated with all other such environmental matters with respect to which notice has not been given, could reasonably be expected to have a Material Adverse Effect:

(i)    any pending or threatened Environmental Claim against any Group Member or any Real Property owned, leased or operated by any Group Member;

(ii)    any condition or occurrence on or arising from any Real Property owned, leased or operated by any Group Member that (a) results in noncompliance by any Group Member with any applicable Environmental Law or (b) could reasonably be expected to form the basis of an Environmental Claim against any Group Member or any such Real Property;

(iii)    any condition or occurrence on any Real Property owned, leased or operated by any Group Member that could reasonably be expected to cause such Real Property to be subject to any

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restrictions on the ownership, lease, occupancy, use or transferability by any Group Member of such Real Property under any Environmental Law; and

(iv)    the taking of any removal or remedial action in response to the actual or alleged presence of any Hazardous Material on any Real Property owned, leased or operated by any Group Member as required by any Environmental Law or any Governmental Authority or other administrative agency; provided that in any event the Obligors’ Agent shall deliver to each Lender all notices received by any Group Member from any government or governmental agency under, or pursuant to, CERCLA or any similar law which identify any Group Member as potentially responsible parties for remediation costs or which otherwise notify any Group Member of potential liability under CERCLA or any similar law.

All such notices shall describe in reasonable detail the nature of the claim, investigation, condition, occurrence or removal or remedial action and such Group Member’s response thereto.

(j)    Borrowing Base Certificate. (i) On the Second Restatement Effective Date, (ii) not later than 5:00 P.M. (New York time) on or before the 10^th Business Day of each calendar month thereafter (or no later than the Wednesday of each week during any period in which a Weekly Borrowing Base Period is in effect), a borrowing base certificate setting forth the Borrowing Base (in each case with supporting calculations in reasonable detail) substantially in the form of Exhibit P (each, a “Borrowing Base Certificate”), which shall be prepared (A) as of December 15, 2015 in the case of the Borrowing Base Certificate delivered on the Second Restatement Effective Date and (B) as of the close of business of the preceding month in the case of each subsequent Borrowing Base Certificate (or, if any such Borrowing Base Certificate is delivered weekly, as of the close of business of the Saturday preceding such delivery, in which case the calculation thereunder with respect to Inventory shall be based upon good faith estimates by Borrowers) and (iii) the Obligors’ Agent shall also furnish a Borrowing Base Certificate within five (5) Business Days after December 15 of each year (which shall roll forward the Qualified Obligors’ Inventory, credit card receivables and the total outstanding Loans), as of the close of business on the immediately preceding Saturday; provided that such Borrowing Base Certificate shall not be required to be furnished in any given Fiscal Year, if (x) as of such date there are no outstanding Loans or requests and (y) no Notice of Borrowing has been provided at any time between December 15 and December 31 of such Fiscal Year. Each such Borrowing Base Certificate shall include such supporting information as may be reasonably requested from time to time by the Administrative Agent or any Co-Collateral Agent. 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 9.01(j); provided that, 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 9.01(j), then the Obligors’ Agent 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.

(k)    Notice of Compliance Period. Promptly, and in any event within three Business Days after any Authorized Officer of the Obligors’ Agent or any other Borrower obtains knowledge thereof, notice of the commencement of a Dominion Period or a Compliance Period.

(l)    Field Examinations; Appraisals. Upon the request of the Security Agent (acting in consultation with the Co-Collateral Agents) (x) one appraisal of Inventory of the Qualified Obligors during each Fiscal Year and (y) one collateral examination of the Inventory and Accounts of the Qualified Obligors in each Fiscal Year, in each case, in scope reasonably satisfactory to the Administrative Agent, and from a third-party appraiser and a third-party consultant reasonably satisfactory to the Administrative Agent, and completed at the cost of the Obligors; provided that the third-party appraiser and consultant shall be encouraged to source their relevant teams from jurisdictions in which such appraisals and collateral examinations are being undertaken; provided further, that (I) during any period (i) commencing on the date on which Excess

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Availability is less than or equal to the greater of (A) £12,000,000 or (B) 15% of the lesser of (a) the Borrowing Base at such time and (b) the Total Commitments then in effect and (ii) ending on the first date thereafter on which Excess Availability is greater than the greater of (A) £12,000,000 and (B) 15% of the lesser of (a) the Borrowing Base at such time or (b) the Total Commitments then in effect, the Security Agent may request one additional request in respect of each of clauses (x) and (y) above and (II) during any period during which an Event of Default is in existence, the Security Agent may make unlimited additional requests in respect of clauses (x) and (y) above, in each case, as the Security Agent (acting in consultation with the Co-Collateral Agents) in its reasonable discretion determines are necessary or appropriate, in each case at the cost of the Obligors.

(m)    Asset Sales, etc. Notice of any intended sale or other disposition of Collateral of any Qualified Obligor included in the Borrowing Base outside of the ordinary course of business, (x) if a Dominion Period then exists, (y) if a Compliance Period exists either before or after giving effect to such sale or disposition and the Net Sale Proceeds therefrom are in excess of £5,000,000 or (z) if the Net Sale Proceeds of which exceeds £10,000,000, in each case at least five (5) Business Days prior to the date of consummation of such sale or disposition; and

(n)    Patriot Act Information. Promptly following the Administrative Agent’s request therefor, all documentation and other information that the Administrative Agent reasonably requests on its behalf or on behalf of any Lender in order to comply with its on-going obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.

(o)    Deposit Account Information. Immediately upon the occurrence of a Dominion Period, the Obligors, upon the request of any Co-Collateral Agent, shall deliver to the Co-Collateral Agents a schedule of all deposit accounts and securities accounts, that to the knowledge of the Authorized Officers of the Obligors, are maintained by the Obligors, 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.

(p)    Casualty and Condemnation. The Borrowers (a) will furnish to the Administrative Agent and each of the Co-Collateral Agents prompt written notice of any casualty or other insured damage to any material portion of the Collateral or the commencement of any action or proceeding for the taking or expropriation of any material portion of the Collateral (including any Mortgaged Property or any part thereof) or interest therein under power of eminent domain or by condemnation or similar proceeding and (b) will ensure that the Net Insurance Proceeds of any such event (whether in the form of insurance proceeds, condemnation awards or otherwise) are collected and applied in accordance with the applicable provisions of Section 5.02(d) and the Security Documents.

(q)    Cash Pooling Information. Upon the request of the Administrative Agent or a Co-Collateral Agent, a statement with respect to each Cash Pooling Account, showing, for the preceding calendar month, all amounts credited to and debited from each such Cash Pooling Account, as well as the cash balance of each such Cash Pooling Account as at the end of such month.

(r)    Other Information. From time to time, such other information or documents (financial or otherwise) with respect to any Group Member as the Administrative Agent or any Lender (through the Administrative Agent) may reasonably request.

At the request of the Obligors’ Agent 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 9.01 may be satisfied by the Obligors’ Agent’s delivering such financial information in electronic format to the Administrative Agent and the Administrative Agent’s posting such information to a secure address on the world wide web (the “Information Website”) such as IntraLinks or Debtdomain. The accommodation provided

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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 Obligors physical delivery of specific financial information provided for in this Section 9.01. The Obligors’ Agent 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.

9.02Books, Records and Inspections; Annual Meetings. Each Obligor will, and will cause each of its Subsidiaries to, keep proper books of record and accounts in which full, true and correct entries in conformity with GAAP or other local or internationally recognized accounting standards and all requirements of law shall be made of all dealings and transactions in relation to its business and activities. Each Obligor will, and will cause each of its Subsidiaries to, permit officers and designated representatives of the Administrative Agent and any Co-Collateral Agent and, following the occurrence and continuation of an Event of Default, any Lender (a) to visit and inspect, under guidance of officers of such Group Member, any of the properties of such Group Member, (b) to examine the books of account of such Group Member and discuss the affairs, finances and accounts of such Group Member with, and be advised as to the same by, its and their officers and independent accountants and (c) to verify Eligible Credit Card Receivables and/or Eligible Inventory, all upon reasonable prior notice and at such reasonable times and intervals and to such reasonable extent as the Administrative Agent, any such Co-Collateral Agent or any such Lender may reasonably request. At a date to be mutually agreed upon between the Administrative Agent and the Obligors’ Agent occurring on or prior to the 120^th day after the close of each Fiscal Year, the Obligors’ Agent will, at the request of the Administrative Agent, hold a meeting with all of the Lenders at which meeting will be reviewed the financial results of the Group Members for the previous Fiscal Year and the budgets presented for the current Fiscal Year.

9.03Maintenance of Property; Insurance. (a) Each Obligor will, and will cause each of its Subsidiaries to, (i) keep all property necessary to the business of such Obligor and its Subsidiaries in good working order and condition, ordinary wear and tear excepted and subject to the occurrence of casualty events, (ii) maintain with financially sound and reputable insurance companies insurance (or, to the extent consistent with business practices in effect on the Second Restatement Effective Date, a program of self-insurance) on all such property and against all such risks as is consistent and in accordance with industry practice for companies similarly situated owning similar properties and engaged in similar businesses as the Group Members, and (iii) furnish to the Administrative Agent, upon its request therefor, full information as to the insurance carried.

(b)    Each Obligor will, and will cause each of its Subsidiaries to, at all times keep its property insured in favor of the Security Agent, and all policies or certificates (or certified copies thereof) with respect to such insurance (and any other insurance maintained by each Obligor and/or such Subsidiaries) (i) shall be endorsed to the Security Agent’s satisfaction for the benefit of the Security Agent (including, without limitation, by naming the Security Agent as loss payee, lender loss payee and/or additional insured), (ii) shall state that such insurance policies shall not be canceled without at least 30 days’ prior written notice thereof by the respective insurer to the Security Agent, and (iii) shall be deposited with the Security Agent.

9.04Existence; Conduct of Business. Each Obligor will, and will cause each of its Subsidiaries (other than Immaterial Subsidiaries) to, do or cause to be done, all things necessary to preserve, renew and keep in full force and effect (x) its existence and (y) except where the failure to do so would not reasonably be expected to result in a Material Adverse Effect, its material rights, franchises, licenses, permits, copyrights, patents, know-how, trademarks and trade names material to the conduct of its business; provided, however, that nothing in this Section 9.04 shall prevent (i) sales of assets and other transactions by any Group Member in accordance with Section 10.02 or (ii) the withdrawal by any Group Member of its qualification

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as a foreign Company in any jurisdiction if such withdrawal could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

9.05Compliance with Statutes, etc. Each Obligor will, and will cause each of its Subsidiaries to, comply with all applicable statutes, regulations and orders of, and all applicable restrictions imposed by, all Governmental Authorities in respect of the conduct of its business, the relationship with its employees and the ownership of its property (including applicable statutes, regulations, orders and restrictions relating to environmental standards and controls), except such non-compliances as could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

9.06Compliance with Environmental Laws. Each Obligor will comply, and will cause each of its Subsidiaries to comply, with all Environmental Laws and permits applicable to, or required by, the ownership, lease or use of its Real Property now or hereafter owned, leased or operated by any Group Member, except such non-compliances as could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

9.07Pension Schemes. (a) Each Obligor will, and will procure that each other Group Member will, ensure that all pension schemes of any Group Member are funded to the extent required by law or otherwise comply in all material respects with the requirements of any law applicable in the jurisdiction in which the relevant pension scheme is maintained, in each case, where failure to do so would have a Material Adverse Effect.

(b)    ERISA. As soon as possible and, in any event, within fifteen (15) days after an Obligor, any Subsidiary of an Obligor or any ERISA Affiliate knows or has reason to know of the occurrence of any of the following, the Obligors’ Agent will deliver to the Administrative Agent written notice setting forth the full details as to such occurrence and the action, if any, that an Obligor, any Subsidiary of an Obligor or any ERISA Affiliate is required or proposes to take, together with any notices required or proposed to be given or filed by such Obligor, such Subsidiary, the Plan administrator or such ERISA Affiliate to or with the PBGC or any other government agency, or a Plan or Multiemployer Plan participant and any notices received by such Obligor, such Subsidiary or ERISA Affiliate from the PBGC or any other government agency, or a Plan or Multiemployer Plan participant with respect thereto: (i) that a Reportable Event has occurred (except to the extent that the Obligors’ Agent has previously delivered to the Administrative Agent a certificate and notices (if any) concerning such event pursuant to the next clause hereof); (ii) that a contributing sponsor (as defined in section 4001(a)(13) of ERISA) of a Plan is subject to the advance reporting requirement of PBGC Regulation section 4043.61 (without regard to subparagraph (b)(1) thereof), and an event described in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC Regulation section 4043 is reasonably expected to occur with respect to such Plan within the following 30 days; (iii) that an accumulated funding deficiency, within the meaning of section 412 of the Code or section 302 of ERISA, has been incurred or an application may be or has been made for a waiver or modification of the minimum funding standard (including any required installment payments) or an extension of any amortization period under section 412 of the Code or section 303 or 304 of ERISA with respect to a Plan; (iv) that a Plan or Multiemployer Plan has been or may be terminated, reorganized, partitioned or declared insolvent under Title IV of ERISA; (v) that proceedings may be or have been instituted to terminate or appoint a trustee to administer a Plan which is subject to Title IV of ERISA; or (vi) that an Obligor, any Subsidiary of an Obligor or any ERISA Affiliate will or may incur any liability (including any indirect, contingent, or secondary liability) to or on account of the termination of or withdrawal from a Plan or Multiemployer Plan under section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan under section 436(f) of the Code. The Obligors’ Agent will deliver to the Agent copies of any records, documents or other information that must be furnished to the PBGC with respect to any Plan pursuant to Section 4010 of ERISA. Upon written request of the Administrative Agent, the Obligors’ Agent will deliver to the Administrative Agent a copy of each funding waiver request filed with the Internal Revenue Service or any other government agency with respect to any Plan and all communications received

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by an Obligor, any Subsidiary of an Obligor or any ERISA Affiliate from the Internal Revenue Service or any other government agency with respect to each Plan of the Obligor, any Subsidiary of the Obligor or any ERISA Affiliate. Upon written request of the Administrative Agent, the Obligors’ Agent will also deliver to the Administrative Agent a complete copy of the annual report (on Internal Revenue Service Form 5500-series) of each Plan, other than a Multiemployer Plan, (including, to the extent required, the related financial and actuarial statements and opinions and other supporting statements, certifications, schedules and information) required to be filed with the Internal Revenue Service. In addition to any notices delivered to the Administrative Agent pursuant to the first sentence hereof, upon written request of the Administrative Agent copies of any records, documents or other information required to be furnished to the PBGC or any other government agency, and any material notices received by an Obligor, any Subsidiary of the Obligor or any ERISA Affiliate with respect to any Plan or Non-U.S. Plan received from any government agency or plan administrator or sponsor or trustee with respect to any Multiemployer Plan, shall be delivered to the Administrative Agent no later than fifteen (15) Business Days after the date such records, documents and/or information has been furnished to the PBGC or any other government agency or such notice has been received by an Obligor, Subsidiary of an Obligor or the ERISA Affiliate, as applicable.

If, at any time after the Second Restatement Effective Date, an Obligor, any Subsidiary of an Obligor or any ERISA Affiliate maintains, or contributes to (or incurs an obligation to contribute to), a Plan which is not set forth in Schedule 8.10, as may be updated from time to time, then the Obligors’ Agent shall deliver to the Agent an updated Schedule 8.10 as soon as possible and, in any event, within fifteen (15) Business Days after such Obligor, such Subsidiary or such ERISA Affiliate maintains, or contributes to (or incurs an obligation to contribute to), such pension plan. Such updated Schedule 8.10 shall supersede and replaced the existing Schedule 8.10.

The Obligor and each of its applicable Subsidiaries shall ensure that all Non-U.S. Plans administered by it or into which it makes payments obtains or retains (as applicable) registered status under and as required by applicable law and is administered in a timely manner in all respects in compliance with all applicable laws except where the failure to do any of the foregoing would not be reasonably likely to result in a Material Adverse Effect upon the business, operations, condition (financial or otherwise) or prospects of the Obligor or any Subsidiary of an Obligor.

(c)    With respect to any defined benefit pension scheme in which an Obligor incorporated in the United Kingdom participates or has participated and which has its main administration in the United Kingdom or is primarily for the benefit of employees in the United Kingdom (a “UK Scheme”), the Obligors’ Agent shall immediately notify the Administrative Agent (i) of any material change in the rate of contribution to any UK Scheme, paid or recommended to be paid (whether by the scheme actuary or otherwise) or required by law or otherwise; (ii) of any investigation or proposed investigation by the Pensions Regulator which is reasonably likely to lead to an issue of a Financial Support Direction or Contribution Notice to any Obligor; and (iii) if any Obligor receives a Financial Support Direction or Contribution Notice from the Pensions Regulator.

9.08End of Fiscal Years; Fiscal Quarters. Each Obligor will cause its and each of its Subsidiaries’ (other than Immaterial Subsidiaries) Fiscal Years to end on the Saturday closest to the last day of January, provided, that, notwithstanding the foregoing, each Group Member organized in Spain shall cause its Fiscal Year to end on January 31.

9.09Performance of Obligations. Each Obligor will, and will cause each of its Subsidiaries to, perform all of its obligations under the terms of each mortgage, indenture, security agreement, loan agreement or credit agreement and each other agreement, contract or instrument by which it is bound, except such non-performances as could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

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9.10Payment of Taxes. Each Obligor will pay and discharge, and will cause each of its Subsidiaries to pay and discharge, all taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or upon any properties belonging to it, prior to the date on which penalties attach thereto, and all lawful claims which, if unpaid, might become a Lien or charge upon any properties of any Group Member not otherwise permitted under Section 10.01(i) except where the failure to make payment would not reasonably be expected to result in a Material Adverse Effect; provided that no Obligor nor any of its Subsidiaries shall be required to pay any such tax, assessment, charge, levy or claim which is being contested in good faith and by proper proceedings if it has maintained adequate reserves with respect thereto in accordance with relevant GAAP or the accounting principles applicable in the jurisdiction of incorporation of the relevant Obligor.

9.11Use of Proceeds. The Borrowers will use the proceeds of the Loans only as provided in Section 8.08.

9.12Information Regarding Collateral. The Obligors’ Agent and the other Borrowers will furnish to the Administrative Agent prompt written notice of:

(a)    With respect to any Obligor that is required to provide Collateral under the laws of any United States jurisdiction, any change in any Obligors’ (A) legal name, (B) organizational identity, (C) organizational identification number, (D) organizational structure, (E) in the case of any Obligor that is not a registered organization for purposes of Section 9-307 of the UCC, its place of business or, if it has more than one place of business, its Chief Executive Office, or (F) in the case of any Obligor organized under the laws of North Dakota or South Dakota, its federal Taxpayer Identification Number.

(b)    With respect to any Obligor that is required to provide Collateral under the laws of England and Wales, under the laws of Spain, under the laws of France, under the laws of Germany or under the laws of Australia, any change (A) in such Obligor’s corporate name, Australian Company Number or Australian Business Number, (B) in the location of such Obligor’s Chief Executive Office, its principal place of business, registered office, any office in which it maintains books or records relating to Collateral (other than de-minimis portions of 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), or (C) in such Obligors’ identity or corporate structure.

(c)    Promptly (and in any event within 20 Business Days (or such other time period as the Administrative Agent may reasonably agree)) upon a change referred to in clause (a) above, the Obligors agree to make, or to provide to the Administrative Agent all the information required to enable it to make, all filings under the UCC (or the analogous legislation in any other relevant jurisdiction) or otherwise that are required in order for the Administrative Agent to continue at all times following such change to have a valid, legal and perfected security interest in all the Collateral.

(d)    With respect to any leased property located in France that contains French Eligible Inventory (the “Specified French Properties”), the Obligor’s Agent shall provide prompt notice to the Administrative Agent at least 30 days prior to the termination or expiration of such lease.

9.13Additional Subsidiaries; Ownership of Subsidiaries; Additional Borrowers. (a) Except as otherwise permitted by Section 10.02, or pursuant to a Permitted Acquisition consummated in accordance with the terms hereof, each Parent Guarantor will, and will cause each of its Subsidiaries to, own 100% of the Equity Interests of each of their Subsidiaries (other than directors’ qualifying shares to the extent required by applicable law).

(b)    If any Subsidiary of any Parent Guarantor is formed or acquired after the Second Restatement Effective Date, the Obligors’ Agent will cause (x) the Collateral and Guaranty Requirements to

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the extent applicable to be satisfied with respect to such Subsidiary and with respect to any Equity Interest in or Indebtedness of such Subsidiary owned by or on behalf of any Obligor and (y) evidence reasonably satisfactory to the Administrative Agent that the Liens indicated by the results of a search of each system that is, or is similar to, the UCC that filings made with respect to such Subsidiary in the jurisdictions contemplated by the applicable Perfection Certificate and copies of the financing statements (or similar documents) disclosed by such search (in each case to the extent such searches and copies are made available to such Subsidiary) are Permitted Liens or shall have been terminated and released.

(b)    At any time that the Obligors’ Agent desires that a Wholly-Owned Subsidiary of the European Parent Guarantor organized under the laws of a jurisdiction in the European Union becomes a Borrower hereunder, such Subsidiary shall satisfy the following conditions, after which it shall become a Borrower, as the case may be:

(i)    the consent of all Lenders shall have been obtained;

(ii)    the articles of incorporation and corporate form of such Borrower shall be satisfactory in form and substance to the Administrative Agent;

(iii)    to the extent requested by any Lender, such Obligor shall have executed and delivered Notes satisfying the requirements of Section 2.05;

(iv)    such Obligor shall have executed, together with each other Obligor, and delivered to the Administrative Agent a Borrower Assumption Agreement, substantially in the form of Exhibit U;

(v)    the Administrative Agent shall have received an opinion (from either the Administrative Agent’s counsel or the Obligors’ counsel (such counsel to render opinions based on conventions in the respective jurisdictions) reasonably satisfactory to the Administrative Agent) addressed to the Administrative Agent, the Security Agent, the Co-Collateral Agents, the Facility Agent and each of the Lenders in form and substance reasonably satisfactory to the Administrative Agent;

(vi)    the Administrative Agent shall have received from such Obligor all of the documents, certificates, papers, records and other information that would have been required to have been delivered by such Subsidiary pursuant to Section 6.04 on the Second Restatement Effective Date if such Obligor had been an Obligor on the Second Restatement Effective Date and such other documents, certificates, papers, records and other information, to the extent reasonably requested by the Administrative Agent;

(vii)    all necessary governmental (domestic and foreign), regulatory and third party approvals and/or consents in connection with this Agreement and the other Credit Documents and otherwise referred to herein or therein, in each case with respect to such Borrower, shall have been obtained and remain in full force and effect and evidence thereof shall have been provided to the Administrative Agent;

(viii)    the Administrative Agent shall have received a letter from CT Corporation System, presently located at 111 Eighth Avenue, New York, New York, 10011, substantially in the form of Exhibit O, indicating its consent to its appointment by such Subsidiary as its agent to receive service of process as specified in Section 13.08;

(ix)    if such Borrower is a Qualified Obligor and is organized in a Qualified Jurisdiction, the Obligors’ Agent shall have provided to the Agents (i) an appraisal of the Inventory of such Borrower from Hilco Appraisal Services (or such other service provider as is reasonably acceptable to the

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Administrative Agent) and (ii) a collateral examination of the Accounts and Inventory of such Borrower from KPMG LLP (or such other service provider as is reasonably acceptable to the Administrative Agent), in each case in scope reasonably satisfactory to the Administrative Agent and the Security Agent and the results of such appraisal and collateral examination shall be in form and substance reasonably satisfactory to the Administrative Agent and the Security Agent; and

(x)    all requirements for such Borrower pursuant to the Collateral and Guaranty Requirements must be satisfied and all other relevant documentation (including opinions of counsel) of the type described in Section 6 shall be delivered as if such new Borrower were an Obligor on the Second Restatement Effective Date.

For the avoidance of doubt, any such entity that becomes an Obligor hereunder shall be subject to the limitations of Section 17.19.

9.14Further Assurances. (a) Each Obligor will, and will cause each other Group Member to, execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing, registration and recording of financing statements, obtaining consents, fixture filings, mortgages, charges, debenture, deeds of trust, charge or real property mortgage forms and other documents and supplying information), which may be required under any applicable law, or which the Administrative Agent, the Security Agent or the Required Lenders may reasonably request, to cause the Collateral and Guaranty Requirements to be and remain satisfied at all times (including, without limitation, the Incremental Security Documents), together with the related opinions, all at the expense of the Obligors. The Obligors also agree to provide to the Administrative Agent or the Security Agent, from time to time upon request, evidence reasonably satisfactory to the Administrative Agent or the Security Agent as to the perfection and priority of the Liens created or intended to be created by the Security Documents.

(b)On each date after the Second Restatement Effective Date upon which any Obligor enters into any Security Documents pursuant to preceding Section 9.13 or this Section 9.14, the Obligors’ Agent on behalf of the respective Obligor entering into such Security Documents on such date shall deliver to the Administrative Agent a completed Perfection Certificate Supplement (together with all attachments contemplated thereby) dated the date of entry into such Security Documents; in each case, signed by an Authorized Officer of the Obligors’ Agent, it being understood and agreed that the respective Perfection Certificate Supplement need only speak to the respective Obligor then entering into the respective Security Documents.

(c)At the reasonable request of (i) any Obligor, (ii) the Administrative Agent or (iii) any Secured Creditor that was not a Secured Creditor on the Second Restatement Effective Date, each Obligor and each Secured Creditor shall enter into any amendments to the Security Documents or take any other actions for the purpose of naming such new Secured Creditor as a Secured Creditor thereunder.

9.15Retention of Financial Consultant. Upon the occurrence and during the continuance of a Specified Default, upon the request of the Co-Collateral Agents, the Obligors (at their sole cost and expense) shall retain a business and financial consultant mutually acceptable to the Obligors’ Agent 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.

9.16Permitted Acquisitions. (a) Subject to the provisions of this Section 9.16 and the requirements contained in the definition of Permitted Acquisition, each Obligor may from time to time effect Permitted Acquisitions, so long as (in each case except to the extent the Required Lenders otherwise specifically agree in writing in the case of a specific Permitted Acquisition): (i) the Aggregate Consideration payable for the proposed Permitted Acquisition, when added to the Aggregate Consideration paid or payable

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for all other Permitted Acquisitions theretofore consummated during the then Fiscal Year of the Obligors’ Agent, does not exceed the Permitted Acquisition Basket Amount for such Fiscal Year; and (ii) no Event of Default shall have occurred and be continuing at the time of the consummation of the proposed Permitted Acquisition or immediately after giving effect thereto; provided that, an Obligor may effect a Permitted Acquisition without regard to the Permitted Acquisition Basket Amount if (I) the Payment Conditions are satisfied at such time, (II) no Event of Default shall have occurred and be continuing at the time of the consummation of the proposed Permitted Acquisition or immediately after giving effect thereto; (III) the Obligors’ Agent shall have given to the Administrative Agent and the Lenders at least 10 Business Days’ prior written notice of any Permitted Acquisition (or such shorter period of time as may be reasonably acceptable to the Administrative Agent), which notice shall describe in reasonable detail the principal terms and conditions of such Permitted Acquisition; (IV) calculations are made by the Obligors’ Agent with respect to the financial covenant contained in Section 10.07 (determined, for purposes of this Section 9.16 only, as if a Compliance Period is then in existence) for the respective Calculation Period on a Pro Forma Basis as if the respective Permitted Acquisition (as well as all other Permitted Acquisitions theretofore consummated after the first day of such Calculation Period) had occurred on the first day of such Calculation Period, and such calculations shall show that such financial covenant would have been complied with if the Permitted Acquisition had occurred on the first day of such Calculation Period; (V) all representations and warranties contained in Sections 8.01, 8.02, 8.05, 8.06, 8.09, 8.10, 8.14, 8.15, 8.17, 8.21, 8.28, and 8.29 shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on and as of the date of such Permitted Acquisition (both before and after giving effect thereto), unless stated to relate to a specific earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date; and (VI) the Obligors’ Agent shall have delivered to the Administrative Agent and each Lender a certificate executed by its chief financial officer or director, certifying to the best of such officer’s knowledge, compliance with the requirements of preceding clauses (I) through (V), inclusive, and containing the calculations (in reasonable detail) required by preceding clauses (I) and (IV); provided that if on the date a binding contract for an otherwise Permitted Acquisition is entered into the conditions in clauses (I) and (IV) would have been met had such Permitted Acquisition been consummated on such date, then such acquisition shall be deemed a Permitted Acquisition.

(b)At the time of each Permitted Acquisition involving the creation or acquisition of a Subsidiary, or the acquisition of capital stock or other Equity Interest of any Person, the capital stock or other Equity Interests thereof created or acquired in connection with such Permitted Acquisition shall be pledged for the benefit of the Secured Creditors in accordance with the Collateral and Guaranty Requirements.

(c)The Obligors’ Agent will cause each Subsidiary which is formed to effect, or is acquired pursuant to, a Permitted Acquisition to comply with, and to execute and deliver all of the documentation as and to the extent required by, Sections 9.13, 9.14 and 10.12, to the reasonable satisfaction of the Administrative Agent, subject to the limitation of Section 17.19.

(d)The consummation of each Permitted Acquisition shall be deemed to be a representation and warranty by each Obligor that the certifications pursuant to this Section 9.16 are true and correct and that all conditions thereto have been satisfied and that same is permitted in accordance with the terms of this Agreement, which representation and warranty shall be deemed to be a representation and warranty for all purposes hereunder, including, without limitation, Sections 8 and 11.

9.17Maintenance of Company Separateness. Except with respect to the Australian Obligor, each Obligor will, and will cause each of its Subsidiaries to, satisfy customary Company formalities, including, as applicable, (i) the holding of regular board of directors’ and shareholders’ meetings or action by directors or shareholders without a meeting, (ii) the maintenance of separate Company records and (iii) the maintenance of separate bank accounts in its own name. No Obligor nor any of its Subsidiaries shall

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take any action, or conduct its affairs in a manner, which is likely to result in the Company existence of any Obligor or any of its Subsidiaries being ignored, or in the assets and liabilities of any Obligor or any of its Subsidiaries being substantively consolidated with those of any other such Person in a bankruptcy, reorganization or other insolvency proceeding.

9.18Holding Company Obligations. Each Parent Guarantor will (a) carry on business solely as a holding company of the Group and will not have any material assets (other than as permitted under the Credit Documents) or carry on any other business other than (1) the holding of shares and other equity interests in its Subsidiaries and the Propcos, (2) the making of loans to its Subsidiaries and the Group Members, (3) the maintenance of a head office and (4) related activities (including the provisions of consultancy, advisory and/or treasury services to Group Members and the entry into, and the performance of its obligations and the exercise of its rights under, the Credit Documents); and (b) not incur any Indebtedness other than as permitted by Sections 10.04(iv), 10.04(v), 10.04(xiii), 10.04(xviii), 10.04(xxii) and 10.04(xxiii) under the Credit Documents.

9.19Operation of Cash Pooling Accounts during Dominion Period. Upon the commencement of a Dominion Period, each Qualified Obligor shall cause the net aggregate positive cash balance (if any) of all Cash Pooling Accounts maintained by such Qualified Obligor as on such date, as well as any cash which is subsequently deposited into any such Cash Pooling Accounts during any Dominion Period, to be transferred within one Business Day to a Core Concentration Account, as applicable. Subject to the preceding sentence, each Qualified Obligor shall suspend the operation of all Cash Pooling Accounts maintained by such Qualified Obligor for the duration of any Dominion Period.

9.20Cash Management for Toys SARL during Dominion Period. Toys SARL will arrange, and will cause each French Collection Bank and any financial institution where a French Collection Account or Core French Concentration Account is maintained during any Dominion Period to arrange, for all collected amounts held in such French Collection Account or such Core French Concentration Account from and after the date requested by the Administrative Agent, to be sent by ACH or wire transfer or similar electronic transfer no less frequently than once per Business Day to one or more accounts maintained by the French Proceeds Loan Agent at DB London (or if DB London is not the French Proceeds Loan Agent, at the institution designated by such successor French Proceeds Loan Agent) or an affiliate thereof (each a “DB French Account”). Subject to the terms of the respective French Proceeds Loan Documents, all amounts received in a DB French Account during a Dominion Period shall be applied (and allocated) by the French Proceeds Loan Agent) on a daily basis in the following order (in each case to the extent the French Proceeds Loan Agent has actual knowledge of the amounts owing or outstanding as described below, and after giving effect to the application of any such amounts (x) otherwise required to be applied pursuant to Section 5.02(b), (c) or (d), or (y) constituting proceeds from any Collateral otherwise required to be applied pursuant to the terms of the respective French Proceeds Loan Document), subject to Section 5.02(a)(i)(u) and (a)(i)(z) and the provisions of the immediately succeeding sentence (to the extent applicable): (1) first, to the payment (on a ratable basis) of any outstanding expenses actually due and payable to the French Proceeds Loan Agent under any of the French Proceeds Loan Documents, for which Toys SARL is obligated; (2) second, to the extent all amounts referred to in preceding clause (1) have been paid in full, to pay (on a ratable basis) all accrued and unpaid interest actually due and payable on the French Proceeds Loans and then all accrued and unpaid fees actually due and payable by Toys SARL to the French Proceeds Loan Agent or the U.K. Borrowers under any of the French Proceeds Loan Documents; (3) third, to the extent all amounts referred to in preceding clauses (1) and (2) have been paid in full, to pay (on a ratable basis) any and all unpaid principal of French Proceeds Loans which are then actually due and payable; (4) fourth, to the extent all amounts referred to in preceding clauses (1) through (3), inclusive, have been paid in full, to repay (on a ratable basis) the outstanding principal of French Proceeds Loans (whether or not then due and payable); (5) fifth, to the extent all amounts referred to in preceding clauses (1) through (4), inclusive, have been paid in full, to pay (on a ratable basis)

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all other outstanding French Proceeds Loan Secured Obligations of Toys SARL then due and payable to French Proceeds Loan Agent and the U.K. Borrowers under any of the French Proceeds Loan Documents; and (6) sixth, to Toys SARL. Toys SARL agrees that it will not cause any proceeds of any Core Concentration Account to be otherwise redirected.

Section 10.Negative Covenants. Each Obligor hereby covenants and agrees that on and after the Second Restatement Effective Date and until the Total Commitment and all Letters of Credit have terminated and the Loans, Notes and Unpaid Drawings (in each case, together with interest thereon), Fees and all other Secured Obligations (other than any indemnities described in Section 13.13 which are not then due and payable) incurred hereunder and thereunder, are paid in full:

10.01Liens. Each Obligor will not, and will not permit any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with respect to any property or assets (real or personal, tangible or intangible) of any Obligor or any Group Member, whether now owned or hereafter acquired, or sell any such property or assets subject to an understanding or agreement, contingent or otherwise, to repurchase such property or assets (including sales of accounts receivable with recourse to any Obligor or any Group Member), or assign any right to receive income or permit the filing of any financing statement under the UCC or any other similar notice of Lien under any similar recording or notice statute; provided that the provisions of this Section 10.01 shall not prevent the creation, incurrence, assumption or existence of the following (Liens described below are herein referred to as “Permitted Liens”):

(i)inchoate Liens for taxes, assessments or governmental charges or levies not yet due or Liens for taxes, assessments or governmental charges or levies other than Liens on Borrowing Base Collateral that are not required to be paid pursuant to Section 9.10;

(ii)Liens in respect of property or assets of any Group Member imposed by law, which were incurred in the ordinary course of business and do not secure Indebtedness for borrowed money, such as carriers’, warehousemen’s, materialmen’s and mechanics’ liens and other similar Liens arising in the ordinary course of business, and (x) which do not in the aggregate materially detract from the value of such Group Member’s property or assets or materially impair the use thereof in the operation of the business of the Group or (y) which are being contested in good faith by appropriate proceedings, which proceedings have the effect of preventing the forfeiture or sale of the property or assets subject to any such Lien;

(iii)Liens in existence on the Second Restatement Effective Date which are listed, and the property subject thereto described, in Schedule 10.01, but only to the respective date, if any, set forth in such Schedule 10.01 for the removal, replacement and termination of any such Liens,plusrenewals, replacements and extensions of such Liens to the extent set forth on such Schedule 10.01, provided that (x) the aggregate principal amount of the Indebtedness, if any, secured by such Liens does not increase from that amount outstanding at the time of any such renewal, replacement or extension and (y) any such renewal, replacement or extension does not encumber any additional assets or properties of any Group Member;

(iv)Liens created by or pursuant to this Agreement and the Security Documents;

(v)Liens on Inventory and Accounts owned by Group Members other than Qualified Obligors and created by or pursuant to the Local Law Financing Documents to the extent permitted by Section 10.04(ix);

(vi)(x) licenses, sublicenses, leases or subleases granted by any Obligor to other Persons not materially interfering with the conduct of the business of the Group and (y) any interest or title

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of a lessor, sublessor or licensor under any lease or license agreement permitted by this Agreement to which a Group Member is a party;

(vii)Liens upon assets of any Group Member subject to Capitalized Lease Obligations to the extent such Capitalized Lease Obligations are permitted by Section 10.04(iii), so long as (A) 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 refinancing thereof permitted thereunder), (B) the Indebtedness secured thereby does not exceed 100% of the cost of acquisition or improvement of such fixed or capital assets and (C) such Liens shall not extend to any other property or assets of the Obligors;

(viii)Liens placed upon fixed or capital assets acquired after the Second Restatement Effective Date and used in the ordinary course of business of any Group Member so long as (A) 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 refinancing thereof permitted thereunder), (B) the Indebtedness secured thereby does not exceed 100% of the cost of acquisition or improvement of such fixed or capital assets and (C) such Liens shall not extend to any other property or assets of the Obligors; provided that the Indebtedness secured by such Liens is permitted by Section 10.04(iii).

(ix)easements, rights-of-way, restrictions, encroachments and other similar charges or encumbrances, and minor title deficiencies, in each case not securing Indebtedness and not materially interfering with the conduct of the business of the Group;

(x)Liens arising from precautionary UCC financing statement filings regarding operating leases entered into in the ordinary course of business;

(xi)Liens arising out of the existence of judgments or awards that do not constitute an Event of Default under Section 11.01(i);

(xii)statutory and common law landlords’ liens under leases to which any Group Member is a party;

(xiii)Liens (other than Liens imposed under ERISA) incurred in the ordinary course of business in connection with workers compensation claims, unemployment insurance and social security benefits and Liens securing the performance of bids, tenders, leases and contracts in the ordinary course of business, statutory obligations, surety bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business and consistent with past practices (exclusive of obligations in respect of the payment for borrowed money);

(xiv)Permitted Encumbrances;

(xv)Liens on property or assets acquired pursuant to a Permitted Acquisition, or on property or assets of an Obligor in existence at the time such Subsidiary is acquired pursuant to a Permitted Acquisition (other than, in each case, on the Inventory and Eligible Credit Card Receivables of a Qualified Obligor), provided that (x) any Indebtedness that is secured by such Liens is permitted to exist under Section 10.04(vi), and (y) such Liens are not incurred in connection with, or in contemplation or anticipation of, such Permitted Acquisition and do not attach to any other asset of a Group Member;

(xvi)Liens arising out of any conditional sale, title retention, consignment or other similar arrangements for the sale of goods entered into by any Group Member in the ordinary course of business to the extent such Liens do not attach to any assets other than the goods subject to such

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arrangements or the receivables arising from the trading of these goods in the ordinary course of business;

(xvii)Liens (x) incurred in the ordinary course of business in connection with the purchase or shipping of goods or assets (or the related assets and proceeds thereof), which Liens are in favor of the seller or shipper of such goods or assets and only attach to such goods or assets or receivables arising from the trading of these goods or assets, and (y) in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;

(xviii)bankers’ Liens, Liens in favor of securities intermediaries, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on deposit in one or more deposit or securities accounts maintained by any Group Member, in each case granted in the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank or banks with respect to cash management and operating account arrangements including Liens arising under the general business conditions of a German credit institution with which any Group Member maintains a banking relationship;

(xix)Liens attaching solely to cash earnest money deposits in connection with any letter of intent or purchase agreement in connection with a Permitted Acquisition;

(xx)Liens on deposit account or securities accounts in connection with overdraft protection and netting services;

(xxi)Security given to a public or private utility or any Governmental Authority as required in the ordinary course of business;

(xxii)Liens on insurance proceeds incurred in the ordinary course of business in connection with the financing of insurance premiums;

(xxiii)Liens securing letters of credit to the extent permitted under Section 10.04(xii);

(xxiv)Liens, right of set-off or netting arising by operation of law or by contract to substantially the same effect by virtue of the provision to any Group Member of clearing bank facilities or overdraft facilities permitted under this Agreement or as otherwise required by the relevant clearing bank under its standard terms and conditions for operation of the relevant accounts and including any cash pooling, net balance or balance transfer arrangements entered into by any Group Member in respect of bank accounts of Group Members in the ordinary course of its banking arrangements;

(xxv)any Lien constituted or subsisting to comply with the requirements under § 8a of the German Act on Partial Retirement (Altersteilzeitgesetz) and under § 7d of the German Social Security Code IV (Sozialgesetzbuch IV) former versions (until 31 December 2007), § 7b of the German Social Security Code IV former version (from 1 January until 31 December 2008) and under § 7e of the German Social Security Code IV current version (since 1 January 2009);

(xxvi)Liens on securities which are the subject of repurchase agreements as described in clause (v) of the definition of “Cash Equivalents” incurred in the ordinary course of business;

(xxvii)Liens incurred in connection with sale-leaseback transactions of fixed or capital assets permitted under Section 10.04, so long as such Liens shall not extend to any other property or assets of the Obligors;

(xxviii)Liens on Equity Interests issued by any Propco securing Indebtedness;

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(xxix)additional Liens (other than on Borrowing Base Collateral unless such Liens are junior to the Liens securing the Secured Obligations and are subject to an intercreditor agreement in form and substance satisfactory to the Administrative Agent) of any Group Member not otherwise permitted by this Section 10.01 that do not secure obligations in excess of £75,000,000 in the aggregate for all such Liens at any time;

(xxx)Liens securing the Specified Debt to the extent permitted under Section 10.04(xxii); and

(xxxi)Liens securing Interest Rate Protection Agreements or Other Hedging Agreements to the extent permitted by Section 10.04(xiv).

In connection with the granting of Liens of the type described in clauses (iii), (v), (vii), (viii), (x), (xv), (xxiv) and (xxviii) of this Section 10.01 by any Group Member, the Administrative Agent and the Security Agent shall be authorized to take any actions deemed appropriate by it in connection therewith (including, without limitation, by executing appropriate lien releases or lien subordination agreements in favor of the holder or holders of such Liens, in either case solely with respect to the item or items of equipment or other assets subject to such Liens).

10.02Consolidation, Merger, or Sale of Assets, etc. Each Obligor will not, and will not permit any of its Subsidiaries to, wind up, liquidate or dissolve its affairs or enter into any partnership, joint venture, or transaction of merger (including any “fusion” implemented in accordance with articles L.236-1 to L.236.24 of the French Code de commerce or any “transmission universelle du patrimoine”) or consolidation or de-merger, or convey, sell, lease or otherwise dispose of all or any part of its property or assets (other than sales of inventory in the ordinary course of business), or enter into any sale-leaseback transactions or acquire any Acquired Entity or Business (or agree to do any of the foregoing at any future time), except that:

(i)Group Members may sell assets to the extent required by Applicable Law, provided such assets are not material to the business of the Group;

(ii)Group Members may (x) sell inventory in the ordinary course of business or (y) liquidate or otherwise dispose of obsolete or worn-out property in the ordinary course of business;

(iii)Group Members may liquidate or otherwise dispose of Cash Equivalents in the ordinary course of business, in each case for cash at Fair Market Value;

(iv)Group Members may sell assets (other than the capital stock or other Equity Interests of any Wholly-Owned Subsidiary, unless all of the capital stock or other Equity Interests of such Wholly-Owned Subsidiary are sold in accordance with this clause (iv)), so long as (v) no Default or Event of Default then exists or would result therefrom, (w) each such sale is in an arm’s-length transaction and such Group Member receives at least Fair Market Value, (x) the consideration received by such Group Member consists of at least 75% cash and is paid at the time of the closing of such sale, (y) the Net Sale Proceeds therefrom are applied and/or reinvested as (and to the extent) required by Section 5.02(e) and (z) the aggregate amount of the cash and non-cash proceeds received from all assets sold pursuant to this clause (iv) shall not exceed £15,000,000 in any Fiscal Year (for this purpose, using the Fair Market Value of property other than cash); provided, that notwithstanding the foregoing limitations, Group Members may consummate the substantially current purchase and sale or exchange of assets used or useful in the business conducted by the Group Members on the Second Restatement Effective Date so long as (x) the assets acquired by the Group Members are located in the same jurisdiction as the assets sold by the Group Members, (y) each such sale is in an arm’s length transaction and the respective Group Member receives at least Fair Market Value and

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(z) the Security Agent shall have a perfected Lien on the assets acquired pursuant to such purchase or exchange at least to the same extent for the assets sold pursuant to such transaction (immediately prior to giving effect thereto) subject to no other Lien other than Permitted Liens;

(v)each Group Member may lease (as lessee) or license (as licensee) real or personal property (so long as any such lease or license does not create a Capitalized Lease Obligation except to the extent permitted by Section 10.04(iv));

(vi)each Group Member may sell or discount, in each case without recourse and in the ordinary course of business, accounts receivable arising in the ordinary course of business, but only in connection with the compromise or collection thereof and not as part of any financing transaction;

(vii)each Group Member may grant licenses, sublicenses, leases or subleases to other Persons not materially interfering with the conduct of the business of the Group, in each case so long as no such grant otherwise affects the Security Agent’s security interest in the asset or property subject thereto;

(viii)transfers of assets (i) among the Obligors, (ii) by any Group Member that is not an Obligor to any Obligor and (iii) by any Group Member that is not an Obligor to any other Group Member that is not an Obligor in each case shall be permitted, so long as any assets so transferred shall be subject to any security interests granted to the Security Agent for the benefit of the Secured Creditors at least to the same extent as would have been required had the transferee originally owned such assets;

(ix)(i) any Obligor may be merged, consolidated or liquidated with or into any other Obligor organized in the same jurisdiction, (ii) any Group Member that is not an Obligor may be merged, consolidated or liquidated with or into any Obligor organized in the same jurisdiction and (iii) any Group Member that is not an Obligor may be merged, consolidated or liquidated with or into any other Group Member that is not an Obligor organized in the same jurisdiction (so long as a Wholly-Owned Subsidiary of a Group Member is the surviving Person of any such merger, consolidation or liquidation); provided that any such merger, consolidation or liquidation shall only be permitted pursuant to this clause (ix), so long as (A) any security interests granted to the Security Agent for the benefit of the Secured Creditors in the assets (and Equity Interests) of any such Person subject to any such transaction shall remain in full force and effect and perfected and enforceable (to at least the same extent as in effect immediately prior to such merger, consolidation or liquidation), (B) if any Person subject to any such merger, consolidation or liquidation is a Borrower, the surviving Person also shall be a Borrower and (C) if the Person to be merged, consolidated or liquidated into another Person as contemplated above is party to the Guaranty, the nature and scope of the obligations of such Person under such Guaranty are substantially identical to the nature and scope of the obligations of such other Person under such Guaranty;

(x)Permitted Acquisitions may be consummated in accordance with the requirements of Section 9.16;

(xii)Group Members may sell non-core assets acquired in connection with Permitted Acquisitions which are not used in the business of the Group;

(xii)Group Members may undertake sale-leaseback transactions of fixed or capital assets, to the extent not otherwise prohibited hereunder;

(xiii)Group Members may undertake bulk sales or other dispositions of the Obligors’ Inventory not in the ordinary course of business in connection with store closings, at arm’s length;

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(xiv)Group Members may incur Permitted Liens;

(xv)Group Members may undertake exchanges or swaps of equipment, store leases or other Real Property having substantially equivalent value; provided that, upon the completion of any such exchange or swap, (i) the Security Agent, for its own benefit and the benefit of other Secured Creditors, has a first priority lien (subject only to Permitted Liens having priority by operation of Applicable Law) in such equipment, store leases or other Real Property received by the Obligors at least to the same extent as the assets exchanged or swapped pursuant to such transaction (immediately prior to giving effect thereto) subject to no other Lien other than Permitted Liens, and (ii) all Net Sale Proceeds, if any, received in connection with any such exchange or swap of equipment are applied to the Loans if then required in accordance with Section 5.02; and

(xvi)Group Members may sell, transfer, wind up or otherwise dispose of assets, including the Equity Interests of any Subsidiary or any business unit thereof, so long as (a) the amount of any such sale, transfer, winding up or disposal, together with the aggregate amount of any previous sales, transfers, windings up and disposals made by Group Members pursuant to this clause (xvi) shall not exceed in the aggregate an amount equal to 7.5% of the Consolidated Total Assets of the Group, (b) no Default or Event of Default exists or would result therefrom, (c) the Obligor being disposed of has no Loans or Letters of Credit Outstanding, (d) Excess Availability, calculated on a pro forma basis giving effect to such disposition (and as set forth in a Borrowing Base Certificate), shall not be less than the greater of (i) ₤12,000,000 and (ii) 12.5% of the lesser of (x) the Total Commitment as then in effect and (y) the Borrowing Base (giving pro forma effect to such disposition) at such time, and (e) such sale is in an arm’s-length transaction.

To the extent the Required Lenders waive the provisions of this Section 10.02 with respect to the sale of any Collateral, or any Collateral is sold as permitted by this Section 10.02 (other than to an Obligor), such Collateral shall be sold free and clear of the Liens created by the Security Documents, and the Administrative Agent and the Security Agent shall be authorized to take any actions deemed appropriate in order to effect the foregoing.

Notwithstanding anything to the contrary contained above in this Section 10.02 or elsewhere in this Agreement, at any time when a Dominion Period is in effect, no Borrowing Base Collateral may be sold, transferred or otherwise disposed of by any Borrower or any Obligor that is not a Borrower (other than sales of inventory in the ordinary course of business) unless the Obligors’ Agent delivers a pro forma Borrowing Base Certificate to the Administrative Agent prior to the sale, transfer or other disposal of such Collateral demonstrating compliance with the Borrowing Base.

Notwithstanding anything to the contrary contained above in this Section 10.02, any transfer of material assets, other than cash or cash-like instruments, to a CFC Limited Obligor from an Obligor that is not a CFC Limited Obligor or merger of an Obligor that is not a CFC Limited Obligor with and into a CFC Limited Obligor, in each case, shall require the prior written consent of the Administrative Agent.

10.03Dividends. Each Obligor will not, and will not permit any of its Subsidiaries to, authorize, declare or pay any Dividends with respect to each Obligor or any of its Subsidiaries, except that:

(i)any Subsidiary of an Obligor may pay cash Dividends or make other distributions of property to an Obligor or to any Wholly-Owned Subsidiary of such Obligor;

(ii)any Non-Wholly-Owned Subsidiary of an Obligor may pay cash Dividends or make other distributions of property to its shareholders, members or partners generally, so long as such Obligor or its respective Subsidiary which owns the Equity Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the

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Equity Interest in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary);

(iii)the Obligors may pay cash Dividends to the respective Parent Guarantor, so long as the proceeds thereof are promptly used by such Parent Guarantor to pay operating expenses incurred in the ordinary course of business (including, without limitation, outside directors and professional fees, expenses and indemnities) and other similar corporate overhead costs and expenses;

(iv)the Obligors may pay cash Dividends at the times and in the amounts necessary to enable Parent (or any of its Subsidiaries that are direct or indirect parent entities of a Parent Guarantor) to pay its tax obligations; provided that (x) the aggregate amount of cash Dividends paid pursuant to this clause (iv) to enable Parent  and such Subsidiaries to pay Federal and state income taxes for a taxable period shall not exceed the lesser of (a) the amount of such Federal and state income taxes attributable to the income and gain of the Parent Guarantors and  their direct or indirect Subsidiaries that are Obligors (as if such Parent Guarantors and such Subsidiaries were subject to taxation as a separate consolidated or combined tax group  for U.S. federal and state income tax purposes) or (b) the actual Federal and state income taxes owed by Parent and its Subsidiaries that are direct or indirect parent entities of a Parent Guarantor that are attributable to the income and gain of the Parent Guarantors and their direct or indirect Subsidiaries that are Obligors, in each case, at such time for the respective tax period and (y) any refunds received by Parent or any such Subsidiaries shall promptly be returned by Parent or such Subsidiaries to the respective Obligor to the extent the reduction in liability giving rise to such refund would have reduced any Dividends already paid pursuant to this clause (iv);

(v)any Obligor may pay cash Dividends to its respective direct or indirect holders of Equity Interests to the extent such funds are used by a Parent Guarantor to pay management fees to the Sponsor or its Affiliates to the extent permitted by Section 10.06(viii);

(vi)any Obligor may pay cash Dividends or make other distributions of property to its respective direct or indirect holders of Equity Interests if the Payment Conditions are satisfied;

(vii)any Obligor may pay cash Dividends or make other distributions of property to its respective direct or indirect holders of Equity Interests from amounts received by such Obligors as Dividends originating from a Propco in an aggregate amount (when added to the aggregate principal amount of loans made pursuant to Section 10.05(xix)) not to exceed (A) £75,000,000plus(B) as long as the Payment Conditions are satisfied, an additional £25,000,000 per Fiscal Year;

(viii)during any Dominion Period, the Obligors may pay cash Dividends from cash accounts which constitute Excluded Accounts by virtue of clause (z) of the definition thereof;

(ix)any Obligor may pay cash Dividends or make other distributions of property to its respective direct or indirect holders of its Equity Interests so long as (a) no Default or Event of Default then exists or would result therefrom, and (b) the aggregate amount of all Dividends made pursuant to this clause (ix) shall not exceed the Net Equity Proceeds Amount at such time;

(x)the Obligors may pay cash Dividends or, if the relevant Specified Debt was incurred in exchange for the retirement of the debt of Parent (with no cash proceeds received in connection therewith), any deemed non-cash Dividend in connection therewith shall be permitted to be paid to the Parent and/or its Affiliates (other than the Sponsors) in an aggregate amount (when added to the aggregate principal amount of loans made pursuant to Section 10.05(xx)) of the Pounds Sterling

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Equivalent of $650,000,000 with the proceeds of Specified Debt incurred pursuant to Section 10.04(xxii) and/or 10.04(xxiii) within 30 days upon receipt of such proceeds (or such later date as may be agreed to by the Administrative Agent in its sole discretion); provided that the Obligor’s Agent shall have provided a certificate to the Administrative Agent describing the use of proceeds of the Specified Debt and listing which entity is expected to ultimately receive such proceeds and if such proceeds will flow directly or indirectly through an Affiliate of the Parent (ie: not the Parent or a Subsidiary thereof), such additional information as reasonably requested by the Administrative Agent; and

(xi)the Obligors may pay cash Dividends to the Parent and/or its Subsidiaries and the Propcos in an aggregate amount not to exceed the Amortization Payment Amount, the proceeds of which shall be used solely to finance an amortization payment in an aggregate amount (when added to the aggregate principal amount of loans or Investments made pursuant to Section 10.05(xxi)) not to exceed £20,000,000 (the “Amortization Payment Amount”) under the Spanish Propco Facility Agreement; provided that at the time of such Dividends and also after giving effect thereto (i) there shall exist no Default or Event of Default and (ii) all representations and warranties contained herein and in the other Credit Documents shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on such date (it being understood and agreed that (x) any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date and (y) any representation or warranty that is qualified as to “materiality,” “Material Adverse Effect” or similar language shall be true and correct in all respects on such date).

Notwithstanding anything to the contrary contained above in this Section 10.03, any Dividends of assets, other than cash or cash-like instruments, paid to a CFC Limited Obligor from an Obligor that is not a CFC Limited Obligor shall require the prior written consent of the Administrative Agent.

10.04Indebtedness. Each Obligor will not, and will not permit any of its Subsidiaries to, contract, create, incur, assume or suffer to exist any Indebtedness, except:

(i)Indebtedness incurred pursuant to this Agreement and the other Credit Documents;

(ii)Indebtedness outstanding on the Second Restatement Effective Date and listed on Schedule 8.20 (the “Existing Indebtedness”) (as reduced by any repayments of principal thereof), and any subsequent extension, renewal or refinancing thereof, provided that the aggregate principal amount of the Indebtedness to be extended, renewed or refinanced does not increase from that amount outstanding at the time of any such extension, renewal or refinancing and, providedfurther, that any Intercompany Debt listed on Schedule 8.20 made by an Obligor to any Group Member that is not an Obligor (and subsequent extensions, refinancings, renewals, replacements and refundings thereof as permitted pursuant to this Section 10.04(ii)) (x) may only be extended, refinanced, renewed, replaced or refunded if the Intercompany Debt so extended, refinanced, renewed, replaced or refunded has the same obligor(s) and obligee(s) as the Intercompany Debt being extended, refinanced, renewed, replaced or refunded and (y) shall be subject to the requirements of clauses (w), (x) and (y) appearing in the proviso to Section 10.05(vii);

(iii)Indebtedness of Group Members evidenced by Capitalized Lease Obligations and purchase money Indebtedness described in Section 10.01(vii) and Section 10.01(viii);

(iv)Indebtedness constituting Intercompany Loans to the extent permitted by Section 10.05(vii); provided that clause (e) of the Collateral and Guaranty Requirements are satisfied and any such Indebtedness owed by an Obligor shall be subordinated to the Secured Obligations on

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terms no less favorable to the Lenders than those set forth in the Intercompany Subordination Agreement;

(v)Indebtedness consisting of guaranties by the Obligors of each other’s Indebtedness to the extent that the guaranteed Indebtedness is otherwise permitted under this Agreement;

(vi)Indebtedness of any Obligor acquired pursuant to a Permitted Acquisition (or Indebtedness assumed at the time of a Permitted Acquisition of an asset securing such Indebtedness), provided that (x) such Indebtedness was not incurred in connection with, or in anticipation or contemplation of, such Permitted Acquisition and (y) such Indebtedness was not incurred in connection with, or secured by, any Borrowing Base Collateral;

(vii)Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, so long as such Indebtedness is extinguished within four Business Days of its incurrence;

(viii)Indebtedness of Group Members with respect to performance bonds, surety bonds, appeal bonds or customs bonds required in the ordinary course of business or in connection with the enforcement of rights or claims of any Group Member or in connection with judgments that do not result in a Default or an Event of Default;

(ix)Indebtedness of Group Members (other than Qualified Obligors) under the Local Law Financing Documents in an aggregate principal amount not to exceed £28,000,000;

(x)Indebtedness of any Group Member which may be deemed to exist in connection with agreements providing for indemnification, purchase price adjustments and similar obligations in connection with the acquisition or disposition of assets in accordance with the requirements of this Agreement, so long as any such obligations are those of the Person making the respective acquisition or sale, and are not guaranteed by any other Person except as permitted by Section 10.04(v);

(xi)without duplication of any other Indebtedness, non-cash accruals of interest, accretion or amortization of original issue discount and/or pay-in-kind interest;

(xii)Indebtedness relating to letters of credit obtained in the ordinary course of business (including, for the avoidance of doubt, any private label letters of credit issued by Parent), 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;

(xiii)Indebtedness of any Parent Guarantor to Parent or any of Parent’s Subsidiaries (other than any Group Member); provided that such Indebtedness (x) 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 and (y) is subordinated to the Secured Obligations on terms reasonably acceptable to the Administrative Agent;

(xiv)Indebtedness of the Obligors under (x) Interest Rate Protection Agreements entered into with respect to other Indebtedness permitted under this Section 10.04 and (y) Other Hedging Agreements entered into in the ordinary course of business and providing protection to the Group Members against fluctuations in currency values or commodity prices in connection with the business of the Group, in either case so long as the entering into of such Interest Rate Protection Agreements or Other Hedging Agreements are bona fide hedging activities and are not for speculative purposes;

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(xv)Indebtedness incurred in the ordinary course of business in connection with the financing of insurance premiums;

(xvi)Indebtedness that is discharged on the day on which it is incurred and arises pursuant to the operation of cash pooling, net balance or balance transfer arrangements made available to Group Members;

(xvii)Indebtedness incurred in connection with sale leaseback transactions permitted hereunder;

(xviii)Indebtedness due to the Sponsor Group; provided that 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 Secured Obligations on terms reasonably acceptable to the Administrative Agent;

(xix)Contingent Obligations related to or arising from tax covenants, substantially the same as those in effect as of the Restatement Effective Date and Second Restatement Effective Date, entered into in connection with a Propco Financing;

(xx)Indebtedness of any Group Member to Parent or any of Parent’s Subsidiaries (other than any Group Member) comprised of loans or notes incurred after the Second Restatement Effective Date to fund ongoing operations of the Group, so long as no Default or Event of Default shall be continuing at the time such Indebtedness is incurred;

(xxi)additional Indebtedness incurred by Group Members so long as the Payment Conditions are satisfied at the time such Indebtedness is incurred, which Indebtedness shall be unsecured unless otherwise permitted under Section 10.01(xxix);

(xxii)subject to and upon the terms and conditions set forth herein, the European Parent Guarantor, Midco2 or a Subsidiary of the Parent Guarantors reasonably acceptable to the Administrative Agent, may by written notice to Administrative Agent, incur Indebtedness (such Indebtedness and any Refinancing Indebtedness thereof, the “Specified Debt”) the proceeds of which are used (directly or indirectly) solely to refinance indebtedness of Parent (or which is issued solely in exchange for the retirement of indebtedness of Parent) in an aggregate principal amount not to exceed $575,000,000 plus an additional amount (up to an additional $75,000,000) to the extent permitted under Section 10.04(xxiii); provided that:

(A)no Specified Debt shall have a scheduled maturity or termination date prior to the date six months after the Maturity Date;

(B)the Administrative Agent shall have received a certificate in a form reasonably satisfactory to the Administrative Agent and signed on behalf of the Obligor’s Agent, certifying on behalf of each Borrower that the conditions under the Credit Agreement to incur the Specified Debt have been satisfied, the date on which the Specified Debt will be incurred and attaching copies of the definitive Specified Debt Documents;

(C)the Specified Debt may not benefit from any guarantees or be secured other than (I) guaranties from the Guarantors (substantially in the form of the Guaranty) which may be secured solely on a junior basis on the Collateral; provided that the same shall be subject to a Specified Debt Intercreditor Agreement; (II) guaranties from any Propco which may be secured on a first lien basis by the capital stock of such Propco and/or the assets of such Propco; provided that such Propco shall also guaranty the Secured

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Obligations and such capital stock and/or assets shall also secure the Secured Obligations on a second lien basis on terms reasonably acceptable to the Administrative Agent (provided, however, if the first lien pledge is released, the second lien pledge shall be automatically released simultaneously); and/or (III) guaranties from the Parent and its Subsidiaries which may be secured by their respective assets (other than, in each case, the Parent Guarantors or any of their Subsidiaries, except as provided in the preceding clauses (I) and (II) or with respect to assets not constituting Collateral of the Parent Guarantors or their Subsidiaries, on a junior lien basis to the extent that the Secured Obligations are secured on a first lien basis subject to an intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent which shall provide the Security Agent with instruction priority with respect to any enforcement actions consistent with the requirements set forth in clause (x) of the definition of Specified Debt Intercreditor Agreement); and

(D)no payments of interest and/or principal in respect of the Specified Debt shall be permitted other than (x) amortization payments in an amount less than or equal to 1.00% per annum (of the original aggregate principal amount incurred thereof) and (y) regularly scheduled interest payments in an amount less than or equal to 6.00% per annum (of the aggregate outstanding principal amount thereof) unless, (A) Payment Conditions are met or (B) such payments are made solely with the proceeds of Refinancing Indebtedness (that otherwise meets the requirements with respect to Specified Debt) or a Permitted Specified Debt Payment Source so long as no Default or Event of Default has occurred and is continuing at the time of such refinancing and after giving effect thereto (and for the avoidance of doubt, whether or not Payment Conditions are then satisfied), with any such Permitted Specified Debt Payment Source or Specified Debt to be deemed to be “Specified Debt” for all purposes under this Agreement after the incurrence thereof in accordance with the term set forth herein.

(xxiii)so long as no Default or Event of Default then exists or would result therefrom, additional Indebtedness incurred by any Borrower and its respective Subsidiaries (and if incurred as additional Specified Debt, such Specified Debt may be incurred by the European Parent Guarantor, Midco2 or a Subsidiary of the Parent Guarantors reasonably acceptable to the Administrative Agent) in an aggregate principal amount not to exceed the Pounds Sterling Equivalent of $75.0 million at any one time outstanding, which Indebtedness shall be unsecured unless otherwise permitted under Section 10.01(xxix) or Section 10.04(xxii); provided, however, the aggregate principal amount allowed to be incurred pursuant to this Section 10.04(xxiii) shall be reduced dollar-for-dollar to the extent any portion of the Pounds Sterling Equivalent of $75.0 million was used to increase the Specified Debt above $575,000,000.

10.05Advances, Investments and Loans. Each Obligor will not, and will not permit any of its Subsidiaries to, directly or indirectly, make any Investment, except that the following shall be permitted:

(i)Group Members may acquire and hold accounts receivables owing to any of them, if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms of such Group Member;

(ii)Group Members may acquire and hold cash and Cash Equivalents;

(iii)Group Members may hold the Investments held by them on the Second Restatement Effective Date and described on Schedule 10.05(iii) and undertake refinancings thereof on substantially the same terms or capitalize any such existing Investments that constitute intercompany

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loans to a Group Member, provided that any increase in such Investments made shall be permitted only if permitted under the other provisions of this Section 10.05;

(iv)Group Members may acquire and own investments (including debt obligations) received in connection with the bankruptcy or reorganization of suppliers and customers and in good faith settlement of delinquent obligations of, and other disputes with, customers and suppliers arising in the ordinary course of business;

(v)Group Members may make loans and advances to their officers and employees for moving, relocation and travel expenses and other similar expenditures, in each case in the ordinary course of business in an aggregate amount not to exceed £2,000,000 at any time (determined without regard to any write-downs or write-offs of such loans and advances);

(vi)Group Members may acquire and hold obligations of their officers and employees in connection with such officers’ and employees’ acquisition of shares of common Equity Interests of the Parent (so long as no cash is actually advanced by any Group Member in connection with the acquisition of such obligations);

(vii)(I) any Obligor may make intercompany loans and advances to any other Obligor, (II) any Obligor may make intercompany loans and advances to any Group Member that is not an Obligor, (III) any Group Member that is not an Obligor may make intercompany loans and advances to any Obligor and to any other Group Member that is not an Obligor and (IV) any Group Member may make intercompany loans and advances to any Affiliate of a Group Member (other than to the Sponsors, Sponsor Related Parties or any other stockholder of the Parent) (such intercompany loans and advances referred to in preceding clauses (I) through (IV), collectively, the “Intercompany Loans”), provided that (t) unless the Payment Conditions are satisfied at the time any such Intercompany Loan is made, at no time shall the aggregate outstanding principal amount of all Intercompany Loans made pursuant to preceding sub-clause (II) of this clause (vii), when added to the amount of contributions, acquisitions of Equity Interests, capitalizations and forgivenesses theretofore made pursuant to subclause (II) of Section 10.05(viii) (for this purpose, taking the Fair Market Value of any property (other than cash) so contributed at the time of such contribution), exceed £5,000,000 at any time outstanding (determined without regard to any write-downs or write-offs of such loans and advances and net of any returns on any such Investment in the form of a principal repayment, distribution, dividend or redemption, as applicable), (u) unless the Payment Conditions are satisfied at the time any such Intercompany Loan is made, at no time shall the aggregate outstanding principal amount of all Intercompany Loans made pursuant to preceding sub-clause (IV) of this clause (vii), when added to the amount of contributions, acquisitions of Equity Interests, capitalizations and forgivenesses theretofore made pursuant to subclause (IV) of Section 10.05(viii) (for this purpose, taking the Fair Market Value of any property (other than cash) so contributed at the time of such contribution), exceed £5,000,000 at any time outstanding (determined without regard to any write-downs or write-offs of such loans and advances and net of any returns on any such Investment in the form of a principal repayment, distribution, dividend or redemption, as applicable), (w) no Intercompany Loan may be made pursuant to subclauses (II) or (IV) above at any time that a Default or an Event of Default has occurred and its continuing, (x) unless otherwise agreed by the Administrative Agent, each Intercompany Loan shall be evidenced by an Intercompany Note, (y) each Intercompany Loan made by any Group Member that is not an Obligor to an Obligor (A) shall be subject to the subordination provisions contained in the Intercompany Subordination Agreement, (B) shall be subject to market cash interest rates (as reasonably determined by the Parent in consultation with the Administrative Agent) and (C) the terms of such Intercompany Loans and the Intercompany Subordination Agreement shall not permit any repayment thereof unless no Event of

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Default is continuing or would result therefrom and (z) any Intercompany Loans made to any Obligor pursuant to this clause (vii) shall cease to be permitted by this clause (vii) if such Obligor ceases to constitute an Obligor;

(viii)(I) Obligors may make capital contributions to, or acquire Equity Interests of, other Obligors, (II) Obligors may make capital contributions to, or acquire Equity Interests of, Group Members that are not Obligors, (III) Group Members that are not Obligors may make cash capital contributions to, or acquire Equity Interests of, other Group Members that are not Obligors and (IV) Group Members may make capital contributions to, or acquire Equity Interests of, any Affiliate of a Group Member (other than to the Sponsors, Sponsor Related Parties or any other Stockholder of the Parent); provided that (v) unless the Payment Conditions are satisfied at the time such capital contribution or acquisition of Equity Interests is made, the aggregate amount of contributions, acquisitions of Equity Interests, capitalizations and forgiveness on and after the Second Restatement Effective Date made pursuant to preceding subclause (II) (for this purpose, taking the Fair Market Value of any property (other than cash) so contributed at the time of such contribution), when added to the aggregate outstanding principal amount of Intercompany Loans made to Group Members that are not Obligors pursuant to subclause (II) of Section 10.05(vii) (determined without regard to any write-downs or write-offs thereof and net of any returns on any such Investment in the form of a principal repayment, distribution, dividend or redemption, as applicable), shall not exceed an amount equal to £5,000,000, (w) unless the Payment Conditions are satisfied at the time of such capital contribution or acquisition of Equity Interests is made, the aggregate amount of contributions, acquisitions of Equity Interests, capitalizations and forgiveness on and after the Second Restatement Effective Date made pursuant to preceding subclause (IV) (for this purpose, taking the Fair Market Value of any property (other than cash) so contributed at the time of such contribution), when added to the aggregate outstanding principal amount of Intercompany Loans made to Affiliates of Group Members pursuant to subclause (IV) of Section 10.05(vii) (determined without regard to any write-downs or write-offs thereof and net of any returns on any such Investment in the form of a principal repayment, distribution, dividend or redemption, as applicable), shall not exceed an amount equal to £5,000,000, (x) no contribution, capitalization or forgiveness may be made pursuant to preceding subclauses (II) and (IV) at any time that a Default or an Event of Default has occurred and its continuing, (y) in the case of any contribution pursuant to preceding subclause (I) or (II), any security interest granted to the Security Agent for the benefit of the Secured Creditors pursuant to the Security Documents in any assets so contributed shall remain in full force and effect and perfected (to at least the same extent as in effect immediately prior to such contribution) and all actions required to maintain said perfected status have been taken and (z) any Investment made in or to made to any Obligor pursuant to this clause (viii) shall cease to be permitted by this clause (viii) if such Obligor ceases to constitute an Obligor;

(ix)Group Members may own the Equity Interests of their respective Subsidiaries created or acquired in accordance with the terms of this Agreement (so long as all amounts invested in such Subsidiaries are independently justified under another provision of this Section 10.05);

(x)Contingent Obligations permitted by Section 10.04, to the extent constituting Investments;

(xi)Permitted Acquisitions shall be permitted in accordance with the requirements of Section 9.16;

(xii)Group Members may receive and hold promissory notes and other non-cash consideration received in connection with any asset sale permitted by Section 10.02(iv);

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(xiii)Group Members may make investments made in accordance with the investment policy set forth as Schedule 10.05(xiii) hereto;

(xiv)Group Members may capitalize or forgive (i) any Indebtedness owed to any Obligor by other Obligors or (ii) provided that the Payment Conditions are satisfied at the time such capitalization or forgiveness, any Indebtedness owed to any Obligor by Persons other than Obligors not to exceed £5,000,000 in the aggregate;

(xv)Group Members may make payments in respect of earnest money required in connection with Permitted Acquisitions;

(xvi)Group Members may make loans or provide credit to other Group Members arising as a result of the operation of cash pooling, net balance or balance transfer arrangements made available to Group Members;

(xvii)Group Members may make guarantees of Indebtedness of Group Members that are not Obligors not in excess of £5,000,000 in the aggregate at any time outstanding;

(xviii)Group Members may enter into Interest Rate Protection Agreements and Other Hedging Agreements permitted by Section 10.04(xiv);

(xix)Obligors may make loans or other Investments to its respective direct or indirect holders of Equity Interests from amounts received by such Obligors as Dividends originating from a Propco in an aggregate amount (when added to the aggregate principal amount of Dividends or other distributions made pursuant to Section 10.03(vii)) not to exceed (A) £75,000,000 plus (B) as long as the Payment Conditions are satisfied, an additional £25,000,000 per Fiscal Year;

(xx)Obligors may make loans or other Investments to the Parent and/or its Affiliates (other than the Sponsors) in an aggregate amount (when added to the aggregate principal amount of Dividends made pursuant to Section 10.03(x)) of the Pounds Sterling Equivalent of $650,000,000 with the proceeds of Specified Debt incurred pursuant to Section 10.04(xxii) and/or 10.04(xxiii) within 30 days upon receipt of such proceeds (as such date may be extended by the Administrative Agent in its sole discretion); provided that the Obligor’s Agent shall have provided certificate to the Administrative Agent describing the use of proceeds of the Specified Debt and listing which entity is expected to ultimately receive such proceeds and if such proceeds will flow directly or indirectly through an Affiliate of the Parent (ie: not the Parent or a Subsidiary thereof), such additional information as reasonably requested by the Administrative Agent;

(xxi)Obligors may make loans or other Investments to the Parent and/or its Subsidiaries and the Propcos in an aggregate amount not to exceed the Amortization Payment Amount, the proceeds of which shall be used solely to finance an amortization payment in an aggregate amount (when added to the aggregate principal amount of Dividends or other distributions made pursuant to Section 10.03(xi)) not to exceed £20,000,000 under the Spanish Propco Facility Agreement; provided that at the time of such loans or other Investments and also after giving effect thereto (i) there shall exist no Default or Event of Default and (ii) all representations and warranties contained herein and in the other Credit Documents shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on such date (it being understood and agreed that (x) any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date and (y) any representation or warranty that is qualified as to “materiality,” “Material Adverse Effect” or similar language shall be true and correct in all respects on such date);

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(xxii)in addition to Investments permitted by clauses (i) through (xxi) of this Section 10.05, Group Members may make additional loans, advances and other Investments to or in a Person in an aggregate amount for all loans, advances and other Investments made pursuant to this clause (xxii) (determined without regard to any write-downs or write-offs thereof), net of cash repayments of principal in the case of loans, sale proceeds in the case of Investments in the form of debt instruments and cash equity returns (whether as a distribution, dividend, redemption or sale) in the case of equity investments, not to exceed the sum of (a) £20,000,000 plus (b) the Net Equity Proceeds Amount at such time;

(xxiii)Group Members may forgive or capitalize any Intercompany Loans to the Spanish Propco that are outstanding on the Second Restatement Effective Date and listed on Schedule 10.05(iii); and

(xxiv)Group Members may make additional Investments not otherwise permitted by clauses (i) through (xxiii) of this Section 10.05 so long as the Payment Conditions are satisfied at the time any such Investments are made.

Notwithstanding anything to the contrary contained above in this Section 10.05, any intercompany loans, advances or other Investments of assets, other than cash or cash-like instruments, made to, capital contributions of assets, other than cash or cash-like instruments, made to or acquisitions of Equity Interests of a CFC Limited Obligor from or by an Obligor that is not a CFC Limited Obligor shall require the prior written consent of the Administrative Agent.

10.06Transactions with Affiliates. Each Obligor will not, and will not permit any of its Subsidiaries to, enter into any transaction or series of related transactions with any Affiliate of each Obligor or any of its Subsidiaries, other than in the ordinary course of business and on terms and conditions substantially as favorable to such Obligor or such Subsidiary as would reasonably be obtained by such Obligor or such Subsidiary at that time in a comparable arm’s-length transaction with a Person other than an Affiliate, except that the following in any event shall be permitted:

(i)Dividends may be paid to the extent provided in Section 10.03;

(ii)loans may be made and other transactions may be entered into among the Group Members to the extent permitted by Sections 10.02, 10.04 and 10.05;

(iii)customary fees, indemnities and reimbursements may be paid to non-officer directors of Group Members;

(iv)Each Parent Guarantor may issue common Equity Interests and Qualified Preferred Stock;

(v)Group Members may enter into, and may make payments under, employment agreements, employee benefits plans, stock option plans, indemnification provisions and other similar compensatory arrangements with officers, employees and directors of Group Members in the ordinary course of business;

(vi)Subsidiaries of each Parent Guarantor may pay management fees, licensing fees and similar fees to any Obligor;

(vii)the payment and performance under (i) leases to which a Group Member is a party with any Propco and Contingent Obligations permitted under Section 10.04(xix), (ii) intercompany licensing agreements in effect as of the Second Restatement Effective Date relating to intellectual

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property, (iii) intercompany services agreements relating to provision of financial, accounting, marketing, procurement, information technology and other business services in effect as of the Second Restatement Effective Date, (iv) intercompany payables relating to insurance claims and (v) private label letters of credit for which Parent serves as issuer;

(viii)so long as no Default or Event of Default then exists or would result therefrom, each Parent Guarantor may pay management fees to the Sponsor and its Affiliates in accordance with the terms of the applicable Advisory Agreement as in effect on the Second Restatement Effective Date ; and

(ix)each Parent Guarantor may reimburse the Sponsor and its Affiliates for their reasonable out-of-pocket expenses incurred in connection with their providing management services to the Group.

Notwithstanding anything to the contrary contained above in this Section 10.06, in no event shall any Group Member pay any management, consulting or similar fee to any of their respective Affiliates except as specifically provided in clauses (vi), (vii) and (viii) of this Section 10.06.

10.07Consolidated Fixed Charge Coverage Ratio. During each Compliance Period, each Parent Guarantor shall not permit (i) the Consolidated Fixed Charge Coverage Ratio for the last Test Period ended prior to the beginning of such Compliance Period for which financial statements are available to be less than 1.00:1.00, (ii) the Consolidated Fixed Charge Coverage Ratio for any Test Period for which financial statements first become available during such Compliance Period to be less than 1.00:1.00 or (iii) the Consolidated Fixed Charge Coverage Ratio for any Test Period ending during such Compliance Period (or before such Compliance Period and after the Test Period referenced in clause (i) above) to be less than 1.00:1.00. Within three Business Days after the beginning of a Compliance Period (or if the deadline for delivery of the financial statements for the applicable Fiscal Month or Fiscal Quarter in accordance with Section 9.01(a) or (b) has not expired, within three Business Days of such deadline), the Obligors’ Agent shall provide to Administrative Agent a compliance certificate (whether or not a Compliance Period is in effect on the date such compliance certificate is required to be delivered) calculating the Consolidated Fixed Charge Coverage Ratio for the Test Period ended immediately prior to the beginning of such Compliance Period based on the most recent financial statements delivered pursuant to Section 9.01(a) or (b).

10.08Modifications of Certificate of Incorporation, By-Laws and Certain Other Agreements; Limitations on Voluntary Payments, etc.

Each Obligor will not, and will not permit any of its Subsidiaries to:

(i)amend, modify or change its certificate or articles of incorporation (including, without limitation, by the filing or modification of any certificate or articles of designation), certificate of formation, limited liability company agreement or by-laws (or the equivalent organizational documents), as applicable, or any agreement entered into by it with respect to its capital stock or other Equity Interests (including any Shareholders’ Agreement), or enter into any new agreement with respect to its capital stock or other Equity Interests, unless such amendment, modification, change or other action contemplated by this clause (i) could not reasonably be expected to be adverse to the interests of the Lenders in any material respect and the terms of any such amendment, modification, change or other action will not violate any of the other provisions of this Agreement or any other Credit Document;

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(ii)amend, modify or change any provision of the Advisory Agreement unless such amendment, modification or change could not reasonably be expected to be adverse in any material respect to the interests of the Lenders or is mandated under Applicable Law; or

(iii)make (or give any notice in respect of) any voluntary or optional payment or prepayment on or redemption, repurchase or acquisition for value of, or any prepayment or redemption as a result of any change of control or similar event, asset sale, insurance or condemnation event, debt issuance, equity issuance, capital contribution or similar required “repurchase” event of (including, in each case without limitation, by way of depositing with the trustee with respect thereto or any other Person money or securities before due for the purpose of paying when due any) (I) Indebtedness incurred pursuant to Sections 10.04(xiii) and 10.04(xviii); provided that notwithstanding anything to the contrary in this Section 10.08(iii), any Group Member may prepay, repay, redeem or repurchase any such Indebtedness so long as prior to and after giving effect to such payment, prepayment, redemption or repurchase, the Payment Conditions are satisfied; (II) or Indebtedness incurred pursuant to Section 10.04(xx) unless at the time of prepayment, repayment, redemption or repurchase of such Indebtedness, no Default or Event of Default is continuing or would result therefrom; or (III) any Specified Debt except to the extent permitted pursuant to Section 10.04(xxii).

10.09Limitation on Certain Restrictions on Subsidiaries. Each Obligor will not, and will not permit any Group Member to (or in the case of Toys SARL only, will not and will not permit any of its Subsidiaries to), directly or indirectly, create or otherwise cause or suffer to exist or become effective any encumbrance or restriction on the ability of any such Group Member to (a) pay dividends or make any other distributions on its capital stock or any other Equity Interest or participation in its profits owned by any Group Member, or pay any Indebtedness owed to any Group Member, (b) make loans or advances to any Group Member or (c) transfer any of its properties or assets to any Group Member, except for such encumbrances or restrictions existing under or by reason of (i) applicable law, (ii) this Agreement and the other Credit Documents, (iii) the Local Law Financing Documents, (iv) customary provisions restricting subletting or assignment of any lease governing any leasehold interest of any Obligor, (v) customary provisions restricting assignment of any licensing agreement (in which any Group Member is the licensee) or other contract entered into by any Group Member in the ordinary course of business, (vi) restrictions on the transfer of any asset pending the close of the sale of such asset and (vii) restrictions on the transfer of any asset subject to a Lien permitted by Section 10.01(iii), (vi), (vii), (xv) or (xvi).

10.10Limitation on Issuance of Equity Interests. (a) Each Obligor will not, and will not permit any of its Subsidiaries to, issue (i) any Preferred Equity to a Person who is not an Obligor or Subsidiary of an Obligor or (ii) any redeemable common stock or other redeemable common Equity Interests other than common stock or other redeemable common Equity Interests that is or are redeemable at the sole option of any Group Member, as the case may be; provided that notwithstanding the foregoing, each Parent Guarantor may issue Qualified Preferred Stock.

(b)No Parent Guarantor will permit any of its Subsidiaries to issue any capital stock or other Equity Interests (including by way of sales of treasury stock) or any options or warrants to purchase, or securities convertible into, capital stock or other Equity Interests, except (i) for transfers and replacements of then outstanding shares of capital stock or other Equity Interests, (ii) for stock splits, stock dividends and other issuances which do not decrease the percentage ownership of any Parent Guarantor or any of their respective Subsidiaries in any class of the capital stock or other Equity Interests of such Subsidiary, (iii) to qualify directors to the extent required by applicable law and for other nominal share issuances to Persons other than Group Members to the extent required under applicable law, (iv) for issuances by Subsidiaries of each Parent Guarantor which are newly created or acquired in accordance with the terms of this Agreement,

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(v) Non-Wholly-Owned Subsidiaries may issue Equity Interests and (vi) as may be required by Applicable Law.

10.11Business; etc. Each Obligor will not, and will not permit any of its Subsidiaries to, engage directly or indirectly in any business other than the businesses engaged in by the Group as of the Second Restatement Effective Date and reasonable extensions thereof and businesses ancillary or complimentary thereto.

10.12Limitation on Creation of Subsidiaries. (a) Each Obligor will not, and will not permit any of its Subsidiaries to, establish, create or acquire after the Second Restatement Effective Date any Subsidiary (other than Non-Wholly-Owned Subsidiaries permitted to be established, created or acquired in accordance with the requirements of Section 10.12(b) and other then Immaterial Subsidiaries), provided that each Obligor and its Wholly-Owned Subsidiaries shall be permitted to establish, create and, to the extent permitted by this Agreement, acquire Wholly-Owned Subsidiaries, so long as, in each case, (i) at least 5 days’ prior written notice thereof is given to the Administrative Agent (or such shorter period of time as is acceptable to the Administrative Agent in any given case), (ii) the capital stock or other Equity Interests of such new Subsidiary are promptly pledged pursuant to, and to the extent required by, this Agreement and the Security Documents and the certificates, if any, representing such stock or other Equity Interests, together with stock or other appropriate powers duly executed in blank, are delivered to the Security Agent, (iii) each such new Wholly-Owned Subsidiary executes any Security Documents required under the Collateral and Guaranty Requirements, and (iv) each such new Wholly-Owned Subsidiary to the extent requested by the Administrative Agent or the Required Lenders, takes all actions required pursuant to Section 9.13. In addition, each new Wholly-Owned Subsidiary that is required to execute any Credit Document shall execute and deliver, or cause to be executed and delivered, all other relevant documentation (including opinions of counsel) of the type described in Section 6 as such new Subsidiary would have had to deliver if such new Subsidiary were an Obligor on the Second Restatement Effective Date.

(b)In addition to Subsidiaries of each Parent Guarantor created pursuant to preceding clause (a), each Parent Guarantor and its Subsidiaries may establish, acquire or create, and make Investments in, Non-Wholly-Owned Subsidiaries after the Second Restatement Effective Date as a result of Permitted Acquisitions (subject to the limitations contained in the definition thereof) and Investments expressly permitted to be made pursuant to Section 10.05, provided that (i) all of the capital stock or other Equity Interests of each such Non-Wholly-Owned Subsidiary shall be pledged by any Obligor which owns same as, and to the extent, required by the Collateral and Guaranty Requirement, and (ii) each such Non-Wholly-Owned Subsidiary shall take the actions specified in Section 10.12(a) to the same extent that such Non-Wholly-Owned Subsidiary would have been required to take if it were a Wholly-Owned Subsidiary of any Parent Guarantor.

10.13No Additional Deposit Accounts; etc. The Qualified Obligors will not, directly or indirectly, open, maintain or otherwise have any checking, savings, deposit, securities or other accounts at any bank or other financial institution where cash or Cash Equivalents are or may be deposited or maintained with any Person, other than (a) Core Concentration Accounts, (b) Collection Accounts, (c) Disbursement Accounts, (d) other Deposit Accounts, (e) Excluded Accounts and (f) securities accounts, in each case, meeting the requirements set forth in this Agreement (including the Collateral and Guaranty Requirements); provided that prior to opening any new Core Concentration Account, Collection Account, Disbursement Account, other Deposit Account, Excluded Account or securities account following the Second Restatement Effective Date, (i) such Obligor has notified the Administrative Agent of such new account (and in the case of a new Excluded Account, designated such Excluded Account as either a Cash Pooling Account or otherwise) and (ii) in the case of any new Core Concentration Account, Collection Account, other Deposit Account (other than Excluded Accounts and Disbursement Accounts) or securities account, the financial

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institution with which such account is opened, together with the applicable Obligor which has opened such account and the Security Agent have executed and delivered to the Administrative Agent a Cash Management Control Agreement reasonably acceptable to the Administrative Agent (or in the case of a securities account, such other control agreement as may be reasonably satisfactory to the Administrative Agent).

10.14Cash Pooling Accounts. At any time that Loans are outstanding, the Qualified Obligors will ensure that the net aggregate cash balance of any Cash Pooling Accounts maintained by such Qualified Obligors (whether positive or negative, as applicable) shall not exceed the Pounds Sterling Equivalent of £15,000,000 for any three consecutive Business Days, and the Qualified Obligors shall take (or refrain from taking, as the case may be) all such actions as are necessary to ensure compliance with this Section 10.14, including (without limitation), transferring funds from, or suspending transfers of funds to, any Cash Pooling Accounts. The Security Agent acknowledges that (a) all of the obligations of the Qualified Obligors in respect of the Cash Pooling Accounts are solely the personal obligations of the Qualified Obligors, and (b) any breach by any of the Qualified Obligors of their obligations under this Agreement shall not prejudice the status of the Cash Pooling Accounts and shall not prejudice the relevant account bank’s rights in respect of the Cash Pooling Accounts, including the account bank’s rights of set-off.

Section 11.Events of Default.

11.01Events of Default. Upon the occurrence of any of the following specified events (each, an “Event of Default”):

(a)Payments. Any Borrower shall (i) default in the payment when due of any principal of any Loan or any Note or Unpaid Drawing or (ii) default, and such default shall continue unremedied for five or more Business Days, in the payment when due of any interest on any Loan, Note or any Unpaid Drawing or any Fees or any other amounts owing hereunder or under any other Credit Document; or

(b)Representations, etc. Any representation, warranty or statement made or deemed made by any Obligor herein or in any other Credit Document or in any certificate delivered to the Administrative Agent or any Lender pursuant hereto or thereto shall prove to be untrue in any material respect on the date made or deemed made; or

(c)Covenants. Any Obligor shall (i) default in the due performance or observance by it of any term, covenant or agreement contained in Sections 5.03(e), 5.03(f) or Section 10, (ii) default in the due performance or observance by it of any term, covenant or agreement contained in Section 9.01(j) and such default shall continue unremedied for a period of one Business Day, (iii) default in the due performance or observance of any term, covenant or agreement contained in Section 9.01(g)(i), 9.08, 9.11, 9.14 or 9.16 and such default shall continue unremedied for a period of five Business Days, or (iv) default in the due performance or observance by it of any other term, covenant or agreement contained in this Agreement (other than those as provided in Sections 11.01(a) and 11.01(b)) and such default (in the case of this clause (ii) shall continue unremedied for a period of 30 days after written notice thereof to the defaulting party by the Administrative Agent or the Required Lenders; or

(d)Default Under Other Agreements. (a) (i)  Any Group Member shall (x)default in any payment of any Indebtedness (other than the Secured Obligations) (including, without limitation, any Specified Debt) beyond the period of grace, if any, provided in an instrument or agreement under which such Indebtedness was created or (y) default in the observance or performance of any agreement or condition relating to any Indebtedness (other than the Secured Obligations) (including, without limitation, any Specified Debt) or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders)

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to cause (determined without regard to whether any notice of acceleration is required other than, in any case, voluntary prepayments or terminations permitted under this Agreement), any such Indebtedness to become due prior to its stated maturity (except with respect to secured Indebtedness to the extent the same become due as a result of sale or transfer of the property or assets securing such Indebtedness), or (ii) any Indebtedness (other than the Secured Obligations) (including, without limitation, any Specified Debt) of Group Member shall be declared to be (or shall become) due and payable, or required to be prepaid other than by a regularly scheduled required prepayment or other prepayments permitted by this Agreement, prior to the stated maturity thereof, provided that it shall not be a Default or an Event of Default under this Section 11.01(d) unless the aggregate principal amount of all Indebtedness as described in preceding clauses (i) and (ii) is at least £15,000,000; or

(e)Bankruptcy, etc. Any Group Member shall commence a voluntary case concerning itself under Title 11 of the United States Code entitled “Bankruptcy,” as now or hereafter in effect, or any successor thereto (the “Bankruptcy Code”); or an involuntary case is commenced against any Group Member, and the petition is not controverted within 10 days, or is not dismissed within 60 days after the filing thereof, provided, however, that during the pendency of such period, each Lender shall be relieved of its obligation to extend credit hereunder; or a custodian (as defined in the Bankruptcy Code) is appointed for, or takes charge of, all or substantially all of the property of any Group Member, to operate all or any substantial portion of the business of any Group Member, or any Group Member commences any other proceeding (including, but not limited to a bank administration proceeding) under any reorganization, arrangement, adjustment or moratorium of debt, relief of debtors, dissolution, bankruptcy, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect relating to any Group Member (including, without limitation, under the Companies Act 2006 (United Kingdom) or the Insolvency Act 1986 as amended (United Kingdom), the Corporations Act (Australia), or any corporate action, legal proceedings or other procedure or step is taken in relation to the appointment of a liquidator, receiver, administrative receiver, administrator, compulsory manager or other similar officer in respect of any Group Member (other than any Group Member incorporated in Australia) or any of its assets; where the following proceedings are commenced against any member of the Group which conducts business in France (a “French Group Member”): any procédure d’alerte, de sauvegarde, de conciliation (including a jugement d’homologation de conciliation), de redressement, cession totale de l’entreprise, règlementou liquidation judiciaire or a conciliateur, administrateur judiciaire, liquidateur or mandataire ad hoc is appointed in respect of a French Group Member), or there is commenced against any Group Member any such proceeding which remains undismissed for a period of 45 days after the filing thereof, or any Group Member is adjudicated insolvent (with respect to an Australian Obligor, as defined in the Corporations Act) or bankrupt; or any order of relief or other order approving any such case is sought in such proceeding (including the entry of an order of relief against it or for the appointment of a receiver, controller (as defined in the Corporations Act) receiver-manager, trustee, monitor, custodian or similar official for it or for any substantial part of its property) is entered; or any Group Member makes a general assignment for the benefit of creditors; or any French Group Member is in a state of “cessation des paiements” within the meaning of Article L. 631-1 of the French commercial code (Code de commerce); or any Company action is taken by any Obligor for the purpose of effecting any of the foregoing; where the following proceedings are commenced against any member of the Group which has a permanent establishment in Spain (a “Spanish Group Member”): any “concurso”, “administración judicial”, “disolución”, “liquidación”, “intervención judicial o administrativa”, “negociaciones para alcanzar un acuerdo de refinanciación” as per Article 5bis of theSpanish Insolvency Act 22/2003, of 9 July (the “Spanish Insolvency Act”) or falls into any of the categories or situations set out in articles 360 et seq. of the Royal Decree Law 1/2010 which approves the Spanish Companies Act (the “Spanish Companies Act”) which would require it to be wound up (causa de disolución) or is obliged to initiate the proceedings for its compulsory winding-up; or any German Obligor is over-indebted (überschuldet) or unable to pay its debts (zahlungsunfähig) in the meaning of Sections 17 to 19 of the German

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Insolvency Code (Insolvenzordnung) or a court order for the rejection of insolvency proceedings due to lack of funds (Abweisungsbeschluss mangels Masse) is made in respect of a German Obligor; or

(f)Pension Plans. (a) Any Plan shall fail to satisfy the minimum funding standard required for any plan year or part thereof under Section 412 of the Code or Section 302 of ERISA or a waiver of such standard or extension of any amortization period is sought or granted under Section 412 of the Code or Section 303 or 304 of ERISA, a Reportable Event shall have occurred, a contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan subject to Title IV of ERISA shall be subject to the advance reporting requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph (b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur with respect to such Plan within the following 30 days, any Plan or Multiemployer Plan shall have had or is likely to have a trustee appointed to administer such Plan, any Plan which is subject to Title IV of ERISA is, shall have been or is likely to be terminated or to be the subject of termination proceedings under ERISA, any Plan shall have an Unfunded Current Liability, any Obligor or a Subsidiary of an Obligor or any ERISA Affiliate has incurred or is reasonably likely to incur any liability to or on account of a Plan or Multiemployer Plan under section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or section 436(f) of the Code, a “default” within the meaning of Section 4219(c)(5) of ERISA, shall occur with respect to any Plan or Multiemployer Plan; any applicable law, rule or regulation is adopted, changed or interpreted, or the interpretation or administration thereof is changed, in each case after the date hereof, by any Governmental Authority (a “Change in Law”), or, as a result of a Change in Law, an event occurs following a Change in Law, with respect to or otherwise affecting any Plan or Multiemployer Plan; (b) there shall result from any such event or events the imposition of a lien, the granting of a security interest, or a liability or a material risk of incurring a liability; and (c) such lien, security interest or liability, individually, and/or in the aggregate has had, or could reasonably be expected to have, a Material Adverse Effect; or

(g)Security Documents. Any of the Security Documents shall cease to be in full force and effect, or shall cease to give the Security Agent for the benefit of the Secured Creditors the Liens, rights, powers and privileges purported to be created thereby (including, without limitation, a perfected security interest in, and Lien on, all of the Collateral, in favor of the Security Agent, superior to and prior to the rights of all third Persons (except as permitted by Section 10.01), and subject to no other Liens (except as permitted by Section 10.01) (except as a result of the sale, release or other disposition of the applicable Collateral in a transaction permitted under the Credit Documents), or any Obligor shall default in the due performance or observance of any term, covenant or agreement on its part to be performed or observed pursuant to any such Security Document and such default shall continue beyond the period of grace, if any, specifically applicable thereto pursuant to the terms of such Security Document; or

(h)Guaranties. Any Guaranty or any provision thereof shall cease to be in full force or effect as to any Guarantor (except as a result of a release of any Guarantor in accordance with the terms thereof), or any Guarantor or any Person acting for or on behalf of such Guarantor shall deny or disaffirm such Guarantor’s obligations under the Guaranty to which it is a party or any Guarantor shall default in the due performance or observance of any term, covenant or agreement on its part to be performed or observed pursuant to the Guaranty to which it is a party; or

(i)Judgments. One or more judgments or decrees shall be entered against any Group Member involving in the aggregate for any Group Member a liability (to the extent not paid or to the extent not covered by a reputable and solvent insurance company) and such judgments and decrees either shall be final and non-appealable or shall not be vacated, discharged or stayed or bonded pending appeal for any period of 45 consecutive days, and the aggregate amount of all such judgments equals or exceeds £15,000,000; or

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(j)Change of Control. A Change of Control shall occur; or

(k)Denial of Liability. (a) Any Obligor shall deny its obligations under this Agreement, any Note or any other Credit Document, (b) any law, rule or regulation shall purport to render invalid, or preclude enforcement of, any material provision of this Agreement or any other Credit Document or impair performance of any Obligor’s obligations hereunder or under any other Credit Document or (c) any dominant authority asserting or exercising de jure or de facto governmental or police powers shall, by moratorium laws or otherwise, cancel, suspend or defer the obligation of any Obligor to pay any amount required to be paid hereunder or under any other Credit Document; or

(l)Governmental Action. Any Governmental Authority shall have condemned, nationalized, seized, or otherwise expropriated all or any substantial part of the property, shares of capital stock or other assets of any Obligor or any of its Subsidiaries, or shall have assumed custody or control of such property or other assets or of the business or operations of any Obligor or any of its Subsidiaries, or shall have taken any action for the dissolution or disestablishment of any Obligor or any of its Subsidiaries or any action that would prevent any Obligor, any of its Subsidiaries or any of their respective officers from carrying on the business of such Obligor or such Subsidiary or a substantial part thereof and, in each case, such action, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect; or

(m)English Insolvency. (a) A member of the Group incorporated in England and Wales is unable or admits inability to pay its debts as they fall due or is deemed to or declared to be unable to pay its debts under applicable law, suspends or threatens to suspend making payments on any of its debts or, by reason of actual or anticipated financial difficulties, commences negotiations with its creditors or any class of its creditors with a view to rescheduling any of its indebtedness; (b) the value of the assets of any member of the Group incorporated in England and Wales is less than its liabilities (taking into account contingent and prospective liabilities); or (c) a moratorium is declared in respect of any indebtedness of any member of the Group incorporated in England and Wales. If a moratorium occurs, the ending of the moratorium will not remedy any Event of Default caused by that moratorium; or

(n)Australian Insolvency. A member of the Group incorporated in Australia is (i) is (or has stated that it is) insolvent under administration or insolvent (each as defined in the Corporations Act); (ii) is in liquidation, in provisional liquidation, under administration or wound up or has had a Controller (as defined in the Corporations Act) appointed to its property; (iii) is subject to any arrangement, assignment, moratorium or composition, protected from creditors under any statute or dissolved (in each case, other than to carry out a reconstruction or amalgamation while solvent on terms approved by the Agent); (iv) has had an application or order made, resolution passed, proposal put forward, or any other action taken, in each case in connection with that person, which is preparatory to or could result in any of (i), (ii) or (iii) above (and, in the case of an application or similar action, it is not stayed, withdrawn or dismissed within 30 days); (v) is taken (under section 459F(1) of the Corporations Act) to have failed to comply with a statutory demand; (vi) is the subject of an event described in section 459C(2)(b) or section 585 of the Corporations Act (or it makes a statement from which the Agent reasonably deduces it is so subject); or (vii) is otherwise unable to pay its debts when they fall due; or

(o)Creditors’ Process. Any expropriation, attachment, sequestration, distress or execution affects any material asset or assets of a member of the Group incorporated in England and Wales or Australia and is not discharged within 28 days;

then, and in any such event, and at any time thereafter, if any Event of Default shall then be continuing, the Administrative Agent, upon the written request of the Required Lenders, shall by written notice to the Borrowers, take any or all of the following actions, without prejudice to the rights of the Administrative

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Agent, any Lender or the holder of any Note to enforce its claims against any Obligor (provided that, if an Event of Default specified in Section 11.01(e) shall occur with respect to any Borrower, the result which would occur upon the giving of written notice by the Administrative Agent as specified in clauses (i) and (ii) below, shall occur automatically without the giving of any such notice): (i) declare the Total Commitment terminated, whereupon all the Commitments of each Lender shall forthwith terminate immediately and any Commitment Commission shall forthwith become due and payable without any other notice of any kind; (ii) declare the principal of and any accrued interest in respect of all Loans and the Notes and all Secured Obligations owing hereunder and thereunder to be, whereupon the same shall become, forthwith due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived by each Obligor; (iii) terminate any Letter of Credit which may be terminated in accordance with its terms; (iv) direct the Borrowers to pay (and the Borrowers agree that upon receipt of such notice, or upon the occurrence of an Event of Default specified in Section 11.01(e) with respect to any Borrower, they will pay) to the Security Agent at the Payment Office such additional amount of cash or Cash Equivalents, to be held as security by the Security Agent, as is equal to the aggregate Stated Amount of all Letters of Credit issued for the account of the Borrowers and then outstanding; (v)  enforce and/or exercise, as Security Agent, all of the Liens and security interests and other rights and remedies created pursuant to the Security Documents; (vi) enforce each Guaranty; and (vii) apply any cash collateral held by the Administrative Agent pursuant to Section 11.02 to the repayment of the Secured Obligations.

Notwithstanding anything to the contrary herein or in the French Proceeds Loan Documents, no French Proceeds Loan Creditor shall take any action in respect of the French Proceeds Loans or the French Proceeds Loan Collateral to accelerate any of the liabilities thereunder or to enforce the French Proceeds Loan Collateral without the consent of the Required Lenders.

11.02Application of Proceeds. (a) All moneys collected by the Administrative Agent, the Security Agent or any other Secured Creditor (x) upon any sale or other disposition of the Collateral or any portion thereof or any other enforcement of remedies under the Security Documents (excluding, for the avoidance of doubt, the French Proceeds Loan Security Documents), (y) after acceleration of the Loans pursuant to Section 11.01 and (z) upon any distribution in connection with an insolvency or liquidation proceeding with respect to any Obligor, together with all other moneys received by the Security Agent hereunder, shall be applied as follows, subject to the terms of any Specified Debt Intercreditor Agreement:

(i)first, to the payment of all amounts owing the Security Agent, each Co-Collateral Agent and the Administrative Agent of the type described in clauses (iv), (v) and (vi) of the definition of “Secured Obligations”;

(ii)second, to the extent proceeds remain after the application pursuant to the preceding clause (i), to the payment of all amounts owing to any Agent of the type described in clauses (v) and (vi) of the definition of “Secured Obligations”;

(iii)third, to the extent proceeds remain after the application pursuant to the preceding clauses (i) and (ii), an amount equal to the outstanding Primary Obligations shall be paid to the Secured Creditors as provided in Section 11.02(e) hereof, with each Secured Creditor receiving an amount equal to its outstanding Primary Obligations or, if the proceeds are insufficient to pay in full all such Primary Obligations, its ProRata Share of the amount remaining to be distributed;

(iv)fourth, to the extent proceeds remain after the application pursuant to the preceding clauses (i) through (iii), inclusive, an amount equal to the outstanding Secondary Obligations shall be paid to the Secured Creditors as provided in Section 11.02(e) hereof, with each Secured Creditor receiving an amount equal to its outstanding Secondary Obligations or, if the proceeds are insufficient

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to pay in full all such Secondary Obligations, its ProRata Share of the amount remaining to be distributed;

(v)fifth, to the extent proceeds remain after the application pursuant to preceding clauses (i) through (iv), inclusive, an amount equal to the outstanding Tertiary Obligations shall be paid to the Secured Creditors as provided in Section 11.02(e), with each Secured Creditors receiving an amount equal to its outstanding Tertiary Obligations or, if the proceeds are insufficient to pay in full all such Tertiary Obligations, its ProRata Share of the amount remaining to be distributed; and

(vi)sixth, to the extent proceeds remain after application pursuant to the preceding clauses (i) through (v), inclusive, and following the Termination Date, to the relevant Obligor or to whomever may be lawfully entitled to receive such surplus.

(b)For purposes of this Agreement, (x) “Pro Rata Share” shall mean, when calculating a Secured Creditor’s portion of any distribution or amount, that amount (expressed as a percentage) equal to a fraction the numerator of which is the then unpaid amount of such Secured Creditor’s Primary Obligations, Secondary Obligations or Tertiary Obligations, as the case may be, and the denominator of which is the then outstanding amount of all Primary Obligations, Secondary Obligations or Tertiary Obligations, as the case may be, (y) “Primary Obligations” shall mean (i) in the case of the Credit Document Obligations, all principal of, premium, fees and interest on, all Loans, all Unpaid Drawings, the Stated Amount of all outstanding Letters of Credit and all Fees and (ii) in the case of the Hedging Obligations and Cash Management Obligations, all amounts due under each Secured Hedging Agreement that is a Qualified Secured Hedging Agreement and each Secured Cash Management Agreement that is a Qualified Secured Cash Management Agreement (other than indemnities, fees (including, without limitation, attorneys’ fees) and similar obligations and liabilities); provided that such Primary Obligations in respect of such Qualified Secured Hedging Agreements and such Qualified Secured Cash Management Agreements shall not exceed an aggregate of £30,000,000 and (z) “Secondary Obligations” shall mean all Secured Obligations other than Primary Obligations and Tertiary Obligations. For the avoidance of doubt, notwithstanding the foregoing, no amounts received from any Guarantor shall be applied to any Excluded Swap Obligations of such Guarantor.

(c)When payments to Secured Creditors are based upon their respective ProRata Shares (other than in respect of Tertiary Obligations), the amounts received by such Secured Creditors hereunder shall be applied (for purposes of making determinations under this Section 11.02 only) (i) first, to their Primary Obligations and (ii) second, to their Secondary Obligations. If any payment to any Secured Creditor of its Pro Rata Share of any distribution would result in overpayment to such Secured Creditor, such excess amount shall instead be distributed in respect of the unpaid Primary Obligations or Secondary Obligations, as the case may be, of the other Secured Creditors, with each Secured Creditor whose Primary Obligations or Secondary Obligations, as the case may be, have not been paid in full to receive an amount equal to such excess amount multiplied by a fraction the numerator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of such Secured Creditor and the denominator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of all Secured Creditors entitled to such distribution.

(d)Each of the Secured Creditors, by their acceptance of the benefits hereof and of the other Security Documents, agrees and acknowledges that if the Lender Creditors receive a distribution on account of undrawn amounts with respect to Letters of Credit issued under this Agreement (which shall only occur after all outstanding Loans under this Agreement and Unpaid Drawings have been paid in full), such amounts shall be paid to the Administrative Agent under this Agreement and held by it, for the equal and ratable benefit of the Lender Creditors, as cash security for the repayment of Secured Obligations owing to

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the Lender Creditors as such. If any amounts are held as cash security pursuant to the immediately preceding sentence, then upon the termination of all outstanding Letters of Credit under this Agreement, and after the application of all such cash security to the repayment of all Secured Obligations owing to the Lender Creditors after giving effect to the termination of all such Letters of Credit, if there remains any excess cash, such excess cash shall be returned by the Administrative Agent to the Security Agent for distribution in accordance with Section 11.02(a) hereof.

(e)All payments required to be made hereunder shall be made (x) if to the Lender Creditors, to the Administrative Agent for the account of the Lender Creditors, (y) if to the Hedging Creditors, to the trustee, paying agent or other similar representative (each, a “Representative”) for the Hedging Creditors or, in the absence of such a Representative, directly to the Hedging Creditors and (z) if to the Cash Management Creditors, directly to the Cash Management Creditors.

(f)For purposes of applying payments received in accordance with this Section 11.02, the Security Agent shall be entitled to rely upon (i) the Administrative Agent, (ii) the Representative or, in the absence of such a Representative, upon the Hedging Creditors and (iii) Cash Management Creditors for a determination (which the Administrative Agent and the Secured Creditor agree (or shall agree) to provide upon request of the Security Agent) of the outstanding Primary Obligations and Secondary Obligations owed to the Lender Creditors, the Other Creditors or the Cash Management Creditors, as the case may be. Unless it has received written notice from a Secured Creditor to the contrary, the Administrative Agent and each Representative, in furnishing information pursuant to the preceding sentence, and the Security Agent, in acting hereunder, shall be entitled to assume that no Secondary Obligations are outstanding. Unless it has written notice from a Hedging Creditor or Cash Management Creditor to the contrary, the Security Agent, in acting hereunder, shall be entitled to assume that no Secured Hedging Agreements or Secured Cash Management Agreements are in existence.

(g)It is understood that the Obligors (except Toys SARL) shall remain severally liable to the extent of any deficiency between the amount of the proceeds of the Collateral and the aggregate amount of the Secured Obligations.

Section 12.The Agents.

12.01Appointment. The Lenders (including in their capacity as Issuing Lenders and the Lead Arrangers) hereby irrevocably designate and appoint the Agents to act as specified herein and in the other Credit Documents. Each Lender hereby irrevocably authorizes, and each holder of any Note by the acceptance of such Note shall be deemed irrevocably to authorize the Agents to take such action on its behalf under the provisions of this Agreement, the other Credit Documents and any other instruments and agreements referred to herein or therein and to exercise such powers and to perform such duties hereunder and thereunder as are specifically delegated to or required of the Agents by the terms hereof and thereof and such other powers as are reasonably incidental thereto. The Agents may perform any of their respective duties hereunder by or through their officers, directors, agents, employees or affiliates.

12.02Nature of Duties. (a) The Agents shall not have any duties or responsibilities except those expressly set forth in this Agreement and in the other Credit Documents. No Agent nor any of its officers, directors, agents, employees or affiliates shall be liable for any action taken or omitted by it or them hereunder or under any other Credit Document or in connection herewith or therewith, unless caused by its or their gross negligence, willful misconduct or bad faith (as determined by a court of competent jurisdiction in a final and non-appealable decision). The duties of the Agents shall be mechanical and administrative in nature; the Agents shall not have by reason of this Agreement or any other Credit Document a fiduciary relationship in respect of any Lender or the holder of any Note; and nothing in this Agreement or in any other Credit Document, expressed or implied, is intended to or shall be so construed as to impose upon the

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Agents any obligations in respect of this Agreement or any other Credit Document except as expressly set forth herein or therein.

(b)Notwithstanding any other provision of this Agreement or any provision of any other Credit Document, the Lead Arrangers are named as such for recognition purposes only, and in its capacity as such shall have no powers, duties, responsibilities or liabilities with respect to this Agreement or the other Credit Documents or the transactions contemplated hereby and thereby; it being understood and agreed that the Lead Arrangers shall be entitled to all indemnification and reimbursement rights in favor of the Administrative Agent as, and to the extent, provided for under Sections 12.06 and 13.01. Without limitation of the foregoing, the Lead Arrangers shall not, solely by reason of this Agreement or any other Credit Documents, have any fiduciary relationship in respect of any Lender or any other Person.

12.03Lack of Reliance on the Agents. Independently and without reliance upon the Agents, each Lender and the holder of each Note, to the extent it deems appropriate, has made and shall continue to make (a) its own independent investigation of the financial condition and affairs of the Obligors in connection with the making and the continuance of the Loans and the taking or not taking of any action in connection herewith and (b) its own appraisal of the creditworthiness of the Obligors and, except as expressly provided in this Agreement, no Agent shall have any duty or responsibility, either initially or on a continuing basis, to provide any Lender or the holder of any Note with any credit or other information with respect thereto, whether coming into its possession before the making of the Loans or at any time or times thereafter. No Agent shall be responsible to any Lender or the holder of any Note for any recitals, statements, information, representations or warranties herein or in any document, certificate or other writing delivered in connection herewith or for the execution, effectiveness, genuineness, validity, enforceability, perfection, collectability, priority or sufficiency of this Agreement or any other Credit Document or the financial condition of the Obligors or be required to make any inquiry concerning either the performance or observance of any of the terms, provisions or conditions of this Agreement or any other Credit Document, or the financial condition of the Obligors or the existence or possible existence of any Default or an Event of Default.

12.04Certain Rights of the Administrative Agent. If the Administrative Agent shall request instructions from the Required Lenders with respect to any act or action (including failure to act) in connection with this Agreement or any other Credit Document, the Administrative Agent shall be entitled to refrain from such act or taking such action unless and until the Administrative Agent shall have received instructions from the Required Lenders; and the Administrative Agent shall not incur liability to any Lender by reason of so refraining. Without limiting the foregoing, neither any Lender nor the holder of any Note shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or refraining from acting hereunder or under any other Credit Document in accordance with the instructions of the Required Lenders.

12.05Reliance. Each Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, statement, certificate, telex, teletype or telecopier message, cablegram, radiogram, order or other document or telephone message signed, sent or made by any Person that such Agent believed to be the proper Person, and, with respect to all legal matters pertaining to this Agreement and any other Credit Document and its duties hereunder and thereunder, upon advice of counsel selected by such Agent.

12.06Indemnification. To the extent any Agent (or any affiliate thereof) is not reimbursed and indemnified by the Borrowers, the Lenders will reimburse and indemnify such Agent (and any affiliate thereof) in proportion to their respective “percentage” as used in determining the Required Lenders (determined as if there were no Defaulting Lenders and as if all references to Affiliated Lenders in the definition of Required Lenders were deleted) for and against any and all liabilities, obligations, losses,

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damages, penalties, claims, actions, judgments, costs, expenses or disbursements of whatsoever kind or nature which may be imposed on, asserted against or incurred by such Agent (or any affiliate thereof) in performing its respective duties hereunder or under any other Credit Document or in any way relating to or arising out of this Agreement or any other Credit Document; provided that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, claims, actions, judgments, suits, costs, expenses or disbursements resulting from such Agent’s (or such affiliates’ thereof) gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision).

12.07Agents in their Individual Capacities. With respect to its obligation to make Loans, or issue or participate in Letters of Credit, under this Agreement, each Agent shall have the rights and powers specified herein for a “Lender” and may exercise the same rights and powers as though it were not performing the duties specified herein; and the term “Lender”, “Required Lenders”, “Supermajority Lenders”, “holders of Notes” or any similar terms shall, unless the context clearly indicates otherwise, include such Agent in its respective individual capacities. Each Agent and its respective affiliates may accept deposits from, lend money to, and generally engage in any kind of banking, investment banking, trust or other business with, or provide debt financing, equity capital or other services (including financial advisory services) to any Obligor or any Affiliate of any Obligor (or any Person engaged in a similar business with any Obligor or any Affiliate thereof) as if they were not performing the duties specified herein, and may accept fees and other consideration from any Obligor or any Affiliate of any Obligor for services in connection with this Agreement and otherwise without having to account for the same to the Lenders.

12.08Holders. The Administrative Agent may deem and treat the payee of any Note as the owner thereof for all purposes hereof unless and until a written notice of the assignment, transfer or endorsement thereof, as the case may be, shall have been filed with the Administrative Agent. Any request, authority or consent of any Person who, at the time of making such request or giving such authority or consent, is the holder of any Note shall be conclusive and binding on any subsequent holder, transferee, assignee or endorsee, as the case may be, of such Note or of any Note or Notes issued in exchange therefor.

12.09Resignation by, and Removal of, the Administrative Agent. (a) The Administrative Agent (for purposes of this Section 12.09(a) through (e), the term “Administrative Agent” also shall include DBNY in its capacity as Security Agent hereunder and pursuant to the Security Documents) may resign from the performance of all its respective functions and duties hereunder and/or under the other Credit Documents at any time by giving 15 Business Days’ prior written notice to the Lenders and, unless a Default or an Event of Default under Section 11.01(e) then exists, the Borrowers. Any such resignation by an Administrative Agent hereunder shall also constitute its resignation as Security Agent under the French Proceeds Loan Documents. Any such resignation by an Administrative Agent hereunder shall also constitute its resignation as an Issuing Lender and the Fronting Lender, in which case the resigning Administrative Agent (x) shall not be required to issue any further Letters of Credit or make any additional Specified Foreign Currency Loans hereunder and (y) shall maintain all of its rights as Issuing Lender or Fronting Lender, as the case may be, with respect to any Letters of Credit issued by it, or Specified Foreign Currency Loans made by it, prior to the date of such resignation. Such resignation shall take effect upon the appointment of a successor Administrative Agent pursuant to clauses (b) and (c) below or as otherwise provided below. If the Administrative Agent shall become (and for so long as it remains) subject to any event or proceeding described in clause (iii) of the definition of Defaulting Lender, the Administrative Agent may be removed by the Borrowers or the Required Lenders; provided that (x) in the case of a removal by the Borrowers, the Administrative Agent shall be contemporaneously replaced as Administrative Agent by one or more of the other Agents or a Person approved by the Required Lenders and reasonably acceptable to the Borrowers, which acceptance shall not be unreasonably withheld or delayed and (y) in the case of a removal by the Required Lenders, the Administrative Agent shall be contemporaneously replaced by a successor Administrative Agent designated by the Required Lenders, which successor Administrative Agent shall be

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reasonably acceptable to the Borrowers, which acceptance shall not be unreasonably withheld or delayed (provided that the Borrowers’ approval shall not be required if a Default or an Event of Default then exists).

(b)Upon any such notice of resignation by the Administrative Agent, the Required Lenders shall appoint a successor Administrative Agent hereunder and under the other Credit Documents who shall be a commercial bank or trust company reasonably acceptable to the Borrowers, which acceptance shall not be unreasonably withheld or delayed (provided that the Borrowers’ approval shall not be required if an Event of Default then exists).

(c)If a successor Administrative Agent shall not have been so appointed within such 15 Business Day period, the Administrative Agent, with the consent of the Borrowers (which consent shall not be unreasonably withheld or delayed, provided that the Borrowers’ consent shall not be required if an Event of Default then exists), shall then appoint a successor Administrative Agent who shall serve as Administrative Agent hereunder or thereunder until such time, if any, as the Required Lenders appoint a successor Administrative Agent as provided above.

(d)If no successor Administrative Agent has been appointed pursuant to clause (b) or (c) above by the 20^th Business Day after the date such notice of resignation was given by the Administrative Agent, the Administrative Agent’s resignation shall become effective and the Required Lenders shall thereafter perform all the duties of the Administrative Agent hereunder and/or under any other Credit Document until such time, if any, as the Required Lenders appoint a successor Administrative Agent as provided above.

(e)Upon a resignation or removal of the Administrative Agent pursuant to this Section 12.09, the Administrative Agent shall remain indemnified to the extent provided in this Agreement and the other Credit Documents and the provisions of this Section 12 (and the analogous provisions of the other Credit Documents) shall continue in effect for the benefit of the Administrative Agent for all of its actions and inactions while serving as the Administrative Agent hereunder and under the other Credit Documents.

(f)The Co-Collateral Agent may resign at any time upon written notice to the Borrowers and the Administrative Agent and such resignation shall become effective immediately upon the delivery of such written notice.

(g)Upon a resignation or removal of the Co-Collateral Agent pursuant to Section 12.09(f), the Co-Collateral Agent shall remain indemnified to the extent provided in this Agreement and the other Credit Documents and the provisions of this Section 12 (and the analogous provisions of the other Credit Documents) shall continue in effect for the benefit of the Co-Collateral Agent for all of its actions and inactions while serving as the Co-Collateral Agent hereunder and under the other Credit Documents.

12.10Collateral Matters. (a) For the purposes of this Section 12.10 only, any reference to a “Lender” shall include the UK Borrowers in their capacity as French Proceeds Loan Creditors, the “Security Documents” shall include the French Proceeds Loan Security Documents and “Secured Obligations” shall include the French Proceeds Loan Secured Obligations. Each Lender (including in its capacity as an Issuing Lender) authorizes and directs the Security Agent to enter into the Security Documents for the benefit of (and, in respect of the Security Documents governed by French law, in the name and for the account of,) the Lenders and the other Secured Creditors. Each Lender hereby agrees, and each holder of any Note by the acceptance thereof will be deemed to agree, that, except as otherwise set forth herein, any action taken by the Required Lenders in accordance with the provisions of this Agreement or the Security Documents, and the exercise by the Required Lenders of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of the Lenders.

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The Security Agent is hereby authorized on behalf of all of (and, in respect of the Security Documents governed by French law, in the name and for the account of,) the Lenders, without the necessity of any notice to or further consent from any Lender, from time to time prior to an Event of Default, to take any action with respect to any Collateral or Security Documents which may be necessary to perfect and maintain perfected the security interest in and liens upon the Collateral granted pursuant to the Security Documents.

(b)The Lenders hereby authorize and direct the Security Agent, at its option and in its discretion or upon request of a Borrower or Toys SARL, as the case may be, to release or subordinate (as the case may be) any Lien granted to or held by the Security Agent upon any Collateral (i) upon termination of the Total Commitment (and all Letters of Credit) and payment and satisfaction of all of the Secured Obligations (other than inchoate indemnification obligations and other contingent obligations not due and payable) at any time arising under or in respect of this Agreement or the Credit Documents or the transactions contemplated hereby or thereby, (ii) constituting property being sold or otherwise disposed of (to Persons other than an Obligor unless such respective Obligor is not required to give a security interest in the assets being transferred) upon the sale or other disposition thereof in compliance with Section 10.05, (iii) if approved, authorized or ratified in writing by the Required Lenders (or all of the Lenders hereunder, to the extent required by Section 13.12) or (iv) as otherwise may be expressly provided in the relevant Security Documents. Upon request by the Administrative Agent at any time, the Lenders will confirm in writing the Security Agent’s authority to release particular types or items of Collateral pursuant to Section 12.10.

(c)The Security Agent shall have no obligation whatsoever to the Lenders or to any other Person to assure that the Collateral exists or is owned by any Obligor or is cared for, protected or insured or that the Liens granted to the Security Agent herein or pursuant hereto have been properly or sufficiently or lawfully created, perfected, protected or enforced or are entitled to any particular priority, or to exercise or to continue exercising at all or in any manner or under any duty of care, disclosure or fidelity any of the rights, authorities and powers granted or available to the Security Agent in this Section 12.10, in any of the Security Documents, it being understood and agreed that in respect of the Collateral, or any act, omission or event related thereto, the Security Agent may act in any manner it may deem appropriate, in its sole discretion, given the Security Agent’s own interest in the Collateral as one of the Lenders and that the Security Agent shall have no duty or liability whatsoever to the Lenders, except for its gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision).

(d)The Security Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Credit Document by or through, or delegate any and all such rights and powers to, any one or more sub-agents, trustees or third parties appointed by the Security Agent. The Security Agent (and any such sub-agent, trustee or third party) may perform any and all of its duties and exercise its rights and powers by or through their respective Affiliates. The exculpatory and indemnification provisions of this Section 12 and Section 13.01 shall apply to any such sub-agent, trustee or third party and to their respective Affiliates to the same extent that such provisions apply to the Security Agent.

(e)Each Lender authorizes and directs the Security Agent and the Administrative Agent to enter into the intercreditor agreements, including the Specified Debt Intercreditor Agreement, third party holder (tiers détenteur) appointment agreements and related documents in respect of the Secured Hedging Agreements, the Secured Cash Management Agreements, the Specified Debt, and this Section 12.10(e), as applicable, it being understood that such intercreditor agreements and/or other documents shall contain an acknowledgement that the Hedging Creditors, Cash Management Creditors and/or holders of the Specified Debt, as applicable, are bound by and restate the authorizations set forth in Section 12.10.

(f)Each Lender authorizes and directs the Security Agent and the Administrative Agent to enter into acknowledgments and other agreements with the financial institutions providing the cash pooling

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arrangements which recognize such financial institution’s right to net out balances in the deposit accounts included in the cash pooling arrangements will be senior to the security interest of the Security Agent in such deposit accounts. It is understood and agreed that the Collection Accounts and Concentration Accounts will not be permitted to be subject to such cash pooling arrangements.

12.11Lower Ranking Share Pledges. (a) The Lenders (including in their capacity as Issuing Lenders) hereby mandate the Security Agent to execute in their name and for their account, simultaneously with the execution of each Incremental Commitment Agreement, Qualified Secured Hedging Agreement and Qualified Cash Management Agreement (as applicable), any Incremental Security Document and/or Hedging/Cash Management Security Document to the extent necessary to allow each Incremental Lender, Hedging Creditor and Cash Management Creditor to benefit from the Incremental Security Documents and the Hedging/Cash Management Security Document (as applicable).

(b)Specifically, the Secured Creditors in their capacity as beneficiaries of the French Share Pledge, expressly authorize the granting of a second ranking pledge and, if applicable, of lower ranking pledges on the French Pledged Shares to the benefit of the Lenders, Incremental Lenders, the Hedging Creditors and the Cash Management Creditors in accordance with the terms of such lower ranking pledge agreements. Each Incremental Lender (and each Hedging Creditor and Cash Management Creditor in the relevant intercreditor agreement or similar agreement), in its capacity as beneficiary of lower ranking pledge agreements, expressly authorizes the granting of pledges ranking lower than the pledge of which it is the beneficiary on the French Pledged Shares, in favor of other Incremental Lenders, Hedging Creditors and the Cash Management Creditors which would execute Incremental Commitment Agreements, Qualified Secured Hedging Agreements and Qualified Cash Management Agreements (as applicable) after the date on which it executed the Incremental Commitment Agreement(s) to which it is a party.

12.12Delivery of Information. The Administrative Agent shall not be required to deliver to any Lender originals or copies of any documents, instruments, notices, communications or other information received by the Administrative Agent from any Obligor, any Subsidiary thereof, the Required Lenders, any Lender or any other Person under or in connection with this Agreement or any other Credit Document except (a) as specifically provided in this Agreement or any other Credit Document and (b) as specifically requested from time to time in writing by any Lender with respect to a specific document, instrument, notice or other written communication received by and in the possession of the Administrative Agent at the time of receipt of such request and then only in accordance with such specific request.

12.13Co-Collateral Agent. If a Co-Collateral Agent proposes an adjustment or revision to Borrowing Base eligibility standards, advance rates applicable to the Borrowing Base or Reserves, or makes any other proposal regarding a determination or action which may be made by the Co-Collateral Agents pursuant to this Agreement or any Security Document, the other Co-Collateral Agent shall respond to such proposal within three Business Days of its receipt of such written proposal. In the event that the Co-Collateral Agents do not agree on eligibility standards or Reserves or any other action or determination which may be made by the Co-Collateral Agents pursuant to the Agreement or any Security Documents, 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 or eligibility reduced by any Co-Collateral Agent in the event of any such disagreement may not exceed £5,000,000 in the aggregate at any time outstanding for all such disagreements; and furtherprovided 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 furtherprovided 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

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proviso hereof and shall not be included in calculating the amount of Reserves or eligibility reductions permitted under such first proviso.

12.14Amendments to Guaranties and Security Documents on the Second Restatement Effective Date. By their execution and delivery hereof, the Lenders party hereto hereby authorize and direct the Administrative Agent and the Co-Collateral Agents to enter into the Credit Document Acknowledgment and Amendment in substantially the form of Exhibit R hereto.

Section 13.Miscellaneous.

13.01Payment of Expenses, etc. (a) The Borrowers hereby agree to: (a) whether or not the transactions herein contemplated are consummated, pay all reasonable out-of-pocket costs and expenses (including Expenses) of the Agents (including, without limitation, the reasonable fees and disbursements of White & Case LLP and the Administrative Agent’s other counsel and consultants and the fees and expenses in connection with the appraisals and collateral examinations required pursuant to, and subject to the limits set forth in, Section 9.01(l)) in connection with the preparation, execution, delivery and administration of this Agreement and the other Credit Documents and the documents and instruments referred to herein and therein and any actual or proposed amendment, waiver or consent relating hereto or thereto, of the Agents and their respective Affiliates in connection with their syndication efforts with respect to this Agreement and of the Agents and, after the occurrence of an Event of Default, each of the Issuing Lenders and the Lenders in connection with the enforcement of this Agreement and the other Credit Documents and the documents and instruments referred to herein and therein or in connection with any refinancing or restructuring of the credit arrangements provided under this Agreement in the nature of a “work-out” or pursuant to any insolvency or bankruptcy proceedings (including, in each case without limitation, the reasonable fees and disbursements of counsel (limited to one local counsel in each relevant jurisdiction (or two in the case of a conflict preventing only one local counsel acting)) and consultants for the Agents and, after the occurrence of an Event of Default, counsel (limited to one local counsel in each relevant jurisdiction (or two in the case of a conflict preventing only one local counsel acting)) for each of the Issuing Lenders and Lenders); (b) pay and hold the Administrative Agent, the Facility Agent, each of the Issuing Lenders, the Security Agent, each Co-Collateral Agent and each of the Lenders harmless from and against any and all present and future stamp, excise and other similar documentary taxes with respect to the foregoing matters (other than taxes covered by section 5.04.7) (including as a result of any assignment pursuant to Section 13.04(b), whether by Assumption Agreement or otherwise, if the Australian Borrower does anything which causes them to become resident outside New South Wales where that change causes duty to be payable on an assignment of debt) and save the Administrative Agent, the Facility Agent, each of the Issuing Lenders, the Security Agent, each Co-Collateral Agent and each of the Lenders harmless from and against any and all liabilities with respect to or resulting from any delay or omission (other than to the extent attributable to the Administrative Agent, the Facility Agent, such Issuing Lender, such Security Agent or such Lender) to pay such taxes; and (c) indemnify the Administrative Agent, the Facility Agent, the Security Agent, each Co-Collateral Agent, each Issuing Lender and each Lender, (each, an “Indemnified Person”) and each of their respective officers, directors, employees, representatives, agents and Affiliates from and hold each of them harmless against any and all liabilities, obligations, losses, damages, penalties, claims, actions (including removal or remedial actions), judgments, suits, costs, expenses and disbursements (including reasonable attorneys’ and consultants’ fees and disbursements) incurred by, imposed on or assessed against any of them as a result of, or arising out of, or in any way related to, or by reason of, (i) any investigation, litigation or other proceeding (whether or not the Administrative Agent, the Facility Agent, the Security Agent, any Co-Collateral Agent, any Issuing Lender or any Lender is a party thereto and whether or not such investigation, litigation or other proceeding is brought by or on behalf of any Obligor) related to the entering into and/or performance of this Agreement or any other Credit Document or the use of any Letter of Credit or the proceeds of any Loans hereunder or the consummation of the Transaction or any other transactions

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contemplated herein or in any other Credit Document or the exercise of any of their rights or remedies provided herein or in the other Credit Documents, or (ii) the actual or alleged presence of Hazardous Materials in the air, surface water or groundwater or on the surface or subsurface of any Real Property at any time owned, leased or operated by any Obligor or any of its Subsidiaries, the generation, storage, transportation, handling or disposal of Hazardous Materials by any Obligor at any location, whether or not owned, leased or operated by any Obligor, the non-compliance by any Obligor with any Environmental Law (including applicable permits thereunder) applicable to any Real Property, or any Environmental Claim asserted against any Obligor or any Real Property at any time owned, leased or operated by any Obligor, including, in each case, without limitation, the reasonable fees and disbursements of counsel and other consultants incurred in connection with any such investigation, litigation or other proceeding (but excluding any losses, liabilities, claims, damages, actions, suits, disbursements, judgments, costs or expenses to the extent incurred by reason of the gross negligence or willful misconduct of the Person to be indemnified (as determined by a court of competent jurisdiction in a final judgment)). To the extent that the undertaking to indemnify, pay or hold harmless any Agent, any Issuing Lender or any Lender set forth in the preceding sentence may be unenforceable because it is violative of any law or public policy, the Borrowers shall make the maximum contribution to the payment and satisfaction of each of the indemnified liabilities which is permissible under applicable law. Subject to Section 9.01(l), in addition, the Obligors agree to reimburse the Administrative Agent for all reasonable third party administrative, audit and monitoring expenses incurred in connection with the Borrowing Base and determinations thereunder.

(b)To the full extent permitted by applicable law, each Obligor shall not assert, and hereby waives, any claim against any Indemnified Person, on any theory of liability, for special, indirect, consequential or incidental damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof. No Indemnified Person 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 Credit Documents or the transactions contemplated hereby or thereby, except to the extent the liability of such Indemnified Person results from such Indemnified Person’s gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non‑appealable decision).

13.02Right of Setoff. In addition to any rights now or hereafter granted under applicable law or otherwise, and not by way of limitation of any such rights, upon the occurrence and during the continuance of an Event of Default, the Administrative Agent, the Facility Agent, each Issuing Lender and each Lender is hereby authorized at any time or from time to time, without presentment, demand, protest or other notice of any kind to any Obligor or to any other Person, any such notice being hereby expressly waived, to set off and to appropriate and apply any and all deposits (general or special) and any other Indebtedness at any time held or owing by the Administrative Agent, the Facility Agent, such Issuing Lender or such Lender (including, without limitation, by branches and agencies of the Administrative Agent, the Facility Agent, such Issuing Lender or such Lender wherever located) to or for the credit or the account of any Obligor against and on account of the Secured Obligations and liabilities of the Obligors to the Administrative Agent, such Issuing Lender or such Lender under this Agreement or under any of the other Credit Documents, including, without limitation, all interests in Secured Obligations purchased by such Lender pursuant to Section 13.04(b), and all other claims of any nature or description arising out of or connected with this Agreement or any other Credit Document, irrespective of whether or not the Administrative Agent, such Issuing Lender or such Lender shall have made any demand hereunder and although said Secured Obligations, liabilities or claims, or any of them, shall be contingent or unmatured; 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

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with the provisions of Section 15.07 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, the Issuing Banks, 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; providedfurther that that no amounts received from, or set off with respect to, any Guarantor shall be applied to any Excluded Swap Obligations of such Guarantor.

13.03Notices. Except as otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including telecopier communication, facsimile transmission or electronic mail) and mailed, telecopied, transmitted or delivered: if to any Obligor, to such Obligor as set forth on Schedule I hereto; if to any Lender, at its address, facsimile number or electronic mail address specified on Schedule 13.03; and if to the Administrative Agent, at the Notice Office; if to the Facility Agent, at the Notice Office, if to the Security Agent at 60 Wall Street, New York, New York 10005, Attention: Dusan Lazarov, facsimile number (212) 797-5695; if to the Co-Collateral Agents, at Deutsche Bank AG New York Branch, 60 Wall Street, New York, New York 10005, Attention: Dusan Lazarov, facsimile number (212) 797-5695 and Bank of America, N.A., 100 Federal Street, Boston MA 02110, Attention: Christine Hutchinson, facsimile number (617) 434-4131; or, as to any Obligor or the Administrative Agent, the Facility Agent, the Security Agent or any Co-Collateral Agent, at such other address as shall be designated by such party in a written notice to the other parties hereto and, as to each Lender, at such other address, facsimile number or electronic mail address as shall be designated by such Lender in a written notice to the Borrowers and the Administrative Agent. All such notices and communications shall, when mailed, telecopied, faxed, mailed electronically or sent by overnight courier, be effective when deposited in the mails or overnight courier, as the case may be, or sent by telecopier or electronic mail, except that notices and communications to the Administrative Agent, the Security Agent and any Co-Collateral Agent, shall not be effective until received by the Administrative Agent, the Security Agent or such Co‑Collateral Agent, as the case may be.

13.04Benefit of Agreement; Assignments; Participations. (a) This Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective successors and assigns of the parties hereto; provided, however, that none of the Parent Guarantors nor any Borrower may assign or transfer any of their rights, obligations or interest hereunder without the prior written consent of the Lenders which consent will not be given unless the assignee or transferee is a member of the same “wholly-owned group” as, or an Associate of, each of the Borrowers for the purposes of section 128F of the Australian Tax Act and, providedfurther, that, although any Lender may transfer, assign or grant participations in its rights hereunder, such Lender shall remain a “Lender” for all purposes hereunder (and may not transfer or assign all or any portion of its Commitments or Loans hereunder except as provided in Sections 2.13 and 13.04(b)) and the transferee, assignee or participant, as the case may be, shall not constitute a “Lender” hereunder and, providedfurther, that no Lender shall transfer or grant any participation under which the participant shall have rights to approve any amendment to or waiver of this Agreement or any other Credit Document except to the extent such amendment or waiver would (i) extend the final scheduled maturity of any Loan, Note or Letter of Credit (unless such Letter of Credit is not extended beyond the Maturity Date) in which such participant is participating, or reduce the rate or extend the time of payment of interest or Fees thereon (except in connection with a waiver of applicability of any post-default increase in interest rates) or reduce the principal amount thereof (it being understood that any amendment or modification to the financial definitions in this Agreement or to Section 13.07(a) shall not constitute a reduction in the rate of interest or Fees payable hereunder), or increase the amount of the participant’s participation over the amount thereof then in effect (it being understood that a waiver of any Default or Event of Default or of a mandatory reduction in the Total Commitment shall not constitute a change in the terms of such participation, and that an increase in any Commitment (or the available portion thereof) or Loan shall be permitted without the consent of any participant if the participant’s participation is not increased as a result thereof), (ii) consent to the assignment or transfer by Borrower of any of its rights and obligations under this Agreement or (iii) release all or

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substantially all of the Collateral under any or all of the Security Documents (except as expressly provided in the Credit Documents) supporting the Loans or Letters of Credit hereunder in which such participant is participating. In the case of any such participation, the participant shall not have any rights under this Agreement or any of the other Credit Documents (the participant’s rights against such Lender in respect of such participation to be those set forth in the agreement executed by such Lender in favor of the participant relating thereto) and all amounts payable by the Borrowers hereunder shall be determined as if such Lender had not sold such participation; provided that nothing herein shall require any notice to any Borrower or any other Person in connection with the sale of any participation. To the extent permitted by law, each participant shall also be entitled to the benefits of Section 13.02 as though it were a Lender, provided such participant agrees to be subject to Section 13.06 as though it were a Lender.

(b)Notwithstanding the foregoing, any Lender (or any Lender together with one or more other Lenders) may (x) assign all or a portion of its Commitments and related outstanding Secured Obligations (or, if the Commitments have terminated, outstanding Secured Obligations) hereunder to (i) (A) its parent company and/or any Affiliate of such Lender or (B) to one or more other Lenders or any Affiliate of any such other Lender (provided that, in each case, in relation to a French Qualifying Obligor, the assignment to a Lender incorporated, domiciled, established or acting through a Facility Office situated in a Non-Cooperative Jurisdiction is subject to the prior consent of such French Qualifying Obligor, which shall not be unreasonably withheld; provided that any fund that invests in loans and is managed or advised by the same investment advisor of another fund which is a Lender (or by an Affiliate of such investment advisor) shall be treated as an Affiliate of such other Lender for the purposes of this sub‑clause (x)(i)(B)); provided that no such assignment may be made to any such Person that is, or would at such time constitute, a Defaulting Lender or (ii) in the case of any Lender that is a fund that invests in loans, any other fund that invests in loans managed or advised by the same investment advisor of any Lender or by an Affiliate of such investment advisor or (y) assign all, or if less than all, a portion equal to at least £5,000,000, in each case in the aggregate for the assigning Lender or assigning Lenders, of such Commitments and related outstanding Secured Obligations (or, if the Commitments have terminated, outstanding Secured Obligations) hereunder to one or more Eligible Transferees (treating any fund that invests in loans and any other fund that invests in loans and is managed or advised by the same investment advisor of such fund or by an Affiliate of such investment advisor as a single Eligible Transferee), each of which assignees shall become a party to this Agreement as a Lender by execution of an Assignment and Assumption Agreement, provided that (t) at such time, Schedule 1.01(a) shall be deemed modified to reflect the Commitments and/or outstanding Loans, as the case may be, of such new Lender and of the existing Lenders, (u) upon the surrender of the relevant Notes by the assigning Lender (or, upon such assigning Lender’s indemnifying the Borrowers for any lost Note pursuant to a customary indemnification agreement) new Notes will be issued, at such Borrower’s reasonable expense, to such new Lender and to the assigning Lender upon the request of such new Lender or assigning Lender, such new Notes to be in conformity with the requirements of Section 2.05 (with appropriate modifications) to the extent needed to reflect the revised Commitments and/or outstanding Loans, as the case may be, (v) any assignment of any Commitment (or related extensions of credit) shall require the consents (not to be unreasonably withheld, delayed or conditioned) of each Issuing Lender and, unless such assignment is to a Person that will not be a Participating Specified Foreign Currency Lender, the Fronting Lender, (w) the consent of the Administrative Agent, the Fronting Lender (unless such assignment is to a Person that will not be a Participating Specified Foreign Currency Lender) and, so long as no Default or Event of Default then exists, the Obligors’ Agent shall be required in connection with any such assignment pursuant to clause (y) above (such consent, in any case, not to be unreasonably withheld, delayed or conditioned), (x) the Administrative Agent shall receive at the time of each such assignment, from the assigning or assignee Lender, the payment of a non‑refundable assignment fee of $3,500, (y) each assignment by any Participating Specified Foreign Currency Lender shall require a Specified Foreign Currency Participation Settlement with respect to such Participating Specified Foreign Currency Lender unless the

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Fronting Lender agrees in its sole discretion that the respective assignee shall succeed such Participating Specified Foreign Currency Lender as a Participating Specified Foreign Currency Lender itself, in which case such assignee shall acquire the Specified Foreign Currency Participation of the respective assignor and (z) no such transfer or assignment will be effective until recorded by the Administrative Agent on the Register pursuant to Section 13.15. A Lender may only assign all or a portion of its Commitments hereunder if that assignment would result in at least two Lenders under this Agreement.

(c)Nothing in this Agreement shall prevent or prohibit any Lender from pledging its Loans and Notes hereunder to a Federal Reserve Bank in support of borrowings made by such Lender from such Federal Reserve Bank and, with prior notification to the Administrative Agent (but without the consent of the Administrative Agent or the Obligors’ Agent), any Lender which is a fund may pledge all or any portion of its Loans and Notes to its trustee or to a collateral agent providing credit or credit support to such Lender in support of its obligations to such trustee, such collateral agent or a holder of such obligations, as the case may be. No pledge pursuant to this clause (c) shall release the transferor Lender from any of its obligations hereunder.

(d)An assignment of rights will only be effective vis-à-vis third parties if the assignment is notified (signifié) to each French Obligor by a bailiff (huissier) in accordance with article 1690 of the French Code Civil.

(e)Any Lender which assigns all of its Commitments and/or Loans hereunder in accordance with Section 13.04(b) shall cease to constitute a “Lender” hereunder, except with respect to indemnification provisions under Sections 2.10, 2.11, 3.06, 5.04, 12.06, 13.01 and 13.06 and any others expressly stated to survive as to such assigning Lender.

13.05No Waiver; Remedies Cumulative. No failure or delay on the part of the Administrative Agent, the Facility Agent, the Security Agent, any Co-Collateral Agent, any Issuing Lender or any Lender in exercising any right, power or privilege hereunder or under any other Credit Document and no course of dealing between any Obligor and the Administrative Agent, the Facility Agent, the Security Agent, any Co-Collateral Agent, any Issuing Lender or any Lender shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or under any other Credit Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder or thereunder. The rights, powers and remedies herein or in any other Credit Document expressly provided are cumulative and not exclusive of any rights, powers or remedies which the Administrative Agent, the Facility Agent, the Security Agent, any Co‑Collateral Agent, any Issuing Lender or any Lender would otherwise have. No notice to or demand on any Obligor in any case shall entitle any Obligor to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Administrative Agent, the Facility Agent, the Security Agent, any Co-Collateral Agent, any Issuing Lender or any Lender to any other or further action in any circumstances without notice or demand.

13.06Payments Pro Rata. (a) Except as otherwise provided in this Agreement, the Facility Agent agrees that promptly after its receipt of each payment from or on behalf of any Borrower in respect of any Secured Obligations hereunder, the Facility Agent shall distribute such payment to the Lenders entitled thereto (other than any Lender that has consented in writing to waive its pro rata share of any such payment) pro rata based upon their respective shares, if any, of the Secured Obligations with respect to which such payment was received.

(b)Each of the Lenders agrees that, if it should receive any amount hereunder (whether by voluntary payment, by realization upon security, by the exercise of the right of setoff or banker’s lien, by counterclaim or cross action, by the enforcement of any right under the Credit Documents, or otherwise), which is applicable to the payment of the principal of, or interest on, the Loans, Unpaid Drawings,

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Commitment Commission or Letter of Credit Fees, of a sum which with respect to the related sum or sums received by other Lenders is in a greater proportion than the total of such Secured Obligation then owed and due to such Lender bears to the total of such Secured Obligation then owed and due to all of the Lenders immediately prior to such receipt, then such Lender receiving such excess payment shall purchase for cash without recourse or warranty from the other Lenders an interest in the Secured Obligations of the respective Obligor to such Lenders in such amount as shall result in a proportional participation by all the Lenders in such amount; provided that if all or any portion of such excess amount is thereafter recovered from such Lenders, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest.

(c)Notwithstanding anything to the contrary contained herein, the provisions of the preceding Sections 13.06(a) and (b) shall be subject to the express provisions of this Agreement which require, or permit, differing payments to be made to Non-Defaulting Lenders as opposed to Defaulting Lenders.

13.07Calculations; Computations. (a) Except as otherwise expressly provided herein, terms of an accounting or financial nature shall be construed, and all financial statements shall be prepared and related computations and determinations shall be made, in accordance with GAAP, as in effect from time to time; provided that, if any Borrower notifies the Administrative Agent that such Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Second Restatement Effective Date in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrowers that the Administrative Agent or the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such terms shall be construed, or computations or determinations made, on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith.

(b)All computations of interest, Commitment Commission and other Fees (other than Drawing Fees) hereunder shall be made on the basis of a year of 360 (save in the case of amounts denominated in Pounds Sterling or Australian Dollars where a year shall be 365 days) days for the actual number of days (including the first day but excluding the last day; except that in the case of Letter of Credit Fees and Facing Fees, the last day shall be included) occurring in the period for which such interest, Commitment Commission or Fees are payable.

13.08GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS OTHERWISE PROVIDED IN ANY OTHER CREDIT DOCUMENT, BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT, EXCEPT AS OTHERWISE PROVIDED IN ANY OTHER CREDIT DOCUMENT, MAY BE BROUGHT SOLELY IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, IN EACH CASE WHICH ARE LOCATED IN THE COUNTY OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT, EACH OBLIGOR HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH OBLIGOR HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION, WITH A REGISTERED ADDRESS BEING 111 EIGHTH AVENUE, NEW YORK, NEW YORK 10011, AS ITS AUTHORIZED DESIGNEE,

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APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON ITS BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. IF FOR ANY REASON SUCH AUTHORIZED DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS SUCH, EACH OBLIGOR AGREES TO DESIGNATE A NEW AUTHORIZED DESIGNEE, APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION REASONABLY SATISFACTORY TO THE ADMINISTRATIVE AGENT UNDER THIS AGREEMENT. EACH OBLIGOR HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK PERSONAL JURISDICTION OVER SUCH OBLIGOR, AND AGREES NOT TO PLEAD OR CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN ANY OF THE AFOREMENTIONED COURTS, THAT SUCH COURTS LACK PERSONAL JURISDICTION OVER SUCH OBLIGOR. EACH OBLIGOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH OBLIGOR AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. EACH OBLIGOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY OTHER CREDIT DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT, ANY LENDER OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST EACH OBLIGOR IN ANY OTHER JURISDICTION.

(b)EACH OBLIGOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

(c)EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

13.09Counterparts. This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. A set of counterparts executed by all the parties hereto shall be lodged with the Obligors’ Agent and the Administrative Agent. Delivery of an executed counterpart hereof by facsimile or electronic transmission shall be as effective as delivery of an original executed counterpart hereof.

13.10Effectiveness. This Agreement (as amended and restated) shall become effective on the date (the “Second Restatement Effective Date”) on which (i) each Obligor, the Administrative Agent, the Facility Agent, each of the Co-Collateral Agents and each Lender with a Commitment, (which shall

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include the Required Lenders (determined immediately before the occurrence of the Second Restatement Effective Date and without giving effect thereto)) shall have signed a counterpart hereof (whether the same or different counterparts) and shall have delivered the same to the Administrative Agent at the Notice Office or, in the case of the Lenders, shall have given to the Administrative Agent telephonic (confirmed in writing), written or telex notice (actually received) at such office that the same has been signed and mailed to it; it being understood that any Existing Lender which does not execute a counterpart hereof shall be replaced in accordance with the provisions of Section 13.12(b) and (ii) the conditions contained in Sections 6 and 7 are met to the satisfaction of the Administrative Agent. Unless the Administrative Agent has received actual notice from any Lender that the conditions described in clause (ii) of the preceding sentence have not been met to its satisfaction, upon the satisfaction of the condition described in clause (i) of the immediately preceding sentence and upon the Administrative Agent’s good faith determination that the conditions described in clause (ii) of the immediately preceding sentence have been met, then the Second Restatement Effective Date shall have deemed to have occurred, regardless of any subsequent determination that one or more of the conditions thereto had not been met (although the occurrence of the Second Restatement Effective Date shall not release any Obligor from any liability for failure to satisfy one or more of the applicable conditions contained in Sections 6 and 7). The Administrative Agent will give each Parent Guarantor, the Borrowers and each Lender prompt written notice of the occurrence of the Second Restatement Effective Date.

13.11Headings Descriptive. The headings of the several sections and subsections of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

13.12Amendment or Waiver; etc. (a) Neither this Agreement nor any other Credit Document nor any terms hereof or thereof may be changed, waived, discharged or terminated unless such change, waiver, discharge or termination is in writing signed by the respective Obligors party hereto or thereto and the Required Lenders (although additional parties may be added to (and annexes may be modified to reflect such additions), and Subsidiaries of the Parent Guarantor (other than the Borrowers) may be released from, the Guaranty and the relevant Security Documents, provided that no such change, waiver, discharge or termination shall, without the consent of each Lender (other than a Defaulting Lender except that, for the purposes of succeeding clauses (i), (ii) and (iii) (but, in the case of such clause (iii), only to the extent relating to such clause (i) or (ii)), a Defaulting Lender shall have a separate vote to the extent otherwise provided therein; provided that for the purposes of succeeding clauses (ii) and (iii) (but, in the case of such clause (iii), only to the extent relating to such clause (ii)), to the extent a Defaulting Lender does not accept or reject in writing to the Administrative Agent a written amendment, waiver or modification proposal on or prior to the expiry of the period of time granted to all Lenders required to consent to such proposal such Defaulting Lender shall be deemed to have consented to the respective written amendment, waiver or modification proposal) (with Secured Obligations being directly affected in the case of the following clauses (i) and (vii)), (i) extend the final scheduled maturity of any Loan or Note or extend the stated expiration date of any Letter of Credit beyond the Maturity Date, or reduce the rate or extend the time of payment of interest or Fees thereon (except in connection with the waiver of applicability of any post-default increase in interest rates), or reduce (or forgive) the principal amount thereof (it being understood that any amendment or modification to the financial definitions in this Agreement or to Section 13.07(a) shall not constitute a reduction in the rate of interest or Fees for the purposes of this clause (i)), (ii) release all or substantially all of the Collateral (except as expressly provided in the Credit Documents) under all Security Documents and the “Collateral” under and defined in the French Proceeds Loan Security Documents, (iii) amend, modify or waive any provision of this Section 13.12(a) (except for technical amendments with respect to additional extensions of credit pursuant to this Agreement which afford the protections to such additional extensions of credit of the type provided to the Commitments on the Second Restatement Effective Date), (iv) reduce the “majority” voting threshold specified in the definition of Required Lenders (it being understood that, with the consent

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of the Required Lenders, additional extensions of credit pursuant to this Agreement may be included in the determination of the Required Lenders on substantially the same basis as the Commitments are included on the Second Restatement Effective Date), (v) consent to the assignment or transfer by any Obligor of any of their rights and obligations under this Agreement or any other Credit Document to which it is a party, (vi) amend the definition of Supermajority Lenders (it being understood that, with the consent of the Required Lenders, additional extensions of credit pursuant to this Agreement may be included in the determination of the Supermajority Lenders on substantially the same basis as the Commitments are included on the Second Restatement Effective Date) or (vii) amend the priority of payments set forth in Section 11.02 hereof; provided, further, that no such change, waiver, discharge or termination shall (1) increase the Commitment of any Lender over the amount thereof then in effect without the consent of such Lender (it being understood that waivers or modifications of conditions precedent, covenants, Defaults or Events of Default or of a mandatory reduction in the Total Commitment shall not constitute an increase of the Commitment of any Lender, and that an increase in the available portion of the Commitment of any Lender shall not constitute an increase of the Commitment of such Lender), (2) without the consent of each Issuing Lender, amend, modify or waive any provision of Section 3 or alter its rights or obligations with respect to Letters of Credit, (3) without the consent of the Administrative Agent, amend, modify or waive any provision of Section 12 or any other provision of this Agreement or any other Credit Document as same relates to the rights or obligations of the Administrative Agent, (4) without the consent of the Security Agent, amend, modify or waive any provision relating to the rights or obligations of the Security Agent, (5) without the consent of the Facility Agent, amend, modify or waive any provision relating to the rights or obligations of the Facility Agent or (6) without the consent of the Supermajority Lenders and each Co-Collateral Agent, (w) change the definition of the term Borrowing Base or any component definition thereof if, as a result thereof, the amounts available to be borrowed by the 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 or Eligible Credit Card Receivables acquired in a Permitted Acquisition to the Borrowing Base as provided herein), (x) amend the definition of Dominion Period or the definition of Availability Condition, (y) increase the advance rates applicable to the Borrowing Base over those in effect on the Second Restatement Effective Date (it being understood that the establishment, modification or elimination of Reserves and adjustment, establishment and elimination of criteria for Eligible Credit Card Receivables and Eligible Inventory, in each case by the Co-Collateral Agents in accordance with the terms hereof, will not be deemed such an increase in advance rates) or decrease the frequency of Borrowing Base Certificate deliveries required pursuant to Section 9.01(j) or (z) amend, modify or waive any provision of Section 10.13.

(b)If, in connection with any proposed change, waiver, discharge or termination of or to any of the provisions of this Agreement as contemplated by clauses (i) through (v), inclusive, of the first proviso to Section 13.12(a), 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 Borrowers shall have the right, so long as all non-consenting Lenders whose individual consent is required are treated as described in either clause (A) or (B) below, to either (A) replace such non-consenting Lender or Lenders with one or more Replacement Lenders pursuant to Section 2.13 so long as at the time of such replacement, each such Replacement Lender consents to the proposed change, waiver, discharge or termination or (B) terminate such non-consenting Lender’s Commitment and/or repay each outstanding Loan of such Lender and/or cash collateralize its applicable Percentage of the Letter of Credit of Outstandings in accordance with Sections 4.02(b) and/or 5.01(b), provided that, unless the Commitments which are terminated and Loans which are repaid pursuant to preceding clause (B) are immediately replaced in full at such time through the addition of new Lenders or the increase of the Commitments and/or outstanding Loans of existing Lenders (who in each case must specifically consent thereto), then in the case of any action pursuant to preceding clause (B), the Required Lenders (determined after giving effect to the proposed action) shall specifically consent thereto, providedfurther, that the Borrowers shall not have the right to replace a Lender, terminate its Commitment or repay

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its Loans solely as a result of the exercise of such Lender’s rights (and the withholding of any required consent by such Lender) pursuant to the second proviso to Section 13.12(a).

(c)Notwithstanding anything to the contrary contained in clause (a) above of this Section 13.12, the Borrowers, the Administrative Agent, the Security Agent and each Incremental Lender may, in accordance with the provisions of Section 2.14, as applicable, enter into an Incremental Commitment Agreement,provided that after the execution and delivery by the Borrowers, the Administrative Agent, the Security Agent and each such Incremental Lender of such Incremental Commitment Agreement, such Incremental Commitment Agreement may thereafter only be modified in accordance with the requirements of clause (a) above of this Section 13.12.

(d)Notwithstanding anything to the contrary contained in clause (a) above of this Section 13.12, the relevant Obligors and the Security Agent may make such amendments to Security Documents to exclude any Cash Pooling Accounts from grants of security interests if the Obligor’s Agent reasonably determines that Cash Pooling Accounts cannot be opened in a specific jurisdiction for a given Group Member so long as the Security Agent has a security interest in such account for the benefit of the Secured Creditors.

(e)In addition, notwithstanding anything else to the contrary contained in this Section 13.12, (a) if the Administrative Agent and the Borrowers shall have jointly identified any error or omission of a technical nature in any provision of the Credit Documents, then the Administrative Agent and the Borrowers shall be permitted to amend such provision and (b) the Administrative Agent and the Borrowers shall be permitted to amend any provision of any Security Document to better implement the intentions of this Agreement and the other Credit Documents, and in each case, such amendments shall become effective without any further action or consent of any other party to any Loan Document if the same is not objected to in writing by the Required Lenders within ten (10) Business Days following receipt of notice thereof.

13.13Survival. All indemnities set forth in Sections 2.10, 2.11, 3.06, 5.04, 12.06 and 13.01 and any others expressly stated to survive the execution, delivery and termination of this Agreement shall survive the execution, delivery and termination of this Agreement and the Notes and the making and repayment of the Secured Obligations.

13.14Domicile of Loans. Each Lender may transfer and carry its Loans and/or participations in outstanding Letters of Credit at, to or for the account of any office, Subsidiary or Affiliate of such Lender, provided that each Lender shall carry all French Proceeds Loans through (i) a credit institution (établissement de crédit) licensed for such purpose by the relevant French banking and financial authorities or (ii) a credit institution (établissement de crédit) or a financial institution (établissement financier), in each case having its registered office in a member state of the European Union or in a state which is a party to the European Economic Area agreement if such credit institution or financial institution has otherwise complied with articles L.511-22 and L.522-23 of the French Code monétaire et financier, as applicable and/or participations in outstanding Letters of Credit. Notwithstanding anything to the contrary contained herein, to the extent that a transfer of Loans pursuant to this Section 13.14 would, at the time of such transfer, result in increased costs under Section 2.10, 2.11, 3.06 or 5.04 from those being charged by the respective Lender prior to such transfer, then the Borrowers shall not be obligated to pay such increased costs (although the Borrowers shall be obligated to pay any other increased costs of the type described above resulting from changes after the date of the respective transfer, unless such transfer has been made in order to comply with the proviso in the immediately preceding sentence).

13.15Register. The Borrowers hereby designate the Administrative Agent to serve as its agent, solely for purposes of this Section 13.15, to maintain a register (the “Register”) on which it will record the Commitments from time to time of each of the Lenders, the Loans made by each of the Lenders and each

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repayment in respect of the principal amount of the Loans of each Lender. Failure to make any such recordation, or any error in such recordation, shall not affect the Borrowers’ obligations in respect of such Loans. With respect to any Lender, the assignment of the Commitment of such Lender and the rights to the principal of, and interest on, any Loan made pursuant to such Commitment shall not be effective until such assignment is recorded on the Register maintained by the Administrative Agent with respect to ownership of such Commitment and Loans and prior to such recordation all amounts owing to the assignor with respect to such Commitment and Loans shall remain owing to the assignor. The registration of assignment of all or part of any Commitments and Loans shall be recorded by the Administrative Agent on the Register only upon the acceptance by the Administrative Agent of a properly executed and delivered Assignment and Assumption Agreement pursuant to Section 13.04(b) (including as contemplated by Section 2.13). Coincident with the delivery of such an Assignment and Assumption Agreement to the Administrative Agent for acceptance and registration of assignment of all or part of a Loan, or as soon thereafter as practicable, the assigning Lender shall surrender the Note (if any) evidencing such Loan, and thereupon one or more new Notes in the same aggregate principal amount shall be issued to the assigning Lender and/or the new Lender at the request of any such Lender. Any provision of Incremental Commitments pursuant to Section 2.14 shall be recorded by the Administrative Agent on the Register only upon the acceptance of the Administrative Agent of a properly executed and delivered Incremental Commitment Agreement. The Obligors agree to indemnify the Administrative Agent from and against any and all losses, claims, damages and liabilities of whatsoever nature which may be imposed on, asserted against or incurred by the Administrative Agent in performing its duties under this Section 13.15 (absent gross negligence, bad faith or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable judgment)). In addition, each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrowers, maintain a register (the “Participant Register”) on which it will record the name and address of each participant and the principal amounts (and stated interest) of each participant’s interest in the Loans or other obligations under this Agreement.

13.16Confidentiality. (a) Subject to the provisions of clause (b) of this Section 13.16, each Agent, each Lender and each Issuing Lender agrees that it will not disclose any Confidential Information to any Person without the prior consent of the Obligors’ Agent; provided that nothing herein shall prevent any Agent, Issuing Lender or any Lender from disclosing any such information (a) to the extent required pursuant to the order of any court or administrative agency or in any pending legal or administrative proceeding, or otherwise as required by applicable law or compulsory legal process (in which case the respective Agent, Issuing Lender or Lender, to the extent permitted by law, agrees to inform the Obligors’ Agent promptly thereof) (except this paragraph does not permit the disclosure of any information under section 275(4) of the PPSA unless section 275(7) of the PPSA applies), (b) to the extent required upon the request or demand of any regulatory authority having jurisdiction over such Agent, Issuing Lender or Lender or any of their respective Affiliates (in which case, the respective Agent, Issuing Lender or Lender to the extent permitted, agrees to inform the Obligors’ Agent promptly thereof; although no such notice to the Obligors’ Agent shall be required in connection with ordinary course reviews by any such regulatory authority) (except this paragraph does not permit the disclosure of any information under section 275(4) of the PPSA unless section 275(7) of the PPSA applies), (c) to the extent that such information becomes publicly available other than by reason of improper disclosure by the respective Agent, Issuing Lender or Lender or any of its Affiliates, (d) to the extent that such information is received by the respective Agent, Issuing Lender or Lender from a third party that is not to its knowledge subject to confidentiality obligations to any Obligor, (e) to the extent that such information is independently developed by any of the Agents, any Issuing Lender or Lender without using any such Confidential Information obtained from the Obligors’ Agent or any other Obligor, (f) to the Agents’, any Issuing Lender’s or any Lender’s respective Affiliates and their respective employees, legal counsel, independent auditors and other experts or agents who need to know such information in connection with the Transaction and are informed of the confidential nature of such

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information, (g) to potential Lenders, participants or assignees or any potential direct or indirect counterparty (or its advisors) to any swap or derivative transaction relating to any Borrower or any of its Affiliates or any of their respective obligations, in each case who are instructed that they shall be bound by terms no less restrictive than this paragraph (or language substantially similar to this paragraph), (h) to market data collectors in each case, who are instructed that they shall be bound by terms no less restrictive than this paragraph, (i) to any rating agency when required by it (it being understood that, prior to any such disclosure, such rating agency shall undertake to preserve the confidentiality of any Information relating to the Credit Parties received by it from such Person) or (j) for purposes of establishing a “due diligence” defense, provided that the respective Agent, Issuing Lender or Lender will, to the extent permitted, promptly provide the Obligors’ Agent with the opportunity to seek a protective order or other measure ensuring confidential treatment of the Confidential Information used to establish such defense.

(b)The Obligors hereby acknowledge and agree that each Lender may share with any of its Affiliates, and such Affiliates may share with such Lender, any information related to any Obligor (including, without limitation, any non-public customer information regarding the creditworthiness of any Obligor), provided such Persons shall be subject to the provisions of this Section 13.16 to the same extent as such Lender.

13.17Patriot Act. Each Lender subject to the USA PATRIOT ACT (Title 111 of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Patriot Act”) hereby notifies the Obligors that pursuant to the requirements of the Patriot Act, they are required to obtain, verify and record information that identifies the Obligors and other information that will allow such Lender to identify the Obligors in accordance with the Patriot Act.

13.18Judgment Currency. (a) The Obligors’ obligations hereunder and under the other Credit Documents to make payments in the respective Available Currency (the “Obligation Currency”) shall not be discharged or satisfied by any tender or recovery pursuant to any judgment expressed in or converted into any currency other than the Obligation Currency, except to the extent that such tender or recovery results in the effective receipt by the Administrative Agent, the Security Agent, the respective Issuing Lender or the respective Lender of the full amount of the Obligation Currency expressed to be payable to the Administrative Agent, the Security Agent, such Issuing Lender or such Lender under this Agreement or the other Credit Documents. If for the purpose of obtaining or enforcing judgment against any Obligor in any court or in any jurisdiction, it becomes necessary to convert into or from any currency other than the Obligation Currency (such other currency being hereinafter referred to as the “Judgment Currency”) an amount due in the Obligation Currency, the conversion shall be made, at the rate of exchange (as quoted by a nationally known third party dealer in such currency designated by the Administrative Agent) determined, in each case, as of the day on which the judgment is given (such day being hereinafter referred to as the “Judgment Currency Conversion Date”).

(b)If there is a change in the rate of exchange prevailing between the Judgment Currency Conversion Date and the date of actual payment of the amount due, each Borrower covenants and agrees to pay, or cause to be paid, such additional amounts, 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 the Obligation Currency which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial award at the rate of exchange prevailing on the Judgment Currency Conversion Date.

(c)For purposes of determining any rate of exchange for this Section, such amounts shall include any premium and costs payable in connection with the purchase of the Obligation Currency.

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13.19European Monetary Union. The following provisions of this Section 13.19 shall come into effect on and from the date on which the United Kingdom becomes a Participating Member State. Each obligation under this Agreement which has been denominated in Pounds Sterling shall be redenominated into Euros in accordance with the relevant EMU Legislation. However, if and to the extent that the relevant EMU Legislation provides that an amount which is denominated in Pounds Sterling can be paid by the debtor either in Euros or in that national currency unit, each party to this Agreement shall be entitled to pay or repay any amount denominated or owing in Pounds Sterling hereunder either in Euros or in Pounds Sterling. Without prejudice and in addition to any method of conversion or rounding prescribed by any relevant EMU Legislation, (i) each reference in this Agreement to a minimum amount (or an integral multiple thereof) in Pounds Sterling shall be replaced by a reference to such reasonably comparable and convenient amount (or an integral multiple thereof) in Euros as the Administrative Agent may from time to time specify and (ii) except as expressly provided in this Section 13.19, this Agreement shall be subject to such reasonable changes of construction as the Administrative Agent may from time to time specify to be necessary or appropriate to reflect the introduction of or changeover to Euros in the United Kingdom, provided that this Section 13.19 shall not reduce or increase any actual or contingent liability arising under this Agreement.

13.20Australian Code of Banking Practice. The parties agree that the Australian Code of Banking Practice does not apply to this Agreement and the transactions in connection with it.

13.21Qualified Secured Hedging Agreements and Qualified Secured Cash Management Agreements. On or prior to the date on which any Obligor shall enter into any Secured Hedging Agreement or any Secured Cash Management Agreement, the Obligors’ Agent shall, if it wishes that the respective Secured Hedging Agreement or Secured Cash Management Agreement be treated as pari passu with the Credit Document Obligations with respect to the priority of payment of proceeds of the Collateral in accordance with the waterfall provisions set forth in Section 11.02, notify the Administrative Agent in writing whether (x) such Secured Hedging Agreement is to be a “Qualified Secured Hedging Agreement” or (y) such Secured Cash Management Agreement is to be a “Qualified Secured Cash Management Agreement”. If the Obligors’ Agent shall fail to deliver such notice within the time period described above, such Secured Hedging Agreement or Secured Cash Management Agreement shall not constitute a Qualified Secured Hedging Agreement or Qualified Secured Cash Management Agreement, as the case may be. Each Borrower, each Guarantor and the Security Agent, each Hedging Creditor (pursuant to the relevant intercreditor agreement) and each Cash Management Creditor (pursuant to the relevant intercreditor agreement) (as applicable) shall execute and deliver to the Administrative Agent and the Security Agent such additional Security Documents and/or amendments to the Security Documents which are necessary to ensure that all Qualified Secured Hedging Agreements and Qualified Secured Cash Management Agreements are secured by each relevant Security Document (the “Hedging/Cash Management Security Documents”). The parties hereto understand and agree that the provisions of this Section 13.21 are made for the benefit of the Hedging Creditors and the Cash Management Creditors which become parties to Secured Hedging Agreements or Secured Cash Management Agreements, and agree that any amendments or modifications to the provisions of this Section 13.21 shall not be effective with respect to any Secured Hedging Agreement or Secured Cash Management Agreement, as the case may be, entered into prior to the date of respective amendment or modification of this Section 13.21 (without the written consent of the relevant parties thereto).

Notwithstanding any such designation of a Secured Hedging Agreement as a Qualified Secured Hedging Agreement or a Secured Cash Management Agreement as a Qualified Secured Cash Management Agreement, no provider or holder of any such Qualified Secured Hedging Agreement or Qualified Secured Cash Management Agreement shall have any voting or approval rights hereunder (or be deemed a Lender) solely by virtue of its status as the provider of such agreements or the obligations owing thereunder, nor shall their consent be required (other than in their capacities as a Lender to the extent applicable) for any matter hereunder or under any of the other Credit Documents, including without limitation, as to any matter relating to the

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Collateral or the release of Collateral or guarantors. The Administrative Agent accepts no responsibility and shall have no liability for the calculation of the exposure owing by the Obligors under any such Qualified Secured Hedging Agreement and/or Qualified Secured Cash Management Agreement or the amount of any Hedge Product Reserve and/or Bank Product Reserve, and shall be entitled in all cases to rely on the applicable Secured Creditor (or Affiliate thereof) and the applicable Obligor party to such agreement for the calculation thereof. Such Secured Creditor (or Affiliate thereof) party to any such Qualified Secured Cash Management Agreement agrees to provide the Administrative Agent, the Security Agent and the Co-Collateral Agents with the maximum exposure under such agreements at the time of such designation as a Qualified Secured Cash Management Agreement (and the Co-Collateral Agents shall reserve for such amounts). Such Secured Creditor (or Affiliate thereof) party to any Qualified Secured Hedging Agreement agrees to provide the Administrative Agent, the Security Agent and the Co-Collateral Agents with the calculations of all such exposures and reserves, if any, at such times as the Administrative Agent, the Security Agent or the Co-Collateral Agents shall reasonably request, and in any event, at least weekly (unless otherwise agreed to by the Administrative Agent and the Co-Collateral Agents). The applicable Secured Creditor (or Affiliate thereof) understands and agrees that the amount of exposures secured under any such Qualified Secured Hedging Agreement and/or Qualified Secured Cash Management Agreement shall be limited (as Primary Obligations) to the exposures as notified pursuant to the preceding two sentences.

13.22No Fiduciary Duty. Each Agent, each Lender and their Affiliates (collectively, solely for purposes of this paragraph, the “Lenders”), may have economic interests that conflict with those of the Obligors, their stockholders and/or their respective affiliates. Each Obligor agrees that nothing in the Credit Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between any Lender, on the one hand, and any Obligor, its respective stockholders or its respective affiliates, on the other. The Obligors acknowledge and agree that: (i) the transactions contemplated by the Credit Documents (including the exercise of rights and remedies hereunder and thereunder) are arm’s-length commercial transactions between the Lenders, on the one hand, each Obligor, on the other, and (ii) in connection therewith and with the process leading thereto, (x) no Lender has assumed an advisory or fiduciary responsibility in favor of any Obligor, its respective stockholders or its respective affiliates with respect to the transactions contemplated hereby (or the exercise of rights or remedies with respect thereto) or the process leading thereto (irrespective of whether any Lender has advised, is currently advising or will advise any Obligor, its respective stockholders or its respective Affiliates on other matters) or any other obligation to any Obligor except the obligations expressly set forth in the Credit Documents and (y) each Lender is acting solely as principal and not as the agent or fiduciary of such Obligor, its respective management, stockholders, creditors or any other Person. Each Obligor acknowledges and agrees that such Obligor has consulted its own legal and financial advisors to the extent it deemed appropriate and that it is responsible for making its own independent judgment with respect to such transactions and the process leading thereto. Each Obligor agrees that it will not claim that any Lender has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to such Obligor, in connection with such transaction or the process leading thereto.

13.23Post-Closing Actions. Notwithstanding anything to the contrary contained in this Agreement or the other Credit Documents, the parties hereto acknowledge and agree that the Obligors shall be required to take the actions (if any) specified in Schedule 13.23 as promptly as practicable, and in any event within the time periods set forth in Schedule 13.23. The provisions of Schedule 13.23 shall be deemed incorporated by reference herein as fully as if set forth herein in its entirety.

All conditions precedent, representations and covenants contained in this Agreement and the other Credit Documents shall be deemed modified to the extent necessary to effect the foregoing (and to permit the taking of the actions described above within the time periods required above, rather than as elsewhere provided in the Credit Documents), provided that (x) to the extent any representation and warranty would not be true

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because the foregoing actions were not taken on the Second Restatement Effective Date, the respective representation and warranty shall be required to be true and correct in all material respects at the time the respective action is taken (or was required to be taken) in accordance with the foregoing provisions of this Section 13.23 and (y) all representations and warranties relating to the Security Documents shall be required to be true immediately after the actions required to be taken by this Section 13.23 have been taken (or were required to be taken). The acceptance of the benefits of each Credit Event shall constitute a representation, warranty and covenant by the Obligors to each of the Lenders that the actions required pursuant to this Section 13.23 will be, or have been, taken within the relevant time periods referred to in this Section 13.23 and that, at such time, all representations and warranties contained in this Agreement and the other Credit Documents shall then be true and correct without any modification pursuant to this Section 13.23, and the parties hereto acknowledge and agree that the failure to take any of the actions required above, within the relevant time periods required above, shall give rise to an immediate Event of Default pursuant to this Agreement.

13.24Conflicting Provisions in Security Documents. In the event that any provisions of this Agreement conflict with any Security Document, the provisions of this Agreement shall govern.

13.25Continuing Effect. This Agreement shall amend and restate in its entirety the Existing Facility Agreement, and all obligations of the Borrowers thereunder and under the Credit Documents as in effect immediately prior to the Restatement Effective Date (the “Existing Credit Documents”) shall be deemed replaced and extended as obligations under this Agreement and the Credit Documents and be governed hereby and thereby without novation. For the avoidance of doubt, clause 2(b) of Schedule 19 of the Existing Facility Agreement is not amended and restated under the terms of this Agreement and the original provision contained in the Existing Facility Agreement is not affected by the parties’ entry into this Agreement.

Section 14.Nature of Obligations.

14.01Nature of Obligations. Notwithstanding anything to the contrary contained elsewhere in this Agreement, it is understood and agreed by the various parties to this Agreement that all Secured Obligations to repay principal of, interest on, and all other amounts with respect to, all Loans, Letters of Credit and other Secured Obligations pursuant to this Agreement and each other Credit Document (including, without limitation, all fees, indemnities, taxes and other Secured Obligations in connection therewith or in connection with the related Commitments) shall constitute the several direct obligations of each of the Obligors subject to the Agreed Security Principles. In addition to the direct (and several) obligations of the Obligors with respect to Obligations as described above, all such Secured Obligations shall be guaranteed pursuant to, and in accordance with the terms of, the Guaranty.

14.02Independent Obligation. The obligations of each Obligor with respect to the Secured Obligations are independent of the Secured Obligations of each other Obligor under the Guaranty of such Secured Obligations, and a separate action or actions may be brought and prosecuted against each Obligor, whether or not any other Obligor is joined in any such action or actions. Each Obligor waives, to the fullest extent permitted by law, the benefit of any statute of limitations affecting its liability hereunder or the enforcement thereof. Any payment by any Obligor or other circumstance which operates to toll any statute of limitations as to any Obligor shall, to the fullest extent permitted by law, operate to toll the statute of limitations as to each Obligor.

14.03Authorization. Each of the Obligors authorizes the Administrative Agent, the Security Agent, the Issuing Lenders and the Lenders without notice or demand (except as shall be required by applicable statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to, to the maximum extent permitted by applicable law and the Credit Documents:

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(a)exercise or refrain from exercising any rights against any other Obligor or any Guarantor or others or otherwise act or refrain from acting;

(b)release or substitute any other Obligor, endorsers, or other obligors;

(c)settle or compromise any of the Secured Obligations of any other Obligor, any security therefor or any liability (including any of those hereunder) incurred directly or indirectly in respect thereof or hereof, and may subordinate the payment of all or any part thereof to the payment of any liability (whether due or not) of any Borrower to its creditors other than the Lenders;

(d)apply any sums paid by any other Obligor or any other Person, howsoever realized to any liability or liabilities of such other Obligor or other Person regardless of what liability or liabilities of such other Obligor or other Person remain unpaid; and/or

(e)consent to or waive any breach of, or act, omission or default under, this Agreement or any of the instruments or agreements referred to herein, or otherwise, by any other Obligor or any other Person.

14.04Reliance. It is not necessary for the Administrative Agent, the Security Agent, any Issuing Lender or any Lender to inquire into the capacity or powers of any Obligor, or any other Obligor or the officers, directors, members, partners or agents acting or purporting to act on its behalf, and any Secured Obligations made or created in reliance upon the professed exercise of such powers shall constitute the obligations of the respective Obligors hereunder.

14.05Contribution; Subrogation. No Obligor shall exercise any rights of contribution or subrogation with respect to any other Obligor as a result of payments made by it hereunder, in each case unless and until (i) the Total Commitment and all Letters of Credit have been terminated and (ii) all of the Secured Obligations have been paid in full in cash; provided that so long as no Event of Default exists (it being understood solely for this purposes an Event of Default will not exist if any Obligor makes the full payment owing by another Obligor), the foregoing shall not restrict the right of any Obligor to request reimbursement from any other Obligor in respect of payments made by it hereunder in respect of such other Obligor’s obligations hereunder or the right of such other Obligor to repay the party requesting repayment.

14.06Waiver. Each Borrower waives any right to require the Administrative Agent, the Security Agent, the Issuing Lenders or the Lenders to (i) proceed against any other Borrower, any Guarantor or any other party, (ii) proceed against or exhaust any security held from any Borrower, any Guarantor or any other party or (iii) pursue any other remedy in the Administrative Agent’s, the Security Agent’s, any Issuing Lender’s or Lenders’ power whatsoever. Each Borrower waives any defense based on or arising out of suretyship or any impairment of security held from any Borrower, any Guarantor or any other party or on or arising out of any defense of any other Borrower, any Guarantor or any other party other than payment in full in cash of the Secured Obligations, including, without limitation, any defense based on or arising out of the disability of any other Borrower, any Guarantor or any other party, or the unenforceability of the Secured Obligations or any part thereof from any cause, or the cessation from any cause of the liability of any other Borrower, in each case other than as a result of the payment in full in cash of the Secured Obligations.

14.07Lender’s Rights and Obligations. The obligations of each Issuing Lender and Lender under this Agreement bind each of them severally. Failure by an Issuing Lender or Lender to perform its obligations under this Agreement does not affect the obligations of any other party under this Agreement. No Issuing Lender or Lender is responsible for the obligations of any other Issuing Lender or Lender under this Agreement. The rights, powers and remedies of each Issuing Lender and Lender in connection with this Agreement are separate and independent rights, powers and remedies and any debt arising under this

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Agreement to or for the account of an Issuing Lender or Lender from an Obligor is a separate and independent debt.

Section 15.Loans; Intra-Lender Issues.

15.01Specified Foreign Currency Participations. Notwithstanding anything to the contrary contained herein, all Loans which are denominated in Australian Dollars, Pounds Sterling or Euros (each, a “Specified Foreign Currency Loan”) shall be made solely by the Lenders (including the Fronting Lender) who are not Participating Specified Foreign Currency Lenders. Subject to Section 15.07, each Lender acceptable to the Fronting Lender (in its sole discretion) that does not have Specified Foreign Currency Funding Capacity (a “Participating Specified Foreign Currency Lender”) at the time such Lender becomes a “Lender” hereunder shall irrevocably and unconditionally purchase and acquire and shall be deemed to irrevocably and unconditionally purchase and acquire from the Fronting Lender, and the Fronting Lender shall sell and be deemed to sell to each such Participating Specified Foreign Currency Lender, without recourse or any representation or warranty whatsoever, an undivided interest and participation (a “Specified Foreign Currency Participation”) in each Loan which is a Specified Foreign Currency Loan funded by the Fronting Lender in an amount equal to such Participating Specified Foreign Currency Lender’s Percentage of the Borrowing that includes such Loan (it being understood and agreed that whether or not a Person should become a Participating Specified Foreign Currency Lender shall be made by the Administrative Agent in its sole discretion). Such purchase and sale of a Specified Foreign Currency Participation shall be deemed to occur automatically upon the making of a Specified Foreign Currency Loan by the Fronting Lender, without any further notice to any Participating Specified Foreign Currency Lender. The purchase price payable by each Participating Specified Foreign Currency Lender to the Fronting Lender for each Specified Foreign Currency Participation purchased by it from the Fronting Lender shall be equal to 100% of the principal amount of such Specified Foreign Currency Participation (i.e., the product of (i) the amount of the Borrowing that includes the relevant Loan and (ii) such Participating Specified Foreign Currency Lender’s Percentage), and such purchase price shall be payable by each Participating Specified Foreign Currency Lender to the Fronting Lender in accordance with the settlement procedure set forth in Section 15.02. The Fronting Lender and the Administrative Agent shall record on their books the amount of the Loans made by the Fronting Lender and each Participating Specified Foreign Currency Lender’s Specified Foreign Currency Participation and funded Specified Foreign Currency Participation therein, all payments in respect thereof and interest accrued thereon and all payments made by and to each Participating Specified Foreign Currency Lender pursuant to this Section 15.01. This Section 15 shall not affect the obligations of any Lender that does not have Specified Foreign Currency Funding Capacity and that is not a Participating Specified Foreign Currency Lender to make Specified Foreign Currency Loans in accordance with the terms and conditions set forth in the other Sections of this Agreement.

15.02Settlement Procedures for Specified Foreign Currency Participations. Each Participating Specified Foreign Currency Lender’s Specified Foreign Currency Participation in the Specified Foreign Currency Loans shall be in an amount equal to its Percentage of all such Specified Foreign Currency Loans. However, in order to facilitate the administration of the Specified Foreign Currency Loans made by the Fronting Lender and the Specified Foreign Currency Participations, settlement among the Fronting Lender and the Participating Specified Foreign Currency Lenders with regard to the Participating Specified Foreign Currency Lenders’ Specified Foreign Currency Participations shall take place in accordance with the following provisions:

(a)The Fronting Lender and the Participating Specified Foreign Currency Lenders shall settle (a “Specified Foreign Currency Participation Settlement”) by payments in respect of the Specified Foreign Currency Participations as follows: So long as any Specified Foreign Currency Loans are outstanding, Specified Foreign Currency Participation Settlements shall be effected upon the request of the

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Fronting Lender through the Administrative Agent on such Business Days as requested by the Fronting Lender and as the Administrative Agent shall specify by a notice by telecopy, telephone or similar form of notice to each Participating Specified Foreign Currency Lender requesting such Specified Foreign Currency Participation Settlement (each such date on which a Specified Foreign Currency Participation Settlement occurs herein called a “Specified Foreign Currency Participation Settlement Date”), such notice to be delivered no later than 2:00 p.m. (New York time) at least one Business Day prior to the requested Specified Foreign Currency Participation Settlement Date; provided that the Fronting Lender shall have the option but not the obligation to request a Specified Foreign Currency Participation Settlement Date and, in any event, shall not request a Specified Foreign Currency Participation Settlement Date prior to the occurrence of an Event of Default; providedfurther, that if (x) such Event of Default is cured or waived in writing in accordance with the terms hereof, (y) no Secured Obligations have yet been declared due and payable under Section 11.01 and (z) the Administrative Agent has actual knowledge of such cure or waiver, all prior to the Administrative Agent’s giving notice to the Participating Specified Foreign Currency Lenders of the first Specified Foreign Currency Participation Settlement Date under this Agreement, then the Administrative Agent shall not give notice to the Participating Specified Foreign Currency Lenders of a Specified Foreign Currency Participation Settlement Date based upon such cured or waived Event of Default. If on any Specified Foreign Currency Participation Settlement Date the total principal amount of the Specified Foreign Currency Loans made or deemed made by the Fronting Lender during the period ending on (but excluding) such Specified Foreign Currency Participation Settlement Date and commencing on (and including) the immediately preceding Specified Foreign Currency Participation Settlement Date (or the Second Restatement Effective Date in the case of the period ending on the first Specified Foreign Currency Participation Settlement Date) (each such period herein called a “Specified Foreign Currency Participation Settlement Period”) is greater than the principal amount of Specified Foreign Currency Loans repaid during such Specified Foreign Currency Participation Settlement Period to the Fronting Lender, each Participating Specified Foreign Currency Lender shall pay to the Fronting Lender (through the Administrative Agent), no later than 11:00 a.m. (New York time) on such Specified Foreign Currency Participation Settlement Date, an amount equal to such Participating Specified Foreign Currency Lender’s ratable share of the amount of such excess. If in any Specified Foreign Currency Participation Settlement Period the outstanding principal amount of the Specified Foreign Currency Loans repaid to the Fronting Lender in such period exceeds the total principal amount of the Specified Foreign Currency Loans made or deemed made by the Fronting Lender during such period, the Fronting Lender shall pay to each Participating Specified Foreign Currency Lender (through the Administrative Agent) on such Specified Foreign Currency Participation Settlement Date an amount equal to such Participating Specified Foreign Currency Lender’s ratable share of such excess. Specified Foreign Currency Participation Settlements in respect of Specified Foreign Currency Loans shall be made in the respective Available Currency in which such Specified Foreign Currency Loan was funded on the Specified Foreign Currency Participation Settlement Date for such Specified Foreign Currency Loans.

(b)If any Participating Specified Foreign Currency Lender fails to pay to the Fronting Lender on any Specified Foreign Currency Participation Settlement Date the full amount required to be paid by such Participating Specified Foreign Currency Lender to the Fronting Lender on such Specified Foreign Currency Participation Settlement Date in respect of such Participating Specified Foreign Currency Lender’s Specified Foreign Currency Participation (such Participating Specified Foreign Currency Lender’s “Specified Foreign Currency Participation Settlement Amount”) with the Fronting Lender, the Fronting Lender shall be entitled to recover such unpaid amount from such Participating Specified Foreign Currency Lender, together with interest thereon (in the same respective currency or currencies as the relevant Specified Foreign Currency Loans) at the relevant Euro Rate plus 2.00%. Without limiting the Fronting Lender’s rights to recover from any Participating Specified Foreign Currency Lender any unpaid Specified Foreign Currency Participation Settlement Amount payable by such Participating Specified Foreign Currency Lender to the Fronting Lender, the Administrative Agent shall also be entitled to withhold from amounts otherwise

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payable to such Participating Specified Foreign Currency Lender an amount equal to such Participating Specified Foreign Currency Lender’s unpaid Specified Foreign Currency Participation Settlement Amount owing to the Fronting Lender and apply such withheld amount to the payment of any unpaid Specified Foreign Currency Participation Settlement Amount owing by such Participating Specified Foreign Currency Lender to the Fronting Lender.

15.03Obligations Irrevocable. The obligations of each Participating Specified Foreign Currency Lender to purchase from the Fronting Lender a participation in each Specified Foreign Currency Loan made by the Fronting Lender and to make payments to the Fronting Lender with respect to such participation, in each case as provided herein, shall be irrevocable and not subject to any qualification or exception whatsoever, including any of the following circumstances:

(a)any lack of validity or enforceability of this Agreement or any of the other Credit Documents or of any Loans, against the Borrowers or any other Obligor;

(b)the existence of any claim, setoff, defense or other right which the Borrowers or any other Obligor may have at any time against the Administrative Agent, any Participating Specified Foreign Currency Lender, or any other Person, whether in connection with this Agreement, any Specified Foreign Currency Loans, the transactions contemplated herein or any unrelated transactions;

(c)any application or misapplication of any proceeds of any Specified Foreign Currency Loans;

(d)the surrender or impairment of any security for any Specified Foreign Currency Loans;

(e)the occurrence of any Default or an Event of Default;

(f)the commencement or pendency of any events specified in Section 11.01(e), in respect of any Obligor or other Group Member or any other Person; or

(g)the failure to satisfy the applicable conditions precedent set forth in Section 6 or 7.

15.04Recovery or Avoidance of Payments. In the event any payment by or on behalf of any Borrower or any other Obligor received by the Administrative Agent or the Fronting Lender with respect to any Specified Foreign Currency Loan made by the Fronting Lender is thereafter set aside, avoided or recovered from the Administrative Agent or the Fronting Lender in connection with any insolvency proceeding or due to any mistake of law or fact, each Participating Specified Foreign Currency Lender shall, upon written demand by the Administrative Agent, pay to the Fronting Lender (through the Administrative Agent) such Participating Specified Foreign Currency Lender’s Percentage of such amount set aside, avoided or recovered, together with interest at the rate and in the currency required to be paid by the Fronting Lender or the Administrative Agent upon the amount required to be repaid by it.

15.05Indemnification by Lenders. Each Participating Specified Foreign Currency Lender agrees to indemnify the Fronting Lender (to the extent not reimbursed by the Borrowers and without limiting the obligations of the Borrowers hereunder or under any other Credit Document) ratably for any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including attorneys’ fees) or disbursements of any kind and nature whatsoever that may be imposed on, incurred by or asserted against the Fronting Lender in any way relating to or arising out of any Specified Foreign Currency Loans or any action taken or omitted by the Fronting Lender in connection therewith; provided that no Participating Specified Foreign Currency Lender shall be liable for any of the foregoing to the extent it arises from the gross negligence or willful misconduct of the Fronting Lender (as determined by a court of competent

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jurisdiction in a final and non-appealable judgment). Without limiting the foregoing, each Participating Specified Foreign Currency Lender agrees to reimburse the Fronting Lender promptly upon demand for such Participating Specified Foreign Currency Lender’s ratable share of any costs or expenses payable by the Borrowers to the Fronting Lender in respect of the Specified Foreign Currency Loans to the extent that the Fronting Lender is not promptly reimbursed for such costs and expenses by the Borrowers. The agreement contained in this Section 15.05 shall survive payment in full of all Specified Foreign Currency Loans.

15.06Specified Foreign Currency Loan Participation Fee. In consideration for each Participating Specified Foreign Currency Lender’s participation in the Specified Foreign Currency Loans made by the Fronting Lender, the Fronting Lender agrees to pay to the Administrative Agent for the account of each Participating Specified Foreign Currency Lender, as and when the Fronting Lender receives payment of interest on its Specified Foreign Currency Loans, a fee (the “Specified Foreign Currency Participation Fee”) at a rate per annum equal to the Applicable Margin on such Specified Foreign Currency Loans minus 0.25% on the unfunded Specified Foreign Currency Participation of such Participating Specified Foreign Currency Lender in such Specified Foreign Currency Loans of the Fronting Lender. The Specified Foreign Currency Participation Fee in respect of any unfunded Specified Foreign Currency Participation in a Specified Foreign Currency Loan shall be payable to the Administrative Agent in the Available Currency in which the respective Specified Foreign Currency Loan was funded when interest on such Specified Foreign Currency Loan is received by the Fronting Lender. If the Fronting Lender does not receive payment in full of such interest, the Specified Foreign Currency Participation Fee in respect of the unfunded Specified Foreign Currency Participation in such Specified Foreign Currency Loans shall be reduced proportionately. Any amounts payable under this Section 15.06 by the Administrative Agent to the Participating Specified Foreign Currency Lenders shall be paid in the Available Currency in which the respective Specified Foreign Currency Loan was funded (or, if different, the currency in which such interest payments are actually received).

15.07Defaulting Lenders; etc. (a) Notwithstanding anything to the contrary contained above, (x) no Lender may become a Participating Specified Foreign Currency Lender at any time it is a Defaulting Lender, and (y) if any Participating Specified Foreign Currency Lender at any time becomes a Defaulting Lender or if the Fronting Lender reasonably determines that the credit quality of any then existing Participating Specified Foreign Currency Lender has suffered a material adverse change, the Fronting Lender shall have the right to, by notice to the affected Lender, (i) terminate such Lender’s status as a Participating Specified Foreign Currency Lender for Loans and (ii) declare a Specified Foreign Currency Participation Settlement Date to occur with respect to such affected Lender.

(b)Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such 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.

(ii)Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Section 11 or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 13.02 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 any Issuing Lender hereunder; third, to cash collateralize the Issuing Lenders’ Fronting Exposure with respect

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to such Defaulting Lender; fourth, as the Borrowers 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 Borrowers, 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 Lenders’ 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 or the Issuing Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender or the Issuing Lenders 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 the Borrowers as a result of any judgment of a court of competent jurisdiction obtained by the Borrowers 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 or Unpaid Drawings 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 7 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and Unpaid Drawings owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or Unpaid Drawings owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in L/C Obligations are held by the Lenders pro rata in accordance with the Commitments under the applicable Facility without giving effect to Section 15.07(iii). 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 15.07(b)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii)Reallocation of Participations to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in L/C Obligations shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that such reallocation does not cause the Individual Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Commitment. 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.

(iv)Cash Collateral. If the reallocation described in clause (iii) above cannot, or can only partially, be effected, the Borrowers shall, without prejudice to any right or remedy available to it hereunder or under law, second, cash collateralize the Issuing Lenders’ Fronting Exposure.

(c)Defaulting Lender Cure. If the Borrower, the Administrative Agent and each Issuing Lender 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 to be held pro rata by the Lenders in accordance with the Commitments under the applicable Facility (without giving effect to Section 15.07(iii)), whereupon such

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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 Borrower 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.

(d)New Letters of Credit. So long as any Lender is a Defaulting Lender, no Issuing Lender shall be required to issue, extend, renew or increase any Letter of Credit unless it is satisfied that it will have no Fronting Exposure after giving effect thereto.

Section 16.Parallel Debt and Special Appointment of Security Agent.

16.01Parallel Debt owed to Security Agent. (a) Notwithstanding any other provision of this Agreement, each Obligor (other than Toys SARL) hereby irrevocably and unconditionally undertakes to pay to the Security Agent as creditor in its own right and not as a representative of the other Secured Creditors amounts equal to any amounts owing from time to time by that Obligor to any Secured Creditor under any Credit Document (excluding, for the avoidance of doubt, any French Proceeds Loan Security Documents) as and when those amounts are due for payment under the relevant Credit Document.

(b)Each Obligor and the Security Agent acknowledge that the obligations of each Obligor under paragraph (a) are several and are separate and independent from, and shall not in any way limit or affect, the corresponding obligations of that Obligor to any Secured Creditor under any Credit Document (its “Corresponding Debt”) nor shall the amounts for which each Obligor is liable under paragraph (a) (its “Parallel Debt”) be limited or affected in any way by its Corresponding Debt provided that:

(i)the Parallel Debt of each Obligor shall be decreased to the extent that its Corresponding Debt has been irrevocably paid or (in the case of guarantee obligations) discharged; and

(ii)the Corresponding Debt of each Obligor shall be decreased to the extent that its Parallel Debt has been irrevocably paid or (in the case of guarantee obligations) discharged.

(c)The Security Agent acts in its own name and not as a trustee, and its claims in respect of the Parallel Debt shall not be held on trust. The security granted under the Credit Documents to the Security Agent to secure the Parallel Debt is granted to the Security Agent in its capacity as creditor of the Parallel Debt and shall not be held on trust.

(d)All monies received or recovered by the Security Agent pursuant to this Section 16.01, and all amounts received or recovered by the Security Agent from or by the enforcement of any security granted to secure the Parallel Debt, shall be applied in accordance with this Agreement.

(e)Without limiting or affecting the Security Agent’s rights against the Obligors (whether under Section 16.01 or under any other provision of the Credit Documents), each Obligor acknowledges that:

(i)nothing in this Section 16.01 shall impose any obligation on the Security Agent to advance any sum to any Obligor or otherwise under any Credit Document, except in its capacity as Lender; and

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(ii)for the purpose of any vote taken under any Credit Document, the Security Agent shall not be regarded as having any participation or commitment other than those which it has in its capacity as a Lender.

16.02Appointment of Security Agent for German Security. (a) For the purposes of German Security (as defined below) in addition to the provisions set out in Section 12.10, the specific provisions set out in paragraphs (b) to (f) of this Section 16.02 shall prevail.

(b)With respect to German Security (where “German Security” shall mean any security interest created under the Security Documents which are governed by German law), the Security Agent shall in case of German Security constituted by non–accessory (nicht akzessorische) security interests, hold, administer and, as the case may be, enforce or release such German Security in its own name, but for the account of the Secured Creditors.

(c)In the case of German Security constituted by accessory (akzessorische) security interests created by way of pledge or other accessory instruments, hold (with regard to its own rights under Section 16.01), administer and, as the case may be, enforce or release such German Security in the name of and for and on behalf of the Secured Creditors and in its own name on the basis of the abstract acknowledgement of indebtedness pursuant to Section 16.01, but in each case for the account of the Secured Creditors.

(d)For the purposes of performing its rights and obligations as Security Agent under any accessory (akzessorische) German Security, each Secured Creditor hereby authorises the Security Agent to act as its agent (Stellvertreter), and releases the Security Agent from the restrictions imposed by Section 181 German Civil Code (Bürgerliches Gesetzbuch) and similar restrictions applicable to it pursuant to any other applicable law, in each case to the extent legally possible to such Secured Creditor. A Secured Creditor which is barred by its constitutional documents or by-laws from granting such exemption shall notify the Security Agent accordingly. At the request of the Security Agent, each Secured Creditor shall provide the Security Agent with a separate written power of attorney (Spezialvollmacht) for the purposes of executing any relevant agreements and documents on their behalf. Each Secured Creditor hereby ratifies and approves all acts previously done by the Security Agent on such Secured Creditor’s behalf.

(e)The Security Agent accepts its appointment as administrator of the German Security on the terms and subject to the conditions set out in this Agreement and the Secured Creditor, the Security Agent and all other parties to this Agreement agree that, in relation to the German Security, no Secured Creditor shall exercise any independent power to enforce any German Security or take any other action in relation to the enforcement of the German Security, or make or receive any declarations in relation thereto.

(f)Each Secured Creditor hereby authorizes and instructs the Security Agent (with the right of sub-delegation (Untervollmacht)) to enter into any documents evidencing German Security and to make and accept all declarations and take all actions it considers necessary or useful in connection with any German Security on behalf of such Secured Creditor. The Security Agent shall further be entitled to rescind, release, amend and/or execute new and different documents securing the German Security.

(g)For the purpose of the authorization referred to in Section 16.02(f), each Secured Creditor releases the Security Agent from the restrictions imposed by Section 181 German Civil Code (Bürgerliches Gesetzbuch) and similar restrictions applicable to it pursuant to any other applicable law, in each case to the extent legally possible to such Secured Creditor. A Secured Creditor which is barred by its constitutional documents or by-laws from granting such exemption shall notify the Security Agent accordingly. The Security Agent shall be entitled to release any sub-attorney from the restrictions referred to in this Section 16.02(g).

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16.03Appointment of the Security Agent for the Credit Documents Governed by Spanish Law. Each Lender irrevocably empowers and entitles the Security Agent with express power of substitution and delegation to exercise any rights and carry out any acts which are required to comply with the provisions set out in this Agreement and other Credit Documents, including among other things, the execution of any of the following acts in the name and on behalf of the Lenders (even when doing so with express authorization for self-contracting (autocontratación) double representation (doble representación), multiple representation (múltiple representación) or conflict of interest (conflicto de interés): (a) to appear before a Notary Public and accept any type of guarantee and security, whether personal or real, granted in favor of the relevant Lenders (whether in its own capacity or as agent of other parties) over any and all shares, rights, receivables, bank accounts, goods and chattels, fixing their price for the purposes of an auction and the address for serving of notices and submitting to the jurisdiction of law courts by waiving its own forum, and release such guarantees or security, all of the foregoing under the terms and conditions which the attorney may freely agree, signing the notarial deeds (escrituras públicas o pólizas) that the attorney may deem fit; (b) to ratify, if necessary or convenient any such escrituras públicas or pólizas executed by an orally appointed representative in the name or on behalf of the Lenders; (c) to execute and/or do any and all deeds, documents, acts and things, required in connection with the execution of the Credit Documents, and/or the execution of any further notarial deed of amendment (escritura pública de rectificación o subsanación) that may be required for the purpose or in connection with the faculties granted in this clause; (d) to execute in the name of any of the Lenders (whether in its own capacity or as agent of other parties) any novation, amendment or ratification to any Credit Document and appear before a Notary Public and raise into the status of a public document such documents, (e) to file a petition of bankruptcy (concurso) of any Obligor or any analogous procedure for any Spanish Obligor in accordance with the terms of this Agreement; (f) to accept the transfer or endorsement in favor of the Lenders of any shares, interests, credit rights, receivables, bank accounts, assets, or property; and (g) to carry out as many related or supplementary acts as appropriate or necessary to fulfill its duties under this power of attorney or its mandate under this Agreement

Section 17.Guaranty.

17.01Guaranty. (a) Each Guarantor, jointly and severally, irrevocably, absolutely and unconditionally guarantees as a primary obligor and not merely as surety to the Secured Creditors the full and prompt payment when due (whether at the stated maturity, by required prepayment, declaration, acceleration, demand or otherwise) of the Secured Obligations.

Each Guarantor understands, agrees and confirms that the Secured Creditors may enforce this Guaranty up to the full amount of the Secured Obligations against such Guarantor without proceeding against any Obligor, or against any security for the Secured Obligations, or under any other guaranty covering all or a portion of the Secured Obligations. This Guaranty is a guaranty of prompt payment and performance and not of collection.

(b)Additionally, subject to the provisions of this Section 17, each Guarantor, jointly and severally, unconditionally, absolutely and irrevocably, guarantees the payment of any and all Secured Obligations whether or not due or payable by the Borrowers or any other Obligor upon the occurrence in respect of the Borrowers or any other Obligor of any of the events specified in Section 11.01(e) of this Agreement, and unconditionally, absolutely and irrevocably, jointly and severally, promises to pay such Secured Obligations to the Secured Creditors, or order, on demand, subject in each case to the applicable guaranty limitations set forth below.

(c)Without limiting the foregoing, any Spanish Obligor acknowledges that the guaranty provided by it under this Section 17 must be construed as a first demand guaranty (garantía a primer

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requerimiento) and not as performance bond (fianza) and, therefore, the benefits of preference (excusión), order (orden) and division (división) shall not apply.

17.02Liability of Guarantors Absolute. The liability of each Guarantor hereunder is primary, absolute, joint and several, and unconditional and is exclusive and independent of any security for or other guaranty of the indebtedness of any Borrower whether executed by such Guarantor, any other Obligor, any other guarantor or by any other party, and the liability of each Guarantor hereunder shall not be affected or impaired by any circumstance or occurrence whatsoever, including, without limitation (and each Obligor hereby waives any defense arising from any of the following): (a) any direction as to application of payment by any Obligor or any other party, (b) any other continuing or other guaranty, undertaking or maximum liability of a Guarantor or of any other party as to the Secured Obligations, (c) any payment on or in reduction of any such other guaranty or undertaking, (d) any dissolution, termination or increase, decrease or change in personnel by any Obligor, (e) the failure of the Guarantor to receive any benefit from or as a result of its execution, delivery and performance of this Guaranty, (f) any payment made to any Secured Creditor on the indebtedness which any Secured Creditor repays any Obligor pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and each Guarantor waives any right to the deferral or modification of its obligations hereunder by reason of any such proceeding, (g) any action or inaction by the Secured Creditors as contemplated in Section 17.05 hereof or (h) any invalidity, rescission, irregularity or unenforceability of all or any part of the Secured Obligations or of any security therefor.

17.03Obligations of Guarantors Independent. The obligations of each Guarantor hereunder are independent of the obligations of any other Guarantor, any other guarantor or any Obligor, and a separate action or actions may be brought and prosecuted against each Guarantor whether or not action is brought against any other Guarantor, any other guarantor or any Obligor and whether or not any other Guarantor, any other guarantor or any Obligor be joined in any such action or actions. Each Guarantor waives (to the fullest extent permitted by Applicable Law) the benefits of any statute of limitations affecting its liability hereunder or the enforcement thereof. Any payment by any Obligor or other circumstance which operates to toll any statute of limitations as to such Obligor shall operate to toll the statute of limitations as to each Guarantor.

17.04Waivers by Guarantors. (a) Each Guarantor hereby waives (to the fullest extent permitted by Applicable Law) notice of acceptance of this Guaranty and notice of the existence, creation or incurrence of any new or additional liability to which it may apply, and waives promptness, diligence, presentment, demand of payment, demand for performance, protest, notice of dishonor or nonpayment of any such liabilities, suit or taking of other action by the Administrative Agent or any other Secured Creditor against, and any other notice to, any party liable thereon (including such Guarantor, any other Guarantor, any other guarantor or any Obligor) and each Guarantor further hereby waives any and all notice of the creation, renewal, extension or accrual of any of the Secured Obligations and notice or proof of reliance by any Secured Creditor upon this Guaranty, and the Secured Obligations shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended, modified, supplemented or waived, in reliance upon this Guaranty. In addition, each Guarantor hereby waives any non-perfection of any collateral securing payment of any Secured Obligation and any other circumstance (including, without limitation, any statute of limitations but excluding payment or performance of the obligations) or any existence of or reliance on any representation by the Secured Creditors that might otherwise constitute a defense available to, or a legal or equitable discharge of, any Borrower or Guarantor or any other guarantor or surety.

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(b)Each Guarantor waives any right to require the Secured Creditors to: (i) proceed against any Obligor, any other Guarantor, any other guarantor of the Secured Obligations or any other party; (ii) proceed against or exhaust any security held from any Obligor, any other Guarantor, any other guarantor of the Secured Obligations or any other party; or (iii) pursue any other remedy in the Secured Creditors’ power whatsoever. Each Guarantor waives any defense based on or arising out of any defense of any Obligor, any other Guarantor, any other guarantor of the Secured Obligations or any other party other than payment in full in cash of the Secured Obligations, including, without limitation, any defense based on or arising out of the disability of any Obligor, any other Guarantor, any other guarantor of the Secured Obligations or any other party, or the unenforceability of the Secured Obligations or any part thereof from any cause, or the cessation from any cause of the liability of any Obligor other than payment in full in cash of the Secured Obligations. The Secured Creditors may, at their election, foreclose on any collateral serving as security held by the Administrative Agent, the Security Agent or the other Secured Creditors by one or more judicial or nonjudicial sales, whether or not every aspect of any such sale is commercially reasonable (to the extent such sale is permitted by Applicable Law), or exercise any other right or remedy the Secured Creditors may have against any Obligor or any other party, or any security, without affecting or impairing in any way the liability of any Guarantor hereunder except to the extent the Secured Obligations have been paid in full in cash. Each Guarantor waives any defense arising out of any such election by the Secured Creditors, even though such election operates to impair or extinguish any right of reimbursement, contribution, indemnification or subrogation or other right or remedy of such Guarantor against any Obligor, any other guarantor of the Secured Obligations or any other party or any security.

(c)Each Guarantor has knowledge and assumes all responsibility for being and keeping itself informed of each Obligor’s financial condition, affairs and assets, and of all other circumstances bearing upon the risk of nonpayment of the Secured Obligations and the nature, scope and extent of the risks which such Guarantor assumes and incurs hereunder, and has adequate means to obtain from each Obligor on an ongoing basis information relating thereto and each Obligor’s ability to pay and perform its respective Secured Obligations, and agrees to assume the responsibility for keeping, and to keep, so informed for so long as this Guaranty is in effect. Each Guarantor acknowledges and agrees that (x) the Secured Creditors shall have no obligation to investigate the financial condition or affairs of any Obligor or any other Guarantor for the benefit of such Guarantor nor to advise such Guarantor of any fact respecting, or any change in, the financial condition, assets or affairs of any Obligor or any other Guarantor that might become known to any Secured Creditor at any time, whether or not such Secured Creditor knows or believes or has reason to know or believe that any such fact or change is unknown to such Guarantor, or might (or does) increase the risk of such Guarantor as guarantor hereunder, or might (or would) affect the willingness of such Guarantor to continue as a guarantor of the Secured Obligations hereunder and (y) the Secured Creditors shall have no duty to advise any Guarantor of information known to them regarding any of the aforementioned circumstances or risks.

(d)Each Guarantor hereby acknowledges and agrees that no Secured Creditor nor any other Person shall be under any obligation (a) to marshal any assets in favor of such Guarantor or in payment of any or all of the liabilities of any Obligor under the Credit Documents or the obligation of such Guarantor hereunder or (b) to pursue any other remedy that such Guarantor may or may not be able to pursue itself any right to which such Guarantor hereby waives.

(e)Each Guarantor warrants and agrees that each of the waivers set forth in Section 17.03 and in this Section 17.04 is made with full knowledge of its significance and consequences and that if any of such waivers are determined to be contrary to any Applicable Law or public policy, such waivers shall be effective only to the maximum extent permitted by applicable law.

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17.05Rights of Secured Creditors. Subject to Section 17.04, any Secured Creditor may (except as shall be required by applicable statute and cannot be waived) at any time and from time to time without the consent of, or notice to, any Guarantor, without incurring responsibility to such Guarantor, without impairing or releasing the obligations or liabilities of such Guarantor hereunder, upon or without any terms or conditions and in whole or in part (and each Obligor hereby waives any defense arising from any of the following):

(a)change the manner, place or terms of payment of, and/or change, increase or extend the time of payment of, renew, increase, accelerate or alter, any of the Secured Obligations (including, without limitation, any increase or decrease in the rate of interest thereon or the principal amount thereof), any security therefor, or any liability incurred directly or indirectly in respect thereof, and the guaranty herein made shall apply to the Secured Obligations as so changed, extended, increased, accelerated, renewed or altered;

(b)take and hold security for the payment of the Secured Obligations and sell, exchange, release, surrender, impair, realize upon or otherwise deal with in any manner and in any order any property or other collateral by whomsoever at any time pledged or mortgaged to secure, or howsoever securing, the Secured Obligations or any liabilities (including any of those hereunder) incurred directly or indirectly in respect thereof or hereof, and/or any offset thereagainst;

(c)exercise or refrain from exercising any rights against any Obligor, any other Credit Party, any Subsidiary thereof, any other guarantor of the Borrowers or others or otherwise act or refrain from acting;

(d)release or substitute any one or more endorsers, Guarantors, other guarantors, any Obligor or other obligors;

(e)settle or compromise any of the Secured Obligations, any security therefor or any liability (including any of those hereunder) incurred directly or indirectly in respect thereof or hereof, and may subordinate the payment of all or any part thereof to the payment of any liability (whether due or not) of any Obligor to creditors of such Obligor other than the Secured Creditors;

(f)apply any sums by whomsoever paid or howsoever realized to any liability or liabilities of any Obligor to the Secured Creditors regardless of what liabilities of such Obligor remain unpaid;

(g)consent to or waive any breach of, or any act, omission or default under, any of the Credit Documents or any of the instruments or agreements referred to therein, or otherwise amend, modify or supplement any of the Credit Documents or any of such other instruments or agreements;

(h)act or fail to act in any manner which may deprive such Guarantor of its right to subrogation against any Obligor to recover full indemnity for any payments made pursuant to this Guaranty; and/or

(i)take any other action or omit to take any other action which would, under otherwise applicable principles of common law, give rise to a legal or equitable discharge of such Guarantor from its liabilities under this Guaranty (including, without limitation, any action or omission whatsoever that might otherwise vary the risk of such Guarantor or constitute a legal or equitable defense to or discharge of the liabilities of a guarantor or surety or that might otherwise limit recourse against such Guarantor).

No invalidity, illegality, irregularity or unenforceability of all or any part of the Secured Obligations, the Credit Documents or any other agreement or instrument relating to the Secured Obligations or of any security or guarantee therefor shall affect, impair or be a defense to this Guaranty, and this Guaranty shall be primary, absolute and unconditional notwithstanding the occurrence of any event or the existence of any other

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circumstances which might constitute a legal or equitable discharge of a surety or guarantor except payment in full in cash of the Secured Obligations.

17.06Continuing Guaranty. This Guaranty is a continuing one and all liabilities to which it applies or may apply under the terms hereof shall be conclusively presumed to have been created in reliance hereon. No failure or delay on the part of any Secured Creditor in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein expressly specified are cumulative and not exclusive of any rights or remedies which any Secured Creditor would otherwise have. No notice to or demand on any Guarantor in any case shall entitle such Guarantor to any other further notice or demand in similar or other circumstances or constitute a waiver of the rights of any Secured Creditor to any other or further action in any circumstances without notice or demand. It is not necessary for any Secured Creditor to inquire into the capacity or powers of any Obligor or the officers, directors, partners or agents acting or purporting to act on its or their behalf, and any indebtedness made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder.

17.07Subordination of Indebtedness Held by Guarantors. Any indebtedness of any Obligor now or hereafter held by any Guarantor is hereby subordinated to the indebtedness of such Obligor to the Secured Creditors; and such indebtedness of such Obligor to any Guarantor, if the Administrative Agent or the Security Agent, after an Event of Default has occurred and is continuing, so requests, shall be collected, enforced and received by such Guarantor as trustee for the Secured Creditors and be paid over to the Secured Creditors on account of the indebtedness of such Obligor to the Secured Creditors, but without affecting or impairing in any manner the liability of such Guarantor under the other provisions of this Guaranty. Prior to the transfer by any Guarantor of any note or negotiable instrument evidencing any indebtedness of any Obligor to such Guarantor, such Guarantor shall mark such note or negotiable instrument with a legend that the same is subject to this subordination. Without limiting the generality of the foregoing, each Guarantor hereby agrees with the Secured Creditors that it will not exercise any right of subrogation which it may at any time otherwise have as a result of this Guaranty (whether contractual, under Section 509 of the Bankruptcy Code or otherwise) until all Secured Obligations have been irrevocably paid in full in cash; provided, that if any amount shall be paid to such Guarantor on account of such subrogation rights at any time prior to the irrevocable payment in full in cash of all the Secured Obligations, such amount shall be held in trust for the benefit of the Secured Creditors and shall forthwith be paid to the Secured Creditors to be credited and applied upon the Secured Obligations, whether matured or unmatured, in accordance with the terms of the Credit Documents or, if the Credit Documents do not provide for the application of such amount, to be held by the Secured Creditors as collateral security for any Secured Obligations thereafter existing.

17.08Guaranty Enforceable by Administrative Agent or Security Agent. Notwithstanding anything to the contrary contained elsewhere in this Guaranty, the Secured Creditors agree (by their acceptance of the benefits of this Guaranty) that the Guaranty in this Section 17 may be enforced only by the action of the Administrative Agent or the Security Agent, in each case acting upon the instructions of the Required Lenders and that no other Secured Creditor shall have any right individually to seek to enforce or to enforce this Guaranty or to realize upon the security to be granted by the Security Documents, it being understood and agreed that such rights and remedies may be exercised by the Administrative Agent or the Security Agent for the benefit of the Secured Creditors upon the terms of this Guaranty and the Security Documents. The Secured Creditors further agree that this Guaranty may not be enforced against any director, officer, employee, partner, member or stockholder of any Guarantor (except to the extent such partner, member or stockholder is also a Guarantor hereunder). It is understood and agreed that the agreement in this Section 17.08 is among and solely for the benefit of the Secured Creditors and that, if the Required

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Lenders so agree (without requiring the consent of any Guarantor), this Guaranty may be directly enforced by any Secured Creditor.

17.09Expenses. The Guarantors hereby jointly and severally agree to pay all reasonable out-of-pocket costs and expenses of the Security Agent, the Administrative Agent and each other Secured Creditor in connection with the enforcement of this Guaranty and the protection of the Secured Creditors’ rights hereunder and any amendment, waiver or consent relating hereto (including, in each case, without limitation, the reasonable fees and disbursements of counsel (including in-house counsel) employed by the Security Agent, the Administrative Agent and each other Secured Creditor).

17.10Benefit and Binding Effect. This Guaranty shall be binding upon each Guarantor and its successors and assigns and shall inure to the benefit of the Secured Creditors and their successors and assigns.

17.11Set Off. In addition to any rights now or hereafter granted under applicable law (including, without limitation, Section 151 of the New York Debtor and Creditor Law) and not by way of limitation of any such rights, upon the occurrence and during the continuance of an Event of Default (as defined in this Agreement), each Secured Creditor is hereby authorized, at any time or from time to time, without notice to any Guarantor or to any other Person, any such notice being expressly waived, to set off and to appropriate and apply any and all deposits (general or special) and any other indebtedness at any time held or owing by such Secured Creditor to or for the credit or the account of such Guarantor, against and on account of the obligations and liabilities of such Guarantor to such Secured Creditor under this Guaranty, irrespective of whether or not such Secured Creditor shall have made any demand hereunder and although said obligations, liabilities, deposits or claims, or any of them, shall be contingent or unmatured; provided, that no amounts received from, or set off with respect to, any Guarantor shall be applied to any Excluded Swap Obligations of such Guarantor. Each Secured Creditor (by its acceptance of the benefits hereof) acknowledges and agrees that the provisions of this Section 17.11 are subject to the sharing provisions set forth in Section 13.06 of this Agreement.

17.12Reinstatement. If any claim is ever made upon any Secured Creditor for repayment or recovery of any amount or amounts received in payment or on account of any of the Secured Obligations and any of the aforesaid payees repays all or part of said amount by reason of (i) any judgment, decree or order of any court or administrative body having jurisdiction over such payee or any of its property or (ii) any settlement or compromise of any such claim effected by such payee with any such claimant (including, without limitation, any Obligor), then and in such event each Guarantor agrees that any such judgment, decree, order, settlement or compromise shall be binding upon such Guarantor, notwithstanding any revocation hereof or the cancellation of any Note or any other instrument evidencing any liability of any Obligor, and such Guarantor shall be and remain liable to the aforesaid payees hereunder for the amount so repaid or recovered to the same extent as if such amount had never originally been received by any such payee.

17.13Contribution. At any time a payment in respect of the Secured Obligations is made under this Guaranty, the right of contribution of each Guarantor against each other Guarantor shall be determined as provided in the immediately following sentence, with the right of contribution of each Guarantor to be revised and restated as of each date on which a payment (a “Relevant Payment”) is made on the Secured Obligations under this Guaranty. At any time that a Relevant Payment is made by a Guarantor that results in the aggregate payments made by such Guarantor in respect of the Secured Obligations to and including the date of the Relevant Payment exceeding such Guarantor’s Contribution Percentage (as defined below) of the aggregate payments made by all Guarantors in respect of the Secured Obligations to and including the date of the Relevant Payment (such excess, the “Aggregate Excess Amount”), each such

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Guarantor shall have a right of contribution against each other Guarantor who has made payments in respect of the Secured Obligations to and including the date of the Relevant Payment in an aggregate amount less than such other Guarantor’s Contribution Percentage of the aggregate payments made to and including the date of the Relevant Payment by all Guarantors in respect of the Secured Obligations (the aggregate amount of such deficit, the “Aggregate Deficit Amount”) in an amount equal to (x) a fraction the numerator of which is the Aggregate Excess Amount of such Guarantor and the denominator of which is the Aggregate Excess Amount of all Guarantors multiplied by (y) the Aggregate Deficit Amount of such other Guarantor. A Guarantor’s right of contribution pursuant to the preceding sentences shall arise at the time of each computation, subject to adjustment to the time of each computation; provided that no Guarantor may take any action to enforce such right until the Secured Obligations have been irrevocably paid in full in cash and the Total Commitment and all Letters of Credit have been terminated, it being expressly recognized and agreed by all parties hereto that any Guarantor’s right of contribution arising pursuant to this Section 17.13 against any other Guarantor shall be expressly junior and subordinate to such other Guarantor’s obligations and liabilities in respect of the Secured Obligations and any other obligations owing under this Guaranty. As used in this Section 17.13: (i) each Guarantor’s “Contribution Percentage” shall mean the percentage obtained by dividing (x) the Adjusted Net Worth (as defined below) of such Guarantor by (y) the aggregate Adjusted Net Worth of all Guarantors; (ii) the “Adjusted Net Worth” of each Guarantor shall mean the greater of (x) the Net Worth (as defined below) of such Guarantor and (y) zero; and (iii) the “Net Worth” of each Guarantor shall mean the amount by which the fair saleable value of such Guarantor’s assets on the date of any Relevant Payment exceeds its existing debts and other liabilities (including contingent liabilities, but without giving effect to any Secured Obligations arising under this Guaranty) on such date. Notwithstanding anything to the contrary contained above, any Guarantor that is released from this Agreement pursuant to Section 18 of this Agreement shall thereafter have no contribution obligations, or rights, pursuant to this Section 17.13, and at the time of any such release, if the released Guarantor had an Aggregate Excess Amount or an Aggregate Deficit Amount, same shall be deemed reduced to $0, and the contribution rights and obligations of the remaining Guarantors shall be recalculated on the respective date of release (as otherwise provided above) based on the payments made hereunder by the remaining Guarantors. All parties hereto recognize and agree that, except for any right of contribution arising pursuant to this Section 17.13, each Guarantor who makes any payment in respect of the Secured Obligations shall have no right of contribution or subrogation against any other Guarantor in respect of such payment until all of the Secured Obligations have been irrevocably paid in full in cash. Each of the Guarantors recognizes and acknowledges that the rights to contribution arising hereunder shall constitute an asset in favor of the party entitled to such contribution. In this connection, each Guarantor has the right to waive its contribution right against any Guarantor to the extent that after giving effect to such waiver such Guarantor would remain solvent, in the determination of the Required Lenders.

17.14Limitations for US Guarantors. This Section 17.14 shall apply to any guarantee (hereafter a “United States Guarantee”) which is granted by any Guarantor incorporated under the laws of the United States of America or any State or territory thereof (a “US Guarantor”). Each Guarantor and each Secured Creditor (by its acceptance of the benefits of the Guaranty in this Section 17) hereby confirms that it is its intention that this Guaranty not constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy Code, the Uniform Fraudulent Conveyance Act of any similar Federal or state law. To effectuate the foregoing intention, each Guarantor and each Secured Creditor (by its acceptance of the benefits of the Guaranty in this Section 17) hereby irrevocably agrees that the Secured Obligations guaranteed by such Guarantor shall be limited to such amount as will, after giving effect to such maximum amount and all other (contingent or otherwise) liabilities of such Guarantor that are relevant under such laws and after giving effect to any rights to contribution pursuant to any agreement providing for an equitable contribution among such Guarantor and the other Guarantors, result in the Secured Obligations of such Guarantor in respect of such maximum amount not constituting a fraudulent transfer or conveyance.

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17.15Limitations for French Obligors. (a) The obligations and liabilities of any Obligor incorporated in France under the Credit Documents shall not include any obligation or liability which if incurred would (i) constitute a misuse of corporate assets within the meaning of article L. 241-3 or L. 242-6 of the French Code de commerce or (ii) a violation of article L.225-216 of the French Code de commerce.

(b)The obligations and liabilities of any French Obligor under any Credit Document for the Secured Obligations (as the case may be) of any other Obligor which is not a Subsidiary of such French Obligor shall be limited, at any time, to an amount equal to the aggregate of all amounts borrowed (directly or indirectly) under this Agreement by such guaranteed party to the extent directly or indirectly on-lent to such French Obligor under intercompany loan arrangements and outstanding at the date a payment is to be made by such French Obligor under the relevant Credit Document, it being specified that any payment made by such French Obligor under Section 17.01 in respect of the obligations of such guaranteed party shall reduce pro tanto the outstanding amount of the intercompany loans due by such French Obligor under the intercompany loan arrangements referred to above.

(c)The obligations and liabilities of each French Obligor under any Credit Document for the Secured Obligations of any other Obligor which is its Subsidiary shall not, in relation to amounts due by such Obligor as Borrower, be limited and shall therefore cover all amounts due by such guaranteed party as Borrower and shall cover, in relation to amounts due by such Obligor as Guarantor, all amounts due by such Obligor as Guarantor subject to the limitations set out in paragraphs (a) and (b) above as if the same applied mutatismutandis to such Obligor. It is understood that the limitations set forth in this Section 17.15 shall also apply to such French Obligor’s obligations under the Guaranty to repay any amounts owed under Sections 13.01, 13.02 and 14.05 which are not attributable to such Obligor.

(d)Notwithstanding anything to the contrary contained herein or in any other Credit Document, it is acknowledged that such French Obligor is not acting jointly and severally with the other Obligors and shall not be considered as “co-débiteur solidaire” as to its obligations pursuant to the guarantee or any obligation under any Credit Document.

17.16    Limitations for German Guarantors. (a) The restrictions in this Section 17.16 shall apply to any guarantee and indemnity (hereinafter the “Guarantee”) granted by a Guarantor incorporated under the laws of Germany as a limited liability company (“GmbH”) (a “German Guarantor”) to secure liabilities of its direct or indirect shareholder(s) (upstream) or an entity affiliated with such shareholder (verbundenes Unternehmen) within the meaning of section 15 et seq. of the German Stock Corporation Act (Aktiengesetz) (cross-stream) (excluding, for the avoidance of doubt purposes any direct or indirect Subsidiary of such Guarantor). It is understood and agreed that the limitations set forth in this Section 17.16 shall also apply to any German Obligor’s obligations under the Guaranty to repay any amounts owed under Sections 13.01, 13.02 and 14.05 which are not attributable to such Obligor.

(b)    The restrictions in this Section 17.16 shall not apply to the extent the German Guarantor secures any indebtedness under any Credit Documents in respect of (i) loans to the extent they are on-lent or otherwise (directly or indirectly) passed on to the relevant German Guarantor or its Subsidiaries and such amount on-lent or otherwise passed on is not repaid or (ii) bank guarantees or letters of credit that are issued under the Credit Documents for the benefit of any of the creditors of the German Guarantor or the German Guarantor’s Subsidiaries or any other benefit granted under the Credit Documents.

17.16.1    Restrictions on Payment. (a) The parties to this Agreement agree that if payment under the Guarantee or enforcement of the Guarantee under the Security Documents to which a German Guarantor is a party would (i) cause the amount of a German Guarantor’s net assets, as calculated pursuant to Section 17.16.2 (Net Assets) below, to fall below the amount of its registered share capital (Stammkapital), or (ii) increase an existing shortage of its registered share capital (Vertiefung einer Unterbilanz), in each case

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in violation of section 30 of the German Limited Liability Companies Act (Gesetz betreffend die Gesellschaft mit beschränkter Haftung) (“GmbHG”) (such events are hereinafter referred to as a “Capital Impairment”), then the Secured Creditors shall, subject to paragraphs (b) to (c) below, demand such payment or enforcement from such German Guarantor only to the extent such Capital Impairment would not occur.

(b)    If the relevant German Guarantor does not notify the Administrative Agent in writing (the “Management Notification”) within 10 (ten) Business Days after the Administrative Agent notified such German Guarantor of its intention to demand payment under the Guarantee that a Capital Impairment would occur (setting out in reasonable detail to what extent a Capital Impairment would occur), then the restrictions set out in paragraph (a) above shall not apply.

(c)    If the relevant German Guarantor does not provide an Auditors’ Determination (as defined in Section 17.16.4 (Auditors’ Determination) below) within 30 (thirty) Business Days from the date on which the Administrative Agent received the Management Notification then the restrictions set out in paragraph (a) above shall not apply and the Administrative Agent shall not be obliged to assign or make available to the German Guarantor any net proceeds realized.

17.16.2    Net Assets The calculation of net assets (the “Net Assets”) shall only take into account the sum of the values of the assets of the relevant German Guarantor determined in accordance with applicable law and court decisions and, if there is no positive going concern (positive Fortführungsprognose) based on the lower of book value (Buchwert) and liquidation value (Liquidationswert) (consisting of all assets which correspond to those items listed in section 266 subsection (2) A, B and C of the German Commercial Code (Handelsgesetzbuch) “HGB”)lessthe relevant German Guarantor’s liabilities (consisting of all liabilities and liability reserves which correspond to those items listed in accordance with section 266 subsection (3) B, C and D HGB).

For the purposes of calculating the Net Assets, the following balance sheet items shall be adjusted as follows:

(a)    the amount of any increase in the registered share capital of the relevant German Guarantor which was carried out after the relevant German Guarantor became a party to this Agreement without the prior written consent of the Administrative Agent shall be deducted from the amount of the registered share capital of the relevant German Guarantor;

(b)    loans or other contractual liabilities incurred by the relevant German Guarantor in breach of the Credit Documents shall not be taken into account as liabilities.

17.16.3    Mitigation (a) The relevant German Guarantor shall realize, to the extent legally permitted and commercially reasonable in a situation where it does not have sufficient Net Assets to maintain its registered share capital, all of its assets that are shown in the balance sheet with a book value (Buchwert) that is significantly lower than the market value of the assets if such asset is not necessary for the German Guarantor's business (betriebsnotwendig).

(b)    The limitations on demanding payment under this Guarantee set out in this Section 17.16 shall not apply if and to the extent that the German Guarantor has not taken a specific measure which the Security Agent has reasonably requested and which the relevant German Guarantor is legally permitted to take in order to avoid demanding payment under the Guarantee causing a Capital Impairment of the relevant German Guarantor (including without limitation, setting off-claims), provided that it is commercially justifiable to take such measures.

17.16.4    Auditors’ Determination (a) If the relevant German Guarantor claims that a Capital Impairment would occur on payment under this Guarantee, the German Guarantor may (at its own cost and expense) arrange for the preparation of a balance sheet by a firm of recognized auditors (the “Auditors”) in

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order to have such Auditors determine whether (and, if so, to what extent) any payment under this Guarantee would cause a Capital Impairment (the “Auditors’ Determination”).

(b)    The Auditors’ Determination shall be prepared, taking into account the adjustments set out in Section 17.16.2 (Net Assets) above, by applying the generally accepted accounting principles applicable from time to time in Germany (Grundsätze ordnungsmäßiger Buchführung) based on the same principles and evaluation methods as constantly applied by the relevant German Guarantor in the preparation of its financial statements, in particular in the preparation of its most recent annual balance sheet, and taking into consideration applicable court rulings of German courts. Subject to Section 17.6.7 (No Waiver) below, such Auditors’ Determination shall be binding on the relevant German Guarantor and the Administrative Agent.

(c)    Even if the relevant German Guarantor arranges for the preparation of an Auditors’ Determination, the relevant German Guarantor’s obligations under the mitigation provisions set out in Section 17.16.3 (Mitigation) above shall continue to exist.

17.16.5    Improvement of Financial Condition If, after it has been provided with an Auditors’ Determination which prevented it from demanding any or only partial payment under this Guarantee, the Administrative Agent has reasonable grounds to believe that the financial condition of the relevant German Guarantor as set out in the Auditors’ Determination has substantially improved (in particular, if the relevant German Guarantor has taken any action in accordance with the mitigation provisions set out in Section 17.16.3 (Mitigation) above), the Administrative Agent may, at the relevant German Guarantor’s cost and expense, arrange for the preparation of an updated balance sheet of the relevant German Guarantor by applying the same principles that were used for the preparation of the Auditors’ Determination by the Auditors who prepared the Auditors’ Determination pursuant to paragraph (a) of Section 17.16.4 (Auditors’ Determination) above in order for such Auditors to determine whether (and, if so, to what extent) the situation leading to a Capital Impairment has been cured as a result of the improvement of the financial condition of the relevant German Guarantor. The Administrative Agent may demand payment under this Guarantee to the extent that the Auditors determine that the Capital Impairment has been cured.

17.16.6    Reimbursement. Any managing director (Geschäftsführer) of the German Guarantor may request reimbursement from the Secured Creditors (pro rata) for such net proceeds received by the relevant Secured Creditor from the realisation of the security and/or guarantee provided hereunder if such managing director is required to reimburse the German Guarantor pursuant to section 64, sentence 3 GmbHG due to a final non-appealable (rechtskräftig) court decision (other than a court decision based on omission (Versäumnisurteil) or recognisance (Anerkenntnis)) which states that either the granting or the enforcement of any Security Document or a payment under this Guarantee led to the illiquidity (Zahlungsunfähigkeit) of the German Guarantor, such request to be made within one month from the date of service (Zustellung) on such managing director the German Guarantor of such final court decision.

17.16.7    No Waiver Notwithstanding any limitation under this Guarantee, the Administrative Agent shall be entitled to further pursue in court payment claims under this Guarantee granted by the respective German Guarantor if it disagrees with the Auditor's Determination by claiming in court that demanding payment under the German Guarantee against the relevant German Guarantor does not violate §§ 30, 31 GmbHG and would not constitute an unlawful payment within the meaning of § 64 sentence 3 GmbHG. The agreement of the Administrative Agent to abstain from demanding any or part of the payment under this Guarantee in accordance with the provisions above shall constitute neither a waiver (Verzicht) of any right granted under this Agreement or any other Credit Document to the Administrative Agent or any Secured Creditor nor a definite defense (Einwendung) of the relevant German Guarantor against any of the guaranteed obligations.

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17.16.8    GmbH & Co KG The aforementioned provisions shall apply to a limited partnership with a limited liability company as its general partner (GmbH & Co. KG) mutatismutandis and all references to net assets shall be construed as a reference to the aggregated net assets of the general partner and the limited partnership.

17.17Limitations for Spanish Guarantors. The obligations and liabilities of any Obligor incorporated in Spain under the Guaranty shall not include any obligation or liability which, if incurred, it would result in such guarantee constituting unlawful financial assistance within the meaning of: (i) Article 150.1 of the Spanish Companies Act; or (ii) Article 143.2 of the Spanish Companies Act, as applicable.

17.18Guarantee Limitations for BVI Guarantor. In respect of any Guarantor which is organized under the laws of the British Virgin Islands or registered under the British Virgin Islands Business Companies Act, 2004 (a “BVI Guarantor Entity”), each other Guarantor and each Secured Creditor agrees that the maximum amount a BVI Guarantor Entity shall be liable for in respect of the Secured Obligations shall be such sum as would be the maximum amount that such BVI Guarantor Entity could pay whilst still allowing the directors of the BVI Guarantor Entity to resolve that they are satisfied, on reasonable grounds, that immediately thereafter (i) the value of the assets of the BVI Guarantor Entity exceed its liabilities and (ii) the BVI Guarantor Entity is able to pay its debts as they fall due.

17.19Additional Limitations for Guarantors.

(a)Notwithstanding anything in any Credit Document to the contrary, the obligations and liabilities under the Guaranty of any entity that is or becomes (x) a controlled foreign corporation for purposes of Section 957 of the Code (a “CFC”), (y) owned by a CFC (a “Subsidiary CFC”) or (z) a United States Person or a disregarded entity for U.S. federal income tax purposes, in either case, substantially all the assets of which consist of, directly or indirectly, equity interests in or equity interests in and indebtedness of one or more CFCs (a “CFC Holdco”), shall not include any obligation or liability for the Secured Obligations of any United States Tax Person (a “U.S. Obligation”), provided, however, that this Section 17.19 shall not apply (i) at any time that there is no Borrower that is a United States Tax Person and (ii) to any CFC Full Obligor.

(b)Notwithstanding anything in any Credit Document to the contrary, no more than 65% of the total combined voting power of all classes of shares entitled to vote and 100% of all classes of shares not entitled to vote of any CFC Holdco or first tier CFC that is not a Subsidiary of a CFC Holdco shall be pledged in support of a U.S. Obligation; provided, for the avoidance of doubt, that no shares of any Subsidiary CFC or any Subsidiary of such CFC Holdco shall be required to be pledged; provided, however, that this Section 17.19(b) shall not apply to any CFC Full Obligor.

(c)In the event that a Group Member is added as an Obligor following the Second Restatement Effective Date pursuant to Section 9.13, Section 17.22 or otherwise and such Obligor is not organized in the same jurisdiction as any other Obligor, then the relevant Borrower Assumption Agreement or Joinder Agreement, as applicable, shall include guarantee limitation provisions, corporate benefit, tax and other provisions customary for such jurisdiction as the Administrative Agent and the Obligors’ Agent may reasonably agree.

17.20Payments. All payments made by any Guarantor hereunder will be made without setoff, counterclaim or other defense and on the same basis as payments are made by the Borrowers under Sections 5.03 and 5.04 of this Agreement and shall be made in accordance with Section 13.18.

17.21Application of Payments for Australian Obligors.

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(a)Suspense Account. A Secured Creditor may place in a suspense account any payment it receives from an Australian Obligor for as long as it thinks prudent and need not apply it towards satisfying the Secured Obligations or other money payable under this Guaranty.

(b)Remaining Money. Each Secured Creditor agrees to pay any money remaining after the Secured Obligations are discharged either to the relevant Australian Obligor (which the Secured Creditor may do by paying it into an account in the relevant Australian Obligor’s name) or to another person entitled to it. In doing so, it does not incur any liability to the Australian Obligor. A Secured Creditor is not required to pay an Australian Obligor interest on any money remaining after the Secured Obligations are discharged.

(c)Credit from Date of Receipt. An Australian Obligor is only credited with money from the date the Secured Creditor actually receives it.

17.22Additional Guarantors. It is understood and agreed that any Subsidiary that is required to execute a counterpart of this Guaranty after the date hereof pursuant to Collateral and Guaranty Requirements (or that otherwise executes a Joinder Agreement and satisfies the conditions set forth in clauses (x) and (y) below) shall become a Guarantor hereunder by (x) executing and delivering a counterpart hereof to the Administrative Agent or executing a Joinder Agreement substantially in the form of Exhibit I and delivering same to the Administrative Agent, in each case as may be requested by (and in form and substance satisfactory to) the Administrative Agent and (y) taking all actions as specified in this Guaranty and the Collateral and Guaranty Requirements as would have been taken by such Guarantor had it been an original party to this Guaranty, in each case with all documents and actions required to be taken above to be taken to the reasonable satisfaction of the Administrative Agent.

17.23Right to Prove.

(a)Appointment of Attorneys. Each Australian Obligor irrevocably appoints the Administrative Agent and each of its Authorized Officers individually as its attorney and agrees to formally approve all action taken by an attorney under Section 17.23(b).

(b)Attorneys’ Powers. Each attorney may:

(i)do anything which the Australian Obligor may lawfully do to exercise its right of proof after an insolvency event occurs in respect of an Australian Borrower or any other Australian Obligor in connection with a matter not connected with its rights as “Guarantor” under this Guaranty. (These things may be done in the Australian Obligor’s name or the attorney’s name and they include signing and delivering documents, taking part in legal proceedings and receiving any dividend arising out of the right of proof);

(ii)delegate its powers (including this power) and may revoke a delegation; and

(iii)exercise its powers even if this involves a conflict of duty and even if it has a personal interest in doing so.

(c)Application of Insolvency Dividends. The attorney need not account to the relevant Australian Obligor for any dividend received on exercising the right of proof under this Section 17.23 except to the extent that any dividend remains after the Secured Creditors have received all of the Secured Obligations and all other amounts payable under this guaranty.

17.24Secured Money Limitations. Notwithstanding anything to the contrary in this Agreement or in the other Credit Documents, and solely for purposes of this Guaranty and the obligations guaranteed by the Obligors (other than the Australian Obligors) hereunder, the definition of Secured

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Obligations shall assume that the Security Documents governed by Australian law and New York law secure the “Secured Obligations” (as defined in a manner consistent with the Security Documents governed by a law other than that of Australia) of the Australian Obligors instead of the “Secured Money” (as defined in the applicable Security Documents) of the Australian Obligors.

17.25Keepwell. Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Obligor to honor all of its obligations under this Guaranty in respect of any Swap Obligation (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 17.25 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 17.25, or otherwise under this Guaranty, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section 17.25 shall remain in full force and effect until the Termination Date. Each Qualified ECP Guarantor intends that this Section 17.25 constitute, and this Section 17.25 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Obligor for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

Section 18.Release of Liens and Guaranties. A Guarantor shall automatically be released from its obligations under the Credit Documents and all security interests in the Collateral of such Guarantor shall be automatically released upon the consummation of any transaction permitted by this Agreement as a result of which Guarantor ceases to be a Subsidiary of any Parent Guarantor; provided that no Borrower shall be released; providedfurther that, if so required by this Agreement, the Required Lenders shall have consented to such transaction and the terms of such consent did not provide otherwise. Upon any sale or other transfer by any Obligor of any Collateral (other than a sale or transfer of Collateral to any Obligor, unless the respective transferee is not required to grant a security interest upon the Collateral so transferred to it) that is permitted under this Agreement, or upon the effectiveness of any written consent to the release of the security interest granted under any Credit Document in any Collateral pursuant to Section 13.12 of this Agreement, the security interest in such Collateral shall be automatically released. In connection with any termination or release pursuant to this Section, the Security Agent shall promptly execute and deliver to any Obligor, at such Obligor’s expense, all documents that such Obligor shall reasonably request to evidence such termination or release. Any execution and delivery of documents pursuant to this Section shall be without recourse to or warranty by the Security Agent.

For the avoidance of doubt, each of the parties hereto hereby acknowledges and agrees that on and after the occurrence of, and after giving effect to, the Second Restatement Effective Date, Toys “R” Us Europe, LLC (the “Released Party”) is no longer a party to this Agreement or any other Credit Document and is released from its obligations under the Credit Documents, and all security interests in the Collateral of the Released Party is automatically released upon the occurrence of the Second Restatement Effective Date. The Security Agent shall, at the sole expense of the Obligors, promptly execute and deliver to the Obligor’s Agent all documents that the Obligor’s Agent shall reasonably request to evidence such release, without recourse and without representation or warranty of any kind (either express or implied), unless any of the foregoing actions (x) would expose the Security Agent or any officer of the Security Agent to personal liability or (y) would be contrary to applicable law or the Credit Documents.

For the avoidance of doubt, each of the parties hereto hereby acknowledges and agrees that on and after the occurrence of, and after giving effect to, the Second Restatement Effective Date, Toys SARL shall be an Obligor, but shall not be a Borrower or a Guarantor hereunder. The Security Agent is hereby authorized to release Toys SARL from any Security Documents (under and defined in the Existing Facility Agreement) made by Toys SARL in favor of the Security Agent, at the sole expense and request of the Obligors, without

188

recourse and without representation or warranty of any kind (either express or implied), unless any of the foregoing actions (x) would expose the Security Agent or any officer of the Security Agent to personal liability or (y) would be contrary to applicable law or the Credit Documents

Section 19.Security Trust Provisions. Each party hereto agrees and consents to the provisions set forth in Schedule 19 attached hereto. The parties hereto further agreed that the provisions of this Section 19 shall apply to the appointment of the Security Trustee as security agent in relation to U.K. equitable charge over shares in TRU France Finance made in favor of the French Proceeds Loan Creditors on or about the Second Restatement Effective Date (the “FPL Share Charge”), mutatis mutandis, but as if references in Schedule 19 to the “Lenders” or the “Secured Creditors” were references to the Secured Creditors (as defined in the FPL Share Charge) and references in Schedule 19 to the “Secured Obligations” were references to the “Secured Obligations” as defined in the FPL Share Charge.

* * *

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers, all as of the date and year first above written.

TRU EUROPE LIMITED,

as the European Parent Guarantor

By:/s/ Robert S. Zarra______________

Name: Robert S. Zarra

Title: Director

TRU IBERIA HOLDINGS 1, S.L.U.,

as the Spanish Parent Guarantor

By: /s/ Robert S. Zarra_____________

Name: Robert S. Zarra

Title: Attorney

TRU AUSTRALIA HOLDINGS, LLC,

as the Australian Parent Guarantor

By:/s/ Robert S. Zarra______________

Name: Robert S. Zarra

Title: Vice President – International Controller

of Toys “R” Us, Inc.

189

TOYS “R” US (UK) LIMITED,

   as a U.K. Borrower

By:/s/ Robert S. Zarra_________

Name: Robert S. Zarra

Title: Director

TOYS “R” US LIMITED,

as a U.K. Borrower

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

TOYS “R” US GMBH,

as the German Borrower

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Managing Director

TOYS “R” US IBERIA, S.A.U.,

as the Spanish Borrower

By:/s/ Robert S. Zarra____________

Name: Robert S. Zarra

Title: Attorney

TOYS “R” US (AUSTRALIA) PTY LTD,

as the Australian Borrower

By:/s/ Robert S. Zarra__________

Name: Robert S. Zarra

Title: Authorized Officer

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

TRU (UK) H7 LIMITED,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

TRU (UK) H8 LIMITED,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

TOYS “R” US HOLDINGS LIMITED,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

TOYS “R” US PROPERTIES LIMITED,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

TOYS “R” US FINANCIAL SERVICES LIMITED,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

TRU (UK) H4 LIMITED,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

TRU (FRANCE) FINANCE LTD.,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

TRU (FRANCE) HOLDINGS LTD.,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Director

TRU IBERIA HOLDINGS 2, S.L.U.,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Attorney

TRU (BVI) FINANCE II, LTD.

as a Guarantor

By:/s/ John Gregory__________

Name: John Gregory

Title: Director

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

TOYS “R” US SARL

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: gérant (legal representative)

TRU (UK) H6, LLC,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Vice President – International Controller

BABIES “R” US (AUSTRALIA) PTY LTD,

as a Guarantor

By:/s/ Robert S. Zarra________

Name: Robert S. Zarra

Title: Authorized Officer

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

DEUTSCHE BANK AG NEW YORK BRANCH,

Individually and as Administrative Agent, Co-Collateral Agent, Security Agent and Issuing Lender

By:/s/ D. Lazarov_______

Name: D. Lazarov

Title: Director

By:/s/ Anca Trifan_______

Name: Anca Trifan

Title: Managing Director

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

BANK OF AMERICA N.A.,

Individually and as Co-Collateral Agent and Issuing Lender

By:/s/ Christine Hutchinson

Name: Christine Hutchinson

Title: Director

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

GOLDMAN SACHS INTERNATIONAL BANK,

as Lender

By:/s/ Alisdair Fraser_____

Name: Alisdair Fraser

Title: Authorized Signatory

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

CITIBANK, N.A.

as Lender

By:/s/ Brendan Mackay____

Name: Brendan Mackay

Title: Vice President and Director

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

HSBC Bank plc, 8 Canada Square, Canary Wharf, London

as Lender

By:/s/ Nick G. Raye____

Name: Nick G. Raye

Title: Relationship Director

By: /s/ Simon Addis____

Name: Simon Addis

Title: Head of ISB London & South

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

J. P. Morgan Europe Limited,

as Lender

By:/s/ Tim Jacob_____

Name: Tim Jacob

Title: Senior Vice President

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

WELLS FARGO BANK INTERNATIONAL

as Lender

By:/s/ Gareth Dunphy_____

Name: Gareth Dunphy

Title: CFO

By: /s/ Holly Kaczmarczyk____

Name: Holly Kaczmarczyk

Title: Chief Executive Officer – Wells Fargo Bank

International

[Signature Page – Toys – Second A&R Facility Agreement]

Americas 90821884

Schedule I

Obligor Notice Addresses

Entity	Addresses for Notices
TRU Australia Holdings, LLC TRU (UK) H6, LLC	One Geoffrey Way Wayne, NJ 07470 Attention: David J. Schwartz, General Counsel Phone: (973) 617-5740 Fax: (973) 617-4043
Toys “R” Us (Australia) Pty Ltd. Babies “R” Us (Australia) Pty Ltd	Block G Commercial Drive Regents Park Estate 391 Park Road, NSW 2143 Attention: Dianne Guerreiro Phone: 61-2-9794 – 8953 Fax: 61-2-9644-3223 with a copy to  One Geoffrey Way Wayne, NJ 07470 Attention: David J. Schwartz, General Counsel Phone: (973) 617-5740 Fax: (973) 617-4043
TRU Europe Limited TRU (UK) H7 Limited TRU (UK) H8 Limited Toys “R” Us (UK) Limited Toys “R” Us Holdings Limited Toys “R” Us Properties Limited Toys “R” Us Financial Services Limited Toys “R” Us Limited TRU (UK) H4 Limited TRU (France) Finance Ltd. TRU (France) Holdings Ltd.	Geoffrey House, Maidenhead Office Park, Westacott Way, Maidenhead, Berkshire SL6 3QH Attention: Frank Muzika Phone: 44-1-628-414-617 Fax: 44-1-628-414-093. with a copy to  One Geoffrey Way Wayne, NJ 07470 Attention: David J. Schwartz, General Counsel Phone: (973) 617-5740 Fax: (973) 617-4043

1

Toys “R” Us SARL	1, allee des Lutins ZAC de la Marcaux Loups ST FARGEAU PONTHIERRY, FRANCE 77310 Attention: Ralph Binginot and Enrique González Hernán Phone: 33-91-60-76-83-00 Fax: 33-91-60-76-83-25   with a copy to  One Geoffrey Way Wayne, NJ 07470 Attention: David J. Schwartz, General Counsel Phone: (973) 617-5740 Fax: (973) 617-4043
Toys “R” Us GmbH	Köhlstraße 8, 50827 Köln, Germany Attention: Juergen Wallman, Finance Director Central Europe Phone: 49-221-5972 441 Fax: 49-221-5972 444 with a copy to  One Geoffrey Way Wayne, NJ 07470 Attention: David J. Schwartz, General Counsel Phone: (973) 617-5740 Fax: (973) 617-4043
TRU Iberia Holdings 1, S.L.U. TRU Iberia Holdings 2, S.L.U. Toys “R” Us Iberia, S.A.U.	Calle Lucio Emilio Cándido, 12 N-II, Ctra. M-300 km. 29.800, CP 28802, Alcalá de Henares (Madrid), Spain Attention: Enrique González Hernán and Inmaculada García-Miguel Gallego Phone: 34-1-887-82-00 Fax: 34-1-887-82-73 with a copy to  One Geoffrey Way Wayne, NJ 07470 Attention: David J. Schwartz, General Counsel Phone: (973) 617-5740 Fax: (973) 617-4043

3

TRU (BVI) Finance II, Limited c/o Elian (FKA) Ogier Fiduciary Services (BVI) Limited
Ritter House Wickhams Cay II
PO Box 3170
Road Town, Tortola
British Virgin Islands
VG1110  
with a copy to 
One Geoffrey Way
Wayne, NJ 07470
Attention: David J. Schwartz, General Counsel
Phone: (973) 617-5740
Fax: (973) 617-4043

3

SCHEDULE 1.01(a)

Commitments

Lender	Commitment
Deutsche Bank AG New York Branch	£32,450,000
Bank of America, N.A.	£32,450,000
Goldman Sachs International Bank	£25,850,000
Citibank, N.A.	£17,250,000
J.P. Morgan Europe Limited	£10,000,000
HSBC Bank plc	£10,000,000
Wells Fargo Bank International	£10,000,000
TOTAL:	£138,000,000

SCHEDULE 1.01(c)

AGREED SECURITY PRINCIPLES

1.1 The guarantees and security to be provided under the Credit Documents will be given in accordance with certain agreed security principles (the “Agreed Security Principles”). This Schedule 1.01(c) identifies the Agreed Security Principles and addresses the manner in which the Agreed Security Principles may impact on or be determinant of the guarantees and security proposed to be taken in relation to the credit facilities provided under this Agreement.

1.2 The Agreed Security Principles embody a recognition by all parties that there may be certain legal and practical difficulties in obtaining effective guarantees or security from all relevant Obligors in every jurisdiction in which those members are located. In particular:

(a) general statutory limitations, financial assistance, corporate benefit, fraudulent preference, “thin capitalisation” rules, retention of title claims and similar matters may limit the ability of an Obligor to provide a guarantee or security or may require that the guarantee be limited by an amount or otherwise, provided that the relevant Obligor shall use reasonable endeavours to overcome such obstacle;

(b) Obligors will not be required to give guarantees or enter into security documents if (or to the extent) it is not within the legal capacity of the relevant Obligor or if the same would conflict with the fiduciary duties of those directors or contravene any legal prohibition or regulatory condition or it is generally accepted (taking into account market practice in respect of the giving of guarantees and security for financial obligations in the relevant jurisdiction) that it would result in a material risk of personal or criminal liability on the part of any officer of a Obligor provided that the Obligor shall use reasonable endeavours to overcome any such obstacle;

(c) a key factor in determining whether or not security shall be taken is the applicable cost (including adverse effects on interest deductibility registration taxes and notarial costs) which shall not be materially disproportionate to the benefit to the Lenders of obtaining such security;

(d) where there is material incremental cost involved in creating security over all assets owned by an Obligor in a particular category (e.g. real estate) the principle stated at paragraph 1.2(c) of this Schedule 1.01(c) shall apply and, subject to the Agreed Security Principles, only the material assets in that category (e.g. material real estate) shall be subject to security;

(e) it is expressly acknowledged that it may be either impossible or impractical to create security over certain categories of assets in which event security will not be taken over such assets;

(f) any assets subject to contracts, leases, licences or other arrangements with a third party which prevent those assets from being charged will be excluded from any relevant security document; provided that reasonable endeavours to obtain consent

SCHEDULE 1.01(c)

Page 2

to charging any such assets shall be used by the Obligors if the Security Agent determines the relevant asset is material and such endeavours will not involve placing commercial relationships with third parties in jeopardy but unless prohibited this shall not prevent security being given over any receipt or recovery under such contract, lease or licence; provided, further that all credit processing agreements and arrangements and the intellectual property licensing agreements and arrangements with Geoffrey LLC and Group Members are deemed material and shall be included in the relevant security documents;

(g) The granting of security or the perfection of the security granted will not be required if it would have a material adverse effect on the ability of the relevant Obligor to conduct its operations and business in the ordinary course as otherwise permitted by the Credit Documents; and

(h) Notwithstanding any other provision of the Credit Documents to the contrary, no U.S. Obligation shall be (or be deemed) guaranteed by, or otherwise supported directly or indirectly by the assets (including shares in a Subsidiary) of, any Person that is or becomes (x) a CFC, (y) a Subsidiary CFC or (z) a CFC Holdco, provided that (i) not more than 65 per cent of the total combined voting power of all classes of shares entitled to vote and 100 per cent of all classes of shares not entitled to vote of any CFC Holdco or any first tier CFC that is not a Subsidiary of a CFC Holdco shall be pledged as security for a U.S. Obligation, provided, however, for the avoidance of doubt, that no shares of any Subsidiary CFC or any Subsidiary of such CFC Holdco shall be required to be pledged, (ii) the restrictions set forth in this paragraph shall not apply at any time that there is no Borrower that is a United States Tax Person, and (iii) the restrictions set forth in this paragraph shall not apply to any CFC Full Obligor.

Notwithstanding any of the foregoing, the Lenders shall not be obligated to consummate the Transaction unless the Co-Collateral Agents have received valid, perfected first priority liens in all assets of the type included in the Borrowing Base located in Australia and the United Kingdom.

2.Guarantees

2.1 Each guarantee will be an upstream, cross‑stream and downstream guarantee and each guarantee will be for all liabilities of the Obligors under the Credit Documents in accordance with, and subject to any contrary requirements of, the Agreed Security Principles in each relevant jurisdiction. Each Obligor granting security shall do so for all liabilities of the Obligors under the Credit Documents to the extent such guarantee may be considered valid, binding and enforceable under Applicable Law.

2.2 Where an Obligor pledges shares or bank accounts, the security document will (subject to agreed exceptions) be governed by the law of the country of incorporation of the company whose shares are being pledged or in which the bank accounts are situate and not by the law of the country of the pledgor.

SCHEDULE 1.01(c)

Page 3

2.3 In the event that an Obligor owns shares in a company (other than an Immaterial Subsidiary, a dormant company and other agreed de minimis companies) incorporated in the United States, Australia, Austria, Portugal, Switzerland, England, France, Spain or Germany, security shall be created and perfected over such shares in accordance with the law of such jurisdiction.

2.4 In the event that an Obligor shall own shares in a jurisdiction which is not the United States, Australia, Austria, Portugal, Switzerland, England, France, Spain or Germany, no steps shall be taken to create or perfect security over such shares in such company unless it is a Borrower.

3.Terms of Security Documents

The following principles will be reflected in the terms of any security taken as part of the Transaction:

(a) security will not be enforceable until an event of default has occurred and notice of such event of default and of intention to take enforcement action pursuant to the Credit Documents has been given by the Administrative Agent;

(b) notification of pledges over bank accounts will be promptly given to the bank holding the account; provided that this is not inconsistent with the Obligors retaining control over and access to the balances the accounts and, in the case of any bank account situated in Australia, England or Wales, the relevant Obligors shall use reasonable endeavors to obtain from each bank holding any such account an acknowledgement of receipt of such notification and confirmation of each such bank’s agreement to the terms of the notification, and in case of any bank account situated in Germany, the relevant Obligors shall use reasonable endeavors to obtain from each bank holding such account an acknowledgement of receipt of such notification and confirmation of subordination of any existing pledge, including without limitation, any pledge existing by operation of their general business conditions (Allgemeine Geschäftsbedingungen);

(c) notification of receivables security to debtors who are not Obligors will only be given if an Event of Default has occurred and notice of such Event of Default and of intention to take enforcement action pursuant to the Credit Documents has been given by the Administrative Agent but the relevant Security Document may provide for the prompt delivery of blank notifications signed by the relevant Obligor to the Security Agent;

(d) notification of any security interest over insurance policies and intra-group receivables will promptly be served on any insurer of the assets of the Obligors;

(e) the Security Documents should only operate to create security rather than to impose new commercial obligations. Accordingly, they should not contain additional representations, undertakings or indemnities (such as in respect of insurance, information or the payment of costs) unless required for the creation or perfection

SCHEDULE 1.01(c)

Page 4

of security or unless it is generally accepted that any such additional representations, undertakings or indemnities are required in the relevant jurisdiction (taking into account market practice in respect of the giving of guarantees and security for financial obligations in the relevant jurisdiction);

(f) in respect of the share pledges and pledges of intra‑group receivables, until an Event of Default has occurred, the pledgors will be permitted to retain and to exercise voting rights to any shares pledged by them in a manner which does not adversely affect the value of the security or the validity or enforceability of the security or cause an Event of Default to occur and the pledgors will be permitted to receive dividends on pledged shares and payment of intra‑group receivables and retain the proceeds and/or make the proceeds available for purposes not prohibited under the Credit Documents; and

(g) the Administrative Agent or other Secured Creditors should only be able to exercise any power of attorney granted to them under the terms of the Credit Documents following an Event of Default or failure to comply with a further assurance or perfection obligation with respect to the security.

SCHEDULE 1.01(d)

SECURITY DOCUMENTS

Part I.    Security Documents to be delivered on or prior to the Second Restatement Effective Date

1. New York Law governed Security Documents

a. Credit Document Acknowledgement and Amendment

2. English Law governed Security Documents

a. Composite Debenture made by the English Obligors in favor of the Security Agent

b. Equitable charge over shares granted by TRU (UK) H6, LLC over the equity interests of TRU (UK) H4 Limited in favor of the Security Agent

c. Equitable charge over shares granted by TRU (BVI) Finance II, Ltd over the equity interests of Toys “R” Us Financial Services Limited in favor of the Security Agent

d. Equitable charge over shares granted by Toys “R” Us SARL over the equity interests in TRU (France) Finance Ltd. in favor of the French Proceeds Loan Creditors to secure the French Proceeds Loan Secured Obligations

3. French Law governed Security Documents

a. Pledges over Receivables with respect to the receivables under the French Proceeds Loan Agreement granted by the UK Borrowers in favor of the French Proceeds Loan Creditors

b. Pledge granted by Toys “R” Us SARL over its bank accounts located in France in favor of the French Proceeds Loan Creditors

c. Pledge over receivables with respect to the receivables over insurance receivables granted by Toys “R” Us SARL in favor of the French Proceeds Loan Creditors

d. Nonpossessory inventory pledge over inventory of Toys “R” Us SARL to be granted by Toys “R” Us SARL in favor of the French Proceeds Loan Creditors

e. Second Ranking Share pledge over the shares (parts sociales) of Toys “R” Us SARL made by TRU (France) Holdings Ltd. in favor of the beneficiaries as identified therein

4.    BVI Law governed Security Documents

SCHEDULE 1.01(d)

Page 2

a. Deed of Affirmation and Variation in respect of BVI law share charge granted by Toys “R” Us (UK) Limited over shares in TRU (BVI) Finance II, Ltd.

b. Share charge granted by Toys “R” Us (UK) Limited over shares in TRU (BVI) Finance II Ltd. in favor of the Security Agent

Part II.    Security Documents previously delivered pursuant to the Existing Facility Agreement

1. New York Law governed Security Documents

a. Security Agreement made by LLC and TRU Australia Holdings, LLC and TRU (UK) H6, LLC in favor of the Security Agent

b. Intellectual Property Rights Agreement

c. Global Pledge Agreement entered into by each Obligor in favour of the Security Agent

d. Credit Document Acknowledgement and Amendment under and defined in the Existing Facility Agreement

2. English Law governed Security Documents

a. Composite Debenture dated 15 October 2009 made by Toys “R” Us (UK) Limited, Toys “R” Us Holdings Limited, Toys “R” Us Limited, Toys “R” Us Properties Limited and Toys “R” Us Financial Services Limited in favor of the Security Agent

b. Equitable Charge Over Shares dated 15 October 2009made by Toys “R” Us Europe, LLC over the equity interest of Toys “R” Us (UK) Limited in favor of the Security Agent

c. Composite Debenture dated 8 March 2011 made by Toys “R” Us (UK) Limited, Toys “R” Us Holdings Limited, Toys “R” Us Limited, Toys “R” Us Properties Limited and Toys “R” Us Financial Services Limited in favor of the Security Agent

d. Equitable charge over shares dated 8 March 2011 made by Toys “R” Us Europe, LLC over the equity interests of Toys “R” Us (UK) Limited in favor of the Security Agent

e. Deed of Amendment in respect of the Debenture dated 15 October 2009 made by Toys “R” Us (UK) Limited, Toys “R” Us Holdings Limited, Toys “R” Us Limited, Toys “R” Us Properties Limited and Toys “R” Us Financial Services Limited in favor of the Security Agent

SCHEDULE 1.01(d)

Page 3

f. Composite Debenture dated 27 October 2011 made by TRU (France) Holdings Ltd. and TRU (France) Finance Ltd. in favor of Deutsche Bank AG New York Branch as Security Agent

g. Equitable charge over shares dated 27 October 2011 made by Toys “R” Us Europe, LLC over the equity interests of TRU (France) Holdings Ltd. in favor of the Security Agent

h. Debenture dated 29 April 2013 made by TRU (UK) H4 Limited in favor of the Security Agent

i. Equitable charge over shares dated 12 November 2015 made by TRU (BVI) Finance II, LTD over the equity interests of Toys “R” Us Financial Services Limited in favor of the Security Agent

3. Australian Law governed Security Documents

a. Equitable mortgage over shares made by Toys “R” Us (Australia) Pty Limited over the equity interests of Babies “R” US (Australia) Pty Ltd. (ABN 56073394117) in favor of the Security Agent

b. Fixed and floating charge over all of the assets, rights and undertakings of Toys “R” Us (Australia) Pty Limited and Babies “R” US (Australia) Pty Ltd. (ABN 56073394117) in favor of the Security Agent

4. German Law governed Security Documents

a. Share pledge over the shares held by Toys “R” Us Europe, LLC in the Toys “R” Us GmbH made by the Toys “R” Us Europe, LLC in favor of the Security Agent

b. Assignment of Insurances made by Toys “R” Us GmbH in favor of the Security Agent

c. Pledge of bank accounts of Toys “R” Us GmbH

d. Side letter regarding movable assets of Toys “R” Us GmbH

e. Confirmation and Amendment Agreement relating to the Bank Accounts Pledge and Assignment of Insurances made by Toys “R” Us GmbH in favor of the Security Agent

f. Confirmation and amendment agreement relating to the existing Share Pledge over the shares held by Toys “R” Us Europe, LLC in Toys “R” Us GmbH

SCHEDULE 1.01(d)

Page 4

5. French Law governed Security Documents

a. First ranking share pledge over the shares (parts sociales) of Toys “R” Us SARL made by TRU (France) Holdings Ltd.

6. Spanish Law governed Security Documents

a. Share pledge dated 15 October 2009 granted by Toys “R” Us Europe, LLC over the equity interests of Toys “R” Us Iberia, S.A.U. in favor of the Security Agent

b. Supplementary agreement to the share pledge dated 19 November 2009 amongst Toys “R” US Europe, LLC, Toys “R” Us Iberia, S.A.U. and the Security Agent

c. Pledge over credit rights arising from insurances dated 12 February 2010 granted by Toys “R” Us Iberia, S.A.U. in favor of the Security Agent

d. Pledge over credit rights arising from bank accounts dated 12 February 2010 granted by Toys “R” Us Iberia, S.A.U. in favor of the Security Agent

e. Novation of pledges and partial release deed 9 March 2011 entered into among Toys “R” Us Europe, LLC, Toys “R” Us Iberia, S.A.U. and the Security Agent

f. Second supplementary agreement dated 29 April 2011 amongst Toys “R” US Europe, LLC, Toys “R” Us Iberia, S.A.U. and the Security Agent

g. Pledge over bank accounts dated 18 August 2015 granted by Toys “R” Us GmbH in favor of the Security Agent

h. Public deed of irrevocable powers of attorney dated 18 August 2015 granted by Toys “R” Us GmbH in favor of the Security Agent

i. Pledge over bank accounts dated 18 August 2015 granted by Toys “R” Us Limited in favor of the Security Agent

j. Public deed of irrevocable powers of attorney dated 18 August 2015 granted by Toys “R” Us Limited in favor of the Security Agent

7. BVI Law governed Security Documents

a. BVI Share Charge made by Toys “R” Us (UK) Limited over shares in TRU (BVI) Finance II Ltd in favor of the Security Agent

SCHEDULE 1.01(d)

Page 5

Part III.    Security Documents to be delivered after the Second Restatement Effective Date

1.    German Law governed Security Documents

a. Confirmation and amendment agreement relating to the existing Share pledge over the shares made by TRU (UK) H8 Limited in Toys “R” Us GmbH (Notarial)

b. Confirmation and amendment agreement relating to the Bank Accounts Pledge and Assignment of Insurances made by Toys “R” Us GmbH in favor of the Security Agent and all initial Lenders

2. Spanish Law governed Security Documents

a. Deed of novation, extension, ratification and release of certain security documents (novation, extension and ratification of existing pledges other than the release of the pledge over the credit rights arising from bank accounts granted by Toys “R” Us S.à r.l.)

b. Public deed of cancellation and release of the irrevocable powers of attorney granted by Toys “R” Us S.à r.l.

c. Public deed of ratification of irrevocable powers of attorney

d. Deed of share pledge granted by TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) over the equity interests in TRU Iberia Holdings 2, S.L.U. (formerly known as Avenal Investment, S.L.U.) in favor of the Security Agent

e. Public deed of irrevocable powers of attorney granted by TRU Iberia Holdings 1, S.L.U. in favor of the Security Agent

Schedule 3.01(a)
Existing Letters of Credit

None.

Schedule 8.10
ERISA

We sponsor defined benefit pension plans covering certain employees in the UK, Germany and Austria, with such benefits accounted for on an accrual basis using actuarial assumptions.

Schedule 8.13
Subsidiaries; Joint Ventures; Obligors

Parent Guarantor	Subsidiary (including Propcos)	Percent of Ownership/ Membership Interest Parent Guarantor	Direct Owner of Subsidiary	Obligor (“O”)
TRU Europe Limited	United States
	TRU (UK) H6, LLC	100% Indirect	Toys “R” Us Holdings Limited	O
	United Kingdom
	TRU (UK) H7 Limited	100% Direct	TRU Europe Limited	O
	TRU (UK) H8 Limited	100% Direct	TRU Europe Limited	O
	Toys “R” Us (UK) Limited	100% Indirect	TRU (UK) H7 Limited	O
	Toys “R” Us Holdings Limited	100% Indirect	Toys “R” Us (UK) Limited	O
	TRU (UK) H4 Limited	100% Indirect	97.1% owned by Toys “R” Us Holdings Limited; 2.9% owned by TRU (UK) H6, LLC	O
	Toys “R” Us Properties (UK) Limited	100% Indirect	TRU (UK) H5 Limited
	Toys “R” Us Properties Limited	100% Indirect	TRU (UK) H4 Limited	O
	Toys “R” Us Financial Services Limited	100% Indirect	99.9% owned by TRU (BVI) Finance II, Ltd.; 0.1% owned by Toys “R” Us (UK) Limited	O
	Toys “R” Us Limited	100% Indirect	TRU (UK) H4 Limited	O
	TRU (France) Holdings Ltd.	100% Indirect	TRU (UK) H8 Limited	O
	TRU (France) Finance Ltd.	100% Indirect	Toys “R” Us SARL	O
	TRU (UK) Noteholder Limited	100% Indirect	TRU (UK) H4 Limited
	TRU (UK) H5 Limited	100% Indirect	TRU (UK) H4 Limited
	Austria
	Toys “R” Us Handelsgesellschaft mbH	100% Direct	TRU (UK) H8 Limited
	Germany
	Toys “R” Us GmbH	100% Direct	TRU (UK) H8 Limited	O

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	France
	Toys “R” Us SARL	100% Indirect	TRU (France) Holdings Ltd.	O
	Toys “R” Us France Real Estate SAS	100% Indirect	Toys “R” Us SARL
	Netherlands
	TRU Netherlands Holdings BV	100% Direct	TRU (UK) H8 Limited
	Poland
	Toys “R” Us Poland sp.z.o.o.	100% Indirect	TRU Netherlands Holdings BV
	Switzerland
	Toys R Us AG	100% Direct	TRU (UK) H8 Limited
	British Virgin Islands
	TRU (BVI) Finance II, Ltd.	100% Indirect	Toys “R” Us Holdings Limited	O
TRU Iberia Holdings 1, S.L.U.	Spain
	TRU Iberia Holdings 2, S.L.U.	100% Direct	TRU Iberia Holdings 1, S.L.U.	O
	Toys R Us Iberia, S.A.U.	100% Indirect	TRU Iberia Holdings 2, S.L.U.	O
	Toys R Us Iberia Real Estate, S.L.U.	100% Indirect	Toys R Us Iberia, S.A.U.
	Toys R Us Madrid, S.L.U.	100% Indirect	Toys R Us Iberia, S.A.U.
	Portugal
	Toys R Us Portugal – Brinquedos E Arigos Juvenis, LDA	100% Indirect	99.99% owned by Toys R Us Iberia, S.A.U.; 0.01% owned by TRU Iberia Holdings 2, S.L.U.
TRU Australia Holdings, LLC	Australia
	Toys “R” Us (Australia) Pty Ltd	100% Direct	TRU Australia Holdings, LLC	O
	Babies “R” Us (Australia) Pty Ltd	100% Indirect	Toys “R” Us (Australia) Pty Ltd	O

* The following entities are in the process of being dissolved: TRU Holdings I Ltd., TRU Holdings 2 Unlimited, TRU (Ireland) Holdings Unlimited, and Toys “R” Us (Ireland) Unlimited

Schedule 8.20

Intercompany Debt

Non-Group Member to Group Members

Lender	Borrower	AMT	Currency
Toys "R" Us, Inc.	Toys "R" Us (UK) Limited	730,584,190	GBP	(1)
Toys "R" Us, Inc.	Toys "R" Us (UK) Limited	52,129,910	USD	(1)
Toys "R" Us, Inc.	Toys "R" Us (UK) Limited	3,205,173	USD	(1)
Toys "R" Us, Inc.	Toys "R" Us Australia Pty Ltd	28,000,000	AUD	(2)
Group Members to Group Members
Lender	Borrower	AMT	Currency
TRU Europe Limited	Toys "R" Us (UK) Limited	30,214,950	GBP
TRU Europe Limited	TRU (France) Holdings Ltd	25,192,252	USD	(1)
TRU Europe Limited	Toys "R" Us (UK) Limited	218,733,584	GBP	(1)
TRU Europe Limited	Toys "R" Us Limited	50,000,000	CHF
TRU Europe Limited	Toys "R" Us Limited	2,600,000	GBP
TRU Europe Limited	Toys "R" Us Iberia, S.A.U.	11,500,000	EUR
Toys "R" Us (UK) Limited	TRU (BVI) Finance II, Ltd	464,479,453	GBP	(1)
Toys "R" Us (UK) Limited	TRU (BVI) Finance II, Ltd	93,092,469	GBP	(1)
Toys "R" Us Financial Services Limited	Toys R Us (UK) Limited	557,549,977	GBP	(1)
Toys "R" Us Holdings Limited	Toys R Us (UK) Limited	557,549,977	GBP	(1)
Toys "R" Us Limited	TRU (UK) H4, Limited	270,551,168	GBP	(1)
TRU (France) Finance Ltd	TRU (France) Holdings Ltd	111,169,435	EUR
TRU (France) Finance Ltd	TRU Netherlands Holdings, B.V.	300,000	EUR
TRU (France) Finance Ltd	Toys "R" Us Limited	6,000,000	EUR
Toys “R” Us AG	Toys "R" Us Limited	5,000,000	CHF
Toys "R" Us, GMBH	Toys "R" Us Limited	21,400,000	EUR
Toys “R” Us Handelsgesellschaft mbH	Toys "R" Us Limited	13,100,000	EUR
TRU (France) Finance Ltd.	Toys “R” Us SARL	11,500,000	EUR
Toys R Us Portugal	Toys "R" Us Iberia, S.A.U.	12,000,000	EUR
Toys “R” Us Handelsgesellschaft mbH	TRU Netherlands Holdings BV	12,103,957	EUR
Toys “R” Us Handelsgesellschaft mbH	Poland	15,970,000	EUR

(1) Includes accrued interest through November 28, 2015

(2) Short-term loan expected to be fully repaid by end of fiscal year 2015

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Third Party Obligations

Borrower	Description	AMT	Currency
Toys “R” Us Australia Pty Ltd	Various Landlord financings	1,111,000	AUD
Toys “R” Us SARL	Unsecured amortizing loan	2,716,633	EUR
Toys “R” Us SARL	Lease back on DC equipment	1,310,461	EUR
Toys “R” Us SARL	Lease back on DC equipment	7,774,265	EUR

Schedule 10.01
Existing LiensTOYS “R” US SARL

Jurisdiction	Debtor	Secured Party	Collateral Description
France	Toys “R” Us S.A.R.L.	Credit Lyonnais	Bank guarantees issued by Credit Lyonnais in the amount of EUR 443,049
	Toys “R” Us S.A.R.L.	Deutsche Bank	Pledge of shares of Toys “R” Us France Real Estate for real estate loans made to Toys “R” Us France Real Estate for an outstanding principal amount of EUR 46,350,000
	Toys “R” Us S.A.R.L.	BPI	Lease back on DC equipment for EUR 1,310,461
	Toys “R” Us S.A.R.L.	HSBC	Lease back on DC equipment for EUR 7,774,265

TOYS “R” US IBERIA, S.A.U.

Jurisdiction	Debtor	Secured Party	Collateral Description
Spain	Toys “R” Us Iberia, S.A.U.	BBVA	Bank guarantees issued by BBVA in the amount of EUR 6,509,407
	Toys “R” Us Iberia, S.A.U.	Banco Santander, S.A.	Bank guarantees issued by Banco Santander S.A. in the amount of EUR 1,336,718
	Toys “R” Us Iberia, S.A.U.	Deutsche Bank AG, London Branch, Banco Santander, S.A. and BBVA	Pledge of shares of Toys “R” Us Iberia Real Estate as security for real estate loans made to Toys “R” Us Iberia Real Estate S.L.U. for an outstanding principal amount of EUR 24,000,000
	Toys “R” Us Iberia, S.A.U.	Deutsche Bank AG, London Branch, Banco Santander, S.A. and BBVA	Pledge over the credit rights arising from an intercompany receivable from Toys “R” Us Iberia Real Estate, S.L.U. for EUR 12,000,000 as security for real estate loans made to Toys “R” Us Iberia Real Estate S.L.U. for an outstanding principal amount of EUR 24,000,000

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Toys “R” Us GMBH

Jurisdiction	Debtor	Secured Party	Collateral Description
Germany	Toys “R” Us GMBH	Deutsche Bank	Bank guarantees issued by Deutsche Bank in the amount of 1,429,575 EUR
Germany	Toys “R” Us GMBH	Commerzbank	Bank guarantees issued by Commerzbank in the amount of 613,530 EUR

Toys “R” Us Poland Sp. z o.o.

Jurisdiction	Debtor	Secured Party	Collateral Description
Poland	Toys “R” Us Poland Sp. z o.o.	Citi Bank	Bank guarantees issued by Citi Bank in the amount of 2,445,028 PLN

Toys “R” Us AG

Jurisdiction	Debtor	Secured Party	Collateral Description
Switzerland	Toys “R” Us AG	Oberbank	Bank guarantees issued by Oberbank in the amount of 1,876,225 CHF

Schedule 10.05 (iii)
Permitted Investments

Loans from Group Members to Non-Group Members

Lender		Borrower		AMT		Currency
Toys "R" Us (UK) Limited		Toys "R" Us Inc.		647,154,975		GBP		(1)
Toys "R" Us Iberia, S.A.U.		Toys "R" Us Iberia Real Estate S.L.U.		12,000,000		EUR
TRU (France) Finance Ltd		Toys "R" Us Europe, LLC		535,389		EUR
Toys "R" Us Properties Limited		Toys "R" Us Properties (UK) Limited		13,786,340		GBP
Toys "R" Us Limited		Toys "R" Us Properties (UK) Limited		66,404,230		GBP
Toys "R" Us Limited		Toys "R" Us Properties (UK) Limited		2,000,000		GBP
Loans from Group Members to Group Members
Lender	Borrower		AMT		Currency
TRU Europe Limited	Toys "R" Us (UK) Limited		30,214,950		GBP
TRU Europe Limited	TRU (France) Holdings Ltd		25,192,252		USD		(1)
TRU Europe Limited	Toys "R" Us (UK) Limited		218,733,584		GBP		(1)
TRU Europe Limited	Toys "R" Us Limited		50,000,000		CHF
TRU Europe Limited	Toys "R" Us Limited		2,600,000		GBP
TRU Iberia Holdings 1, S.L.U.	Toys "R" Us Iberia, S.A.U.		11,500,000		EUR
Toys "R" Us (UK) Limited	TRU (BVI) Finance II, Ltd		464,479,453		GBP		(1)
Toys "R" Us (UK) Limited	TRU (BVI) Finance II, Ltd		93,092,469		GBP		(1)
Toys "R" Us Financial Services Limited	Toys R Us (UK) Limited		557,549,977		GBP		(1)
Toys "R" Us Holdings Limited	Toys R Us (UK) Limited		557,549,977		GBP		(1)
Toys "R" Us Limited	TRU (UK) H4, Limited		270,551,168		GBP		(1)
TRU (France) Finance Ltd	TRU (France) Holdings Ltd		111,169,435		EUR
TRU (France) Finance Ltd	TRU Netherlands Holdings, B.V.		300,000		EUR
TRU (France) Finance Ltd	Toys "R" Us Limited		6,000,000		EUR
Toys “R” Us AG	Toys "R" Us Limited		5,000,000		CHF
Toys "R" Us, GMBH	Toys "R" Us Limited		21,400,000		EUR
Toys “R” Us Handelsgesellschaft mbH	Toys "R" Us Limited		13,100,000		EUR
TRU (France) Finance Ltd.	Toys “R” Us SARL		11,500,000		EUR
Toys “R” Us Portugal	Toys "R" Us Iberia, S.A.U.		12,000,000		EUR
Toys “R” Us Handelsgesellschaft mbH	TRU Netherlands Holdings BV		12,103,957		EUR
Toys “R” Us Handelsgesellschaft mbH	Poland		15,970,000		EUR

(1) Includes accrued interest through November 28, 2015

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Investments in Non-Obligor Subsidiaries

• Toys “R” Us Iberia, S.A.U. has an equity investment in Toys “R” Us Iberia Real Estate, S.L.U.

• Toys “R” Us Iberia, S.A.U. has an equity investment in Toys “R” Us Portugal – Brinquedos E Artigos Juvenis, LDA

• TRU Iberia Holdings 2, S.L.U. has an equity investment in Toys “R” Us Portugal – Brinquedos E Artigos Juvenis, LDA

• Toys “R” Us Iberia, S.A.U. has an equity investment in Toys R Us Madrid, S.L.

• Toys “R” Us, SARL has an equity investment in Toys “R” Us France Real Estate, S.A.S

• TRU (UK) H8 Limited has an equity investment in Toys “R” Us AG

• TRU (UK) H8 Limited has an equity investment in Toys “R” Us Handelsgesellschaft mbH

• TRU (UK) H8 Limited has an equity investment in TRU Netherlands Holdings BV

• TRU (UK) H4 Limited has an equity investment in TRU UK (H5) Limited

• TRU (UK) H4 Limited has an equity investment in TRU (UK) Noteholder Limited

Schedule 10.05(xiii)
Investment Policy

Objectives in order of priority:

Safety and preservation of principal by minimizing both credit and market risk

Maintain necessary liquidity

Maximize after-tax return

Maximum Investment Maturity – 45 days for Sovereign and Agencies; 30 days for Corporates and Banks

Investment Sector	Required Credit Rating	Authorized Instrument
Sovereign Securities, Agency Securities, State and Local Obligations	•    Required either S&P rating of AA or Moody’s rating of Aa o    If both S&P and Moody’s ratings available, lower rating prevails o    Unlimited amount for AAA rating (or AA+ for the US) o    Up to $150 million for AA rating	•    In Sovereigns and Agencies of Governments of the United States, United Kingdom, Australia, Canada, France, Germany, Switzerland, Austria, and Japan
Bank Obligations	•    An S&P rating of A-2/A- or higher or a Moody’s rating of P-2/A3 or higher (lower rating prevails). If unavailable, a Fitch rating F-2/A- or higher; o    Up to $150 million for AA family or better rated banks o    Up to $100 million for A family of rated banks ($50 million if short-term rating is A-2 or P-2) o    Unlimited capacity for any bank deposit or obligation backed by full FDIC insurance	•    US Bank Obligations -- USD and Eurodollar CDs, Bankers Acceptances, Eurodollar time deposits, Bank Holding Company CP, and cash on deposit in TRU bank accounts in US banks. •    Non-US Bank Obligations – headquartered in same countries as above and limited to Eurodollar time deposits defined as non-negotiable, fixed rate deposits issued by banks outside the United States. Also permissible as cash on deposit in foreign TRU bank accounts in countries listed above.
Corporate Obligations (financial and non-financial entities)	•    Either S&P rating of A-1 or higher, or a Moody’s rating of P-1 or higher •    Limit of $50 million per Issuer	•    Direct issue commercial paper

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Money Market Funds •    Stable net asset value of $1.00 and rated AAA by S&P and Aaa by Moody’s •    Fund assets of at least $5B •    Same day settlement for US funds, 3 days for international funds •    $150 million per fund limit in US, $50 million per non-US fund •    Comprised of high quality money market instruments having a dollar weighted average of 90 days or less •    Pre-approved by Treasurer

• The Company's CEO, CFO, Treasurer and the international Finance Directors are each authorized to delegate to any other authorized Treasury employees of the Company the authority to give instructions pursuant to this policy. This process is formalized in the US with a Certificate of Authority & Designation (Resolution) on file with the Financial Institution.

• Third party investment managers may be appointed with prior approval of the Treasurer and CFO

• Any investments or deviations outside the policy described above must be pre-approved by the CFO and Treasurer on a case by case basis.

SCHEDULE 13.03

Lender Addresses

Lender	Address
Deutsche Bank AG New York Branch	60 Wall Street New York, New York 10005 Attention: Dusan Lazarov Telephone: (212) 250-0211 Telecopier No.: (212) 797-5695email: Dusan.lazarov@db.com
Bank of America, N.A.	100 Federal Street Boston, MA 02110 Attention: Christine Hutchinson Telephone: (617) 434-2385 Telecopier No.: (617) 434-4312 email: Christine.hutchinson@bankofamerica.com
Goldman Sachs International Bank	Peterborough Court 133 Fleet Street London, EC4A 2BB Attention: Naseem Hossain Telephone: +44 20 7051 5829 Telecopier No.: +44 20 7552 7070 E-mail: LoanDocumentation@ln.email.gs.com
Citibank, N.A.	390 Greenwich Street New York, New York 10013 Attention: Brendan MacKay Telephone: (212) 723-3752 Telecopier No.: (904) 746-4860 E-mail: brendan.mackay@citi.com
HSBC Bank plc	8 Canada Square, 27th Floor London E14 5HQ Attention: Process Manager, Loans Administration Telephone: 020 799 25179 Telecopier No.: 020 799 24680 E-mail: nickraye@hsbc.com
J.P. Morgan Europe Limited	25 Bank Street Canary Wharf, London E14 5JP Attention: Donna DiForio Telephone: (212) 270-0303 Telecopier (214) 291-4365 - J.P. Morgan Europe Limited, LondonE-mail: donna.diforio@chase.com

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Wells Fargo Bank International 5^th Floor
2 Harbourmaster Place
I.F.S.C.
Dublin I
Ireland Attention: Mike Watson Telephone: (617) 854-7276 Telecopier No.: (866) 210-8898 E-mail: michael.s.watson@wellsfargo.com

Page 3

SCHEDULE 13.23

Post Closing Actions

Please refer to items listed in Part III of Schedule 1.01(d). Such items are to be completed within two (2) Business Days of the Second Restatement Effective Date.

SECURITY TRUSTEE PROVISIONS

1. INTERPRETATION

(a) Definitions

In this Schedule the following terms have the meanings given to them in this paragraph 1(a). All other capitalised terms have the meaning given to them in this Agreement.

“Delegate” means any delegate, agent, attorney or co-trustee appointed by the Security Agent.

“Discharge Date” means the date on which all the Secured Obligations have been fully and irrevocably discharged and none of the Secured Creditors is under any obligation (whether actual or contingent) to make advances or provide other financial accommodation to any of the Obligors under any of the Credit Documents.

“Liability” means any obligation or liability for the payment of money whether in respect of principal, interest or otherwise, whether actual or contingent, whether owed jointly or severally and whether owed as principal, surety or in any capacity whatsoever including any amount which would constitute such a liability but for any discharge, non provability, unenforceability or non-allowability of the same in any insolvency or other proceedings.

“Receiver” means a receiver and manager or any other receiver (whether appointed pursuant to this Agreement or any statute, by a court or otherwise) of all or any of the Trust Property and shall, where permitted by law, include an administrative receiver.

“Transaction Security” means the security created or expressed to be created in favour of the Security Agent pursuant to this Schedule and the Trustee Security Documents.

“Trust Property” means all rights, interests, benefits and other property which are or are intended to be the subject of the Transaction Security, including without limitation:

(i)any rights, interests or other property and the proceeds thereof from time to time assigned, transferred, mortgaged, charged, or pledged to or otherwise vested in the Security Agent under, pursuant to or in connection with this Schedule or any Trustee Security Document to which the Security Agent is a party;

(ii)any representation, obligation, covenant, warranty or other contractual provision in favour of the Security Agent (other than any made or granted solely for its own benefit) made or granted in or pursuant to any of the Trustee Security Documents to which the Security Agent is a party;

(iii)any sum which is received or recovered by the Security Agent under, pursuant to or in connection with any of the Trustee Security Documents or the exercise of any of the Security Agent’s powers under or in connection therewith (other than any sum received or recovered solely for its own account) and which is held by the Security Agent upon trust

on the terms of this Agreement or any Trustee Security Document to which the Security Agent is a party; and

(iv)all income and other sums at any time received or receivable by the Security Agent in respect of the Trust Property (or any part thereof).

“Trustee Acts” means the United Kingdom Trustee Act 1925 and the United Kingdom Trustee Act 2000.

“Trustee Security Documents” means those Security Documents governed by English or Australian law and in each case between any of the Obligors and the Security Agent in its capacity as trustee for the Secured Creditors.

(b) Certificates

A certificate of any Secured Creditor as to the amount of any Secured Obligation owed to it shall be prima facie evidence of the existence and amount of such Secured Obligation.

(c) Statutes

Any reference in this Schedule to a statute or statutory provision shall, unless the contrary is indicated, be construed as a reference to such statute or statutory provision as the same shall have been or may be amended or re-enacted.

2. APPOINTMENT AND TRUST FOR THE SECURED CREDITORS

(a) Appointment

Each Secured Creditor (other than the Security Agent):

(i)appoints the Security Agent to act as its security trustee for the purposes of the Trustee Security Documents and this Schedule; and

(ii)irrevocably authorises the Security Agent for and on its behalf to exercise the rights, powers and discretions which are specifically delegated to it by the terms of the Trustee Security Documents and this Schedule, together with all rights, powers and discretions which are incidental thereto and to give a good discharge for any moneys payable under the Trustee Security Documents.

(b) Declaration of Trust

(i)To the extent the Trust Property is transferred, charged or granted to the Security Trustee on trust pursuant to the Trustee Security Documents, the Security Agent declares itself trustee of the Trust Property to hold the same on trust for the Secured Creditors for the purpose of securing the Secured Obligations on the terms and subject to the conditions set out in this Schedule.

2

(ii)The Security Agent will act solely as trustee for the Secured Creditors in carrying out its functions under the Trustee Security Documents and this Schedule and will exercise the same care as it would in dealing with a credit for its own account. The Security Agent shall not otherwise have, nor be deemed to have, assumed any obligations to, or trust or fiduciary relationship with, any other party to this Agreement.

3. APPLICATION OF PROCEEDS

(a) Order of Application

All moneys from time to time received or recovered by the Security Agent in respect of the Trust Property and the net proceeds from the realisation or enforcement of all or any part of the Transaction Security shall be held by the Security Agent on trust to apply them as soon as reasonably practicable after receipt or recovery in the following order of priority:

(iii)first, in or towards discharging any fees, costs, expenses, charges, liabilities or any other sums (however described) owing to the Security Agent (in its capacity as trustee) under or in connection with the Credit Documents;

(iv)second, in or towards payment of all costs, charges, expenses and remuneration incurred by or payable to any Receiver or Delegate;

(v)third, to the Administrative Agent for application in or towards payment and discharge of the Secured Obligations (or such part of them as is then due and payable); and

(vi)thereafter, in payment of the balance (if any) to the relevant Obligor.

(b) Investment of Proceeds

(i)Pending its distribution under paragraph 3(a) and without responsibility for any loss or any reduction in return which may result from its so doing, the Security Agent may credit any sum received, recovered or held by it in respect of the Trust Property to such suspense or other account as the Security Agent thinks fit or invest or place on deposit such sum in the name of or under the control of the Security Agent in any investment for the time being authorised by English law for the investment by trustees of trust moneys or with such bank or financial institution (including the Security Agent) as the Security Agent may think fit.

(ii)The Security Agent may at any time in its absolute discretion vary, exchange, transfer or transpose any such investments or deposits for or into other such investments or deposits without being under any obligation or duty to diversify the same. Any investment made by the Security Agent may, at its discretion, be made or retained in the name of a nominee.

(c) Currency Conversion

3

In order to apply any sum held or received by the Security Agent or a Receiver in or towards payment of the Secured Obligations, the Security Agent or such Receiver may purchase an amount in another currency and the rate of exchange to be used shall be that at which, at such time as it considers appropriate, the Security Agent or such Receiver is able to effect such purchase.

(d) Permitted Deductions

The Security Agent shall be entitled to set aside by way of reserve amounts required to meet, and to make and pay, any deductions and withholdings (on account of taxes or otherwise), which it is or may be required by any applicable law to make from any distribution or payment made by it under this Schedule, and to pay all taxes which may be assessed against it in respect of any of the Trust Property, or as a consequence of performing its duties, or by virtue of its acting in its capacity as Security Agent under any of the Trustee Security Documents or otherwise (other than in connection with its remuneration for performing its duties under this Schedule).

(e) Discharge of Secured Obligations

(i)Any payment to be made in respect of the Secured Obligations by the Security Agent may be made to the Administrative Agent (on behalf of the Secured Creditors) and any payment so made shall to the extent of such payment be a good discharge to the Security Agent.

(ii)The Obligors hereby agree that any sums due in respect of the Secured Obligations to any Secured Creditor shall only be discharged to the extent that such Secured Creditor has received such sums in the currency in which such sums are due by an Obligor pursuant to the Credit Documents or the enforcement of the Transaction Security and the realisation of the Trust Property.

(iii)Any payment to be made in respect of the Secured Obligations by the Security Agent shall be made in accordance with this paragraph 3(e).

(f) Clawback

(i)If any Secured Creditor has received an amount as a result of the enforcement of the Transaction Security and the Security Agent is subsequently required to pay an amount equal to that amount (a “Clawback Amount”) to a liquidator (or any other party) whether pursuant to a court order or otherwise, such Secured Creditor will promptly on the request of the Security Agent pay an amount equal to such Clawback Amount to the Security Agent for payment to the liquidator (or other relevant party).

(ii)Each Secured Creditor that has received a Clawback Amount shall indemnify the Security Agent against any and all costs, claims, losses, expenses (including legal fees) and liabilities together with any VAT thereon which the Security Agent may have properly incurred with respect to that Clawback Amount.

4. SECURED CREDITORS’ UNDERTAKINGS

4

Each Secured Creditor (other than the Security Agent) gives the undertakings set out in this paragraph 4 to each of the other Secured Creditors and acknowledges that the Security Agent has entered into this Agreement in full reliance on those undertakings.

(a) Secured Creditors’ Information

The Secured Creditors shall deliver to the Security Agent such information as the Security Agent may reasonably specify as being necessary or desirable to enable the Security Agent to perform its functions as trustee.

(b) Power to Enforce

The Security Agent alone, to the exclusion of the other Secured Creditors, shall have power to enforce or have recourse to the Transaction Security and to exercise its rights and powers pursuant to the Trustee Security Documents.

(c) Indemnity

Without prejudice to any of the provisions of any other Finance Document and to the extent that the Borrower or the relevant Obligor does not do so on demand or is not obliged to do so, each Secured Creditor that is a Lender hereby severally agrees to indemnify, rateably in accordance with the commitment of such Lender, the Security Agent (and every Receiver and Delegate) on demand against any action, charge, claim, cost, damage, demand, expense (including legal fees), liability or loss which may be brought, made or preferred against or suffered, sustained or incurred by the Security Agent in complying with any instructions from any of the Secured Creditors or otherwise sustained or incurred by the Security Agent or any Receiver or Delegate in connection with this Schedule or any Trustee Security Document except to the extent that the liability or loss arises directly from the Security Agent’s (or, as the case may be, the Receiver’s or the Delegate’s) gross negligence or wilful default (provided that the Receiver’s or Delegate’s gross negligence or wilful default shall invalidate its own right to indemnification under this paragraph 4(c) and not the Security Agent’s right to indemnification).

(d) Assignments and Transfers

Each Secured Creditor agrees with the Security Agent that it shall not assign or transfer any of its rights, benefits and/or obligations under the Facilities Agreement unless the person to whom such assignment or transfer is made shall have acceded to this Agreement by the delivery to the Security Agent of an Agreement of accession in such form as the Security Agent may reasonably require so as to ensure that such person shall be bound by the terms and conditions of this Agreement as a Secured Creditor.

5. OBLIGORS’ UNDERTAKINGS AND WAIVERS

(a) The Obligors’ Indemnity

The Obligors shall jointly and severally indemnify and hold harmless the Security Agent and every Receiver and Delegate (“indemnified parties”) on demand from and against any

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and all costs, claims, losses, expenses (including internal costs at the charge-out rate then applicable to the staff in question and legal fees) and liabilities (together with any applicable VAT), incurred by any of them in relation to or arising out of:

(i)the preservation, exercise or enforcement of the Transaction Security;

(ii)the exercise of any of the rights, powers, discretions and remedies vested in any of the indemnified parties by the Trustee Security Documents or by law;

(iii)any default by any Obligor in the performance of any of the obligations expressed to be assumed by it in the Trustee Security Documents; or

(iv)otherwise in relation to any of the Transaction Security or the performance of the terms of this Agreement.

The Security Agent may, in priority to any payment to the Secured Creditors and on its own behalf or on behalf of the other indemnified parties, indemnify itself or such other indemnified parties out of the Trust Property and shall have a lien on the Trust Property for all moneys payable under this paragraph 5(a).

(b) Obligors’ Waiver

Each of the Obligors hereby unconditionally waives, to the extent permitted under applicable law, all rights it may have whether at law or otherwise to require that the Transaction Security be enforced in any particular order or manner or at any particular time or that any sum received or recovered from any person, or by virtue of the enforcement of any of the Transaction Security, which is capable of being applied in or towards discharge of any of the Secured Obligations is so applied.

(c) Sums Received by Obligors

If any of the Obligors receives any sum which, pursuant to any of the Trustee Security Documents, should have been paid to the Security Agent, that sum shall be held by that Obligor on trust for the Secured Creditors and shall as soon as practicably possible be paid to the Security Agent for application in accordance with paragraph 2(a).

6. SECURITY TRUSTEE’S RIGHTS AND DUTIES

The Security Agent will only have those duties which are expressly specified in this Schedule and the Trustee Security Documents. The duties of the Security Agent are solely of a mechanical and administrative nature.

(a) Powers and Remuneration

(i)The Security Agent shall have such rights, powers, authorities and discretions as are (A) conferred on trustees by the Trustee Acts and (B) by way of supplement to the Trustee Acts, provided for in this Schedule and the Trustee Security Documents.

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(ii)Between itself and the other Parties, the Security Agent shall have full power to determine all questions and doubts arising in relation to any of the provisions of this Schedule or any Security Document and any such determination shall in the absence of manifest error, be conclusive and shall bind the other Parties.

(iii)The Security Agent shall be entitled to such remuneration as it may from time to time agree with the Borrower.

(b) Instructions to the Security Agent

The Security Agent shall:

(iv)be entitled, in its absolute discretion, to refrain from taking any (or any further) action or exercising any of its rights under or in respect of this Schedule or the Transaction Security until it has received instructions from the Administrative Agent as to whether (and/or the way in which) such action, right, power, authority or discretion is to be taken or exercised;

(v)except as otherwise provided in this Schedule, act in accordance with any instructions given to it by the Administrative Agent and shall be entitled to assume that (A) any instructions received by it from the Administrative Agent are duly given by the Administrative Agent itself or on behalf of the Lenders, (B) all applicable conditions under the Credit Documents for taking any action it is directed to take have been satisfied and (C) unless it has received actual written notice of their revocation, that any instructions or directions given by the Administrative Agent have not been revoked;

(vi)be entitled to request instructions or clarification from the Administrative Agent as to whether, and in what manner, it should exercise or refrain from exercising any rights, powers and discretions and the Security Agent may refrain from acting unless and until such instructions or clarification are received by it;

(vii)be entitled to refrain from acting in accordance with the instructions of the Administrative Agent or any other person (including bringing any legal action or proceeding arising out of or in connection with the Trustee Security Documents) until it has received such indemnification and/or security as it may in its absolute discretion require (whether by way of payment in advance or otherwise) for all costs, expenses, losses and liabilities which it may incur in taking such action or bringing such legal action or proceedings; and

(viii)be entitled to carry out all dealings with the Lenders through the Administrative Agent and may give to the Administrative Agent any notice or other communication required to be given by the Security Agent to the Lenders.

(c) Action to Protect or Enforce Transaction Security

Subject to the provisions of this paragraph 6:

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(iii)the Security Agent may, in the absence of any instructions from the Administrative Agent to the contrary, take such action in the exercise of any of its duties under the Trustee Security Documents and this Schedule which in its absolute discretion it considers appropriate; and

(iv)at any time after receipt by the Security Agent of notice from the Administrative Agent informing the Security Agent that the Transaction Security has become enforceable and directing the Security Agent to exercise all or any of its rights, remedies, powers or discretions under any of the Trustee Security Documents or this Schedule, the Security Agent shall take such action as in its absolute discretion it thinks fit to enforce the Transaction Security.

(d) Security Agent’s Rights and Discretions

The Security Agent may:

(i)rely on:

(A)any communication, certificate, legal opinion or other document believed by it to be genuine and correct and to have been signed by, or with the authority of, the proper person;

(B)any statement made by a director, officer, partner or employee of any person regarding any matters which may reasonably be assumed to be within his knowledge or within his power to verify; and

(C)a certificate signed by any one or more persons which, or each of which, is believed by it to be a director or other duly authorised officer of the relevant party to the effect that any particular dealing, transaction, step or thing is, in the opinion of the person so certifying, suitable or expedient or as to any other fact or matter upon which the Security Agent may require to be satisfied and shall not be responsible for any loss that may be occasioned by its relying on any such certificate;

(ii)obtain (at the Borrower’s expense) for such legal or other expert advice or services as it may consider necessary or desirable;

(iii)retain for its own benefit, without liability to account to any other person, any fee or other sum received by it for its own account;

(iv)exercise any of its rights, powers and discretions and perform any of its obligations under this Schedule or any of the Trustee Security Documents through its employees or through paid or unpaid agents, which may be corporations, partnerships or individuals (whether or not lawyers or other professional persons), and shall not be responsible for any misconduct or omission on the part of, or be bound to supervise the proceedings or acts of, any such employee or agent (and any such agent which is engaged

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in any profession or business shall be entitled to charge and be paid all usual fees, expenses and other charges for its services);

(v)at any time and from time to time delegate, whether by power of attorney or otherwise and upon such terms and conditions (including the power to sub-delegate with the consent of the Security Agent) as the Security Agent may think fit, to any persons all or any of its rights, powers and discretions under this Schedule or under any of the Trustee Security Documents, and shall not be in any way liable or responsible to any person for any loss or damage arising from any act, default, omission or misconduct on the part of any such delegate or sub-delegate;

(vi)together with every Receiver, Delegate or other person appointed under this Schedule or any of the Trustee Security Documents, indemnify itself out of the Trust Property against all proceedings, claims and demands which may be made or taken against it and all costs, charges, damages, expenses and liabilities which it may suffer or incur unless suffered or incurred by reason of its own gross negligence or wilful misconduct; and

(vii)unless it has, in its capacity as trustee for the Secured Creditors, received actual written notice to the contrary, assume that (A) no Event of Default has occurred and no Obligor is in breach of or default under its obligations under any of the Credit Documents and (B) any right, power, authority or discretion vested by any Finance Document in any person has not been exercised.

(e) Notification

The Security Agent shall promptly inform the Administrative Agent of:

(i)the contents of any written notice or document received by it in its capacity as Security Agent from any Obligor under any Trustee Security Document; and

(ii)the occurrence of any Event of Default or any default by an Obligor in the due performance of or compliance with its obligations under any Trustee Security Document of which the Security Agent has received written notice from any other Party.

(f) Excluded Obligations

Notwithstanding anything to the contrary expressed or implied in any Trustee Security Document, the Security Agent shall not:

(i)be liable to anyone where it has acted in good faith on the opinion or advice of or any information obtained from any lawyer, accountant, architect, engineer, surveyor, broker, consultant, valuer or other expert (including any auditor), whether obtained by the Security Agent or otherwise whether or not the expert’s liability in respect thereof is limited by a monetary cap or otherwise and whether or not any such opinion, advice or information contains some error or is not authentic;

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(ii)be obliged to monitor or enquire as to whether or not an Event of Default has occurred and will not be deemed to have knowledge of the occurrence of an Event Default unless it has actual knowledge or express written notice thereof;

(iii)have any duty to (A) ensure that any payment or other financial benefit in respect of any of the Trust Property is duly and punctually paid, received or collected as and when the same becomes due and payable or (B) to procure that the correct amounts (if any) are paid or received or to ensure the taking up of any (or any offer of any) stocks, shares, rights, moneys or other property paid, distributed, accrued or offered at any time by way of interest, dividend, redemption, bonus, rights, preference, option, warrant or otherwise on, or in respect of or in substitution for any of the Trust Property;

(iv)unless required by law or ordered so to do by a court of competent jurisdiction, be required to (A) to disclose to any Secured Creditor any credit or other information (other than information in the Security Agent’s possession specifically concerning the Trustee Security Documents) with respect to the financial condition or affairs of the Borrower or the Shareholder or any of their related entities whether coming into its or any of its affiliates possession before or on the entry into this Agreement or at any time thereafter or (B) to request any certificates or other documents from the Borrower or the Shareholder unless specifically requested to do so by the Administrative Agent in accordance with this Schedule or any of the Trustee Security Documents;

(v)be bound to account to any other Secured Creditor for any sum or the profit element of any sum received by it for its own account;

(vi)be bound to disclose to any other person (including any Secured Creditor) (A) any confidential information or (B) any other information if disclosure would or might in its reasonable opinion constitute a breach of any law or be a breach of fiduciary duty;

(vii)be liable to any of the Secured Creditors for any action taken or omitted to be taken under or in connection with any of the Trustee Security Documents unless caused by its fraud, gross negligence or wilful misconduct;

(viii)be under any obligations other than those which are specifically provided for in the Trustee Security Documents to which it is a party;

(ix)have or be deemed to have any duty, obligation or responsibility to, or relationship of trust or agency with, any Obligor; or

(x)be obliged to take any action in relation to enforcing or perfecting any charge over any shares in a company registered or incorporated with unlimited liability.

(g) Secured Creditors’ Own Responsibility

It is understood and agreed by each Secured Creditor that at all times such Secured Creditor has itself been, and will continue to be, solely responsible for making its own independent

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appraisal of and investigation into all risks arising under or in connection with the Credit Documents including but not limited to:

(i)the financial condition, creditworthiness, condition, affairs, status and nature of each of the Obligors;

(ii)the legality, validity, effectiveness, adequacy and enforceability of each of the Trustee Security Documents and the Transaction Security and any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Trustee Security Documents;

(iii)whether that Secured Creditor has recourse, and the nature and extent of that recourse, against any Obligor or any other person or any of their respective assets under or in connection with the Trustee Security Documents or the transactions contemplated therein or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Trustee Security Documents;

(iv)the adequacy, accuracy and/or completeness of any information provided by any person in connection with the Trustee Security Documents or the transactions contemplated therein or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Trustee Security Documents; and

(v)the right or title of any person in or to, or the value or sufficiency of any part of the Trust Property, the priority of any of the Transaction Security or the existence of any other Security affecting the Trust Property,

and each Secured Creditor (other than the Security Agent) represents and warrants to the Security Agent that it has not relied on and will not at any time rely on the Security Agent in respect of any of these matters.

(h) No Responsibility to Perfect Security

The Security Agent shall not be liable for any omission or defect in, or any failure to preserve or perfect any or all of the Transaction Security including, without limitation, any failure to:

(i)require the deposit with it of any Agreement or document certifying, representing or constituting the title of any Obligor to any of the Trust Property;

(ii)obtain any licence, consent or other authority for the execution, delivery, legality, validity, enforceability or admissibility in evidence of any of the Trustee Security Documents or the Transaction Security;

(iii)register, file or record or otherwise protect any of the Transaction Security (or the priority of any of the Transaction Security) under any applicable laws in any

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jurisdiction or to give notice to any person of the execution of any of the Trustee Security Documents or of the Transaction Security;

(iv)take, or to require any of the Obligors to take, any steps to perfect its title to any of the Trust Property or to render the Security effective or to secure the creation of any ancillary security under the laws of any jurisdiction; or

(v)require any further assurances in relation to any of the Transaction Security.

(i) Insurance

The Security Agent shall not be under any obligation to insure any of the Trust Property, to require any other person to maintain any insurance or to verify any obligation to arrange or maintain insurance contained in the Trustee Security Documents. The Security Agent shall not be responsible for any loss which may be suffered by any person as a result of the lack of or inadequacy of any such insurance. Where the Security Agent is named on any insurance policy as an insured party, it shall not be responsible for any loss which may be suffered by reason of, directly or indirectly, its failure to notify the insurers of any material fact relating to the risk assumed by such insurers or any other information of any kind, unless any Secured Creditor shall have requested it to do so in writing and the Security Agent shall have failed to do so within 14 days after receipt of that request.

(j) Safekeeping

(i)The Security Agent shall be at liberty to place (at the cost of the Obligors) any of the Trustee Security Documents and any title Agreements or other documents relating to the Transaction Security in any safe custody selected by the Security Agent or with any financial institution, any company whose business includes the safe custody of documents or any firm of lawyers of good repute and the Security Agent shall not be responsible for, or required to insure against, any loss incurred in connection with that deposit.

(ii)The Security Agent may in its absolute discretion make any such arrangements as it thinks fit for allowing any Obligor or its lawyers or auditors or other advisers access to or possession of any title Agreements and other documents relating to the transaction security.

(iii)The Security Agent shall not be responsible for any loss which may result arising out of any deposit, access, possession or other matter provided for in this paragraph 6(j).

(k) Acceptance of Title

The Security Agent shall be entitled to accept without enquiry, and shall not be obliged to investigate, such evidence of right and title as any Obligor may have to any of the Trust Property and shall not be liable for or bound to require any Obligor to remedy any defect in its right or title.

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(l) Illegality

The Security Agent may refrain from doing anything which in its opinion would or might be contrary to any law of any jurisdiction or any directive or regulation binding on it which would or might otherwise render it liable to any person, and the Security Agent may do anything which is, in its opinion, necessary to comply with any such law, directive or regulation.

(m) Business with the Obligors

The Security Agent may accept deposits from, lend money to or provide advisory or other services to and generally engage in any kind of banking or other business with any of the Obligors whether or not this may or does lead to a conflict with the interests of any of the Secured Creditors and may do so without any obligation to account to or disclose any such arrangements to any person.

(n) Security Agent Division Separate

In acting as trustee for the Secured Creditors, the Security Agent shall be regarded as acting through its trustee division which shall be treated as a separate entity from any of its other divisions or departments and any information received by any other division or department of the Security Agent may be treated as confidential and shall not be regarded as having been received by or given to the Security Agent’s trustee division.

(o) Exclusion of Liability

Neither the Security Agent (save in the case of its gross negligence or wilful default) nor any of its officers, employees or agents makes, or shall at any time be deemed to have made any representation or warranty (express or implied) with regard to, nor shall it be responsible or liable to any person for:

(i)the adequacy, accuracy or completeness of any representation, warranty, statement or information contained in this Schedule or any Trustee Security Document, notice, report or other document, statement or information circulated, delivered or made to any Secured Creditor whether orally or otherwise and whether before, on or after the date of this Agreement;

(ii)the execution, delivery, validity, legality, priority, ranking, adequacy, effectiveness, performance, enforceability or admissibility in evidence of this Schedule or any Trustee Security Document or any other document referred to in paragraph (i) above or of any Transaction Security created thereby or any obligations imposed thereby or assumed thereunder or any other document, agreement or arrangement entered into, made or executed in anticipation of, pursuant to or in connection therewith; or

(iii)anything done or not done by it or any of them under or in connection with this Schedule or the Trustee Security Documents;

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(iv)any losses to any person or any liability arising as a result of taking or refraining from taking any action in relation to any of the Trustee Security Documents or the Transaction Security or otherwise, whether in accordance with an instruction from the Administrative Agent or otherwise;

(v)the exercise of, or the failure to exercise, any judgment, discretion or power given to it by or in connection with any of the Trustee Security Documents, the Transaction Security or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection therewith; or

(vi)any shortfall which arises on the enforcement of the Transaction Security,

and each of the Secured Creditors agrees that it will not take any proceedings or assert or seek to assert against any officer, employee or agent of the Security Agent any claim it might have against any of them in respect of the matters referred to in this paragraph 6(o).

(p) Consequential Loss

Notwithstanding anything in this Agreement or the Trustee Security Documents to the contrary, the Security Agent shall not be liable for any consequential loss (being loss of business, goodwill, opportunity or additional profit of any kind) of any other Party (including any party who accedes to this Agreement).

(q) Delays

In no event shall the Security Agent be responsible or liable for any failure or delay in the performance of its 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; it being understood that the Security Agent shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

(r) Permissive Nature of Acts

The permissive rights of the Security Agent to take actions under this Schedule shall not be construed as an obligation or duty to do so.

(s) No Bond or Surety Required

The Security Agent shall not be required to give any bond or surety with respect to the performance of its duties or the exercise of any of its powers under this Schedule or the Trustee Security Documents.

(t) Emergency Action

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If an administrator (other than an administrator appointed by the Security Agent) is appointed to any Obligor under Part 5.3A of the Corporations Act or any replacement provisions and the Security Agent receives notice of that appointment from any Secured Creditor or any Obligor or under the Corporations Act:

(i)the Security Agent must use its reasonable endeavours to give the Secured Creditors (or their representatives) notice of the appointment and to obtain the instructions of the Required Lenders pursuant to this Agreement;

(ii)if the Security Agent does not receive instructions of the Required Lenders at least 1 (one) Business Day prior to the expiry of the Decision Period (as defined in the Corporations Act), then despite any other provision of any Secured Finance Document but subject to paragraph 6(b)(iv)), the Security Agent must appoint a Controller (as defined in the Corporations Act) to the Secured Property of the applicable Obligor on that Business Day; and

(iii)if the Required Lenders subsequently instruct the Security Agent to remove any such Controller appointed by the Security Agent, the Security Agent must promptly take the necessary steps to do so in accordance with such instructions.

7. APPOINTMENT AND REMOVAL OF SECURITY TRUSTEES

(a) Appointment of Additional Security Trustees

(ix)The Security Agent shall, at any time and for any purpose or reason whatsoever, have power to appoint any person to act either as a new or additional trustee, or as co-trustee jointly with the Security Agent, with (subject to the provisions of this Agreement) such of the Security Agent’s rights (including the right to reasonable remuneration and indemnity but not exceeding those conferred on the Security Agent by this Schedule), duties and obligations as are vested in the Security Agent by this Schedule or any Trustee Security Document as shall be conferred or imposed on such person by the instrument of such co-trustee’s appointment.

(x)The Security Agent shall not be bound to supervise, or be responsible for any loss incurred by reason of any act or omission of any such person if the Security Agent shall have exercised reasonable care in the selection of such person.

(xi)So long as it continues to be a trustee under this Schedule, the Security Agent shall have power to remove any such new or additional trustee or co security trustee for any reason whatsoever.

(xii)Whenever there shall be more than one security trustee under this Schedule any reference to “Security Agent” shall be construed as a reference to those trustees or such of them as the context requires.

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(xiii)Whenever there shall be more than two security trustees under this Schedule, the majority of such security trustees shall be competent to execute and exercise all the Security Agent’s rights under this Schedule other than those arising under this paragraph 7(a).

(xiv)The remuneration the Security Agent may pay to any new or additional trustee and any costs and expenses incurred by such new or additional trustee in performing its functions as such shall, for the purposes of this Schedule, be treated as costs and expenses incurred by the Security Agent.

(b) Delegation

The Security Agent may at any time delegate by power of attorney or otherwise to any person for any period, all or any of the rights, powers and discretions vested in it by this Schedule and any of the Trustee Security Documents and such delegation may be made upon such terms and conditions (including the power to sub-delegate) and subject to such restrictions as the Security Agent may think fit and it shall not be bound to supervise, or be in any way responsible for any loss incurred by reason of any misconduct or default on the part of any such delegate or sub-delegate, provided such delegate or sub-delegate has been appointed with reasonable care.

(c) Retirement or Removal of Security Trustee

(viii)A Security Agent may retire from its role as Security Trustee at any time (without assigning any reason therefor and without being responsible for any costs occasioned by such retirement) by giving not less than 30 days’ prior notice to that effect to the Administrative Agent.

(ix)The Administrative Agent (if so instructed or empowered) may remove the Security Agent (and any Additional Security Agents and/or delegates appointed by the Security Agent) from its role as trustee under this Agreement by giving notice to that effect to the Security Agent and each of the other Parties to this Agreement.

(x)The retirement or removal of a sole security trustee shall not take effect until (A) the appointment of a successor security trustee as a co trustee has been made and (B) the Administrative Agent is satisfied that all things required to be done in order that the relevant Finance Documents continue to provide perfected and enforceable security in favour of the successor Security Agent have been done.

(xi)If a notice of retirement or removal has been given under paragraph (i) or (ii) above, the power to appoint a new security trustee who shall be based in New York shall vest in the Secured Creditors who are Lenders but if no successor Security Agent shall have (A) been appointed by the Secured Creditors and (B) accepted such appointment within 30 days of the giving of such notice, the retiring Security Agent, after consultation with the Borrower and the Administrative Agent, shall have the right to appoint a successor Security Agent which shall be a reputable and experienced bank or other financial institution who is based in New York.

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(xii)If a successor to the Security Agent is appointed under the provisions of this Agreement (A) the retiring Security Agent shall be discharged from any further obligations under, but shall remain entitled to the benefits of, this Agreement and (B) the successor trustee and each of the other Secured Creditors shall have same rights and obligations amongst themselves as they would have had if such successor had been an original party to this Agreement.

8. FEES AND EXPENSES

(a) Security Trustee’s Ongoing Fees

In the event of (i) the occurrence of an Event of Default which is continuing or (ii) the Security Agent considering it necessary or expedient or (iii) the Security Agent being requested by an Obligor or the Administrative Agent to undertake duties which the Security Agent and the Borrower agree to be of an exceptional nature and/or outside the scope of the normal duties of the Security Agent under the Trustee Security Documents, the Borrower shall pay to the Security Agent such additional remuneration (together with any applicable VAT) as may be agreed between them. If the Security Agent and the Borrower fail to agree upon the nature of such duties or upon such additional remuneration, that dispute shall be determined by a merchant bank (acting as an expert and not as an arbitrator) selected by the Security Agent and approved by the Borrower and the determination of any such merchant bank shall, in the absence of manifest error, be final and binding upon the parties.

(b) Transaction and Enforcement Expenses

The Borrower shall, from time to time on demand of the Security Agent, reimburse the Security Agent:

(xiii)for all reasonable costs and expenses (including legal fees) properly incurred by the Security Agent, a Receiver or any Delegate in connection with the negotiation, preparation and execution of this Agreement and the Trustee Security Documents and the completion of the transactions and perfection of the security contemplated in the Trustee Security Documents; and

(xiv)on a full indemnity basis, for all costs and expenses (including legal fees) incurred by the Security Agent, a Receiver or any Delegate in connection with the exercise, preservation and/or enforcement of any of the rights, powers and remedies of the Security Agent, of the Transaction Security and any proceedings instituted by or against the Security Agent as a consequence of taking or holding the Security or of enforcing those rights, powers and remedies,

and in each case payment shall be made together with any applicable VAT.

(c) Stamp Taxes

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The Borrower shall promptly pay all stamp, registration, notarial, documentary and other taxes or fees (including any penalties fines, supplements, surcharge or interest relating to such taxes) to which this Agreement, the Trustee Security Documents or any judgment given in connection with them, is or at any time may be, subject and shall, from time to time, indemnify the Security Agent on demand against any liabilities, costs, claims and expenses resulting from any failure to pay or any delay in paying any such tax or fee.

(d) Interest on Demands

If any Obligor fails to pay any sum on the due date for payment of that sum the relevant Obligor shall pay interest on any such sum (before and after any judgment and to the extent interest at a default rate is not otherwise being paid on such sum) from the date of demand until the date of payment calculated on a daily basis at the rate determined in accordance with the relevant provisions of this Agreement.

9. OTHER PROVISIONS

(a) Winding up of the Trust

The trusts set out in this Schedule shall be wound up on the date on which all the Secured Obligations have been fully discharged and none of the Secured Creditors is under any obligation (whether actual or contingent) to make advances or provide any accommodation under the Credit Documents. At that time the Security Agent shall release, without recourse or warranty, all of the Transaction Security then held by it and the rights of the Security Agent under each of the Trustee Security Documents, at which time each of the Security Agent, the Administrative Agent, the Secured Creditors and the Obligors shall be released from its obligations under this Schedule.

(b) Remedies and Waivers

No failure by the Security Agent to exercise, nor any delay by the Security Agent in exercising, any right or remedy under this Schedule shall operate as a waiver thereof nor shall any single or partial exercise of any such right or remedy prevent any further or other exercise thereof or the exercise of any other such right or remedy.

(c) Partial Invalidity

If at any time any provision of this Schedule is or becomes illegal, invalid or unenforceable in any respect or any of the Transaction Security is or becomes ineffective in any respect under the law of any jurisdiction, such illegality, invalidity, unenforceability or ineffectiveness shall not affect:

(xi)the legality, validity or enforceability of the remaining provisions of this Schedule or the effectiveness in any other respect of the Security under such law; or

(xii)the legality, validity or enforceability of such provision or the effectiveness of the Transaction Security under the law of any other jurisdiction.

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(d) Potentially Avoided Payments

If the Security Agent determines that an amount paid to the Secured Creditors under any Finance Document is capable of being avoided or otherwise set aside on the liquidation or administration of the person by whom such amount was paid, then for the purposes of this Schedule, such amount shall be regarded as not having been paid.

(e) Rights Cumulative

The rights and remedies provided by this Schedule are cumulative and not exclusive of any rights or remedies provided by law.

(f) The Trustee Acts

Section 1 of the Trustee Act 2000 shall not apply to the duties of the Security Agent in relation to the trusts constituted by this Schedule. Where there are any inconsistencies between the Trustee Acts and the provisions of this Schedule, the provisions of this Schedule shall, to the extent allowed by law, prevail and, in the case of any such inconsistency with the Trustee Act 2000, the provisions of this Schedule shall constitute a restriction or exclusion for the purposes of that Act.

(g) Conflicting provisions

If there is any conflict between the provisions of this Schedule and any Trustee Security Document with regard to instructions to or other matters affecting the Security Trustee, this Agreement will prevail. However, nothing in this Schedule shall limit the ability of the Security Agent to exercise any rights, powers and discretions it may have in its capacity as a Secured Creditor.

(h) Financial liability

Nothing contained in this Schedule shall require the Security Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of its duties or the exercise of any right, power, authority or discretion hereunder if it has grounds for believing the repayment of such funds or adequate indemnity against, or security for, such risk or liability is not reasonably assured to it. Money held by the Security Agent need not be segregated from other funds except to the extent required by applicable law.

(i) Consents

Any consent given by the Security Agent for the purposes of this Schedule may be given on such terms and subject to such conditions (if any) as the Security Agent may require.

(j) Notices to the Security Agent

Any communication or document to be made or delivered to the Security Agent shall be effective only when received by the Security Agent and then only if it is expressly marked for the attention of the department or officer identified with the Security Agent’s signature below or

19

such other department or officer as the Security Agent shall from time to time specify for this purpose.

20

21

EXHIBIT A-1

ORM OF NOTICE OF BORROWING

[Date]

Deutsche Bank AG New York Branch, as Facility Agent (the “Facility Agent”) for the Lenders party to the Syndicated Facility Agreement referred to below

60 Wall Street

New York, New York 10005

Attention: Mark Kellam

E-mail: Agency.Transactions@db.com and

mark.kellam@db.com

Fax: +1 (904) 779-3080

with a copy to:

Deutsche Bank AG New York Branch, as Administrative Agent (the “Administrative Agent”) for the Lenders party to the Syndicated Facility Agreement referred to below

60 Wall Street

New York, New York 10005
Attention: Dusan Lazarov
Fax: + 1 (212) 797-5695

Ladies and Gentlemen:

The undersigned, [Name of Borrower] (the “Borrower”), refers to the Syndicated Facility Agreement, dated as of October15,2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015 (as further amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”, the capitalized terms defined therein being used herein as therein defined), among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026) (“Australian Borrower”), Toys “R” US GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrower and German Borrower, collectively, the “Borrowers”), 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 and the other agents, and hereby gives you notice, irrevocably, pursuant to Section 2.03 of the Facility Agreement, that the undersigned hereby requests a Borrowing under the Facility Agreement, and in that connection sets forth below the information relating to such Borrowing (the “Proposed Borrowing”) as required by Section 2.03 of the Facility Agreement:

Exhibit A-1
Page 2

[(i)    The Borrower for whom the Obligors’ Agent is delivering this notice is [________________].]¹

(ii)    The Business Day of the Proposed Borrowing is _________ __, ____.²

(iii)    The aggregate principal amount of the Proposed Borrowing is [A$][€][$][£]__________.

(iv)    The Loans to be made pursuant to the Proposed Borrowing shall be maintained as [U.S. Dollar Loans] [Australian Dollar Loans] [Sterling Loans] [Euro Loans]

(v)    The initial Interest Period for the Proposed Borrowing is [one week][one month][two months][three months][six months][[, subject to availability to all Lenders, [nine][twelve] months ].

(vi)    the Loans to be made pursuant to the Proposed Borrowing [shall][shall not] be incurred and maintained as French Borrowing Base Loans.

The undersigned hereby certifies that the following statements are true on the date hereof, and will be true on the date of the Proposed Borrowing:

(A)    the representations and warranties contained in the Facility Agreement and in the other Credit Documents are and will be true and correct in all material respects, before and after giving effect to the Proposed Borrowing and to the application of the proceeds thereof, as though made on such date, unless stated to relate to a specific earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date; [and]

(B)    no Default or Event of Default has occurred and is continuing, or would result from such Proposed Borrowing or from the application of the proceeds thereof[.][; and]

_______________________

¹    Include if the Obligors’ Agent delivers Notice of Borrowing on behalf of a Borrower.

²  Shall be a Business Day at least (x) four Business Days after the date hereof, in the case of Australian Dollar Loans, (y) at least three Business Days after the date hereof, in the case of U.S. Dollar Loans and Euro Loans and (z) at least one Business Day after the date hereof, in the case of Sterling Loans, provided that any such notice shall be deemed to have been given on a certain day only if given before 9:30 A.M. (London time) on such day.

Exhibit A-1
Page 3

[(C)    at the time of the Proposed Borrowing, Excess Availability solely with respect to the UK/AUS Borrowing Base shall be less than or equal ₤5,000,000 and, after giving effect to the Proposed Borrowing, the aggregate principal amount of all outstanding French Borrowing Base Loans shall not exceed (x) the French Borrowing Base or (y) 20% of the total Borrowing Base.]³

Very truly yours,

[NAME OF BORROWER]

By:_________________________

Name:

Title:

_________________________

³Include if Proposed Borrowing consists of French Borrowing Base Loans.

FORM OF NOTICE OF CONTINUATION

[Date]

Deutsche Bank AG New York Branch, as Facility Agent (the “Facility Agent”) for the Lenders party to the Syndicated Facility Agreement referred to below

60 Wall Street

New York, New York 10005

Attention: Mark Kellam

E-mail: Agency.Transactions@db.com and

mark.kellam@db.com

Fax: +1 (904) 779-3080

with a copy to:

Deutsche Bank AG New York Branch, as Administrative Agent (the “Administrative Agent”) for the Lenders party to the Syndicated Facility Agreement referred to below

60 Wall Street

New York, New York 10005
Attention: Dusan Lazarov
Fax: +1 (212) 797-5695

Ladies and Gentlemen:

The undersigned, [Name of Borrower] (the “Borrower”), refers to the Syndicated Facility Agreement, dated as of October15,2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015 (as further amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”, the capitalized terms defined therein being used herein as therein defined), among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026) (the “Australian Borrower”), Toys “R” US GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrower and German Borrower, collectively, the “Borrowers”), the other Obligors party thereto from time to time, the Lenders party thereto from time to time, Deutsche Bank AG New York Branch, as Security Agent, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents and you, as Administrative Agent for such Lenders, and hereby give you notice, irrevocably, pursuant to Section 2.06 of the Facility Agreement, that the undersigned hereby requests to continue the Borrowing of Loans referred to below, and in that connection sets forth below the information relating to such continuation (the “Proposed Continuation”) as required by Section 2.06 of the Facility Agreement:

Exhibit A-2
Page 2

(i)    The Proposed Continuation relates to the Borrowing of [U.S. Dollar Loans] [Australian Dollar Loans] [Sterling Loans] [Euro Loans] originally made on _________ __, 20__ (the “Outstanding Borrowing”) in the principal amount of ______¹ and currently maintained as a Borrowing of [U.S. Dollar Loans] [Australian Dollar Loans] [Sterling Loans] [Euro Loans] with an Interest Period ending on _________ __, ____.

(ii)    The Business Day of the Proposed Continuation is _________ __, ____.² 

(iii)    The Outstanding Borrowing shall be continued as a Borrowing of [U.S. Dollar Loans] [Australian Dollar Loans] [Sterling Loans] [Euro Loans] with an Interest Period of ____.³ 

The undersigned hereby certifies that no Default or Event of Default has occurred and will be continuing on the date of the Proposed Continuation or will have occurred and be continuing on the date of the Proposed Continuation.

Very truly yours,

[NAME OF BORROWER]

By:
Name:    
Title:    

___________________

¹    State in applicable currency.

²  Shall be a Business Day at least (x) four Business Days after the date hereof, in the case of Australian Dollar Loans, (y) at least three Business Days after the date hereof, in the case of U.S. Dollar Loans and Euro Loans and (z) at least one Business Day after the date hereof, in the case of Sterling Loans, provided that any such notice shall be deemed to have been given on a certain day only if given before 9:30 A.M. (London time) on such day.

³  In the event that either (x) only a portion of the Outstanding Borrowing is to be so continued or (y) the Outstanding Borrowing is to be divided into separate Borrowings with different Interest Periods, the Borrower should make appropriate modifications to this clause to reflect same.

EXHIBIT B

FORM OF NOTE

$__________    New York, New York

_________ __, ____

FOR VALUE RECEIVED, [NAME OF BORROWER], a [______ corporation/company] (the “Borrower”), hereby promises to pay to [______] or its registered assigns (the “Lender”), in lawful money of the [United Kingdom] [Australia] [United States of America] [European Union] in immediately available funds, at the Payment Office (as defined in the Agreement referred to below) initially located at 60 Wall Street, New York, New York 10005-2858, Attention: Mark Kellam, Telephone No.: (904) 271-2469 on the Maturity Date (as defined in the Agreement) the principal sum of [__________ POUNDS STERLING (£__________)] [__________ AUSTRALIAN DOLLARS (A$__________)] [__________ U.S. DOLLARS ($__________)] [__________ EUROS (€__________)] or, if less, the unpaid principal amount of all Loans (as defined in the Agreement) made by the Lender pursuant to the Agreement, payable at such times and in such amounts as are specified in the Agreement.

The Borrower also promises to pay interest on the unpaid principal amount of each Loan made by the Lender in like money at said office from the date hereof until paid at the rates and at the times provided in Section 2.08 of the Agreement.

This Note is one of the Notes referred to in the Syndicated Facility Agreement, dated as of October15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), the Borrowers and 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 New York Branch and Bank of America, N.A., as Co-Collateral Agents (as further amended, restated, modified and/or supplemented from time to time, the “Agreement”) and is entitled to the benefits thereof and of the other Credit Documents (as defined in the Agreement). This Note is secured by the Security Documents (as defined in the Agreement) and is entitled to the benefits of the Guaranty (as defined in the Agreement). As provided in the Agreement, this Note is subject to voluntary prepayment and mandatory repayment prior to the Maturity Date, in whole or in part, and Loans may be converted from one Type (as defined in the Agreement) into another Type to the extent provided in the Agreement.

In case an Event of Default (as defined in the Agreement) shall occur and be continuing, the principal of and accrued interest on this Note may be declared to be due and payable in the manner and with the effect provided in the Agreement.

The Borrower hereby waives presentment, demand, protest or notice of any kind in connection with this Note.

Exhibit B

Page 2

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

[NAME OF BORROWER]

By:_______________________________

Name:
Title:

EXHIBIT C

FORM OF LETTER OF CREDIT REQUEST

Dated ¹

Deutsche Bank AG New York Branch, as Administrative Agent, under the Syndicated Facility Agreement referred to below

60 Wall Street

New York, New York 10005

Attention: Dusan Lazarov

Fax: +1 (212) 797-5695

[[____²_____], as Issuing Lender
under the Facility Agreement
_____________________
_____________________
_____________________]

Attention: [_______________]

Ladies and Gentlemen:

The undersigned [Name of Borrower] (the “Borrower”) refers to the Syndicated Facility Agreement, dated as of October 15,2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015 (as further amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”), among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026), the “Australian Borrower”), Toys “R” US GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrower and German Borrower, collectively, the “Borrowers”), 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 and Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents. Unless otherwise defined herein, capitalized terms used in this Letter of Credit Request shall have the meanings set forth in the Facility Agreement.

________________________

¹    Date of Letter of Credit Request.

²    Insert name and address of Issuing Lender. Insert the correct notice information for respective Issuing Lender.

Exhibit C
Page 2

Pursuant to Section 3.03 of the Facility Agreement, we hereby request that the Issuing Lender referred to above issue a [trade][standby] Letter of Credit for the account of the undersigned on ³ (the “Date of Issuance”) in the aggregate Stated Amount of ⁴.

For purposes of this Letter of Credit Request, unless otherwise defined herein, all capitalized terms used herein which are defined in the Facility Agreement shall have the respective meaning provided therein.

The beneficiary of the requested Letter of Credit will be ⁵, and such Letter of Credit will be in support of ⁶ and will have a stated expiration date of ⁷.

We hereby certify that:

(A) the representations and warranties contained in the Facility Agreement and in the other Credit Documents are and will be true and correct in all material respects on the Date of Issuance, both before and after giving effect to the issuance of the Letter of Credit requested hereby, unless stated to relate to a specific earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date; and

(B) no Default or Event of Default has occurred and is continuing nor, after giving effect to the issuance of the Letter of Credit requested hereby, would such a Default or Event of Default occur.

_________________________

³  Date of Issuance which shall be at least two Business Days after the date hereof for Letters of Credit denominated in Pounds Sterling, Euros, or U.S. Dollars (or such earlier date as is acceptable to the respective Issuing Lender in any given case) or at least four Business Days for Letters of Credit denominated in Australian Dollars.

⁴  Aggregate initial Stated Amount of the Letter of Credit which should not be less than £100,000 (or, in the case of a Letter of Credit issued in a currency other than Pounds Sterling, the Pounds Sterling Equivalent thereof) (or such lesser amount as is acceptable to the respective Issuing Lender).

⁵  Insert name and address of beneficiary.

⁶  Insert a description of L/C Supportable Obligations (in the case of standby Letters of Credit) and insert description of permitted trade obligations of the Borrowers or any of their Subsidiaries (in the case of trade Letters of Credit).

⁷  Insert the last date upon which drafts may be presented which may not be later than (i) in the case of Standby Letters of Credit, the earlier of (x) the date which occurs 12 months after the date of issuance thereof (although any such standby Letter of Credit shall be extendible for successive periods of up to 12 months, but, in each case, not beyond the fifth Business Day prior to the Maturity Date) and (y) five Business Days prior to the Maturity Date and (ii) in the case of trade Letters of Credit, the earlier of (x) the date which occurs 180 days after the date of issuance thereof and (y) five Business Days prior to the Maturity Date.

Exhibit C
Page 3

Copies of all documentation with respect to the supported transaction are attached hereto.

[NAME OF BORROWER]

By:___________________________

Name:

Title:

EXHIBIT D-1

FORM OF AUSTRALIAN PERFECTION CERTIFICATE

[Date]

Reference is made to the Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, amongst others, Toys “R” Us (Australia) Pty Ltd and Babies “R” Us (Australia) Pty Ltd (the “Australian Obligors”), the other Obligors party thereto from time to time, the lenders party thereto from time to time (the “Lenders”), Deutsche Bank AG New York, as Administrative Agent and Security Agent, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents (the “Credit Agreement”). Capitalised terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement. Each of the undersigned, a Director of the Australian Obligors hereby certifies (as at the date of this certificate) not in his/her individual capacity, but solely as Director of the Australian Obligors to the Administrative Agent and each other Secured Party as follows:

1.Names

(a)    The exact corporate name of each Australian Obligor, as such name appears in its respective certified certificate of incorporation (or analogous charter document)/certified certificate of change of name, is as follows:

Name

[ ]

[ ]

[ ]

(b)No Australian Obligor has existed under a different corporate name in the past five years.

(c)    No Australian Obligor has changed its identity or corporate structure in any way within the past five years.

(d)    The following is a list of all other names (including trade names, business names or similar appellations) used by each Australian Obligor or any of its divisions or other business units in connection with the conduct of its business or the ownership of its properties at any time during the past five years:

	Name
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

Exhibit D-1
Page 2

(e)    Set forth below is the Australian Business Number (“ABN”) issued by the jurisdiction of organization of each Australian Obligor that is a registered organization:

Name	ABN
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

2.Current Locations

(a)    The registered office of each Australian Obligor is located at the address set forth opposite its name below:

Australian Obligor	Mailing Address
[ ]	[ ]
[ ]	[ ]

(b)    Set forth below opposite the name of each Australian Obligor are all locations where such Australian Obligor maintains any books or records relating to any Accounts Receivable or General Intangibles (with each location at which chattel paper, if any, is kept being indicated by an “*”):

Australian Obligor	Mailing Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(c)    The jurisdiction of formation of each Australian Obligor that is a registered organization is set forth opposite its name below:

Australian Obligor	Jurisdiction
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

Exhibit D-1
Page 3

(d)    Attached hereto as Schedule I is a schedule setting forth all the locations where an Australian Obligor maintains any Inventory or Equipment or other Collateral not identified above (other than Collateral in transit or absent pursuant to any arrangement in connection with warehousing, repair or replacement in the ordinary course of business).

(e)    Set forth below opposite the name of each Australian Obligor are all the places of business of such Australian Obligor not identified in paragraph (a), (b), (c) or (d) above:

Australian Obligor	Mailing Address
[ ]	[ ]
[ ]	[ ]

(f)    Set forth below opposite the name of each Australian Obligor are the names and addresses of all Persons other than such Australian Obligor that have possession of any of the Collateral of such Australian Obligor:

Australian Obligor	Mailing Address
[ ]	[ ]
[ ]	[ ]

3.Personal Property Securities Register (“PPSR”) Searches

PPSR searches have been conducted with respect to each Australian Obligor in Section 1 hereof, and such searches reveal no charges or other encumbrances against any of the Collateral other than those permitted under the Credit Agreement.

4.Constitution and Stamp Duty

The Multijurisdictional Mortgage Statement has been executed by the Australian Obligors and will be delivered to the Australian legal counsel for the Administrative Agent on the Second Restatement Effective Date.

5.Filing Fees

All filing fees and taxes payable in connection with the documents described in Section 4 above will be paid upon lodgement of the document.

6.Commercial Tort Claims

Attached hereto as Schedule III is a true and correct list of commercial tort claims in an amount reasonably estimated to exceed $2,000,000.00 held by any Australian Obligor , including a brief description thereof.

Exhibit D-1
Page 4

7.Other Australian Subsidiaries

Other than the Australian Obligors that are a party to this Perfection Certificate, TRU Australia Holdings, LLC (“Australian Parent Guarantor”) has no Subsidiaries that are Australian Obligors (other than Toys “R” Us (Australia) Pty Limited and Babies “R” Us (Australia) Pty Limited) and (y) the Australian Parent Guarantor has no Subsidiaries that operate or own assets in Australia (other than Toys “R” Us (Australia) Pty Limited and Babies “R” Us (Australia) Pty Limited).

8.Title Documents

Share certificates and blank share transfer forms (executed by the relevant mortgagor) in relation to the Australian Obligors as listed in Schedule III have been delivered to the Australian legal counsel to the Security Agent on or prior to the Second Restatement Effective Date.

*        *        *

Exhibit D-1
Page 5

IN WITNESS WHEREOF, the undersigned have duly executed this certificate on the first date written above.

Exhibit D-1
Page 6

SCHEDULE I

LOCATION OF COLLATERAL

Exhibit D-1
Page 7

SCHEDULE II

COMMERCIAL TORT CLAIMS

[NONE.]

Exhibit D-1
Page 8

SCHEDULE III

TITLE DOCUMENTS

9

25755510v1

AMERICAS 90926253 (2K)

EXHIBIT D-2

FORM OF U.K. PERFECTION CERTIFICATE

Reference is made to the Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, amongst others, Toys “R” Us (UK) Limited and Toys “R” Us Limited (together the “U.K. Borrowers”), the Obligors party thereto from time to time, the lenders party thereto from time to time (the “Lenders”), Deutsche Bank AG New York, as Administrative Agent and Security Agent, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents (the “Credit Agreement”). Capitalised terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

Each of the undersigned, a Director of each U.K. Borrower and each of the other signatories hereto (each a “Grantor”, and together the “Grantors”), hereby certifies not in his/her individual capacity, but solely as a Director of such Grantor to the Administrative Agent and each other Secured Party as follows:

1.Names

(a)The exact corporate name of each Grantor, as such name appears in its respective certified certificate of incorporation or certified certificate of change of name, is as follows:

Name

[ ]

[ ]

[ ]

(b)Set forth below is each other corporate name each Grantor has had in the past five years, together with the date of the relevant change:

	Name	Date of Change
[ ]	[ ]	[ ]
[ ]	[ ]	[ ]
[ ]	[ ]	[ ]

(c)Except as set forth below, no Grantor has changed its identity or corporate structure in any way within the past five years. Changes in identity or corporate structure include mergers, consolidations and acquisitions, as well as any change in the form, nature or jurisdiction of corporate organization. If any such change has occurred, include below the information required by Sections 1 and 2 of this certificate as to each acquiree or constituent party to a merger or consolidation.

(d)The following is a list of all other names (including trade names, business names or similar appellations) used by each Grantor or any of its divisions or other business units in connection with the conduct of its business or the ownership of its properties at any time during the past five years:

Exhibit D-2
Page 2

	Name
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(e)Set forth below is the company number issued by Companies House in respect of each Grantor:

Name	Company Number
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

2.Current Locations

(a)The registered office of each Grantor is located at the address set forth opposite its name below:

Grantor	Registered Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(b)Set forth below opposite the name of each Grantor are all locations other than its Registered Address stated above where such Grantor maintains any books or records relating to any Secured Assets:

Grantor	Mailing Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(c)The jurisdiction of incorporation of each Grantor is set forth opposite its name below:

Exhibit D-2
Page 3

Grantor	Jurisdiction
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(d)Attached hereto as Schedule 1 is a schedule setting forth all the locations where a Grantor maintains any Secured Assets not identified above (other than Secured Assets in transit or absent pursuant to any arrangements in connection with warehousing, repair or replacement in the ordinary course of business).

(e)Set forth below opposite the name of each Grantor are all the places of business of such Grantor not identified in paragraph (a), (b), (c) or (d) above:

Grantor	Places of business
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(f)Set forth below opposite the name of each Grantor are the names and addresses of all Persons other than such Grantor that have possession of any of the Secured Assets of such Grantor:

Grantor	Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

3.Advances

The Master Intercompany Note sets forth (i) the intercompany notes evidencing all Indebtedness of each Borrower that is owing to each Grantor and (ii) the promissory notes or other instruments evidencing all Intercompany Debt that is owing to each Grantor.

Exhibit D-2
Page 4

4.Commercial Tort Claims

Attached hereto as Schedule 2 is a true and correct list of commercial tort claims in an amount reasonably estimated to exceed $2,000,000 held by any Grantor, including a brief description thereof.

5.Other U.K. Subsidiaries

Other than (x) the Grantors that are a party to this Perfection Certificate, the European Parent Guarantor has no Subsidiaries that are U.K. Obligors and (y) the U.K. Obligors, European Parent Guarantor has no Subsidiaries that operate or own assets in the United Kingdom.

6.Title Documents

Blank share transfer forms (executed by the relevant pledgor) in relation to the Grantors as listed in Schedule 3 to this certificate will be delivered to the Security Agent on the Second Restatement Effective Date.

*        *

Exhibit D-2
Page 5

SCHEDULE 1

TO THE U.K. PERFECTION CERTIFICATE

LOCATIONS OF SECURED ASSETS

Exhibit D-2
Page 6

SCHEDULE 2

TO THE U.K. PERFECTION CERTIFICATE

COMMERCIAL TORT CLAIMS

Exhibit D-2
Page 7

SCHEDULE 3

TO THE U.K. PERFECTION CERTIFICATE

SECURED SHARES

Exhibit D-2
Page 8

IN WITNESS WHEREOF, the undersigned have duly executed this certificate on this _____ day of __________, _____.

Toys “R” Us (UK) Limited

By

Name:

Title: Director

Toys “R” Us Holdings Limited

By

Name:

Title: Director

    Toys “R” Us Limited

By

Name:

Title: Director

Toys “R” Us Properties Limited

By

Name:

Title: Director

Toys “R” Us Financial Services Limited

By

Name:

Title: Director

TRU (UK) H4 Limited

By

Name:

Title: Director

Exhibit D-2
Page 9

TRU (France) Finance Ltd.

By

Name:

Title: Director

TRU (France) Holdings Ltd.

By

Name:

Title: Director

TRU (UK) H7 Limited

By

Name:

Title: Director

TRU (UK) H8 Limited

By

Name:

Title: Director

TRU Europe Limited

By

Name:

Title: Director

EXHIBIT D-3

FORM OF PLEDGED SECURITIES PERFECTION CERTIFICATE

[Date]

Reference is made to Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”) and the other Obligors party thereto, the Lenders party thereto from time to time, Deutsche Bank AG New York Branch, as Administrative Agent and Security Agent, and Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

Each of the undersigned, an Authorized Officer, respectively, of each of the entities set forth in the signature pages hereto(each a “Grantor”, and together the “Grantors”), hereby certifies not in his/her individual capacity, but solely as an Authorized Officer of such Grantor, as applicable, to the Administrative Agent and each other Secured Party as follows:

1.Stock Ownership and other Equity Interests. Attached hereto as Schedule 1 is a true and correct list of all the issued and outstanding stock, partnership interests, limited liability company membership interests or other equity interests in each Obligor and the record and beneficial owners of such stock, partnership interests, membership interests or other equity interests. Also set forth on Schedule 1 hereto is each equity investment of any Obligor that represents 50% or less of the equity of the entity in which such investment was made.

2.Credit Parties     (a) The jurisdiction of formation of each Obligor is set forth opposite its name below:

Credit Party	Jurisdiction
TRU Europe Limited	United Kingdom
TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.)	Spain
TRU (UK) H7 Limited	United Kingdom
TRU (UK) H8 Limited	United Kingdom
TRU Australia Holdings, LLC	Delaware, United States
TRU Iberia Holdings 2, S.L.U. (formerly known as Avenal Investment, S.L.U.)	Spain
Toys “R” Us (Australia) Pty Ltd.	Australia
Babies “R” Us (Australia) Pty Ltd.	Australia
Toys “R” Us (UK) Limited	United Kingdom
Toys “R” Us Holdings Limited	United Kingdom
TRU (UK) H6, LLC	Delaware, United States
Toys “R” Us Financial Services Limited	United Kingdom
Toys “R” Us Limited	United Kingdom
Toys “R” Us Properties Limited	United Kingdom

Exhibit D-3
Page 2

TRU (UK) H4 Limited	United Kingdom
TRU (France) Finance Ltd.	United Kingdom
TRU (France) Holdings Ltd.	United Kingdom
TRU (BVI) Finance II, Ltd.	British Virgin Islands
Toys “R” Us SARL	France
Toys “R” Us GmbH	Germany
Toys “R” Us Iberia, S.A.U.	Spain

Exhibit D-3
Page 3

IN WITNESS WHEREOF, the undersigned have duly executed this certificate on the date first written above.

TRU EUROPE LIMITED

By:

Name:

Title:

TRU IBERIA HOLDINGS 1, S.L.U.

By:

Name:

Title:

TRU AUSTRALIA HOLDINGS, LLC

By:

Name:

Title:

TOYS “R” US (UK) LIMITED

By:

Name:

Title:

TOYS “R” US LIMITED

By:

Name:

Title:

TRU (UK) H7 LIMITED

By:

Name:

Title:

Exhibit D-3
Page 4

TRU (UK) H8 LIMITED

By:

Name:

Title:

TOYS “R” US HOLDINGS LIMITED

By:

Name:

Title:

TOYS “R” US FINANCIAL SERVICES LIMITED

By:

Name:

Title:

TOYS “R” US PROPERTIES LIMITED

By:

Name:

Title:

TRU (UK) H4 LIMITED

By:

Name:

Title:

TRU (FRANCE) FINANCE LTD.

By:

Name:

Title:

Exhibit D-3
Page 5

TRU (FRANCE) HOLDINGS LTD.

By:

Name:

Title:

TRU IBERIA HOLDINGS 2, S.L.U.

By:

Name:

Title:

TOYS “R” US IBERIA, S.A.

By:

Name:

Title:

TOYS “R” US SARL

By:

Name:

Title:

TOYS “R” US GMBH

By:

Name:

Title:

TRU (BVI) FINANCE II, LTD.

By:

Name:

Title:

Exhibit D-3
Page 6

TRU (UK) H6, LLC

By:

Name:

Title:

Exhibit D-3
Page 7

TOYS “R” US (AUSTRALIA) PTY LTD

By:

Name:

Title:

BABIES “R” US AUSTRALIA PTY LTD

By:

Name:

Title:

Exhibit D-3
Page 8

SCHEDULE 1
TO THE PLEDGED SECURITIES
PERFECTION CERTIFICATE

I.    STOCK OWNERSHIP

Issuer	Country	Shareholder	Jurisdiction of Shareholder	Share Type	Share Class	Share No	Percentage of Ownership
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II.    OTHER EQUITY INTERESTS

Dated 18 December 2015

French Proceeds Loan Agreement

between

Toys “R” Us SARL

as Borrower

Toys “R” Us (UK) Limited (UK)

Toys “R” Us Limited (UK)

as Lenders

and

Deutsche Bank AG New York Branch

as Security Agent

White & Case LLP

Avocats au Barreau de Paris

Toque Générale: J002

19, Place Vendôme

Paris, 75001

France

Table of Contents

1.	Definitions	1
2.	Loan	4
3.	Interest	5
4.	Conditions Precedent	6
5.	Duration and Repayment	6
6.	Representations and Warranties	7
7.	Covenants	7
8.	Further Assurances	7
9.	Transfer or Assignments of Rights and Obligations	8
10.	Notice	8
11.	Applicable Law - Jurisdiction	8

(i)

This French Proceeds Loan Agreement is made on 18 December 2015.

Between:

(1) Toys “R” Us SARL, a société à responsabilité limitée à associé unique organized under the laws of France, with a share capital of EUR 181,961,805, with registered office located at ZAC de la Mare aux Loups, 1 allée des Lutins, 77310 St Fargeau Ponthierry, France, registered with the Registre du Commerce et des Sociétés of Melun under number 345 404 156 RCS Melun as borrower (the “Borrower”);

(2) Toys “R” Us (UK) Limited, a company organized under the laws of England and Wales, with registered office located at Cannon Place, 78 Cannon Street, London, EC4N 6AF, registered in England and Wales under number 05410173 as lender;

(3) Toys “R” Us Limited, a company organized under the laws of England and Wales, with registered office located at Cannon Place, 78 Cannon Street, London, EC4N 6AF, registered in England and Wales under number 01809223 as lender (together with Toys “R” Us (UK) Limited and their successors, assigns or transferees including pursuant to any enforcement of the French Proceeds Loan Security Documents, the “Lenders”); and

(4) Deutsche Bank AG New York Branch, a company organized under the laws of Germany, with registered office located in the city of Frankfurt am Main, Germany, acting through its New York Branch whose registered office is at 60 Wall Street, New York, NY 10005, United States of America, as security agent (the “Security Agent”),

(hereinafter, collectively, the “Parties” and individually the “Party”).

Whereas:

(A) Pursuant to a syndicated facilities agreement made on 15 October 2009 (as amended and/or restated on 8 March 2011, 20 March 2013 and on or about the date of this Agreement, and as further amended, restated, modified and/or supplemented from time to time, the “Credit Agreement”) entered into between, inter alios, the Lenders as borrowers, TRU Europe Limited as European parent guarantor, the other obligors identified therein, certain financial institutions identified therein as lenders, the Security Agent as administrative agent, facility agent and security agent, the lenders thereunder have agreed to make available to the Lenders certain loans in reliance of the French Borrowing Base (as defined therein), the proceeds of which are used solely to make the Loans (as defined below) (the “French Borrowing Base Loans”).

(B) The Borrower has requested that the Lenders grant a revolving loan or revolving loans to the Borrower, such loans to be funded solely with the proceeds of the French Borrowing Base Loans incurred by the Lenders (the “Loans”).

(C) Accordingly, the Parties agree to enter into this French proceeds loan agreement (the “Agreement”) on the terms and conditions set forth herein.

Now, therefore, the parties hereby agree:

1. Definitions

1.1 Defined Terms

Unless otherwise defined herein, terms defined in the Credit Agreement shall have the same meaning when used in this Agreement.

The following words and expressions shall have the following meanings respectively set forth hereinafter:

“Aggregate Exposure” shall mean, at any time, the sum of the aggregate principal amount of all Loans then outstanding.

“Applicable Borrowing Base Loan”, in respect of each Loan, shall have the meaning given to it in paragraph (i) of Clause 2.1.1 below.

“Applicable Funding Cost” shall mean, at any time in respect of an Interest Period:

(a) for a Loan utilized in Euros, the Euro LIBOR rate applicable to the Applicable Borrowing Base Loan for the equivalent period; and

(b) for a Loan utilized in Pounds Sterling, the Sterling Rate applicable to the Applicable Borrowing Base Loan for the equivalent period,

as notified to the Borrower by the relevant Lender from time to time.

“Applicable Interest Period” shall mean, at any time in respect of a Loan, the Interest Period (as defined in the Credit Agreement) which applies at that time to the Applicable Borrowing Base Loan, as notified to the Borrower by the relevant Lender from time to time.

“Applicable Margin” shall mean, at any time in respect of a Loan, the Applicable Margin (as defined in the Credit Agreement) which applies at that time to the Applicable Borrowing Base Loan, as notified to the Lenders by the Obligors’ Agent under the Credit Agreement, a copy of which will be provided by the Lenders to the Borrower.

“Borrowing” shall mean the borrowing of Loans on a given date in accordance with this Agreement.

“Collateral” shall mean all property (whether real or personal) with respect to which any security interests have been granted (or purported to be granted) pursuant to any French Proceeds Loan Security Document.

“Default” shall mean any event, act or condition which with notice or lapse of time, or both, would constitute an Event of Default.

“Euro LIBOR” shall mean, with respect to each Borrowing of Euro Loans, the applicable screen rate, the same being the percentage rate per annum determined by the Banking Federation of the European Union for the relevant Interest Period, displayed on Reuters Page EURIBOR-01. If the agreed page is replaced or service ceases to be available or if no screen rate is available for the Interest Period of that Loan, the rate for such Interest Period shall be determined in accordance with the terms of the Credit Agreement; provided that if Euro LIBOR shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.

“Event of Default” shall have the meaning ascribed to it in Clause 5.2 below.

“French Proceeds Loan Documents” shall mean this Agreement together with each French Proceeds Loan Security Document, in each case, as amended, restated, modified and/or supplemented from time to time.

“French Proceeds LoanSecured Obligations” shall mean and include all of the following:

(a) the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of all obligations of the Borrower under the French Proceeds Loan Documents

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to the Lenders, whether now existing or hereafter incurred under, arising out of, or in connection with, each French Proceeds Loan Document to which the Borrower is a party;

(b) any and all sums advanced by the Security Agent in order to preserve the Collateral or preserve its security interest in Collateral;

(c) in the event of any proceeding for the collection or enforcement of any indebtedness, obligations, or liabilities of the Borrower referred to in clauses (i) and (ii) above, after an Event of Default shall have occurred and be continuing, the expenses of retaking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, or of any exercise by the Borrower of its rights hereunder, together with reasonable attorneys’ fees and court costs; and

(d) all amounts paid (or incurred) by the Security Agent as to which such has the right to reimbursement or Security Agent indemnity contained in the French Proceeds Loan Documents;

it being acknowledged and agreed that the “French Proceeds Loan Secured Obligations” shall include extensions of credit of the types described above, whether outstanding on the date of the French Proceeds Loan Documents or extended from time to time after the date of the French Proceeds Loan Documents.

“French Proceeds LoanSecurity Documents” shall mean (i) a French law bank accounts pledge agreement entered into between, inter alios, the Borrower as pledgor and the Security Agent on the date hereof pursuant to which the Borrower grants a pledge over its bank accounts in France, (ii) a French law receivables pledge agreement on the date hereof pursuant to which the Borrower grants a pledge over its insurance claims, (iii) a French law inventory pledge agreement entered into between, inter alios, the Borrower as pledgor and the Security Agent on the date hereof pursuant to which the Borrower grants a pledge over its inventory and (iv) an English law share charge entered into between the Borrower as chargor and the Security Agent in respect of the shares in TRU (France) Finance Ltd.

“Interest Period” shall mean each period for which interest is payable under this Agreement in respect of a Loan.

“Interest Rate” has the meaning ascribed to it in Clause 3.1.

“Maturity Date” shall mean the date that is five years from the Second Restatement Effective Date.

“Payment Office” shall mean Cannon Place, 78 Cannon Street, London EC4N 6AF, United Kingdom, facsimile number +44 20 7367 2000.

“Security Requirement” shall mean the requirement that on or prior to the Second Restatement Effective Date, (i) the Security Agent shall have received from the Borrower (y) the duly executed French Proceeds Loan Security Documents and all related documentation (including, without limitation, lien search certificate, opinions of counsel, corporate documents and proceedings and officer’s certificates), (z) all documents, instruments, forms and statements, required by law or reasonably requested by the Security Agent to be filed, registered or recorded to create the Liens intended to be created by the applicable French Proceeds Loan Security Documents and perfect such Liens to the extent required by, and with the priority required by, such French Proceeds Loan Security Document, shall have been filed, registered or recorded or delivered to the Security Agent for filing, registration or recording and (ii) the Borrower shall have obtained all material consents and approvals required to be obtained by it in connection with the execution and delivery of all French Proceeds

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Loan Security Documents to which it is a party, the performance of its obligations thereunder and the granting by it of the Liens thereunder.

“Sterling Rate” shall mean, with respect to each Borrowing of Sterling Loans, the applicable screen rate, the same being the London interbank offered rate administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) for the relevant currency and period displayed on pages LIBOR01 and LIBOR02 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate) or on the appropriate page of such other information service which published that rate from time to time in place of Thomson Reuters. If the agreed page is replaced or service ceases to be available or if no screen rate is available for the Interest Period of that Loan, the rate for such Interest Period shall be determined in accordance with the terms of the Credit Agreement.

“Total Commitment” shall mean, at any time (as notified by the Lenders to the Borrower from time to time), the amount which is the lesser of (i) the French Borrowing Base at that time and (ii) the amount equal to 20 per cent. of the Borrowing Base at that time.

1.2 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 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 Clauses, Articles, Sections, Exhibits and Schedules shall be construed to refer to Clauses, Articles and Sections of, and Exhibits and Schedules to, this Agreement, (e) any reference to any law or regulation herein shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, and (f) 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.

2. Loan

2.1 The Commitments

2.1.1 Subject to and upon the terms and conditions set forth herein each Lender severally agrees to make, at any time and from time to time on or after the Second Restatement Effective Date and prior to the Maturity Date, Loans to the Borrower. Each such Loan:

(i) shall be made and maintained in Pounds Sterling or Euros (and shall be funded from the proceeds of a French Borrowing Base Loan drawn by the relevant Lender in the same currency and in the same amount (in respect of that Loan, the “Applicable Borrowing Base Loan”));

(ii) shall be advanced to the Borrower by the relevant Lender on the date of utilisation of the Applicable Borrowing Base Loan;

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(iii) shall have an Interest Period which matches the Applicable Interest Period;

(iv) may be repaid and reborrowed in accordance with the provisions hereof; and

(v) shall not be made (and shall not be required to be made) by any such Lender in any instance where the incurrence thereof (after giving effect to the use of the proceeds thereof on the date of the incurrence thereof to repay any amounts theretofore outstanding pursuant to this Agreement) would cause (x) the Aggregate Exposure to exceed the Total Commitment at such time and (y) the aggregate principal amount of Loans to exceed the aggregate principal amount of the French Borrowing Base Loans which would be outstanding on the date on which such Loans are made available.

2.2 Notice of Borrowing

Whenever the Borrower desires to incur Loans hereunder, the Borrower shall give the Lenders three Business Days’ prior notice (in accordance with Clause 11.1 below) of each Loan to be incurred hereunder. Each such notice (each, a “Notice of Borrowing)shall be irrevocable and shall be in writing, appropriately completed to specify: (i) the aggregate principal amount (and currency) of the Loans to be incurred pursuant to such Borrowing and (ii) the proposed date of such Borrowing (which shall be a Business Day on which funding of the Applicable Borrowing Base Loan will be possible under the Credit Agreement) and (iii) the proposed initial Interest Period to be applicable thereto.

2.3 Termination of Commitments

The Total Commitment (and the commitment of each Lender hereunder) shall terminate in its entirety on March 8, 2016, unless the Second Restatement Effective Date has occurred on or prior to such date.

3. Interest

3.1 The Borrower agrees to pay interest in respect of the unpaid principal amount of each Loan from the date of Borrowing thereof until the maturity thereof (whether by acceleration or otherwise) at a rate per annum which shall be equal to the sum of the Applicable Margin as in effect from time to time during such Interest Periodplus the Applicable Funding Cost for such Interest Period (the “Interest Rate”).

3.2 Overdue principal and, to the extent permitted by law, overdue interest in respect of each Loan and any other overdue amount payable hereunder shall bear interest at a rate per annum equal to the rate which is 2% in excess of the Interest Rate in effect from time to time for such successive periods not exceeding three months as the Lenders may determine from time to time in respect of amounts comparable to the amount not paid, all in accordance with article 1154 of the French civil code.

3.3 Accrued (and theretofore unpaid) interest shall be payable in respect of each Loan (i) on the last day of each Interest Period applicable thereto and, in the case of an Interest Period in excess of three months, on each date occurring at three month intervals after the first day of such Interest Period and (ii) (x) on the date of any repayment or prepayment thereof (on the amount prepaid or repaid), (y) at maturity (whether by acceleration or otherwise) and (z) after such maturity, on demand.

3.4 Each Interest Period applicable to each Loan shall be the same as the Applicable Interest Period.

3.5 All interest under this Agreement shall accrue from day to day and be calculated on the basis set forth in the Credit Agreement, as applicable.

3.6 For the purposes of articles L313-1 et seq., R 313-1 and R313-2 of the French Code de la consommation and article L. 313-4 of the French Code monétaire et financier, the Parties

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acknowledge that the taux effectif global calculated at the date of this Agreement, based on an assumption as to the period rate (taux de période) and the period term (durée de période) and on the assumption that the interest rate and all other fees, costs or expenses payable under this Agreement will be maintained at their original level throughout the term of this Agreement, is set out in a letter from the Lenders to the Borrower. The Parties acknowledge that this letter forms part of this Agreement.

4. Conditions Precedent

4.1 Other Conditions Precedent

The Lenders will only be obliged to comply with Clause 2.1 (The Commitments) in relation to any Borrowing if, on or before the date of that Borrowing, the Security Agent has received all of the documents and other evidence (i) required under the Credit Agreement in respect of any Utilisation of the French Borrowing Base and (ii) required hereunder and listed in Schedule 1 hereto.

5. Duration and Repayment

5.1 Voluntary Prepayment

5.1 The Borrower may elect at any time to prepay prior to the Maturity Date, in whole or in part, any amounts outstanding (of principal and interest) in respect of the Loans; provided that the Borrower has sent a prior written notice to the Lenders no later than two (2) business days prior to the contemplated repayment date, in accordance with Article 10 herein, which notice shall set forth the amount and date of the contemplated prepayment.

5.2 Mandatory repayments

5.2.1 To the extent required to enable such prepayment of the French Borrowing Base Loans, the Borrower shall repay any outstanding Loans each time the then outstanding French Borrowing Base Loans shall be repaid pursuant to clause 5.02 (Mandatory Repayments; Cash Collateralization) of the Credit Agreement.

5.2.2 In addition to any other mandatory repayments pursuant to this clause 5.2, all then outstanding Loans shall be repaid in full on the Maturity Date.

5.3 Events of Defaults

Upon the occurrence of any of the following specified events (each, an “Event of Default”):

(a) the Borrower shall (i) default in the payment when due of any principal of or any Loan or (ii) default, and such default shall continue unremedied for five or more Business Days, in the payment when due of any interest on any Loan or any fees or any other amounts owing hereunder; or

(b) an Event of Default (under and as defined) in the Credit Agreement occurs,

then, and in any such event, and at any time thereafter, if any Event of Default shall then be continuing, the Lenders, shall by written notice to the Borrower, take any or all of the following actions, without prejudice to the rights of any Lender to enforce its claims against the Borrower (i) declare the Total Commitment terminated, whereupon all the Commitments of each Lender shall forthwith terminate immediately; (ii) declare the principal of and any accrued interest in respect of all Loans and all

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French Proceeds Loan Secured Obligations owing hereunder and thereunder to be, whereupon the same shall become, forthwith due and payable without formal notification (mise en demeure), demand, protest (protêt) or other notice of any kind, all of which are hereby waived by the Borrower to the extent permitted by applicable law and (iii)  enforce and/or exercise, as Security Agent, all of the Liens and security interests and other rights and remedies created pursuant to the French Proceeds Loan Security Documents.

5.4 Method and Place of Payment

5.4.1 Except as otherwise specifically provided herein, all payments under this Agreement shall be made to the Lenders entitled thereto not later than 11:00 a.m (London time) on the date when due and shall be made the currency of the relevant Loan in immediately available funds at the Payment Office or into a bank account (being a bank account in the United Kingdom or France) specified by the Lenders from time to time. Whenever any payment to be made hereunder shall be stated to be due on a day which is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day and, with respect to payments of principal, interest shall be payable at the applicable rate during such extension.

5.4.2 Any payments hereunder:

(a) shall be paid without any set-off or counterclaim and in the currency of invoice and in immediately available, freely transferable cleared funds to such account(s) with such bank(s) as the Lenders notify;

(b) shall be paid without any deduction or withholding for or on account of tax (a “Tax Deduction”) unless a Tax Deduction is required by law. If a Tax Deduction is required by law to be made, the amount of the payment due shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required; and

(c) are exclusive of any value added tax or similar charge (“VAT”). If VAT is chargeable, the Borrower shall also and at the same time pay to the recipient of the relevant payment an amount equal to the amount of the VAT.

6. Representations and Warranties

At the time of each Borrowing and also after giving effect thereto (i) there shall exist no Default or Event of Default and (ii) all representations and warranties contained herein and in the Credit Agreement shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on the date of such Borrowing (it being understood and agreed that (x) any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date and (y) any representation or warranty that is qualified as to “materiality,” “Material Adverse Effect” or similar language shall be true and correct in all respects on such date).

7. Covenants

The Borrower covenants and agrees to comply with Section 9.20 of the Credit Agreement.

8. Further Assurances

The Borrower will execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing, registration and recording of

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financing statements, obtaining consents, fixture filings, mortgages, charges, debenture, deeds of trust, charge or real property mortgage forms and other documents and supplying information), which may be required under any applicable law, or which the Security Agent or the Lenders may reasonably request, to cause the Security Requirement to be and remain satisfied at all times, together with the related opinions, all at the expense of the Borrower. The Borrower also agrees to provide to the Security Agent, from time to time upon request, evidence reasonably satisfactory to the Security Agent as to the perfection and priority of the liens created or intended to be created by the French Proceeds Loan Security Documents.

9. Transfer or Assignment of Rights and Obligations

9.1 Unless with the prior written consent of the Lender, the Borrower may not assign or otherwise transfer its rights and obligations under this Agreement.

9.2 Any Lender may freely assign or otherwise transfer or pledge its rights and obligations under this Agreement, without the consent of the Borrower.

9.3 If a Lender assigns or otherwise transfers its rights and obligations under this Agreement, it shall, as soon as possible after the assignment or transfer has occurred, arrange for the assignment or transfer to be notified to the Borrower by a bailiff (huissier) in accordance with article 1690 of the French Code civil.

10. Notice

10.1 Except as otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including telecopier communication, facsimile transmission or electronic mail) and mailed, telecopied, transmitted or delivered: if to any Obligor, to such Obligor as set forth on Schedule I hereto; if to any Lender, at its address, facsimile number or electronic mail address specified in the heading of this Agreement and:

• if to the Security Agent at 60 Wall Street, New York, New York 10005, Attention: Dusan Lazarov, facsimile number (212) 797-5695;

• if to the Borrower at – ZAC de la Mare aux Loups, 1 allée des Lutins, 77310 St Fargeau Ponthierry, France;

• if to a Lender at Cannon Place, 78 Cannon Street, London EC4N 6AF, United Kingdom, facsimile number +44 20 7367 2000, email, George.Yuill@cms-cmck.com Attention: George Yuill, copy to: Toys “R” US Inc. at 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808, United States of America, registered with the Delaware Secretary of State under number 2356739, facsimile number (973) 617 4043, email, Matthew.Finigan@toysrus.com, Attention: Matthew Finigan; or

• as to any Party to this Agreement, at such other address as shall be designated by such party in a written notice to the other parties hereto.

10.2 All such notices and communications shall, when mailed, telecopied, faxed, mailed electronically or sent by overnight courier, be effective when deposited in the mails or overnight courier, as the case may be, or sent by telecopier or electronic mail, except that notices and communications to the Security Agent shall not be effective until received by the Security Agent.

11. Applicable Law – Jurisdiction

8

11.1 This Agreement shall be governed by French law.

11.2 Any dispute arising out, or in connection with, this Agreement shall be brought before the Commercial Court of Paris.

9

Made on 18 December2015.

In four (4) originals.

Toys “R” Us SARL as Borrower

_________________________________    

By:    

Toys “R” Us (UK) Limited as Lender

_________________________________    

By:    

Toys “R” Us Limited as Lender

_________________________________    

By:

Deutsche Bank AG New York Branch as Security Agent

_________________________________    

By:

_________________________________    

By:

10

Schedule 1
Conditions Precedent to initial Borrowing

1. Constitutional Documents

(a) a copy of the statuts (articles of association), extrait K-bis (extract from the commercial register), a copy of the étatdes inscriptions et privilèges (statement of charges over assets and encumbrances), and certificat de recherche negative de procedures collectives (certificate evidencing the absence of bankruptcy) of the Borrower each dated no more than one Month prior to the Second Restatement Effective Date.

(b) A copy of resolutions of the sole shareholder of the Borrower, approving (i) the transactions and matters contemplated by the French Proceeds Loan Documents to which the Borrower is a party and (ii) the execution, delivery and performance of and authorising named persons to sign the French Proceeds Loan Documents to which the Borrower is a party.

(c) A specimen of the signature of each person authorised by the resolution referred to in paragraph (b) above (except for the signature of Enrique Gonzalez Hernan, who is an authorised person pursuant to paragraph (b) above).

(d) A certificate of an authorised signatory of the Borrower certifying (i) each copy document relating to it specified in this paragraph 1 (Constitutional Documents) is correct, complete and in full force and effect as at a date no earlier than the Second Restatement Effective Date and (ii) borrowing or securing, as appropriate, the Total Commitment would not cause any borrowing, guarantee, security or similar limit binding on such Obligor to be exceeded.

2. Finance Documents

(a) The French Proceeds Loan Documents executed by each of the parties thereto.

(b) A letter relating to the taux effectif global, duly countersigned by the Borrower.

3. Legal opinions

(a) A legal opinion of White & Case LLP, legal advisers to the Arrangers, Agent and Security Agent in France, in relation to, inter alia, the validity and enforceability of the French Proceeds Loan Documents.

(b) A legal opinion of Allen & Overy LLP, legal advisers to the Group in France, in relation to, inter alia, the existence of the Borrower and the capacity and authorisations of the Borrower.

4. Other documents and evidence

Evidence of the payment of all costs and expenses then due to the Lenders and the Security Agent for their own account or that such costs and expenses will be paid in full promptly following the Second Restatement Effective Date.

11

EXHIBIT F-1

FORM OF OFFICERS’ CERTIFICATE

[Date]

This Certificate is furnished pursuant to the Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), the Borrowers and 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 New York Branch and Bank of America, N.A., as Co-Collateral Agents (such Syndicated Facility Agreement, as in effect on the date of this Certificate, being herein called the “Facility Agreement”). Unless otherwise defined here-in, capitalized terms used in this Certificate shall have the meanings set forth in the Facility Agreement.

Each of the undersigned, serving in his or her respective capacity as an Authorized Officer of an applicable respective Borrower as set forth on the signature pages hereto, does hereby certify, solely in his or her capacity as an officer of such Borrower and not in his or her individual capacity, on behalf of such Borrower, that:

1.On the date hereof, all of the conditions set forth in Sections 6.05 through 6.08, inclusive, and 7.01 of the Facility Agreement have been satisfied.

2.On the date hereof, the representations and warranties contained in the Facility Agreement and in the other Credit Documents are true and correct in all material respects with the same effect as though such representations and warranties had been made on the date hereof, both before and after giv-ing effect to each Credit Event to occur on the date here-of and the application of the proceeds thereof, unless stated to relate to a specific earlier date or period, in which case such representations and warranties were true and correct in all material respects as of such specific earlier date or period.

3.On the date hereof, no Default or Event of De-fault has occurred and is continuing or would result from any Credit Event to occur on the date hereof or from the application of the proceeds thereof.

4.There is no pending proceeding for the dissolution or liquidation of such Borrower or any other Obligor or, to the knowledge of the undersigned, threatening its existence.

IN WITNESS WHEREOF, I have hereunto set my hand as of the date first written above.

TOYS “R” US (UK) LIMITED,

as a U.K. Borrower

By:_________________________________

Name:

Title:

TOYS “R” US LIMITED,

as a UK Borrower

By:_________________________________

Name:

Title:

TOYS “R” US (AUSTRALIA) PTY LTD,

as the Australian Borrower

By:_________________________________

Name:

Title: Authorized Signatory

TOYS “R” US GMBH,

as the German Borrower

By:_________________________________

Name:

Title:

TOYS “R” US IBERIA, S.A.U.,

as the Spanish Borrower

By:_________________________________

Name:

Title:

EXHIBIT F-2

FORM OF MANAGING DIRECTORS’ CERTIFICATE

Date: ______ __, ____

This Certificate is furnished pursuant to the Syndicated Facility Agreement, dated as of October 15,2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among the Company and the other Obligors party thereto, the Lenders from time to time party thereto, Deutsche Bank AG New York Branch, as Administrative Agent and Security Agent and Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents (such Syndicated Facility Agreement, as in effect on the date of this Certificate, being herein called the “Credit Agreement”). Unless otherwise defined herein, capitalized terms used in this Certificate shall have the meanings set forth in the Credit Agreement.

I, the undersigned, [Chairman/Chief Executive Officer/President/Vice President/Authorized Officer] of [_____], a [limited liability company] organized and existing under the laws of [_____] (the “Company”), do hereby certify, solely in my capacity as an officer of the Company and not in my individual capacity, on behalf of the Company, that:

1.    The borrowing, guaranteeing and/or securing, as appropriate, of the Total Commitments would not cause any borrowing, guarantee, security or similar limit binding on the Company to be exceeded.

2.    The persons named in Exhibit A are the duly elected, qualified, and acting officers of the Company, holding the respective offices in Exhibit A set forth opposite their names, and the signatures on Exhibit A set forth opposite their names are their genuine signatures.

3.    Attached hereto as Exhibit B is a certified copy of the [Certificate of Formation] of the Company, as in effect on the date hereof, together with all amendments thereto adopted through the date hereof.

4.    Attached hereto as Exhibit C is a true and correct copy of the [Limited Liability Company Agreement] of the Company which was duly adopted and is complete, correct and in full force and effect on the date hereof, together with all amendments thereto adopted through the date hereof.

5.    Attached hereto as Exhibit D is a true and correct copy of resolutions which were duly adopted on _________ __, ____ [by unanimous written consent by the Board of Directors of the Company][by a meeting of the Board of Directors of the Company at which a quorum was present and acting throughout][by written consent of the Sole Member of the Company], and said resolutions have not been rescinded, amended or modified. Except as attached hereto as Exhibit D, no resolutions have been adopted by the [Board of Directors][Sole Member] of the Company which deal with the execution, delivery or performance of any of the Documents to which the Company is a party.

Exhibit F-2
Page 2

[6.    Attached hereto as Exhibit E is a true and complete copy of the resolutions of the Sole Shareholder of the Company, unanimously passed, which resolutions are in full force and effect and have not been rescinded or varied since the date on which such resolutions were passed and which approves and authorizes and directs the execution and performance by the Company of the Documents to which it is a party and all transactions contemplated thereby.]

Exhibit F-2
Page 3

IN WITNESS WHEREOF, I have hereunto set my hand as of the date first written above.

[NAME OF OBLIGOR]

By:______________________________

Name:

Title:

Exhibit F-2
Page 4

I, the undersigned, [Secretary/Assistant Secretary/Authorized Officer] of the Company, do hereby certify, solely in my capacity as an officer of the Company and not in my individual capacity, on behalf of the Company that:

1.    [Name of Person making above certifications] is the duly elected and qualified [Chairman/Chief Executive Officer/President/Vice-President/Authorized Officer] of the Company and the signature above is [his][her] genuine signature.

IN WITNESS WHEREOF, I have hereunto set my hand as of the date first written above.

[NAME OF OBLIGOR]

By:___________________________

Name:

Title:

EXHIBIT A

Name¹	Office	Signature
________________________	________________________	________________________
________________________	________________________	________________________
________________________	________________________	________________________

__________________________

¹ Include name, office and signature of each officer who will sign any Credit Docu-ment on behalf of the Company, including the officer who will sign the certification at the end of this Certificate or related documentation.

EXHIBIT G

FORM OF PERFECTION CERTIFICATE SUPPLEMENT

[Date]

Reference is made to the Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015 (as further amended, restated, supplemented or modified from time to time, the “Facility Agreement”), among TRU Europe Limited (the “European Parent Guarantor” and the “Obligors’ Agent”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026), (the “Australian Borrower”), Toys “R” US GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrower and German Borrower, collectively, the “Borrowers”), TRU (UK) H7 Limited (“Midco 1”), TRU (UK) H8 Limited ( “Midco 2”), TRU Iberia Holdings 2, S.L.U. (formerly known as Avenal Investment, S.L.U.) ( “Midco 4”), Toys “R” Us Holdings Limited (“TRU Holdings”), Toys “R” Us Financial Services Limited (“TRU Financial Services”), Toys “R” Us Properties Limited (“TRU Properties”), TRU (UK) H4 Limited (“TRU H4”), TRU (France) Finance Ltd. (“TRU France Finance”), TRU (France) Holdings Ltd. (“TRU France Holdings” and, together with the European Parent Guarantor, Midco 1, Midco 2, TRU Holdings, TRU Financial Services, TRU Properties, TRU H4 and TRU France Finance, collectively the “U.K. Guarantors”), Babies “R” Us (Australia) Pty Ltd (ABN 56 073 394 117) (the “Babies “R” Us (Australia”), Toys “R” Us SARL (“Toys SARL”), TRU (BVI) Finance II, Ltd. (the “BVI Guarantor”), TRU (UK) H6, LLC (the “U.S. Guarantor”), the Lenders party thereto from time to time, and Deutsche Bank AG New York Branch, as Administrative Agent and Security Agent, and the other Agents party thereto from time to time.

Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Facility Agreement or the Security Documents referred to therein, as applicable.

The undersigned, an Authorized Officer of the Obligors’ Agent, hereby certifies not in his/her individual capacity, but solely as an Authorized Officer of the Obligors’ Agent to the Administrative Agent and each other Secured Creditor as follows:

1.     [Except as attached hereto as Annex A, there]¹ [There] have been no changes or alterations to the U.K. Perfection Certificate dated [                      ].

2.[Except as attached hereto as Annex B, there] [There] have been no changes to the Australian Perfection Certificate dated [                      ].

___________________________

¹ Prior to execution the Authorized Officer of the Obligors’ Agent preparing the certificate should review the whole of Annex A, B and C to ensure there have been no changes or alteration as set forth in Section 9.01(f) of the Facility Agreement.

Exhibit G
Page 2

3.[Except as attached hereto as Annex C, there] [There] have been no changes to the Pledged Securities Perfection Certificate dated [                      ].

Exhibit G
Page 3

IN WITNESS WHEREOF, the undersigned have duly executed this certificate on the first date written above.

TRU EUROPE LIMITED, as

Obligors’ Agent

By:______________________________________

Name:

Title: [Authorized Officer]

ANNEX Ato FORM OF PERFECTION CERTIFICATE SUPPLEMENT

1.[Names

(a)The exact corporate name of each Grantor, as such name appears in its respective certified certificate of incorporation or certified certificate of change of name, is as follows:

Name

[ ]

[ ]

[ ]

(b)Set forth below is each other corporate name each Grantor has had in the past five years, together with the date of the relevant change:

	Name	Date of Change
[ ]	[ ]	[ ]
[ ]	[ ]	[ ]
[ ]	[ ]	[ ]

(c)Except as set forth below, no Grantor has changed its identity or corporate structure in any way within the past five years. Changes in identity or corporate structure include mergers, consolidations and acquisitions, as well as any change in the form, nature or jurisdiction of corporate organization. If any such change has occurred, include below the information required by Sections 1 and 2 of this certificate as to each acquiree or constituent party to a merger or consolidation.

(d)The following is a list of all other names (including trade names, business names or similar appellations) used by each Grantor or any of its divisions or other business units in connection with the conduct of its business or the ownership of its properties at any time during the past five years:

	Name
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(e)Set forth below is the company number issued by Companies House in respect of each Grantor:

Name	Company Number
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(f)]²

2.[Current Locations

(a)The registered office of each Grantor is located at the address set forth opposite its name below:

Grantor	Mailing Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(b)Set forth below opposite the name of each Grantor are all locations where such Grantor maintains any books or records relating to any Accounts and Related Rights:

Grantor	Mailing Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(c)The jurisdiction of incorporation of each Grantor is set forth opposite its name below:

____________________________

² Delete if no changes.

Grantor	Jurisdiction
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(d)Set forth below opposite the name of each Grantor are all the locations where such Grantor maintains any Secured Assets not identified above:

Grantor	Mailing Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(e)Set forth below opposite the name of each Grantor are all the places of business of such Grantor not identified in paragraph (a), (b), (c) or (d) above:

Grantor	Mailing Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]³

(f)Set forth below opposite the name of each Grantor are the names and addresses of all Persons other than such Grantor that have possession of any of the Secured Assets of such Grantor:

____________________________

³ Delete if no changes.

Grantor	Mailing Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ] ]

3.[Advances

The Master Intercompany Note sets forth (i) the intercompany notes evidencing all Indebtedness of each Borrower that is owing to each Grantor and (ii) the promissory notes or other instruments evidencing all Intercompany Debt that is owing to each Grantor.]

4.[Commercial Tort Claims

Attached hereto as Schedule 2 is a true and correct list of commercial tort claims in an amount reasonably estimated to exceed £2,000,000 held by any Grantor, including a brief description thereof.]

5.[Other U.K. Subsidiaries

Other than (x) the Grantors that are a party to this Perfection Certificate, the European Parent Guarantor has no Subsidiaries that are U.K. Obligors and (y) the U.K. Obligors, European Parent Guarantor has no Subsidiaries that operate or own assets in the United Kingdom.]

ANNEX Bto FORM OF PERFECTION CERTIFICATE SUPPLEMENT

1.[Names

The exact corporate name of each Australian Obligor, as such name appears in its respective certified certificate of incorporation (or analogous charter document)/certified certificate of change of name, is as follows:

Name

[ ]

[ ]

[ ]

No Australian Obligor has existed under a different corporate name in the past five years.

No Australian Obligor has changed its identity or corporate structure in any way within the past five years.

The following is a list of all other names (including trade names, business names or similar appellations) used by each Australian Obligor or any of its divisions or other business units in connection with the conduct of its business or the ownership of its properties at any time during the past five years:

	Name
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

Set forth below is the Australian Business Number (“ABN”) issued by the jurisdiction of organization of each Australian Obligor that is a registered organization:]

Name	ABN
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

2.[Current Locations

The registered office of each Australian Obligor is located at the address set forth opposite its name below:

Australian Obligor	Mailing Address
[ ]	[ ]
[ ]	[ ]

(a)

Set forth below opposite the name of each Australian Obligor are all locations where such Australian Obligor maintains any books or records relating to any Accounts Receivable or General Intangibles (with each location at which chattel paper, if any, is kept being indicated by an “*”):

Australian Obligor	Mailing Address
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(b)

The jurisdiction of formation of each Australian Obligor that is a registered organization is set forth opposite its name below:

Australian Obligor	Jurisdiction
[ ]	[ ]
[ ]	[ ]
[ ]	[ ]

(c)

Attached hereto as Schedule I is a schedule setting forth all the locations where an Australian Obligor maintains any Inventory or Equipment or other Collateral not identified above (other than Collateral in transit or absent pursuant to any arrangement in connection with warehousing, repair or replacement in the ordinary course of business).

Set forth below opposite the name of each Australian Obligor are all the places of business of such Australian Obligor not identified in paragraph (a), (b), (c) or (d) above:

Australian Obligor	Mailing Address
[ ]	[ ]
[ ]	[ ]

Set forth below opposite the name of each Australian Obligor are the names and addresses of all Persons other than such Australian Obligor that have possession of any of the Collateral of such Australian Obligor:

Australian Obligor	Mailing Address
[ ]	[ ]
[ ]	[ ]]

3.[Personal Property Securities Register (“PPSR”) Searches

PPSR searches have been conducted with respect to each Australian Obligor in Section 1 hereof, and such searches reveal no charges or other encumbrances against any of the Collateral other than those permitted under the Credit Agreement.]

4.[Constitution and Stamp Duty

The Multijurisdictional Mortgage Statement has been executed by the Australian Obligors and will be delivered to the Australian legal counsel for the Administrative Agent on the Second Restatement Effective Date.]

5.[Filing Fees

All filing fees and taxes payable in connection with the documents described in Section 4 above will be paid upon lodgement of the document.]

6.[Commercial Tort Claims

Attached hereto as Schedule III is a true and correct list of commercial tort claims in an amount reasonably estimated to exceed $2,000,000.00 held by any Australian Obligor , including a brief description thereof.]

7.[Other Australian Subsidiaries

Other than the Australian Obligors that are a party to this Perfection Certificate, TRU Australia Holdings, LLC (“Australian Parent Guarantor”) has no Subsidiaries that are Australian Obligors (other than Toys “R” Us (Australia) Pty Limited and Babies “R” Us (Australia) Pty Limited) and (y) the Australian Parent Guarantor has no Subsidiaries that operate or own assets in Australia (other than Toys “R” Us (Australia) Pty Limited and Babies “R” Us (Australia) Pty Limited).]

8.[Title Documents

Share certificates and blank share transfer forms (executed by the relevant mortgagor) in relation to the Australian Obligors as listed in Schedule III have been delivered to the Australian legal counsel to the Security Agent on or prior to the Second Restatement Effective Date.]

ANNEX Cto FORM OF PERFECTION CERTIFICATE SUPPLEMENT

1.[Stock Ownership and other Equity Interests. Attached hereto as Schedule 1 is a true and correct list of all the issued and outstanding stock, partnership interests, limited liability company membership interests or other equity interests in each Obligor and the record and beneficial owners of such stock, partnership interests, membership interests or other equity interests. Also set forth on Schedule 1 hereto is each equity investment of any Obligor that represents 50% or less of the equity of the entity in which such investment was made.]

2.    [Credit Parties     (a) The jurisdiction of formation of each Obligor is set forth opposite its name below:

Credit Party Jurisdiction

]

EXHIBIT H-1

Form of Tri-Party Agreement (Australia)

Name and Address of Freight Forwarder:

[insert address]

Dear Sir/Madam:

[Qualified Obligor], a [proprietary] company incorporated and validly existing under the laws of Australia (the “Company”), among others, has entered into the Syndicated Facility Agreement, dated as of October 15,2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, with among others, Deutsche Bank AG New York Branch, a branch of Deutsche Bank AG, a corporation duly incorporated and existing under the laws of the Federal Republic of Germany, with License issued by the Banking Department of the State of New York, United States of America, with offices at 60 Wall Street, 2^nd Floor, New York, New York 10005, as security agent (in such capacity, the “Security Agent”), for its own benefit and the benefit of certain other secured parties (the “Secured Creditors”) which are making loans or furnishing other financial accommodations to the Company (as amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”) pursuant to the Facility Agreement and the Company, among others, has granted to the Security Agent, for its own benefit and the benefit of the other Secured Creditors, a security interest in and to, among other things, substantially all of the assets of the Company (the “Collateral”), including, without limitation, all of the Company’s inventory, goods, documents, waybills, bills of lading and other documents of title pursuant to the document entitled “Fixed and Floating Charge (Australia)” dated October 15, 2009, as amended, restated, modified and/or supplemented from time to time, between the Company, the Security Agent and Babies "R" Us (Australia) Pty Ltd.

Pursuant to that certain [insert service contract information], dated as of [______ __], [____] with [__________](as amended and in effect), attached hereto as Exhibit A (the “Service Agreement”), [_______________], provide certain freight warehouse, consolidation and other services to the Company. [_______________], (together with any of their affiliates providing services to the Company under the Service Agreement, collectively, the “Freight Forwarder”) agrees to act as agent and bailee for the Security Agent and the Company for the limited purpose of more fully perfecting and protecting the interest of the Security Agent in goods and inventory of the Company which may be in the possession or control of the Freight Forwarder from time to time, as well as any waybills, forwarder’s cargo receipts, bills of lading, documents, and any other documents of title or carriage constituting, evidencing, or relating to such good and Inventory (as defined in the Facility Agreement) (collectively, the “Documents of Carriage”) that may be issued in connection therewith and which may be in the possession or control of the Freight Forwarder from time to time. This letter shall set forth the terms of the Freight Forwarder’s engagement.

1.Acknowledgment of Security Interest; Power of Attorney: The Freight Forwarder acknowledges, consents, and agrees that the Company has granted to the Security Agent, for its own benefit and the benefit of the other Secured Creditors, a security interest and first priority Lien (as defined in the Facility Agreement) on all of the Company’s right, title, and interest in, to and under all goods, Inventory, documents, Documents of Carriage and any contracts or agreements with carriers, customs brokers, and/or freight forwarders for shipment or delivery of such goods and inventory. The Freight Forwarder further agrees that: (i) it shall act as the Company’s agent and bailee for the purpose of

Exhibit H-1
Page 2

receiving any goods, inventory, Documents of Carriage or other property of the Company (collectively, the “Property”); (ii) the Company holds title to all Property while in the custody or control of the Freight Forwarder; (iii) upon receipt of any Property, the Freight Forwarder shall promptly notify the Company that is holding such Property on behalf of the Company; and (iv) the Freight Forwarder shall not deliver any Property to a third party for shipment and delivery unless any related Documents of Carriage reflect the Company as both “consignor/shipper” and “consignee” and such third party is advised of the Security Agent’s first priority lien on the Property and rights with respect thereto.

2.Appointment of Freight Forwarder as Agent of Security Agent: The Freight Forwarder is hereby appointed as agent for the Security Agent to receive and retain possession of any Property, such receipt and retention of possession being for the purpose of more fully perfecting and preserving the Security Agent's security interests in the Property. The Freight Forwarder will maintain possession of the Property, subject to the security interest of the Security Agent, and will note the security interest of the Security Agent on the Freight Forwarder's books and records. If the Freight Forwarder receives notice from any seller of any Property of its intent to stop delivery of such Property to the Company, the Freight Forwarder shall promptly notify the Security Agent of same and, in all such cases, shall follow solely the instructions of the Security Agent concerning the release, transfer, or other disposition of the Property and will not follow any instructions of the Company or any other person concerning the same.

3.Delivery of Title Documents; Release of Goods: Until the Freight Forwarder receives written notification from the Security Agent to the contrary, the Freight Forwarder is authorized by the Security Agent to, and the Freight Forwarder may, deliver the Property, in each instance as directed by the Company.

4.Notice From Security Agent To Follow Security Agent's Instructions: Upon the Freight Forwarder’s receipt of written notification from the Security Agent, the Freight Forwarder shall promptly cease complying with the instructions of the Company and shall thereafter follow solely the instructions of the Security Agent concerning the release, transfer, or other disposition of the Property and will not follow any instructions of the Company or any other person concerning the same.

5.Limited Authority:    The Freight Forwarder's sole authority as the agent of the Security Agent is to receive and maintain possession of the Property on behalf of the Security Agent and to follow the instructions of the Security Agent as provided herein. Except as may be specifically authorized and instructed by the Security Agent, the Freight Forwarder shall have no authority as the agent of the Security Agent to undertake any other action or to enter into any other commitments on behalf of the Security Agent.

6.Expenses:    Neither the Security Agent nor any other Secured Creditor shall be obligated to compensate the Freight Forwarder for serving as agent hereunder. The Freight Forwarder acknowledges that the Company is solely responsible for payment of any compensation and charges. The Security Agent and Secured Creditors are not responsible for paying any fees, expenses, or other charges which are, or may become, due from the Company to the Freight Forwarder or any other person or governmental authority on account of, or which are assessed against, the Property.

7.Notices:     All notices and other communications called for hereunder shall be effective if hand delivered or sent by facsimile or e-mail, and addressed to the applicable party hereto at such party’s address as follows (or to such other address, written notice of which is given by such party to the other parties hereto in writing with at least seven (7) days’ prior notice):

If to the Security Agent:

Exhibit H-1
Page 3

Deutsche Bank AG New York Branch

60 Wall Street, 2nd floor,

New York, NY 10005

Attention: Dusan Lazarov

Telephone: (212) 250-0211

Fax: (212) 797-5695

E-mail: dusan.lazarov@db.com.

If to the Company:

[____________]

Attention:

Telephone:

Fax:

E-mail:

If to the Freight Forwarder:

[____________]

Attention:

Telephone:

Fax:

8.Term; Amendment:

(a)In the event that the Freight Forwarder desires to terminate this Agreement, the Freight Forwarder shall furnish the Security Agent with sixty (60) days’ prior written notice of the Freight Forwarder's intention to do so. During such sixty (60) day period (which may be shortened by notice to the Freight Forwarder from the Security Agent), the Freight Forwarder shall continue to serve as agent hereunder. The Freight Forwarder shall also cooperate with the Security Agent and undertake all such actions as may be reasonably required by the Security Agent in connection with such termination. Any notice shall be in accordance with Section 7.     

(b)Except as provided in Section 8(a), above, this Agreement shall remain in full force and effect until the Freight Forwarder receives written notification from the Security Agent of the termination of the Freight Forwarder’s responsibilities hereunder. This Agreement may be amended only by notice in writing signed by the Company and an officer of the Security Agent and may be terminated solely by written notice signed by an officer of the Security Agent.

9.Freight Forwarder’s Lien: The Freight Forwarder hereby waives any lien, security interest, or right of retention (whether arising by contract, statute or otherwise) Freight Forwarder now has or hereafter may acquire on or in any Documents of Carriage and Property.

10.Counterparts; Integration: 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 constitutes the entire agreement between the Freight Forwarder and the Security Agent relating to the subject matter hereof. In the event of any conflict between this agreement and the terms of the Service Agreement, the terms of this agreement shall govern. This agreement shall become effective when it shall have been executed by the parties and when the Security 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

Exhibit H-1
Page 4

hereto and their respective successors and assigns. 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.

11.Severability:    If at any time any provision hereof is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, such invalidity shall not affect (a) the legality, validity or enforceability of the remaining provisions of this agreement, or (b) the legality, validity or enforceability of such provision under the law of any other jurisdiction.

12.Governing Law. This letter of agreement is governed by the law in force in New South Wales, Australia. Each party submits to the non-exclusive jurisdiction of the courts of that place. Each party waives any right it has to object to an action being brought in those courts, to claim that the action has been brought in an inconvenient forum, or to claim that those courts do not have jurisdiction.

13.Jury Trial Waiver: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 OR THE TRANSACTIONS CONTEMPLATED HEREBY.

[SIGNATURE PAGE FOLLOWS]

Exhibit H-1
Page 5

If the foregoing correctly sets forth our understanding, please indicate the Freight Forwarder’s assent below.

Very truly yours,

EXECUTED by [Qualified Obligor]in accordance with section 127(1) of the Corporations Act 2001 (Cwlth) by authority of its directors: Signature of director Name of director (block letters) ) ) ) ) ) ) ) ) ) ) ) ) Signature of director/company secretary* *delete whichever is not applicable Name of director/company secretary* (block letters) *delete whichever is not applicable

Exhibit H-1
Page 6

Agreed:

FREIGHT FORWARDER

[___________________________]

By:__________________________

Name: _______________________

Title: ________________________

Exhibit H-1
Page 7

SECURITY AGENT:

DEUTSCHE BANK AG NEW YORK BRANCH

By:______________________________

Name:    

Title:    

By: ______________________________

Name:    

Title:

Exhibit H-2
Page 1

Form of Tri-Party Agreement (UK)

Name and Address of Freight Forwarder:

[insert address]

Dear Sir/Madam:

Each of the companies listed in Exhibit A attached hereto (the “Companies”), among others, has entered into the Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, with among others, Deutsche Bank AG New York Branch, a branch of Deutsche Bank AG, a corporation duly incorporated and existing under the laws of the Federal Republic of Germany, with License issued by the Banking Department of the State of New York, United States of America, with offices at 60 Wall Street, 2^nd Floor, New York, New York 10005, as security agent (in such capacity, the “Security Agent”), for its own benefit and the benefit of certain other secured parties (the “Secured Creditors”) which are making loans or furnishing other financial accommodations to the Companies (as amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”) pursuant to the Facility Agreement and each of the Companies, among others, has granted to the Security Agent, for its own benefit and the benefit of the other Secured Creditors, a security interest in and to, among other things, substantially all of the assets of the Companies (the “Collateral”), including, without limitation, all of the Companies’ inventory, goods, documents, waybills, bills of lading and other documents of title.

Pursuant to that certain [insert service contract information], dated as of [______ __], [____] with [__________] (as amended and in effect), attached hereto as Exhibit B (the “Service Agreement”), provide certain freight warehouse, consolidation and other services to the Companies. [_______________] (together with any of their affiliates providing services to the Companies under the Service Agreement, collectively, the “Freight Forwarder”) agrees to act as agent and bailee for the Security Agent and each of the Companies for the limited purpose of more fully perfecting and protecting the interest of the Security Agent in goods and inventory of the Companies which may be in the possession or control of the Freight Forwarder from time to time, as well as any waybills, forwarder’s cargo receipts, bills of lading, documents, and any other documents of title or carriage constituting, evidencing, or relating to such good and Inventory (as defined in the Facility Agreement) (collectively, the “Documents of Carriage”) that may be issued in connection therewith and which may be in the possession or control of the Freight Forwarder from time to time. This letter shall set forth the terms of the Freight Forwarder’s engagement.

1.Acknowledgment of Security Interest; Power of Attorney: The Freight Forwarder acknowledges, consents, and agrees that each of the Companies has granted to the Security Agent, for its own benefit and the benefit of the other Secured Creditors, a security interest and first priority Lien (as defined in the Facility Agreement) on all of such Company’s right, title, and interest in, to and under all goods, Inventory, documents, Documents of Carriage and any contracts or agreements with carriers, customs brokers, and/or freight forwarders for shipment or delivery of such goods and inventory. The Freight Forwarder further agrees that: (i) it shall act as each of the Companies’ agent and bailee for the purpose of receiving any goods, inventory, Documents of Carriage or other property of the Companies (collectively, the “Property”); (ii) the Companies hold title to all Property while in the custody or control of the Freight Forwarder; (iii) upon receipt of any Property, the Freight Forwarder shall promptly notify the Company that is holding such Property on behalf of such Company; and (iv) the Freight Forwarder shall not deliver any Property to a third party for shipment and delivery unless any related Documents of Carriage reflect such Company as both “consignor/

Exhibit H-2
Page 2

shipper” and “consignee” and such third party is advised of the Security Agent’s first priority lien on the Property and rights with respect thereto.

2.Appointment of Freight Forwarder as Agent of Security Agent: The Freight Forwarder is hereby appointed as agent for the Security Agent to receive and retain possession of any Property, such receipt and retention of possession being for the purpose of more fully perfecting and preserving the Security Agent's security interests in the Property. The Freight Forwarder will maintain possession of the Property, subject to the security interest of the Security Agent, and will note the security interest of the Security Agent on the Freight Forwarder’s books and records. If the Freight Forwarder receives notice from any seller of any Property of its intent to stop delivery of such Property to the Companies, the Freight Forwarder shall promptly notify the Security Agent of same and, in all such cases, shall follow solely the instructions of the Security Agent concerning the release, transfer, or other disposition of the Property and will not follow any instructions of the Companies or any other person concerning the same.

3.Delivery of Title Documents; Release of Goods: Until the Freight Forwarder receives written notification from the Security Agent to the contrary, the Freight Forwarder is authorized by the Security Agent to, and the Freight Forwarder may, deliver the Property, in each instance as directed by each Company.

4.Notice From Security Agent To Follow Security Agent’s Instructions: Upon the Freight Forwarder’s receipt of written notification from the Security Agent, the Freight Forwarder shall promptly cease complying with the instructions of the Companies and shall thereafter follow solely the instructions of the Security Agent concerning the release, transfer, or other disposition of the Property and will not follow any instructions of the Companies or any other person concerning the same.

5.Limited Authority:    The Freight Forwarder's sole authority as the agent of the Security Agent is to receive and maintain possession of the Property on behalf of the Security Agent and to follow the instructions of the Security Agent as provided herein. Except as may be specifically authorized and instructed by the Security Agent, the Freight Forwarder shall have no authority as the agent of the Security Agent to undertake any other action or to enter into any other commitments on behalf of the Security Agent.

6.Expenses:    Neither the Security Agent nor any other Secured Creditor shall be obligated to compensate the Freight Forwarder for serving as agent hereunder. The Freight Forwarder acknowledges that the Companies are solely responsible for payment of any compensation and charges. The Security Agent and Secured Creditors are not responsible for paying any fees, expenses, or other charges which are, or may become, due from the Companies to the Freight Forwarder or any other person or governmental authority on account of, or which are assessed against, the Property.

7.Notices:     All notices and other communications called for hereunder shall be effective if hand delivered or sent by facsimile or e-mail, and addressed to the applicable party hereto at such party’s address as follows (or to such other address, written notice of which is given by such party to the other parties hereto in writing with at least seven (7) days’ prior notice):

Exhibit H-2
Page 3

If to the Security Agent:

Deutsche Bank AG New York Branch

60 Wall Street,

2^nd Floor,

New York, New York

10005-2888

Attention: Dusan Lazarov

Telephone No.: +1 (212) 250-0211

Telecopier No.: +1 (212) 797-5695

E-mail: dusan.lazarov@db.com

If to any of the Companies:

[____________]

Attention:

Fax:

E-mail:

If to the Freight Forwarder:

[____________]

Attention:

Fax:

E-mail:

8.Term; Amendment:

(a)In the event that the Freight Forwarder desires to terminate this Agreement, the Freight Forwarder shall furnish the Security Agent with sixty (60) days’ prior written notice of the Freight Forwarder's intention to do so. During such sixty (60) day period (which may be shortened by notice to the Freight Forwarder from the Security Agent), the Freight Forwarder shall continue to serve as agent hereunder. The Freight Forwarder shall also cooperate with the Security Agent and undertake all such actions as may be reasonably required by the Security Agent in connection with such termination. Any notice shall be in accordance with paragraph 7.     

(b)Except as provided in Section 8(a), above, this Agreement shall remain in full force and effect until the Freight Forwarder receives written notification from the Security Agent of the termination of the Freight Forwarder’s responsibilities hereunder. This Agreement may be amended only by notice in writing signed by the Companies and an officer of the Security Agent and may be terminated solely by written notice signed by an officer of the Security Agent.

9.Freight Forwarder’s Lien: The Freight Forwarder hereby waives any lien, security interest, or right of retention (whether arising by contract, statute or otherwise) Freight Forwarder now has or hereafter may acquire on or in any Documents of Carriage and Property.

10.Counterparts; Integration: 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 constitutes the entire agreement between the Freight Forwarder and the Security Agent relating to the subject matter hereof. In the event of any conflict between this agreement and the terms of the Service Agreement, the terms of this agreement shall govern. This agreement shall become effective when it shall have been executed by the parties and when the Security Agent shall have received counterparts hereof that, when taken

Exhibit H-2
Page 4

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 other electronic transmission shall be effective as delivery of a manually executed counterpart of this agreement. 

11.Severability:    If at any time any provision hereof is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, such invalidity shall not affect (a) the legality, validity or enforceability of the remaining provisions of this agreement, or (b) the legality, validity or enforceability of such provision under the law of any other jurisdiction.

12.Governing Law: THIS AGREEMENT AND ANY NON-CONTRACTUAL OBLIGATIONS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, ENGLISH LAW. EACH PARTY IRREVOCABLY AGREES THAT THE COURTS OF ENGLAND SHALL HAVE EXCLUSIVE JURISDICTION TO SETTLE ANY DISPUTES WHICH MAY ARISE OUT OF OR IN CONNECTION WITH THIS AGREEMENT (INCLUDING A DISPUTE REGARDING THE EXISTENCE, VALIDITY OR TERMINATION OF THIS AGREEMENT).

[SIGNATURE PAGE FOLLOWS]

Exhibit H-2
Page 5

If the foregoing correctly sets forth our understanding, please indicate the Freight Forwarder's assent below.

Very truly yours,

COMPANY:

[QUALIFIED OBLIGOR]

_________________________________

By: ______________________________

Name: ____________________________

Title: _____________________________

Agreed:

FREIGHT FORWARDER:

[___________________________]    

By:__________________________

Name: _______________________

Title: ________________________

SECURITY AGENT:

DEUTSCHE BANK AG NEW YORK BRANCH,

as Security Agent

By:______________________________

Name:    

Title:    

By: ______________________________

Name:    

Title:

Exhibit H-2
Page 6

EXHIBIT A

Exhibit H-2
Page 7

EXHIBIT B

[See attached.]

Exhibit H-2
Page 8

Exhibit I
Page 1

EXHIBIT I

FORM OF GUARANTOR JOINDER AGREEMENT

THIS JOINDER IN THE CREDIT AGREEMENT (this “Joinder”) is executed as of [DATE] by [NAME OF NEW GUARANTOR], a __________ [corporation] [limited liability company] [partnership] [other form of organization] (the “Joining Party”), and delivered to Deutsche Bank AG New York Branch, as Administrative Agent and as Security Agent, for the benefit of the Agents, the Lenders and the other Secured Creditors (each as defined in the Facility Agreement). Except as otherwise defined herein, terms used herein and defined in the Facility Agreement (as defined below) shall be used herein as therein defined.

W I T N E S S E T H:

WHEREAS, TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026) (the “Australian Borrower”), Toys “R” US GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrowers and German Borrower, collectively, the “Borrowers”), the other Obligors from time to time party thereto, the Lenders party thereto from time to time, Deutsche Bank AG New York Branch, as Administrative Agent and Security Agent, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents, Deutsche Bank AG, London Branch, as Facility Agent and the other Agents party thereto from time to time are party to a Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015 (as so amended and restated and as the same may be further amended, amended and restated, supplemented and/or otherwise modified from time to time, the “Facility Agreement”);

WHEREAS, the Obligors (other than the Joining Party) have entered into, or become party to, the Facility Agreement described above;

WHEREAS, the Joining Party is a direct or indirect Subsidiary of any Obligor, and desires, or is required pursuant to the provisions of the Facility Agreement, to become a Guarantor under the Facility Agreement; and

WHEREAS, the Joining Party has agreed to execute and deliver this Joinder in order to become a Guarantor under the Facility Agreement;

NOW, THEREFORE, in consideration of the foregoing and other benefits accruing to the Joining Party, the receipt and sufficiency of which are hereby acknowledged, the Joining Party hereby makes the following representations and warranties to the Administrative Agent for the benefit of the Secured Creditors and hereby covenants and agrees with the Administrative Agent for the benefit of the Secured Creditors as follows:

Exhibit I
Page 2

NOW, THEREFORE, IT IS AGREED:

1.Facility Agreement. By executing and delivering this Joinder, the Joining Party, as provided in Section 17.22 of the Facility Agreement, hereby becomes a party to the Facility Agreement as a Guarantor thereunder with the same force and effect as if originally named therein as a Guarantor and, without limiting the generality of the foregoing, hereby, jointly and severally with each other Guarantor, expressly undertakes to perform all the obligations expressed to be undertaken under the Facility Agreement by a Guarantor and agrees that it shall become party to the Security Documents listed on Annex I hereto within the time period specified in the Facility Agreement and agrees that it shall be bound by such Security Documents in all respects and expressly undertakes to perform all the obligations expressed to be undertaken under such Security Documents and all other actions as specified in the Collateral and Guaranty Requirements. The Joining Party hereby represents and warrants that each of the representations and warranties applicable to the Joining Party contained in Section 8 of the Facility Agreement is true and correct on and as the date hereof in all material respects (after giving effect to this Joinder) as if made on and as of such date (unless stated to relate to a specific earlier date, in which case, such representations and warranties shall be true and correct in all material respects as of such earlier date).

2.[Notwithstanding the foregoing, insert such provisions as are contemplated by the Agreed Security Principles.]

3.[Notwithstanding the foregoing, insert such actions as are required by the Collateral and Guaranty Requirements.]

4.This Joinder shall be binding upon the parties hereto and their respective successors and permitted assigns and shall inure to the benefit of and be enforceable by each of the parties hereto and its successors and permitted assigns, provided, however, the Joining Party may not assign any of its rights, obligations or interest hereunder or under any other Credit Document without the prior written consent of the Lenders or as otherwise permitted by the Credit Documents. THIS JOINDER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. This Joinder may be executed in any number of counterparts, each of which shall be an original, but all of which shall constitute one instrument. In the event that any provision of this Joinder shall prove to be invalid or unenforceable, such provision shall be deemed to be severable from the other provisions of this Joinder which shall remain binding on all parties hereto.

5.In the event of any conflict between the terms of this Joinder and those of the Facility Agreement, the terms of the Facility Agreement shall control. From and after the execution and delivery hereof by the parties hereto, this Joinder shall constitute a “Credit Document” for all purposes of the Facility Agreement and the other Credit Documents.

6.The effective date of this Joinder is [DATE].

* * *

Exhibit I
Page 3

IN WITNESS WHEREOF, the Joining Party has caused this Joinder to be duly executed as of the date first above written.

[NAME OF GUARANTOR]

By:
Name:

Title:

Address:

Fax No.:

Attention:

Exhibit I
Page 4

Accepted and Acknowledged by:

DEUTSCHE BANK AG NEW YORK BRANCH,

as Administrative Agent and as Security Agent

By:    

Name:

Title:

By:    

Name:

Title:

ANNEX I

to GUARANTOR JOINDER AGREEMENT

SECURITY DOCUMENTS

Exhibit I
Page 2

EXHIBIT J

FORM OF SOLVENCY CERTIFICATE

To the Administrative Agent and each of the Lenders
party to the Facility Agreement referred to below:

This Certificate is furnished to the Administrative Agent and the Lenders pursuant to Section 6.11 of the Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor” and together with the European Parent Guarantor and the Spanish Parent Guarantor, the “Parent Guarantors”), 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, and the other agents party thereto, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents (as further amended, restated, modified, and/or supplemented from time to time, the “Facility Agreement”). Unless otherwise defined herein, capitalized terms used in this Certificate shall have the meanings set forth in the Facility Agreement.

I, the undersigned, the Authorized Officer of each of the Parent Guarantors, in that capacity only and not in my individual capacity, do hereby certify as of the date hereof that:

1.    At fair valuation on a going concern basis, all of the properties and assets of the Obligors (on a consolidated basis) are greater than the sum of the debts, including contingent liabilities, of the Obligors (on a consolidated basis).

2.    The present fair saleable value of the properties and assets of the Obligors (on a consolidated basis) on a going concern basis is not less than the amount that would be required to pay the probable liability of the Obligors (on a consolidated basis) on their debts as they become absolute and matured.

3.    The Obligors (on a consolidated basis) are able to realize upon their properties and assets and generally pay their debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business.

4.    The Obligors (on a consolidated basis) do not intend to, and do not believe that they will, incur debts beyond their ability to generally pay as such debts mature.

5.    The Obligors (on a consolidated basis) are not engaged in a business or a transaction, and are not about to engage in a business or transaction, for which their properties and assets (on a consolidated basis) would constitute unreasonably small capital after giving due consideration to the prevailing practices in the industry in which the Obligors are engaged.

Exhibit J

Page 2

IN WITNESS WHEREOF, the undersigned has set his hand as of the date first written above.

EUROPEAN PARENT GUARANTOR:

TRU EUROPE LIMITED,

as European Parent Guarantor

By:_________________________________

Name:

Title:

SPANISH PARENT GUARANTOR:

TRU IBERIA HOLDINGS 1, S.L.U.,

as Spanish Parent Guarantor

By:_________________________________

Name:

Title:

AUSTRALIAN PARENT GUARANTOR:

TRU AUSTRALIA HOLDINGS, LLC,

as Australian Parent Guarantor

By:_________________________________

Name:

Title:

EXHIBIT K

FORM OF COMPLIANCE CERTIFICATE

[Date]

This Compliance Certificate is delivered to you pursuant to Section 9.01(f) of the Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015 (as further amended, restated, supplemented or modified from time to time, the “Facility Agreement”), among TRU Europe Limited (the “European Parent Guarantor” and the “Obligors’ Agent”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026), (the “Australian Borrower”), Toys “R” US GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrower and German Borrower, collectively, the “Borrowers”), the other Obligors party thereto from time to time, the Lenders party thereto from time to time, and Deutsche Bank AG New York Branch, as Administrative Agent and Security Agent, and the other Agents party thereto from time to time. Terms defined in the Facility Agreement and not otherwise defined herein are used herein as therein defined.

1.    I am the duly elected, qualified and acting chief financial officer of Obligors’ Agent.

2.    I have reviewed and am familiar with the contents of this Compliance Certificate. I am providing this Compliance Certificate solely in my capacity as an officer of Obligors’ Agent. The matters set forth herein are true to my knowledge after due inquiry.

3.    I have reviewed the terms of the Facility Agreement and the other Credit Documents and have made or caused to be made under my supervision a review in reasonable detail of the transactions and condition of the Obligors and their Subsidiaries during the accounting period covered by the financial statements attached hereto as ANNEX 1 (the “Financial Statements”). Such review did not disclose at the end of the accounting period covered by the Financial Statements, to my knowledge as of the date of this Compliance Certificate, that a Default or an Event of Default has occurred and is continuing [,except for __________].

4.    Attached hereto as ANNEX 2 are the reasonably detailed calculations showing compliance with respect to the Excess Availability for such period.

5.    Attached as ANNEX 3 hereto is a completed Perfection Certificate Supplement dated the date hereof.

Exhibit K
Page 2

IN WITNESS WHEREOF, I have executed this Compliance Certificate as of the first date written above.

TRU EUROPE LIMITED,

as Obligors’ Agent.

By:___________________________

Name:

Title:

ANNEX 1to Exhibit K

[Applicable Financial Statements To Be Attached]

ANNEX 2to Exhibit K

The information described herein is as of [_________, ____]¹ (the “Computation Date”) and, except as otherwise indicated below, pertains to the period from [the Second Restatement Effective Date] [_________, ____] to the Computation Date (the “Relevant Period”).

Excess Availability

__________________________

¹ Insert the last day of the respective month, fiscal quarter or year covered by the financial statements which are required to be accompanied by this Compliance Certificate.

ANNEX 3to Exhibit K

PERFECTION CERTIFICATE SUPPLEMENT

EXHIBIT L

FORM OF ASSIGNMENT
AND
ASSUMPTION AGREEMENT

This Assignment and Assumption Agreement (this “Assignment”), is dated as of the Effective Date set forth below and is entered into by and between the Assignor identified in item 1 below (the “Assignor”) and the Assignee identified in item 2 below (the “Assignee”). Capitalized terms used herein but not defined herein shall have the meanings given to them in the Syndicated Facility Agreement identified below (as amended, restated, supplemented and/or otherwise modified from time to time, the “Facility Agreement”). The Standard Terms and Conditions for Assignment and Assumption Agreement set forth in Annex 1 hereto (the “Standard Terms and Conditions”) are hereby agreed to and incorporated herein by reference and made a part of this Assignment as if set forth herein in full.

For an agreed consideration (which should not be less than the market value of the assigned property), the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Facility Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below, the interest in and to all of the Assignor’s rights and obligations under the Facility Agreement and any other documents or instruments delivered pursuant thereto that represents the amount and percentage interest identified below of all of the Assignor’s outstanding rights and obligations under the respective Tranches identified below (including, to the extent included in any such Tranches, Letters of Credit) (the “Assigned Interest”). ¹ Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment, without representation or warranty by the Assignor.

1.    Assignor:        

2.    Assignee:        

3. Facility Agreement:    Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC, (the “Australian Parent Guarantor”), the Borrowers and 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 New York Branch and Bank of America, N.A., as Co-Collateral Agents and Bank of America, N.A., as Syndication Agent.

_________________

¹  An assignment of rights will only be effective vis-à-vis third parties if the assignment is notified (signifié) to each French Obligor by a bailiff (huissier) in accordance with article 1690 of the French Code civil.

Exhibit L

Page 2

4. Assigned Interest:

Assignor	Assignee	Aggregate Amount of Commitment/Loans for all Lenders	Amount of Commitment/Loans Assigned
[Name of Assignor]	[Name of Assignee]	$______________	$______________

Effective Date ___________, ____, ____.

Assignor Information Assignee Information

Payment Instructions: _______________    Payment Instructions:    __________________

_______________                __________________

_______________                __________________

_______________                __________________

Reference:_______                Reference:_________

Notice Instructions: _______________    Notice Instructions:    __________________

_______________                __________________

_______________                __________________

_______________                __________________

Reference:______                Reference:_________

[5. The Assignee confirms that it holds a passport under the HMRC DT Treaty Passport scheme (reference number [INSERT SCHEME REFERENCE NUMBER]) and is tax resident in [INSERT JURISDICTION OF TAX RESIDENCE ], so that interest payable to it by borrowers is generally subject to full exemption from UK withholding tax, and requests that the Obligor’s Agent notify:

(a) each Borrower which is a party as a Borrower as at the Effective Date; and

Exhibit L

Page 3

(b) each Additional Borrower which becomes an Additional Borrower after the Effective Date, that it wishes that scheme to apply to the Agreement.]² 

The terms set forth in this Assignment are hereby agreed to:

ASSIGNOR                    ASSIGNEE

[NAME OF ASSIGNOR]            [NAME OF ASSIGNEE]

By:    By:    

    Name:            Name:    Title:            Title:

_________________

²  Include if Assignee holds a passport under the HMRCT DT Treaty Passport scheme and wishes that scheme to apply to the Agreement.

Exhibit L

Page 4

[Consented to and]³ Accepted:

[DEUTSCHE BANK AG NEW YORK BRANCH],

    as Administrative Agent

By:____________________________
Name:
Title:

By:____________________________
Name:
Title:

_________________

³  Insert only if assignment is being made to an Eligible Transferee pursuant to Section 13.04(b)(w) of the Credit Agreement. Consent of the Administrative Agent shall not be unreasonably withheld or delayed.

Exhibit L

Page 5

[Consented to and]⁴ Accepted:

[FRONTING LENDER]

By:____________________________
Name:
Title:

[Consented to and]⁵ Accepted:

[ISSUING LENDER]

By:____________________________
Name:
Title:

_________________

⁴  Insert only if assignment is being made to an Eligible Transferee pursuant to Section 13.04(b)(v) of the Credit Agreement. Consent of the Fronting Lender shall not be unreasonably withheld or delayed.

⁵  Insert only if assignment is being made to an Eligible Transferee pursuant to Section 13.04(b)(v) of the Credit Agreement. Consent of the Issuing Lender shall not be unreasonably withheld or delayed.

Exhibit L

Page 6

[Consented to and]⁶ Accepted:

TRU EUROPE LIMITED, as Obligors’ Agent

By:____________________________
Name:
Title:

_________________

⁶  Insert only if assignment is being made to an Eligible Transferee pursuant to Section 13.04(b)(v) of the Credit Agreement. Consent of the Fronting Lender shall not be unreasonably withheld or delayed.

ANNEX I

TO

EXHIBIT L

[NAME OF BORROWER]

SYNDICATED FACILITY AGREEMENT

STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT
AND ASSUMPTION AGREEMENT

1.    Representations and Warranties.

1.1.    Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of its Assigned Interest, (ii) its 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 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 any Credit Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Facility Agreement, any other Credit Document or any other instrument or document delivered pursuant thereto (other than this Assignment) or any collateral thereunder, (iii) the financial condition of any Obligor, any of its Subsidiaries or affiliates or any other Person obligated in respect of any Credit Document or (iv) the performance or observance by any Obligor, any of its Subsidiaries or affiliates or any other Person of any of their respective obligations under any Credit Document.

1.2.    Assignee. The 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 to consummate the transactions contemplated hereby and to become a Lender under the Facility Agreement, (ii) confirms that it is not, and will not be as a result of executing this Assignment, a Defaulting Lender and that it is (A) a Lender, (B) a parent company and/or an Affiliate (as defined in the Facility Agreement) of the Assignor, (C) a fund that invests in bank loans and is managed by the same investment advisor as a Lender, by an Affiliate of such investment advisor or by a Lender or (D) an Eligible Transferee under Section 13.04(b) of the Facility Agreement; (iii) from and after the Effective Date, it shall be bound by the provisions of the Facility Agreement and, to the extent of its Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Facility Agreement, together with copies of the most recent financial statements delivered pursuant to Section 9.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and to purchase its Assigned Interest on the basis of which it has made such analysis and decision and (v) if it is organized under the laws of a jurisdiction outside the United States, it has attached to this Assignment any tax documentation required to be delivered by it pursuant to the terms of the Facility Agreement, duly completed and executed by it; (b) agrees that it will, independently and without reliance upon the Administrative Agent, the 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 Facility Agreement; (c) appoints and authorizes each of the Administrative Agent, the Syndication Agent, the Security Agent and the Co-Collateral Agents to take such action as agent on its behalf and to exercise such powers under the Facility Agreement and the other Credit Documents as are delegated to or otherwise conferred upon the Administrative Agent, the Syndication Agent, the Security Agent or the Co‑Collateral Agents, as the case may be, by the terms thereof, together with such powers as are reasonably incidental thereto;

Annex I

to Exhibit L

Page 2

and (d) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Credit Documents are required to be performed by it as a Lender.

2.    Payment. From and after the Effective Date, the Administrative Agent shall make all payments in respect the Assigned Interest (including payments of principal, interest, fees, commissions and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

3.    Effect of Assignment. Upon the delivery of a fully executed original hereof to the Administrative Agent, as of the Effective Date, (i) the Assignee shall be a party to the Facility Agreement and, to the extent provided in this Assignment, have the rights and obligations of a Lender thereunder and under the other Credit Documents and (ii) the Assignor shall, to the extent provided in this Assignment, relinquish its rights and be released from its obligations under the Facility Agreement and the other Credit Documents.

4.    General Provisions. This Assignment shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment 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 by telecopy (or other electronic method) shall be effective as delivery of a manually executed counterpart of the Assignment. THIS ASSIGNMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

*    *    *

Annex I

to Exhibit L

Page 3

EXHIBIT M

FORM OF INTERCOMPANY NOTE

Notwithstanding anything contained herein to the contrary, neither the principal of nor the interest on the indebtedness created or evidenced by this instrument or record shall be paid except to the extent permitted under the Intercompany Subordination Agreement dated October 15, 2009, among the holders of this note and each entity identified as a Lender or Payee (or otherwise indicated as lending to another entity under any Original (as defined below)) (together with their registered assigns, each a “Payee”) and Deutsche Bank AG New York Branch, which Intercompany Subordination Agreement is incorporated herein with the same effect as if fully set forth herein.

MASTER INTERCOMPANY NOTE

FOR VALUE RECEIVED, each of the entities set forth on the signature pages hereto and each entity listed as a Borrower or a Payor (or otherwise indicated as borrowing from another entity) under any intercompany loan agreement, as amended, and corresponding note or under any other promissory note, in each case listed on Annex A to this Master Intercompany Note (collectively, the “Originals”) (together with their registered assigns, each a “Payor”), hereby severally, and not jointly, promises to pay to the order of the Payee, in lawful money of the United States of America (or such other currency as such loan and/or advance was made or as otherwise set forth in and with respect to the Originals) in immediately available funds, at such location as Payee shall from time to time designate, the unpaid principal amount of all loans and advances made by Payee to or on behalf of the applicable Payor (including all payments made by Payee under letters of credit issued from the account of Payee which support transactions entered into by any Payor) and such interest as the parties have determined and established on their respective books and records or as otherwise set forth in and with respect to the Originals. Notwithstanding anything to the contrary contained herein, this Master Intercompany Note (the “Note”) shall evidence (a) all loans and advances from each Payee to each Payor not evidenced by another note, instrument or writing and (b) each Original.

The principal balance of all loans and advances made by each Payee to each Payor, together with all accrued interest thereon, shall be due and payable in full on demand, unless otherwise agreed in writing by such Payor and Payee, as applicable, or, in the case of the Originals, as otherwise set forth in such Originals. Unless otherwise set forth to the contrary in the Originals (with respect to the Originals), each Payor may prepay all or any part of the principal or accrued interest at any time and from time to time, without premium or penalty. Unless otherwise set forth in the Originals (with respect to the Originals) all partial prepayments shall be applied first to accrued and unpaid interest and then to the unpaid principal amount of the loans.

Upon the commencement of any bankruptcy, reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar proceeding of any jurisdiction relating to any Payor, the unpaid principal amount hereof with respect to the applicable Payor shall become immediately due and payable without presentment, demand, protest or notice of any kind in connection with this Master Intercompany Note including, without limitation, any Original.

This Note is one of the Intercompany Notes referred to in the Syndicated Facility Agreement dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor” and together with the European Parent Guarantor and the Spanish Parent Guarantor, the “Parent Guarantors”), the other Obligors party thereto from time to time, the Lenders party thereto from time to time, Deutsche Bank AG New York Branch and Bank of America, N.A., and the other agents party thereto as Co-Collateral Agents, Deutsche Bank AG New York Branch, as Administrative Agent (as further amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”) and is subject to the terms thereof. The Payor hereby acknowledges and agrees that the Security Agent (as defined in the Facility Agreement) may, pursuant

to the Facility Agreement as in effect from time to time, exercise all rights provided therein with respect to this Note.

Each Payor and Payee agree that each existing note or instrument evidencing any loan or advance among them including any Original is hereby amended to add the following legend at the top of such note or instrument:

“Notwithstanding anything contained herein to the contrary, neither the principal of nor the interest on the indebtedness created or evidenced by this instrument or record shall be paid except to the extent permitted under the Intercompany Subordination Agreement dated October 15, 2009, among, among others, the holder of this note and Deutsche Bank AG New York Branch, which Intercompany Subordination Agreement is incorporated herein with the same effect as if fully set forth herein.”

Any Subsidiary (as defined in the Facility Agreement) of the Parent Guarantors that wishes to become, or is required pursuant to the terms of the Facility Agreement to become, a party to this Note after the date hereof shall become a Payor or Payee, as applicable, hereunder by executing a counterpart hereof or a joinder agreement (which joinder agreement is in form and substance satisfactory to the Administrative Agent) and delivering same to the Administrative Agent. Each party to this Note on the date hereof agrees that any such Subsidiary shall, at the time it becomes a Payor or Payee pursuant to the foregoing provisions, be treated as if it were an original party hereto.

All payments under this Note shall be made without offset, counterclaim or deduction of any kind.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.

[Signature Pages Follow]

This Master Intercompany Note is dated as of December [__], 2015.

[SIGNATURE BLOCKS FOR PAYORS AND PAYEES TO BE INSERTED]

[Signature Page to Master Intercompany Note]

Annex A

“ORIGINALS”

Americas 90973426 (2K)

INTERCOMPANY SUBORDINATION AGREEMENT

THIS INTERCOMPANY SUBORDINATION AGREEMENT (as amended, restated, modified and/or supplemented from time to time, this “Agreement”), dated as of October 15, 2009, made by each of the undersigned (each, a “Party” and, together with any entity that becomes a party to this Agreement pursuant to Section 9 hereof, the “Parties”) and Deutsche Bank AG New York Branch, as security agent (in such capacity, together with any successor security agent, the “Security Agent”), for the benefit of the Senior Creditors (as defined below). Unless otherwise defined herein, all capitalized terms used herein shall have the meanings ascribed to them in the Facility Agreement referred to below.

W I T N E S S E T H:

WHEREAS, Toys “R” Us Europe, LLC, (the “European Parent Guarantor”), TRU Australia Holdings, LLC, (the “Australian Parent Guarantor” and together with the European Parent Guarantor, the “Parent Guarantors”), the Borrowers and Guarantors 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, and the other agents party thereto, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents, have entered into a Syndicated Facility Agreement, dated as of October 15, 2009, providing for the making of Loans to the Borrowers and the issuance of, and participation in, Letters of Credit for the account of the Borrowers, all as contemplated therein (as used herein, the term “Facility Agreement” means the Syndicated Facility Agreement described above in this paragraph, as the same may be amended, restated, modified, supplemented, extended or renewed from time to time, and including any agreement extending the maturity of or restructuring (including, but not limited to, the inclusion of additional borrowers or guarantors thereunder or any increase in the amount borrowed) all or any portion of, the indebtedness under such agreement;

WHEREAS, the Obligors may at any time and from time to time enter into one or more Secured Hedging Agreements;

WHEREAS, the Obligors may at any time and from time to time enter into one or more Secured Cash Management Agreements;

WHEREAS, pursuant to the Guaranty, each Guarantor has jointly and severally guaranteed to the Secured Creditors the payment when due of all Secured Obligations;

WHEREAS, it is a condition precedent to the extensions of credit under the Facility Agreement that this Agreement be executed and delivered by the original Parties hereto;

WHEREAS, additional Parties may from time to time become parties hereto in order to allow for certain extensions of credit in accordance with the requirements of the Facility Agreement; and

WHEREAS, each of the Parties desires to execute this Agreement to satisfy the conditions described in the immediately preceding paragraphs.

NOW, THEREFORE, in consideration of the mutual promises contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the parties hereto, the Parties and the Security Agent (for the benefit of the Senior Creditors (as defined herein)) hereby agree as follows:

1.    The Subordinated Debt (as defined in Section 7 hereof) and all payments of principal, interest and all other amounts thereunder are hereby, and shall continue to be, subject and subordinate in right of payment to the prior payment in full, in cash, of all Senior Indebtedness to the extent, and in the manner, set forth herein. The foregoing shall apply notwithstanding the availability of collateral to the Senior Creditors or the holders of Subordinated Debt or the actual date and time of execution, delivery, recordation, filing or perfection of any security interests granted with respect to the Senior Indebtedness or the Subordinated Debt, or the lien or priority of payment thereof, and in any instance wherein the Senior Indebtedness or any claim for the Senior Indebtedness is subordinated, avoided or disallowed, in whole or in part, under the Bankruptcy Code or other applicable federal, foreign, state or local law.

2.    Each Party (as a lender of any Subordinated Debt) hereby agrees that until all Senior Indebtedness has been repaid in full in cash:

(a)    Such Party shall not, without the prior written consent of the Required Senior Creditors (as defined in Section 7 hereof), which consent may be withheld or conditioned in the Required Senior Creditors’ sole discretion, commence, or join or participate in, any Enforcement Action (as defined in Section 7 hereof).

(b)    In the event that (i) all or any portion of any Senior Indebtedness becomes due (whether at stated maturity, by acceleration or otherwise), (ii) any Event of Default under the Facility Agreement or any event of default under, and as defined in, any other Senior Indebtedness (or the documentation governing the same), then exists or would result from such payment on the Subordinated Debt (including, without limitation, pursuant to Section 10.08 of the Facility Agreement), (iii) such Party receives any payment or prepayment of principal, interest or any other amount, in whole or in part, of (or with respect to) the Subordinated Debt in violation of the terms of the Facility Agreement or any other Senior Indebtedness (or the documentation governing the same) or (iv) any distribution, division or application, partial or complete, voluntary or involuntary, by operation of law or otherwise, is made of all or any part of the property, assets or business of any Obligor or any Subsidiary of any Obligor or the proceeds thereof, in whatever form, to any creditor or creditors of any Obligor or any Subsidiary of any Obligor or to any holder of indebtedness of any Obligor or any Subsidiary of any Obligor or by reason of any liquidation, dissolution or other winding up of any Obligor, any Subsidiary of any Obligor or their respective businesses, or of any receivership or custodianship for any Obligor or any Subsidiary of any Obligor or of all or substantially all of their respective property, or of any insolvency or bankruptcy proceedings or assignment for the benefit of creditors or any proceeding by or

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against any Obligor or any Subsidiary of any Obligor for any relief under any bankruptcy, reorganization or insolvency law or laws, federal, foreign, state or local, or any law, federal, foreign, state or local relating to the relief of debtors, readjustment of indebtedness, reorganization, composition or extension, then, and in any such event, any payment or distribution of any kind or character, whether in cash, property or securities, which shall be payable or deliverable with respect to any or all of the Subordinated Debt or which has been received by any Party shall be held in trust by such Party for the benefit of the Senior Creditors and shall forthwith be paid or delivered directly to the Senior Creditors for application to the payment of the Senior Indebtedness (after giving effect to the relative priorities of such Senior Indebtedness) to the extent necessary to make payment in full in cash of all sums due under the Senior Indebtedness remaining unpaid after giving effect to any concurrent payment or distribution to the Senior Creditors. In any such event, the Senior Creditors may, but shall not be obligated to, demand, claim and collect any such payment or distribution that would, but for these subordination provisions, be payable or deliverable with respect to the Subordinated Debt. In the event of the occurrence of any event referred to in subclauses (i), (ii), (iii) or (iv) of the second preceding sentence of this clause (b) and until the Senior Indebtedness shall have been fully paid in cash and satisfied and all of the obligations of any Obligor or any Subsidiary of any Obligor to the Senior Creditors have been performed in full, no payment of any kind or character (whether in cash, property, securities or otherwise) shall be made to or accepted by any Party in respect of the Subordinated Debt. Notwithstanding anything to the contrary contained above, if one or more of the events referred to in subclauses (i) through (iv) of the first sentence of this clause (b) is in existence, the Required Senior Creditors may agree in writing that payments may be made with respect to the Subordinated Debt which would otherwise be prohibited pursuant to the provisions contained above, provided that any such waiver shall be specifically limited to the respective payment or payments which the Required Senior Creditors agree may be so paid to any Party in respect of the Subordinated Debt.

(c)    If such Party shall acquire by indemnification, subrogation or otherwise, any lien, estate, right or other interest in any of the assets or properties of any Obligor or any Subsidiary of any Obligor, that lien, estate, right or other interest shall be subordinate in right of payment to the Senior Indebtedness and the lien of the Senior Indebtedness as provided herein, and such Party hereby waives any and all rights it may acquire by subrogation or otherwise to any lien of the Senior Indebtedness or any portion thereof until such time as all Senior Indebtedness has been repaid in full in cash.

(d)    Such Party shall not pledge, assign, hypothecate, transfer, convey or sell any Subordinated Debt or any interest in any Subordinated Debt to any entity (other than under the relevant Security Documents (as hereinafter defined) or in accordance with the relevant requirements of the Facility Agreement to an Obligor which is a Party hereto) without the prior written consent of the Administrative Agent (with the prior written consent of the Required Senior Creditors).

(e)    After request by the Administrative Agent or the Required Senior Creditors, such Party shall within ten (10) days furnish the Senior Creditors with a statement, duly

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acknowledged and certified setting forth the original principal amount of the notes evidencing the indebtedness of the Subordinated Debt, the unpaid principal balance, all accrued interest but unpaid interest and any other sums due and owing thereunder, the rate of interest, the monthly payments and that, to the best knowledge of such Party, there exists no defaults under the Subordinated Debt, or if any such defaults exist, specifying the defaults and the nature thereof.

(f)    If, at any time, all or part of any payment with respect to Senior Indebtedness theretofore made (whether by any Obligor or any other Person or enforcement of any right of setoff or otherwise) is rescinded or must otherwise be returned by the holders of Senior Indebtedness for any reason whatsoever (including, without limitation, the insolvency, bankruptcy or reorganization of any Obligor or such other Persons), the subordination provisions set forth herein shall continue to be effective or be reinstated, as the case may be, all as though such payment had not been made.

(g)    Such Party shall not object to the entry of any order or orders approving any cash collateral stipulations, adequate protection stipulations or similar stipulations executed by the Senior Creditors in any Reorganization Proceeding or any other proceeding under the Bankruptcy Code.

(h)    Such Party waives any marshalling rights with respect to the Senior Creditors in any Reorganization Proceeding or any other proceeding under the Bankruptcy Code.

3.    Each Party hereby represents, warrants and covenants as follows:

(a)    each Party will deliver a schedule setting forth all Intercompany Debt to the Administrative Agent within 10 days after any reasonable request by the Administrative Agent or the Required Senior Creditors (although any failure to deliver such a supplement shall have no effect whatsoever on the subordination provisions contained herein, which shall apply to all Subordinated Debt whether or not listed on said schedule); and

(b)    each Party will not lend, hold or permit to exist any Intercompany Debt owed by it or to it (in accordance with the definition thereof contained herein) except as permitted under the Facility Agreement or unless each obligee or obligor, as the case may be, with respect to such Intercompany Debt is (or concurrently with such extension becomes) a Party to this Agreement.

4.    Any payments made to, or received by, any Party in respect of any guaranty or security in support of the Subordinated Debt shall be subject to the terms of this Agreement and applied on the same basis as payments made directly by the obligor under such Subordinated Debt. To the extent that any Obligor or any Subsidiary of any Obligor (other than the respective obligor or obligors which are already Parties hereto) provides a guaranty or any security in support of any Subordinated Debt, the Party which is the lender of the respective Subordinated Debt will cause each such Person to become a Party hereto (if such Person is not already a Party hereto) not later than the date of the execution and delivery of the respective guarantee or security documentation, provided that any failure to comply with the foregoing requirements of this Section 4 will have no

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effect whatsoever on the subordination provisions contained herein (which shall apply to all payments received with respect to any guarantee or security for any Subordinated Debt, whether or not the Person furnishings such guarantee or security is a Party hereto).

5.    Each Party hereby acknowledges and agrees that no payments will be accepted by it in respect of the Subordinated Debt (unless promptly turned over to the holders of Senior Indebtedness as contemplated by Section 2 above) to the extent such payments would be prohibited under any Senior Indebtedness (or the documentation governing the same).

6.    In addition to the foregoing agreements, each Party hereby acknowledges and agrees that, with respect to all Intercompany Debt (whether or not same constitutes Subordinated Debt), that (x) such Intercompany Debt (and any promissory notes or other instruments evidencing same) may be pledged, and delivered for pledge, by any Obligor or any Subsidiary of any Obligor pursuant to any Security Document (as used herein, the term “Security Documents” shall have the meaning provided in the Facility Agreement and shall include any security documentation executed and delivered in connection with any replacement or refinancing the Facility Agreement) to which such Obligor or the respective such Subsidiary is, or at any time in the future becomes, a party and (y) with respect to all Intercompany Debt so pledged, the Co-Collateral Agents shall be entitled to exercise all rights and remedies with respect to such Intercompany Debt to the maximum extent provided in the various Security Documents (in accordance with the terms thereof and subject to the requirements of applicable law). Furthermore, with respect to all Intercompany Debt at any time owed to any Obligor, and notwithstanding anything to the contrary contained in the terms of such Intercompany Debt, each obligor (including any guarantor) and obligee with respect to such Intercompany Debt hereby agrees, for the benefit of the holders from time to time of the Senior Indebtedness, that the Administrative Agent or the Security Agent may at any time, and from time to time, acting on its own or at the request of the Required Senior Creditors, accelerate the maturity of such Intercompany Debt if (x) any obligor (including any guarantor) of such Intercompany Debt is subject to any Bankruptcy Proceeding or (y) any Enforcement Event shall have occurred. Any such acceleration of the maturity of any Intercompany Debt shall be made by written notice by the Administrative Agent or Co-Collateral Agents to the obligor on the respective Intercompany Debt; provided that no such notice shall be required (and the acceleration shall automatically occur) either upon the occurrence of a Bankruptcy Proceeding with respect to the respective obligor (or any guarantor) of the respective Intercompany Debt or upon (or following) any acceleration of the maturity of any Loans pursuant to the Facility Agreement.

7.    Definitions. As and in this Agreement, the terms set forth below shall have the respective meanings provided below:

“Credit Document Obligations Termination Date” shall mean the first date after the Effective Date upon which all Commitments and Letters of Credit under the Facility Agreement have terminated and all Credit Document Obligations have been paid in full in cash.

“Enforcement Action” shall mean any acceleration of all or any part of the Subordinated Debt, any foreclosure proceeding, the exercise of any power of sale, the obtaining of a receiver, the seeking of default interest, the suing on, or otherwise taking

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action to enforce the obligation of any Obligor or any Subsidiary of any Obligor to pay any amounts relating to any Subordinated Debt, the exercising of any banker’s lien or rights of set-off or recoupment, the institution of a Bankruptcy Proceeding against any Obligor or any Subsidiary of any Obligor, or the taking of any other enforcement action against any asset or Property of any Obligor or its Subsidiaries.

“Enforcement Event” shall have the meaning assigned to such term in the Facility Agreement.

“Intercompany Debt” shall have the meaning assigned to such term in the Facility Agreement.

“Obligation” shall mean any principal, interest, premium, penalties, fees, indemnities and other liabilities and obligations payable under the documentation governing any indebtedness (including, without limitation, all interest accruing after the commencement of any bankruptcy, insolvency, receivership or similar proceeding at the rate provided in the governing documentation, whether or not such interest is an allowed claim in such proceeding).

“Required Senior Creditors” shall mean (i) the Required Lenders (or, to the extent required by Section 13.12 of the Facility Agreement, each of the Lenders) at all times prior to the Credit Document Obligations Termination Date, and (ii) the holders of at least a majority of the outstanding Senior Indebtedness at all times after the Credit Document Obligations Termination Date.

“Senior Creditors” shall mean all holders from time to time of any Senior Indebtedness and shall include, without limitation, the Lender Creditors, the Hedging Creditors and the Cash Management Creditors.

“Senior Indebtedness” shall mean the “Secured Obligations” under and as defined in the Facility Agreement.

“Subordinated Debt” shall mean the principal of, interest on, and all other amounts owing from time to time in respect of, all Intercompany Debt (including, without limitation, pursuant to guarantees thereof or security therefor and intercompany payables not evidenced by a note) at any time outstanding; provided that the term “Subordinated Debt” shall not include any Intercompany Debt which is owed by any Person that is not an Obligor to any other Person.

8.    Each Party agrees to be fully bound by all terms and provisions contained in this Agreement, both with respect to any Subordinated Debt (including any guarantees thereof and security therefor) owed to it, and with respect to all Subordinated Debt (including all guarantees thereof and security therefor) owing by it.

9.    It is understood and agreed that any Subsidiary of any Obligor that is required to execute a counterpart of this Agreement after the date hereof pursuant to the requirements of the

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Facility Agreement or any other Senior Indebtedness shall become a Party hereunder by executing a counterpart hereof (or a joinder agreement in form and substance satisfactory to the Administrative Agent) and delivering same to the Security Agent.

10.    No failure or delay on the part of any party hereto or any holder of Senior Indebtedness in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy hereunder.

11.    Each Party hereto acknowledges that to the extent that no adequate remedy at law exists for breach of its obligations under this Agreement, in the event any Party fails to comply with its obligations hereunder, the Security Agent, the Administrative Agent or the holders of Senior Indebtedness shall have the right to obtain specific performance of the obligations of such defaulting Party, injunctive relief or such other equitable relief as may be available.

12.    Any notice to be given under this Agreement shall be in writing and shall be sent in accordance with the provisions of the Facility Agreement.

13.    In the event of any conflict between the provisions of this Agreement and the provisions of the Subordinated Debt, the provisions of this Agreement shall prevail. In the event of any conflict between the provisions of this Agreement and the provisions of the Facility Agreement, the provisions of the Facility Agreement shall prevail.

14.    No person other than the parties hereto, the Senior Creditors from time to time and their successors and assigns as holders of the Senior Indebtedness and the Subordinated Debt shall have any rights under this Agreement.

15.    This Agreement may be executed in any number of counterparts each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

16.    No amendment, supplement, modification, waiver or termination of this Agreement shall be effective against a party against whom the enforcement of such amendment, supplement, modification, waiver or termination would be asserted, unless such amendment, supplement, modification, waiver or termination was made in a writing signed by such party, provided that amendments hereto shall be effective as against the Senior Creditors only if executed and delivered by the Security Agent (with the written consent of the Required Senior Creditors at such time).

17.    In case any one or more of the provisions confined in this Agreement, or any application thereof, shall be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein, and any other application thereof, shall not in any way be affected or impaired thereby.

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18.    (a) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

(b)    Any legal action or proceeding with respect to this Agreement or any other Credit Document to which any Party is a party may be brought in the courts of the State of New York or of the United States of America for the Southern District of New York in each case which are located in the County of New York, and, by execution and delivery of this Agreement, each Party hereby irrevocably accepts for itself and in respect of its property, generally and unconditionally, the exclusive jurisdiction of the aforesaid courts. Each Party hereby further irrevocably waives any claim that any such court lacks personal jurisdiction over such Party, and agrees not to plead or claim in any legal action or proceeding with respect to this Agreement or any other Credit Document to which such Party is a party brought in any of the aforesaid courts that any such court lacks personal jurisdiction over such Party. Each Party further irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such Party at its address set forth opposite is signature below, such service to become effective 30 days after such mailing. Each Party hereby irrevocably waives any objection to such service of process and further irrevocably waives and agrees not to plead or claim in any action or proceeding commenced hereunder or under any other Credit Document to which such Party is a party that such service of process was in any way invalid or ineffective. Nothing herein shall affect the right of any of the Senior Creditors to serve process in any other manner permitted by law or to commence legal proceedings or otherwise proceed against each Party in any other jurisdiction.

(c)    EACH PARTY HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT TO WHICH IT IS A PARTY BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (b) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

(d)    EACH PARTY HEREBY IRREVOCABLY WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER CREDIT DOCUMENT TO WHICH IT IS A PARTY OR THE TRANSACTIONS CONTEMPLATED HEREBY.

19.    This Agreement shall bind and inure to the benefit of the Administrative Agent, the other Senior Creditors and each Party and their respective successors, permitted transferees and assigns.

* * *

- 8 -

IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Agreement as of the date first above written.

TOYS “R” US HOLDINGS (UK) LIMITED

By:_________________________________

Name:

Title:

TOYS “R” US (UK) LIMITED

By:_________________________________

Name:

Title:

TOYS “R” US HOLDINGS LIMITED

By:_________________________________

Name:

Title:

TOYS “R” US PROPERTIES LIMITED

By:_________________________________

Name:

Title:

TOYS “R” US LIMITED

By:_________________________________

Name:

Title:

TOYS “R” US FINANCIAL SERVICES LIMITED

By:_________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

EXECUTED by TOYS “R” US (AUSTRALIA) PTY LTD in accordance with Section 127(1) of the Corporations Act 2001 (Cwlth) by authority of its directors:
_____________________	_____________________
Signature of director	Signature of director/    company secretary
_____________________	_____________________
Name of director	Name of director/    company secretary
EXECUTED by BABIES “R” US (AUSTRALIA) PTY LTD in accordance with Section 127(1) of the Corporations Act 2001 (Cwlth) by authority of its directors:
_____________________	_____________________
Signature of director	Signature of director/    company secretary
_____________________	_____________________
Name of director	Name of director/    company secretary

Signature page to Toys Intercompany Subordination Agreement

TOYS “R” US GMBH

By:_________________________________

Name:

Title:

TOYS “R” US OPERATIONS GMBH

By:_________________________________

Name:

Title:

TOYS “R” US LOGISTIK GMBH

By:_________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

TOYS “R” US SARL

By:_________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

TOYS “R” US IBERIA, S.A.

By:_________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

TOYS “R” US EUROPE, LLC

By:_________________________________

Name:

Title:

TRU AUSTRALIA HOLDINGS, LLC

By:_________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

TOYS “R” US HANDELSGESELLSCHAFT M.B.H.

By:_________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

TOYS “R” US AG

By:_________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

TOYS “R” US PORTUGAL, LIMITADA

By:_________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

DEUTSCHE BANK AG NEW YORK BRANCH, as Security Agent

By:____________________________________

Name:

Title:

By:____________________________________

Name:

Title:

Signature page to Toys Intercompany Subordination Agreement

Signature page to Toys Intercompany Subordination Agreement

NEWYORK 7328916 (2K)

EXHIBIT O

[______ __], [____]

TRU Europe Limited

Geoffrey House, Maidenhead Office Park, Westacott Way,

Maidenhead, Berkshire SL6 3QH

Fax: 44-1-628-414-093

Attention: Frank Muzika

With a copy to:

One Geoffrey Way

Wayne, New Jersey 07470

Fax: (973) 617-4043

Attention: David J. Schwartz

RE: Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015,among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), the Borrowers and 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 (as further amended, restated, modified and/or supplemented from time to time, the “Syndicated Facility Agreement”). Terms defined in the Syndicated Facility Agreement and not otherwise defined herein are used herein as therein defined.

To whom it may concern:

Pursuant to Section 13.08 of the Syndicated Facility Agreement, TRU Europe Limited (the “Obligors’ Agent”) has irrevocably designated, appointed and empowered the undersigned, CT Corporation System, presently located at 111 Eighth Avenue, New York, New York, 10011, as its authorized designee, appointee and agent to receive, accept and acknowledge receipt thereof and forward for and on its behalf, and in respect of its property, service of any and all legal process, summons, notices and documents which may be served in any such action or proceeding brought in the courts of the State of New York or of the United States of America for the Southern District of New York, in each case located in the city of New York, with respect to the Syndicated Facility Agreement and each Credit Document to which it is a party.

CT Corporation System hereby irrevocably accepts its appointment as agent for service of process for the Obligors, including the following entities listed below as set forth in Section 13.08 of the Syndicated Facilities Agreement through the termination of the Syndicated Facilities Agreement on or before the Maturity Date:

[List Obligors]

We understand that any process shall be forwarded to:

TRU Europe Limited

Exhibit O
Page 2

Geoffrey House, Maidenhead Office Park, Westacott Way,

Maidenhead, Berkshire SL6 3QH

Fax: 44-1-628-414-093

Attention: Frank Muzika

With a copy to:

One Geoffrey Way

Wayne, New Jersey 07470

Fax: (973) 617-4043

Attention: David J. Schwartz

CT Corporation System must be notified immediately of any change to this address. CT Corporation System agrees with you that the undersigned (i) shall inform the Obligors’ Agent promptly in writing at the address listed above (the “Notice Address”) of any change of its address in New York City and the Obligors’ Agent shall promptly inform the Administrative Agent in writing of any such change in address, (ii) shall perform its obligations as such process agent in accordance with the provisions of Section 13.08 of the Syndicated Facility Agreement and (iii) shall forward promptly to the Obligors’ Agent at its Notice Address any legal process, summons, notices and documents received by the undersigned in its capacity as process agent.

As process agent, the undersigned, and its successor or successors, agrees to discharge the above-mentioned obligations and will not refuse fulfillment of such obligations under Section 13.08 of the Syndicated Facility Agreement.

CT Corporation System has accepted this appointment on an irrevocable basis for the first year of the Agreement. Our continued representation after one year from the date hereof is contingent upon our receipt of timely payment.

Best regards,

[______]

EXHIBIT P

BORROWING BASE CERTIFICATE

OFFICER’S CERTIFICATE

This Certificate is being delivered pursuant to Section 9.01(j) of the Syndicated Facility Agreement, dated as of October 15,2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Holdings Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026) (the “Australian Borrower”), Toys “R” US GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrower and German Borrower, collectively, the “Borrowers”), 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 New York Branch and Bank of America, N.A., as Co-Collateral Agents (as further amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”). Unless otherwise defined herein, all terms used herein shall have the meanings ascribed to them in the Facility Agreement.

The undersigned, not in his/her individual capacity, but solely as the Chief Financial Officer of the European Parent Guarantor, represents and warrants on behalf of the European Parent Guarantor, as the Obligors’ Agent that [(x)] the information set forth on the attached Borrowing Base Certificate, (i) is true, correct and complete in all material respects, (ii) is calculated in accordance with the Facility Agreement and (iii) sets forth the Borrowing Base as of the close of business on [__________ ___, _______] [and (y) on Second Restatement Effective Date, after giving effect to the Transaction (and the Credit Events under the Facility Agreement), Excess Availability¹ shall equal to or exceed [__________]]².

IN WITNESS WHEREOF, the undersigned has executed this Certificate as of this [___] day of [__________ _______].

TRU EUROPE LIMITED,
as the Obligors’ Agent

By:
Name:    
Title:    Chief Financial Officer

_________________________

¹ Information attached should demonstrate in reasonable detail such Excess Availability.

² To be included in the Borrowing Base Certificate delivered to the Administrative Agent on the Second Restatement Effective Date pursuant to Section 6.12.

Exhibit P

Page 2

BORROWING BASE CERTIFICATE FOR THE PERIOD ENDING [DATE]ISSUED BY TRU EUROPE LIMITED

BORROWING BASE:

[Attach calculations demonstrating Excess Availability in reasonable detail]

EXHIBIT Q

FORM OF INCREMENTAL COMMITMENT AGREEMENT

[Name(s) of Lender(s)]

[Date]

TRU Europe Limited

Geoffrey House, Maidenhead Office Park, Westacott Way,

Maidenhead, Berkshire SL6 3QH

Attention: Frank Muzika

Phone: 44-1-628-414-617

Fax: 44-1-628-414-093

With a copy to:

One Geoffrey Way

Wayne, NJ 07470

Attention: Chief Financial Officer/ General Counsel

Phone: (973) 617-5820

Fax: (973) 617-4006

Deutsche Bank AG New York Branch

60 Wall Street

New York, New York 10005

Attention: Dusan Lazarov

Phone: +1 (212) 250-0211

Fax: +1 (212) 797-5695

Re: Incremental Commitments

Ladies and Gentlemen:

Reference is hereby made to the Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026), the “Australian Borrower”), Toys “R” Us GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrower and German Borrower, collectively, the “Borrowers”), 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

Exhibit Q

Page 2

Agent and Security Agent, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents and the other Agents party thereto from time to time (as further amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”). Unless otherwise defined herein, capitalized terms used herein shall have the respective meanings set forth in the Facility Agreement. Each Incremental Lender party to this letter agreement (this “Agreement”) hereby severally agrees to provide the Incremental Commitment set forth opposite its name on Annex I attached hereto (for each such Incremental Lender, its “Incremental Commitment”). Each Incremental Commitment provided pursuant to this Agreement shall be subject to all of the terms and conditions set forth in the Facility Agreement, including, without limitation, Sections 2.01 and 2.14 thereof.

Each Incremental Lender, the Borrowers, the Guarantors and the Administrative Agent acknowledge and agree that the Incremental Commitments provided pursuant to this Agreement shall constitute Incremental Commitments on the Agreement Effective Date (as defined below) and shall constitute, or in the case of an existing Lender, shall be added to (and thereafter become a part of), the Total Commitment of such Incremental Lender for all purposes of the Facility Agreement and the other applicable Credit Documents. Each Incremental Lender, each Guarantor, the Borrowers and the Administrative Agent further agree that, with respect to the Incremental Commitment provided by each Incremental Lender pursuant to this Agreement, such Incremental Lender shall receive from the Borrowers such upfront fees and/or other fees, if any, as may be separately agreed to in writing with the Borrowers, the Administrative Agent and Incremental Lender, all of which fees shall be due and payable to such Incremental Lender on the terms and conditions set forth in each such separate agreement.

Furthermore, each of the parties to this Agreement hereby agrees to the terms and conditions set forth on Annex I hereto in respect of each Incremental Commitment provided pursuant to this Agreement.

Each Incremental Lender party to this Agreement, to the extent not already a party to the Facility Agreement as a Lender thereunder, (i) confirms that it is an Eligible Transferee, (ii) confirms that it has received a copy of the Facility Agreement and the other Credit Documents, together with copies of the financial statements referred to therein and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Agreement and to become a Lender under the Facility Agreement, (iii) agrees that it will, independently and without reliance upon the Administrative Agent 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 Facility Agreement and the other Credit Documents, (iv) appoints and authorizes the Administrative Agent, the Security Agent and the Co-Collateral Agents to take such action as agent or trustee (with respect to the Trustee Security Documents), as the case may be, on its behalf and to exercise such powers under the Facility Agreement and the other Credit Documents as are delegated to the Administrative Agent, the Security Agent and the Co-Collateral Agents, as the case may be, by the terms thereof, together with such powers as are reasonably incidental thereto, (v) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Facility Agreement and the other Credit Documents are required to be performed by it as a Lender, and (vi) in the case of any

Exhibit Q

Page 3

Incremental Lender organized under the laws of a jurisdiction outside the United States, attaches the appropriate forms referred to in Section 5.04 of the Facility Agreement, to the extent required to be delivered by it on the date hereof.

Upon the date of (i) the execution of a counterpart of this Agreement by each Incremental Lender, the Administrative Agent, each Borrower and each Guarantor, (ii) the delivery to the Administrative Agent of a fully executed counterpart (including by way of facsimile or other electronic transmission) hereof, (iii) the payment of any fees then due and payable in connection herewith and (iv) the satisfaction of all Incremental Commitment Requirements, all conditions set forth in Section 2.14 and any other conditions precedent set forth in Section 4 of Annex I hereto (such date, the “Agreement Effective Date”), each Incremental Lender party hereto (i) shall be obligated to make the Loans provided to be made by it as provided in this Agreement on the terms, and subject to the conditions, set forth in the Facility Agreement and in this Agreement and (ii) to the extent provided in this Agreement, shall have the rights and obligations of a Lender thereunder and under the other applicable Credit Documents.

The Obligors acknowledge and agree that (i) they shall be jointly and severally liable for all Secured Obligations with respect to the Incremental Commitments provided hereby as, and to the extent, provided in the Facility Agreement including, without limitation, all Loans made pursuant thereto, (ii) all Secured Obligations, including but not limited to the Secured Obligations with respect to the Incremental Commitments provided hereby, shall be entitled to the benefits of the Security Documents and the Guaranty, as, and to the extent, provided therein and in the Facility Agreement and (iii) the Liens created pursuant to the Security Documents secure all of the Secured Obligations, including but not limited to the Secured Obligations with respect to the Incremental Commitments provided hereby, on an equal and ratable basis.

Each Guarantor acknowledges and agrees that all Secured Obligations with respect to the Incremental Commitments provided hereby and all Loans made pursuant thereto shall (i) be fully guaranteed pursuant to the Guaranty as, and to the extent, provided therein and in the Facility Agreement and (ii) be entitled to the benefits of the Credit Documents as, and to the extent, provided therein and in the Facility Agreement.

Attached hereto as Annex II is the officers’ certificate required to be delivered pursuant to clause (vii) of the definition of “Incremental Commitment Requirements” certifying that the conditions set forth in clauses (i), (ii) and (vi) of the definition of “Incremental Commitment Requirements” have been satisfied (together with calculations demonstrating same (where applicable) in reasonable detail).

Attached hereto as Annex III [is an opinion] [are opinions] of [insert name or names of counsel, who will be delivering opinions], counsel to the respective Obligors, delivered as required pursuant to clause (iv) of the definition of “Incremental Commitment Requirements” appearing in Section 1 of the Facility Agreement.

Attached hereto as Annex IV are true and correct copies of officers’ certificates, board of director (or equivalent) resolutions and evidence of good standing of the Obligors required

Exhibit Q

Page 4

to be delivered pursuant to clause (v) of the definition of “Incremental Commitment Requirements” appearing in Section 1 of the Facility Agreement.

You may accept this Agreement by signing the enclosed copies in the space provided below, and returning one copy of same to us before the close of business on ____________ ___, _____. If you do not so accept this Agreement by such time, our Incremental Commitments set forth in this Agreement shall be deemed canceled.

In accordance with the Facility Agreement, this Agreement is designated as a Credit Document.

After the execution and delivery to the Administrative Agent of a fully executed copy of this Agreement (including by way of counterparts and by facsimile or other electronic transmission) by the parties hereto, this Agreement may only be changed, modified or varied by written instrument in accordance with the requirements for the modification of Credit Documents pursuant to Section 13.12 of the Facility Agreement.

In the event of any conflict between the terms of this Agreement and those of the Facility Agreement, the terms of the Facility Agreement shall control.

* * *

Exhibit Q

Page 5

THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.

Very truly yours,

[NAME OF EACH INCREMENTAL LENDER]

By__________________________

                 Name:

Title

Agreed and Accepted

this [___] day of [__________, ____]:

UK BORROWERS:

TOYS “R” US (UK) LIMITED,

as a UK Borrower

By:_________________________________

Name:

Title:

TOYS “R” US LIMITED,

as a UK Borrower

By:_________________________________

Name:

Title:

Exhibit Q

Page 6

AUSTRALIAN BORROWER:

TOYS “R” US (AUSTRALIA) PTY LTD,

as the Australian Borrower

By:_________________________________

Name:

Title: Authorized Signatory

GERMAN BORROWER:

TOYS “R” US GMBH,

as the German Borrower

By:_________________________________

Name:

Title:

Exhibit Q

Page 7

SPANISH BORROWER:

TOYS “R” US IBERIA, S.A.U.,

as the Spanish Borrower

By:_________________________________

Name:

Title:

DEUTSCHE BANK AG NEW YORK BRANCH,
as Administrative Agent

By:_____________________________

Name:

Title:

By:_____________________________

Name:

Title:

Exhibit Q

Page 8

Each Guarantor acknowledges and agrees to each the foregoing provisions of this Incremental Commitment Agreement and to the incurrence of the Loans to be made pursuant thereto.

EUROPEAN PARENT GUARANTOR:

TRU EUROPE LIMITED,

as the European Parent Guarantor

By:_________________________________

Name:

Title:

SPANISH PARENT GUARANTOR:

TRU IBERIA HOLDINGS 1, S.L.U.,

as the Spanish Parent Guarantor

By:_________________________________

Name:

Title:

AUSTRALIAN PARENT GUARANTOR:

TRU AUSTRALIA HOLDINGS, LLC,

as the Australian Parent Guarantor

By:_________________________________

Name:

Title:

UK GUARANTORS:

TRU (UK) H7 LIMITED,

as a Guarantor

By:_________________________________

Name:

Title:

Exhibit Q

Page 9

TRU (UK) H8 LIMITED,

as a Guarantor

By:_________________________________

Name:

Title:

TOYS “R” US HOLDINGS LIMITED,

as a Guarantor

By:_________________________________

Name:

Title:

TOYS “R” US PROPERTIES LIMITED,

as a Guarantor

By:_________________________________

Name:

Title:

TOYS “R” US FINANCIAL SERVICES LIMITED,

as a Guarantor

By:_________________________________

Name:

Title:

TRU (UK) H4 LIMITED,

as a Guarantor

By:_________________________________

Name:

Title:

TRU (FRANCE) FINANCE LTD.,

as a Guarantor

Exhibit Q

Page 10

By:_________________________________

Name:

Title:

TRU (FRANCE) HOLDINGS LTD.,

as a Guarantor

By:_________________________________

Name:

Title:

Exhibit Q

Page 11

AUSTRALIAN GUARANTOR:

BABIES “R” US (AUSTRALIA) PTY LTD,

as a Guarantor

By:_________________________________

Name:

Title: Authorized Signatory

Exhibit Q

Page 12

BVI GUARANTOR:

TRU (BVI) FINANCE II, LTD.,

as a Guarantor

By:_________________________________

Name:

Title:

SPANISH GUARANTOR:

TRU IBERIA HOLDINGS 2, S.L.U.,

as a Guarantor

By:_________________________________

Name:

Title:

U.S. GUARANTOR:

TRU (UK) H6, LLC,

as a Guarantor

By:_________________________________

Name:

Title:

EXHIBIT Q

TERMS AND CONDITIONS FOR INCREMENTAL COMMITMENT AGREEMENT

Dated as of _____________, ____

1.    Names of the Borrowers:    

2. Incremental Commitment amounts (as of the Agreement Effective Date):

Names of Incremental Lenders	Amount of Incremental Commitment
Total:1

3. Applicable Margins and Adjustable Applicable Margins to be applicable to all Revolving Loans:² 

4. [Issue Price:]

5. Agreement Effective Date:

6. Other Conditions Precedent:³ 

__________________________

¹  The aggregate amount of Incremental Commitments must be at least £5,000,000 (or such lesser amount that is acceptable to the Administrative Agent). The Total Commitments shall not exceed in the aggregate £200,000,000.

²  Insert the Applicable Margins and Adjustable Applicable Margins that shall apply to the Loans to be made pursuant to the Incremental Commitments being provided hereunder, such Incremental Commitments shall have the same terms as the Commitments.

³  Insert any additional conditions precedent which may be required to be satisfied prior to the Agreement Effective Date.

ANNEX II

[Officers’ certificate required to be delivered pursuant to clause (vii) of the definition of “Incremental Commitment Requirements” certifying that the conditions set forth in clauses (i), (ii) and (vi) of the definition of “Incremental Commitment Requirements” have been satisfied]

ANNEX III

[Opinion[s] of counsel to the respective Obligors, delivered as required pursuant to clause (iv) of the definition of “Incremental Commitment Requirements”]

ANNEX IV

[True and correct copies of officers’ certificates, board of director resolutions and good standing certificates of the Obligors required to be delivered pursuant to clause (v) of the definition of “Incremental Commitment Requirements”]

ANNEX I

EXHIBIT R

FORM OF CREDIT DOCUMENT ACKNOWLEDGMENT AND AMENDMENT

[_______________ __], 2015

To the Administrative Agent, the Security Agent,

the Co-Collateral Agents and each of the Lenders

party to the Facility Agreement referred to below

Re:    Second Amended and Restated Facility Agreement

Ladies and Gentlemen:

Reference is made to (i) that certain Second Amended and Restated Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, among TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor” and together with the European Parent Guarantor and the Spanish Parent Guarantor, the “Parent Guarantors”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026) (the “Australian Borrower”), Toys “R” Us GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrower and German Borrower, collectively, the “Borrowers”), TRU (UK) H7 Limited (“Midco1”), TRU (UK) H8 Limited (“Midco2”), Toys “R” Us Holdings Limited (“TRU Holdings”), Toys “R” Us Financial Services Limited (“TRU Financial Services”), Toys “R” Us Properties Limited (“TRU Properties”), TRU (UK) H4 Limited (“TRU H4”), TRU (France) Finance Ltd. (“TRU France Finance”), TRU (France) Holdings Ltd. (“TRU France Holdings” and, together with the European Parent Guarantor, Midco1, Midco2, the Australian Parent Guarantor, TRU Holdings, TRU Financial Services, TRU Properties, TRU H4 and TRU France Finance, collectively the “U.K. Guarantors”), Babies “R” Us (Australia) Pty Ltd (ABN 56 073 394 117) (“Babies “R” Us (Australia)”), Toys “R” Us SARL (“Toys SARL”), TRU (BVI) Finance II, Ltd. (the “BVI Guarantor”), TRU (UK) H6, LLC (the “U.S. Guarantor”), TRU Iberia Holdings 2, S.L.U. (formerly known as Avenal Investment, S.L.) (“Midco4”, together with the Spanish Parent Guarantor, the “Spanish Guarantors”), 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 and Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents (as the same may be further amended, restated, modified and/or supplemented from time to time, the “Facility Agreement”). Unless otherwise indicated herein, capitalized terms used but not defined herein shall have the respective meanings set forth in the Facility Agreement. This Credit Document Acknowledgement and Amendment to Security Agreement, Global Pledge Agreement, Intellectual Property Licenses Security Agreement, Fixed and Floating Charge (Australia), and Equitable Mortgage of Shares (Australian Borrower) shall hereinafter be referred to as the “Acknowledgment and Amendment”.

I. Security Documents Acknowledgement.

1.    Each of the Australian Parent Guarantor and the U.S. Guarantor (collectively the “U.S. Obligors”) hereby acknowledges and agrees, and represents and warrants, that on and after the occurrence of, and after giving effect to, the Second Restatement Effective Date and any increase in the amounts owing to the Lenders, Issuing Lenders, and/or any Agent under the Facility Agreement on or after the Second Restatement Effective Date as follows:

(i) it is a party to, and shall continue to be bound by, the Security Agreement, dated as of October 15, 2009, as amended as of March 8, 2011, made by, inter alia, the U.S. Obligors in favor of the Security Agent, as the same may be amended, restated, modified and/or supplemented from time to time in accordance with the terms thereof (including, without limitation, the amendment thereof as provided in Section II below (the “Security Agreement”));

(ii) on and after the Second Restatement Effective Date, it will continue to obtain benefits from the incurrence of Loans to, and the issuance of Letters of Credit for the account of, the U.K. Borrowers, the Australian Borrower, the German Borrower, the Spanish Borrower and any other Borrower under the Facility Agreement from time to time; and

(iii) the Security Agreement and the security interest granted by the U.S. Obligors under the Security Agreement (both immediately before and after giving effect to the amendments thereof as provided in Section II below) shall continue in full force and effect.

2.    Each of the Obligors hereby acknowledges and agrees, and represents and warrants, that on and after the occurrence of, and after giving effect to, the Second Restatement Effective Date and any increase in the amounts owing to the Lenders, Issuing Lenders, and/or any Agent under the Facility Agreement on or after the Second Restatement Effective Date as follows:

(i) it is a party to, and shall continue to be bound by, the Global Pledge Agreement, dated as of October 15, 2009, made by the Obligors in favor of the Security Agent, as the same may be amended, restated, modified and/or supplemented from time to time in accordance with the terms thereof (including, without limitation, the amendment thereof as provided in Section II below (the “Global Pledge Agreement”));

(ii) in the case of the Australian Obligors, each party acknowledges and agrees, and represents and warrants that it is a party to, and shall continue to be bound by, the Fixed and Floating Charge (Australia) originally dated 15 October 2009 (as amended on 16 October 2010) made by each of the Australian Borrower and Babies “R” Us (Australia) in favor of the Security Agent, and as the same may be amended, restated, modified and or supplemented from time to time in accordance with the terms thereof (“Fixed and Floating Charge (Australia)”);

    (iii) in the case of the Australian Borrower, it is a party to, and shall continue to be bound by the Equitable Mortgage of Shares (Australia) dated 15 October 2009 made by the Australian Borrower in favor of the Security Agent, as the same may be amended, restated, modified and or supplemented from time to time in accordance with the terms thereof (“Equitable Mortgage of Shares (Australian Borrower”)); and

2

(iv) the Global Pledge Agreement, the Fixed and Floating Charge (Australia), the Equitable Mortgage of Shares (Australian Borrower), and the security interest granted by the Obligors under the Global Pledge Agreement (both immediately before and after giving effect to the amendments thereof as provided in Section II below), and the security interest granted by the Obligors under the Fixed and Floating Charge (Australia) and the Equitable Mortgage of Shares (Australian Borrower) shall continue in full force and effect with respect to the Obligors.

3.    Each of the Australian Borrower, Toys UK, the German Borrower, Toys SARL, and the Spanish Borrower (collectively the “Parties to the IP Agreement”) hereby acknowledges and agrees, and represents and warrants, that on and after the occurrence of, and after giving effect to, the Second Restatement Effective Date and any increase in the amounts owing to the Lenders, Issuing Lenders, and/or any Agent under the Facility Agreement on or after the Second Restatement Effective Date as follows:

(i) it is a party to, and shall continue to be bound by, the Intellectual Property Licenses Security Agreement, dated as of October 15, 2009, made by the Parties to the IP Agreement in favor of the Security Agent, as the same may be amended, restated, modified and/or supplemented from time to time in accordance with the terms thereof (including, without limitation, the amendment thereof as provided in Section II below (the “IP Agreement”, together with the Security Agreement, the Global Pledge Agreement, the Fixed and Floating Charge (Australia), the Equitable Mortgage of Shares (Australian Parent Guarantor) and the Equitable Mortgage of Shares (Australian Borrower) being collectively referred herein as the “Credit Support Documents”)); and

(ii) the IP Agreement and the security interest granted by the Parties to the IP Agreement under the IP Agreement (both immediately before and after giving effect to the amendments thereof as provided in Section II below) shall continue in full force and effect with respect to the Parties to the IP Agreement.

4.    Each of the undersigned Guarantors hereby acknowledges and agrees, and represents and warrants, that on and after the occurrence of, and after giving effect to, the Second Restatement Effective Date and any increase in the amounts owing to the Lenders, Issuing Lenders, and/or any Agent under the Facility Agreement on or after the Second Restatement Effective Date as follows:

(i) it is a party to, and shall continue to be bound by, the Guaranty as set forth in Section 17 of the Facility Agreement, and the guaranties made by it under such Guaranty shall continue in full force and effect with respect to such Guarantor and the amendment and restatement of the Facility Agreement is not a novation of the debt thereunder; and

(ii) on and after the Second Restatement Effective Date, it will continue to obtain benefits from the incurrence of Loans to, and the issuance of Letters of Credit for the account of, the Borrowers.

3

5.    Each of the undersigned Obligors hereby acknowledges and agrees, and represents and warrants, that on and after the occurrence of, and after giving effect to, the Second Restatement Effective Date and any increase in the amounts owing to the Lenders, Issuing Lenders, and/or any Agent under the Facility Agreement on or after the Second Restatement Effective Date as follows:

(i) it has full power and authority, and has taken all action necessary, to execute and deliver this Acknowledgement and Amendment and to continue the security interests granted by it under the applicable Credit Support Documents; and

(ii) the Facility Agreement and the Obligations of the Obligors under the Facility Agreement shall constitute the “Facility Agreement” and the “Secured Obligations”, respectively, in each case, under and as defined in, each Credit Support Document and the security interest granted, by it under each such Credit Support Document and shall continue to be entitled to the benefits of each Credit Support Document and the security interest granted, by it under each such Credit Support Document (both immediately before and after giving effect to the amendments thereof as provided in Section II below).

II. Amendments to Security Agreement, Global Pledge Agreement, IP Agreement, and Fixed and Floating Charge (Australia)

1.    The Co-Collateral Agents (for and on behalf, and at the direction, of the Required Lenders in accordance with Section 13.12 of the Facility Agreement and Section 10.2 of the Security Agreement) and each of the Obligors hereby agree that it is the intention of the parties that the Secured Obligations be amended and in furtherance thereof hereby further amend the Security Agreement as follows:

(i) On the Second Restatement Effective Date, Annexes A, B, C, D, E, F, G, H, I and J to the Security Agreement shall be restated in their entirety by the respective Annexes attached hereto as of the Second Restatement Effective Date.

(ii) On the Second Restatement Effective Date, the Security Agreement shall be amended by inserting the following proviso at the end of Section 1.1(a) thereof, immediately before the “.”: “; provided further that the Collateral shall not include any Intercompany Notes”.

2.    The Co-Collateral Agents (for and on behalf, and at the direction, of the Required Lenders in accordance with Section 13.12 of the Facility Agreement and Section 21 of the Global Pledge Agreement) and each of the Obligors hereby agree that it is the intention of the parties that the Secured Obligations as defined in the Global Pledge Agreement be amended and in furtherance thereof hereby further amend the Global Pledge Agreement as follows:

(i) On the Second Restatement Effective Date, Annex C to the Global Pledge Agreement shall be restated in its entirety by the Annex C attached hereto as of the Second Restatement Effective Date.

4

(ii) On the Second Restatement Effective Date, the Secured Obligations solely with respect to Toys SARL shall mean the French Proceeds Loan Secured Obligations and the security granted by Toys SARL pursuant thereto shall be granted to the French Proceeds Loan Agent. All references to Secured Creditors under the Global Pledge Agreement solely as it relates to Toys SARL shall be deemed to be references to the French Proceeds Loan Lender Creditors.

(iii) On the Second Restatement Effective Date, the Global Pledge Agreement shall be amended by (x) inserting the following proviso at the end of the second to last paragraph of Section 3.1 thereof, immediately following the phrase “shall not be subject to the limitations described in preceding clause (x) and immediately before the “.”: “; provided further that the U.S. Collateral shall not include any Intercompany Notes” and (y) inserting the following proviso at the end of Section 3.1 thereof, immediately before the “.”: “; provided further that the Non-U.S. Collateral shall not include any Intercompany Notes”.

3.    The Co-Collateral Agents (for and on behalf, and at the direction, of the Required Lenders in accordance with Section 13.12 of the Facility Agreement and Section 8.2 of the IP Agreement) and each of the Obligors hereby agree that it is the intention of the parties that the Secured Obligations as defined in the IP Agreement be amended and in furtherance thereof hereby further amend the IP Agreement as follows:

(i) On the Second Restatement Effective Date, Annexes A, B, and C to the IP Agreement shall be restated in their entirety by the respective Annexes attached hereto as of the Second Restatement Effective Date.

(ii) On the Second Restatement Effective Date, the Secured Obligations solely with respect to Toys SARL shall mean the French Proceeds Loan Secured Obligations and the security granted by Toys SARL pursuant thereto shall be granted to the French Proceeds Loan Agent. All references to Secured Creditors under the Global Pledge Agreement solely as it relates to Toys SARL shall be deemed to be references to the French Proceeds Loan Lender Creditors.

4.    The Co-Collateral Agents (for and on behalf, and at the direction, of the Required Lenders in accordance with Section 13.12 of the Facility Agreement) and each of the Obligors hereby agree that the Fixed and Floating Charge (Australia) be amended as follows:

(i) On the Second Restatement Effective Date, a new Clause 7(e) shall be inserted as follows : “(change of Chargor details) notify the Chargee at least 14 days before: (i) the Grantor changes its name as recorded in a public register in its jurisdiction of incorporation or in its constituent documents; and (ii) any ACN or ARBN allocated to the Chargor changes, is cancelled or otherwise ceases to apply to it (or if it does not have any such applicable number, one is allocated, or otherwise starts to apply, to it); and (iii) the Chargor becomes trustee of a trust, or a partner in a partnership, not stated in the Details.”

5

(ii) On the Second Restatement Effective Date, a new Clause 20.19 shall be inserted as follows: “Confidentiality Notwithstanding Section 13.16 of the Credit Agreement, the Chargee is not permitted to disclose information provided by any other party that is not publicly available (including the existence or contents of any Credit Document) under section 275(4) of the Personal Property Securities Act 2009 (Cth) (the “PPSA”) unless section 275(7) of the PPSA applies.”

III.    Joinder of 2015 New Guarantors.

1.Each of the European Parent Guarantor, the Spanish Parent Guarantor, Midco 1, Midco 2 and Midco 4 (the “2015 New Guarantors”) agrees that, upon its execution hereof, it will become a Pledgor under, and as defined in, the Global Pledge Agreement, and will be bound by all terms, conditions and duties applicable to a Pledgor under the Global Pledge Agreement. Without limitation of the foregoing and in furtherance thereof, each of the 2015 New Guarantors hereby confirms, adopts and ratifies all of the terms and conditions of the Global Pledge Agreement, including, without limitation, the pledge and assignment to the Co-Collateral Agents for the benefit of the Secured Creditors and the grant to the Co-Collateral Agents for the benefit of the Secured Creditors of a security interest in all its right, title and interest in, to and under the Collateral (as defined in the Global Pledge Agreement), if any, now owned or hereafter acquired by it, in each case to the extent provided in the Global Pledge Agreement.

2.By executing and delivering this Acknowledgment and Amendment, each of the 2015 New Guarantors hereby (i) becomes a party to the Intercompany Subordination Agreement dated October 15, 2009 made by the Obligors in favor of the Security Agent (as the same may be amended, restated, modified and/or supplemented from time to time in accordance with the terms thereof, the “Intercompany Subordination Agreement”) as a “Party” thereunder with the same force and effect as if originally named therein as a Party, (ii) expressly, irrevocably, absolutely and jointly and severally assumes all obligations and liabilities of a “Party” under the Intercompany Subordination Agreement and (iii) makes each of the representations and warranties contained in the Intercompany Subordination Agreement on the date hereof, after giving effect to this Acknowledgment and Amendment. Each reference to a “Party” in the Intercompany Subordination Agreement shall be deemed to include each 2015 New Guarantor.

3.Each 2015 New Guarantor hereby makes and undertakes, as the case may be, each covenant, representation and warranty made by, and as (i) each Pledgor pursuant to the Global Pledge Agreement and (ii) each Party pursuant to the Intercompany Subordination Agreement, in each case as of the date hereof (except to the extent any such representation or warranty relates solely to an earlier date in which case such representation and warranty shall be true and correct as of such earlier date), and agrees to be bound by all covenants, agreements and obligations of a Pledgor and Party pursuant to the Global Pledge Agreement and Intercompany Subordination Agreement, respectively, and all other Credit Documents to which it is or becomes a party.

4.Attached hereto as Exhibit A are UCC-1 Financing Statements for each 2015 New Guarantor. Administrative Agent may file the attached UCC-1 Financing Statements upon

6

delivery of a fully executed copy of this Acknowledgment and Amendment to the Administrative Agent.

IV.    Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial.

1.    (a) THIS ACKNOWLEDGEMENT AND AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS ACKNOWLEDGEMENT AND AMENDMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, IN EACH CASE WHICH ARE LOCATED IN THE COUNTY OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS ACKNOWLEDGEMENT AND AMENDMENT, EACH OBLIGOR HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH OBLIGOR HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION, WITH A REGISTERED ADDRESS BEING 111 EIGHTH AVENUE, NEW YORK, NEW YORK 10011, AS ITS AUTHORIZED DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON ITS BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. IF FOR ANY REASON SUCH AUTHORIZED DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS SUCH, EACH OBLIGOR AGREES TO DESIGNATE A NEW AUTHORIZED DESIGNEE, APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION REASONABLY SATISFACTORY TO THE ADMINISTRATIVE AGENT UNDER THIS AGREEMENT. EACH OBLIGOR HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK PERSONAL JURISDICTION OVER SUCH OBLIGOR, AND AGREES NOT TO PLEAD OR CLAIM, IN ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS ACKNOWLEDGEMENT AND AMENDMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN ANY OF THE AFOREMENTIONED COURTS, THAT SUCH COURTS LACK PERSONAL JURISDICTION OVER SUCH OBLIGOR. EACH OBLIGOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH OBLIGOR AT ITS ADDRESS SET FORTH IN THE FACILITY AGREEMENT, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. EACH OBLIGOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY OTHER CREDIT DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT, ANY LENDER OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY

7

LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST EACH OBLIGOR IN ANY OTHER JURISDICTION.

(b)    EACH OBLIGOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS ACKNOWLEDGEMENT AND AMENDMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

(c)    EACH OF THE PARTIES TO THIS ACKNOWLEDGEMENT AND AMENDMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS ACKNOWLEDGEMENT AND AMENDMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

2.    This Acknowledgment and Amendment may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. A set of counterparts executed by all the parties hereto shall be lodged with the Obligors’ Agent and the Administrative Agent.

*    *    *

8

IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Acknowledgment and Amendment as of the date first above written.

TRU EUROPE LIMITED,

as the European Parent Guarantor

By:

Name:

Title:

TRU IBERIA HOLDINGS 1, S.L.U.,

as the Spanish Parent Guarantor

By:

Name:

Title:

TRU AUSTRALIA HOLDINGS, LLC,

as the Australian Parent Guarantor

By:

Name:

Title:

[Signature Page – Toys – Credit Document Acknowledgment and Amendment]

TOYS “R” US (UK) LIMITED,

   as a U.K. Borrower

By:

Name:

Title:

TOYS “R” US LIMITED,

as a U.K. Borrower

By:

Name:

Title:

TOYS “R” US GMBH,

as the German Borrower

By:

Name:

Title:

TOYS “R” US IBERIA, S.A.U.,

as the Spanish Borrower

By:

Name:

Title:

TOYS “R” US (AUSTRALIA) PTY LTD,

as the Australian Borrower

By:

Name:

Title: Authorized Signatory

[Signature Page – Toys – Credit Document Acknowledgment and Amendment]

TRU (UK) H7 LIMITED,

as a Guarantor

By:

Name:

Title:

TRU (UK) H8 LIMITED,

as a Guarantor

By:

Name:

Title:

TOYS “R” US HOLDINGS LIMITED,

as a Guarantor

By:

Name:

Title:

TOYS “R” US PROPERTIES LIMITED,

as a Guarantor

By:

Name:

Title:

TOYS “R” US FINANCIAL SERVICES LIMITED,

as a Guarantor

By:

Name:

Title:

[Signature Page – Toys – Credit Document Acknowledgment and Amendment]

TRU (UK) H4 LIMITED,

as a Guarantor

By:

Name:

Title:

TRU (FRANCE) FINANCE LTD.,

as a Guarantor

By:

Name:

Title:

TRU (FRANCE) HOLDINGS LTD.,

as a Guarantor

By:

Name:

Title:

TRU IBERIA HOLDINGS 2, S.L.U.,

as a Guarantor

By:

Name:

Title:

TRU (BVI) FINANCE II, LTD.

as a Guarantor

By:

Name:

Title:

[Signature Page – Toys – Credit Document Acknowledgment and Amendment]

TOYS “R” US SARL

By:

Name:

Title:

TRU (UK) H6, LLC,

as a Guarantor

By:

Name:

Title:

BABIES “R” US (AUSTRALIA) PTY LTD,

as a Guarantor

By:

Name:

Title: Authorized Signatory

[Signature Page – Toys – Credit Document Acknowledgment and Amendment]

DEUTSCHE BANK AG NEW YORK BRANCH, as Administrative Agent, Co-Collateral Agent, and Security Agent

By:

Name:
Title:

By:

Name:
Title:

[Signature Page – Toys – Credit Document Acknowledgment and Amendment]

ANNEXES TO THE SECURITY AGREEMENT

[see attached]

ANNEX A

to

SECURITY AGREEMENT

SCHEDULE OF CHIEF EXECUTIVE OFFICES

Name of Assignor	Address(es) of Chief Executive Office
TRU Australia Holdings, LLC	One Geoffrey Way Wayne, NJ 07440
TRU (UK) H6, LLC	One Geoffrey Way Wayne, NJ 07440

ANNEX B

to

SECURITY AGREEMENT

SCHEDULE OF INVENTORY AND EQUIPMENT LOCATIONS

AssignorLocation

TRU Australia Holdings, LLC	None
TRU (UK) H6, LLC	None

ANNEX C

to

SECURITY AGREEMENT

SCHEDULE OF LEGAL NAMES, TYPE OF ORGANIZATION(AND WHETHER A REGISTERED ORGANIZATION AND/OR
A TRANSMITTING UTILITY), JURISDICTION OF ORGANIZATION,
LOCATION, ORGANIZATIONAL IDENTIFICATION NUMBERS
AND FEDERAL EMPLOYER IDENTIFICATION NUMBERS

Exact Legal Name of Each Assignor	Type of Organization (or, if the Assignor is an Individual, so indicate)	Registered Organization? (Yes/No)	Jurisdiction of Organization	Assignor’s Location (for purposes of NY UCC § 9-307)	Assignor’s Organization Identification Number (or, if it has none, so indicate)	Assignor’s Federal Employer Identification Number (or, if it has none, so indicate)	Transmitting Utility?(Yes/No)
TRU Australia Holdings, LLC	Limited Liability Company	Yes	Delaware	Delaware	2026162	03-0565221	No
TRU (UK) H6, LLC	Limited Liability Company	Yes	Delaware	Delaware	5299417	46-2216480	No

ANNEX D

to

SECURITY AGREEMENT

SCHEDULE OF TRADE AND FICTITIOUS NAMES

Name of Assignor	Trade and/or Fictitious Names
TRU Australia Holdings, LLC	None
TRU (UK) H6, LLC	None

ANNEX E

to

SECURITY AGREEMENT

DESCRIPTION OF CERTAIN SIGNIFICANT TRANSACTIONS OCCURRING WITHIN ONE YEAR PRIOR TO THE DATE OF THE SECURITY AGREEMENT
Name of Assignor	Description of any Transactions as required by Section 2.8 of the Security Agreement
TRU Australia Holdings, LLC	None
TRU (UK) H6, LLC	None

ANNEX F

to

SECURITY AGREEMENT

SCHEDULE OF DEPOSIT ACCOUNTS

Name of Assignor	Description of Deposit Account	Account Number	Name of Bank, Address and ContactInformation	Jurisdiction of Bank
TRU Australia Holdings, LLC	Operating Account	30748343	Citibank Kay Casanova 388 Greenwich Street 22nd Floor New York, NY 10013 Tel: (212) 816-8103	New York
TRU (UK) H6, LLC	Operating Account	74343212	HSBC Bank plc First Floor 60 Queen Victoria Street London, United Kingdom EC4N 4TR	United Kingdom

ANNEX G

to

SECURITY AGREEMENT

DESCRIPTION OF COMMERCIAL TORT CLAIMS

Name of Assignor	Description of Commercial Tort Claims
TRU Australia Holdings, LLC	None
TRU (UK) H6, LLC	None

ANNEX H

to

SECURITY AGREEMENT

SCHEDULE OF MARKS AND APPLICATIONS;
INTERNET DOMAIN NAME REGISTRATIONS

1.     Marks and Applications:

NONE

2.     Internet Domain Name Registrations:

NONE

ANNEX I

to

SECURITY AGREEMENT

SCHEDULE OF PATENTS

NONE

ANNEX J

to

SECURITY AGREEMENT

SCHEDULE OF COPYRIGHTS

NONE

ANNEXES TO THE GLOBAL PLEDGE AGREEMENT

[see attached]

ANNEX C
to PLEDGE AGREEMENT

SCHEDULE OF LEGAL NAMES, TYPE OF ORGANIZATION(AND WHETHER A REGISTERED ORGANIZATION
AND/OR A TRANSMITTING UTILITY), JURISDICTION OF ORGANIZATION,
LOCATION, ORGANIZATIONAL IDENTIFICATION NUMBERS
AND FEDERAL EMPLOYER IDENTIFICATION NUMBERS

Legal Name	Type of Organization	Registered Organization? (Yes/No)	Jurisdiction of Organization	Location (for purposes of NY UCC § 9-307)	Organization Identification Number	Federal Employer Identification Number	Transmitting Utility? (Yes/No)
TRU Europe Limited	Private Limited Company	N/A	United Kingdom	N/A	9873441	N/A	N/A
TRU Iberia Hodlings 1, S.L.U.	Spanish limited liability company (sociedad de responsabilidad limitada unipersonal)	N/A	Spain	N/A	B87422408 (Spanish tax ID)	N/A	N/A
TRU Australia Holdings, LLC	Limited Liability Company	Yes	Delaware	Delaware	2026162	03-0565221	No
Toys “R” Us (Australia) Pty Ltd.	Proprietary Company Limited by Shares	N/A	Australia	N/A	77 057 455 026 (ABN)	N/A	N/A
Babies “R” Us (Australia) Pty Ltd.	Proprietary Company Limited by Shares	N/A	Australia	N/A	56 073 394 117 (ABN)	N/A	N/A
Toys “R” Us (UK) Limited	Private Limited Company	N/A	United Kingdom	N/A	5410173	N/A	N/A
TRU (UK) H7 Limited	Private Limited Company	N/A	United Kingdom	N/A	9873499	N/A	N/A
TRU (UK) H8 Limited	Private Limited Company	N/A	United Kingdom	N/A	9873452	N/A	N/A

TRU Iberia Holdings 2, S.L.U.	Spanish limited liability company (sociedad de responsabilidad limitada unipersonal)	N/A	Spain	N/A	B87422531 (Spanish tax ID)	N/A	N/A
Toys “R” Us Holdings Limited	Private Limited Company	N/A	United Kingdom	N/A	1826057	N/A	N/A
Toys “R” Us Financial Services Limited	Private Limited Company	N/A	United Kingdom	N/A	1861149	N/A	N/A
Toys “R” Us Limited	Private Limited Company	N/A	United Kingdom	N/A	1809223	N/A	N/A
Toys “R” Us Properties Limited	Private Limited Company	N/A	United Kingdom	N/A	1809224	N/A	N/A
TRU (UK) H4 Limited	Private Limited Company	N/A	United Kingdom	N/A	8436106	N/A	N/A
TRU (France) Finance Ltd.	Private Limited Company	N/A	United Kingdom	N/A	7815995	N/A	N/A
TRU (France) Holdings Ltd.	Private Limited Company	N/A	United Kingdom	N/A	7816012	N/A	N/A
TRU (BVI) Finance II, Ltd.	Company Limited by Shares	N/A	British Virgin Islands	N/A	1627976	N/A	N/A
TRU (UK) H6, LLC	Limited Liability Company	Yes	Delaware	Delaware	5299417	46-2216480	N/A
Toys “R” Us SARL	Limited Liability Company (Société à responsabilité limitée)	N/A	France	N/A	345 404 156 RCS Evry	N/A	N/A
Toys “R” Us GmbH	Limited Liability Company (Gesellschaft mit beschränkter Haftung)	N/A	Germany	N/A	HRB 16651	N/A	N/A

Toys “R” Us Iberia, S.A.U. Spanish public limited company (sociedad anónima unipersonal) N/A Spain N/A A79520656 (Spanish tax ID) N/A N/A

ANNEXES TO THE IP AGREEMENT

[see attached]

ANNEX A

to

IP AGREEMENT

SCHEDULE OF CHIEF EXECUTIVE OFFICES

Name of Assignor	Address(es) of Chief Executive Office
Toys “R” Us (Australia) Pty Ltd.	Block G Commercial Drive Regents Park Estate 391 Park Road, NSW 2143
Toys “R” Us Limited	Geoffrey House, Maidenhead Office Park, Westacott Way, Maidenhead, Berkshire SL6 3QH
Toys “R” Us SARL	1, allee des Lutins ZAC de la Marcaux Loups ST FARGEAU PONTHIERRY, FRANCE 77310
Toys “R” Us GmbH	Köhlstrasse 8, 50827 Köln, Germany
Toys “R” Us Iberia, S.A.U.	Calle Lucio Emilio Cándido, 12, 28802 Alcalá de Henares (Madrid), Spain

ANNEX B

to

IP AGREEMENT

SCHEDULE OF LEGAL NAMES, TYPE OF ORGANIZATION(AND WHETHER A REGISTERED ORGANIZATION AND/OR
A TRANSMITTING UTILITY), JURISDICTION OF ORGANIZATION,
LOCATION, ORGANIZATIONAL IDENTIFICATION NUMBERS
AND FEDERAL EMPLOYER IDENTIFICATION NUMBERS

Legal Name	Type of Organization	Registered Organization? (Yes/No)	Jurisdiction of Organization	Location (for purposes of NY UCC § 9-307)	Organization Identification Number	Federal Employer Identification Number	Transmitting Utility? (Yes/No)
Toys “R” Us (Australia) Pty Ltd.	Proprietary Company Limited by Shares	N/A	Australia	N/A	77 057 455 026 (ABN)	N/A	N/A
Toys “R” Us Limited	Private Limited Company	N/A	United Kingdom	N/A	1809223	N/A	N/A
Toys “R” Us SARL	Limited Liability Company (Société à responsabilité limitée)	N/A	France	N/A	345 404 156 RCS Evry	N/A	N/A
Toys “R” Us GmbH	Limited Liability Company (Gesellschaft mit beschränkter Haftung)	N/A	Germany	N/A	HRB 16651	N/A	N/A
Toys “R” Us Iberia, S.A.U.	Spanish public limited company (sociedad anónima unipersonal)	N/A	Spain	N/A	A79520656 (Spanish tax ID)	N/A	N/A

ANNEX C

to

IP AGREEMENT

SCHEDULE OF ASSIGNED CONTRACTS

License Agreement, dated as of February 1, 2009, by and between Geoffrey, LLC, as Licensor, and each entity listed on Schedule A attached thereto (as such Schedule A may be amended or supplemented from time to time) as Licensee and in effect on the date hereof.

ANNEX C

to

SECURITY AGREEMENT

Americas 90926432 (2K)

EXHIBIT S-1

FORM OF CREDIT CARD NOTIFICATION (AUSTRALIA)

_______________ __, 2015

To:    [Commonwealth Bank of Australia]

[Insert Address]

(the “Processor”)

Attention [             ]

Re: Toys “R” Us (Australia) Pty Limited
Merchant Account Number:

Dear Sir/Madam:

Toys "R" Us (Australia) Pty Ltd (ABN 77 057 455 026), a proprietary company incorporated and validly existing under the laws of Australia (the “Company”), has entered into various financing and security agreements with Deutsche Bank AG New York Branch, a German Banking Corporation with offices at 60 Wall Street, New York, NY 10005, as administrative agent and security agent on behalf of the Secured Creditors (as defined in the Credit Facility) (in such capacity, the “Security Agent”) (including the Syndicated Facility Agreement dated October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, between the Security Agent, the Company, the Borrowers (as defined therein) and others (as further amended, restated, modified and/or supplemented from time to time, the “Credit Facility”), for its own benefit and the benefit of certain other secured parties (the “Secured Creditors”), pursuant to which the Security Agent and the other Secured Creditors may from time to time make loans or furnish certain other financial accommodations to the Company. The Company’s obligations on account of such loans and financial accommodations are secured by, among other things, all credit card charges submitted by the Company to the Processor for processing and the amounts which the Processor owes to the Company on account there of (the “Credit Card Proceeds”) under the charge entitled “Fixed and Floating Charge (Australia)” between the Company, the Security Agent and others dated October 15, 2009 as amended on October 16, 2010 (as may be further amended, restated, modified and/or supplemented) (“Security”)).

The Company and the Processor are parties to the Merchant Agreement under which the Processor has agreed to provide the Company with the credit card merchant facility on the terms and conditions set out therein (“Merchant Agreement”).

The Processer hereby confirms:

(a) its consent to the Security in accordance with clause [7.8] of the Merchant Agreement;

Exhibit S-1
Page 2

(b) that it waives all rights, powers or discretion which the Processor has under clause 8.2(d) of the Merchant Agreement to terminate that agreement solely by reason of the appointment of a receiver by the Security Agent pursuant to the terms of the Security.

This letter of agreement is governed by the law in force in New South Wales, Australia. The Processor and the Security Agent submit to the non-exclusive jurisdiction of the courts of that place. Each party waives any right it has to object to an action being brought in those courts, to claim that the action has been brought in an inconvenient forum, or to claim that those courts do not have jurisdiction.

Please acknowledge your agreement to this letter by signing and returning to us the enclosed copy of this letter (please copy Deutsche Bank AG New York Branch as Security Agent):

Deutsche Bank AG New York Branch

60 Wall Street,

2^nd Floor,

New York, NY 10005

U.S.A.

Attention: Dusan Lazarov

Re: Toys “R” Us (Australia) Pty Limited

This letter may be executed in any number of counterparts and all of such counterparts taken together shall be deemed to constitute the one instrument.

If you have any queries, please do not hesitate to contact us.

Very truly yours,

By:___________________________

for and on behalf of Toys “R” Us (Australia) Pty Limited
Name:
Title:

Date:

Agreed for and on behalf of Commonwealth Bank of Australia

Name:
Title:

Date:

EXHIBIT S-2

Form of Credit Card Notification (UK)

To:    [credit card counterparty]

Re: [●] (the “Company”)

Merchant Account Number:

[          ] 2015

Dear Sir/Madam:

We hereby give you notice that pursuant to a Debenture dated [●], 2015, the Company charged and assigned to Deutsche Bank AG New York Branch (as security agent for the Secured Creditors under the Debenture (the “Security Agent”)), all its rights, title, interests and benefits in, to or in respect of the [name and description of contract] dated [date] between you and the Company (the “Contract”) including all monies which may be payable in respect of the Contract.

With effect from your receipt of this notice we hereby give you notice that:

(a) all payments to be made to the Companyunder or arising from the Contract should be made:

By ACH, Depository Transfer Check, or Electronic Depository Transfer to:

[_______]
ABA #___________________________
For Credit to ______________________
Account No. ______________________
Re: [INSERT NAME OF COMPANY]

or as you may otherwise be instructed in writing from time to time by an officer of the     Security Agent;

(b) upon an Enforcement Event, all remedies provided for in the Contract or available at law or in equity shall be exercisable by the Security Agent;

(c) upon an Enforcement Event, all rights to compel performance of the Contract shall be exercisable by the Security Agent (although the Company shall remain liable to perform all the obligations assumed by it under the Contract); and

(d) upon an Enforcement Event, all rights, title, interests and benefits whatsoever accruing to or for the benefit of Companyarising from the Contract belong to the Security Agent and no changes may be made to the terms of the Contract nor may the Contract be terminated without the Security Agent’s consent.

Exhibit S-2

Page 2

You are hereby authorised and instructed, without requiring further approval from the Company, to provide the Security Agent with such information relating to the Contract as we may from time to time request in writing.

These instructions may not be revoked without the prior written consent of the Security Agent.

Please acknowledge receipt of this notice by signing and dating the acknowledgement set out on the enclosed copy and returning it to the Security Agent.

*    *    *

Exhibit S-2
Page 3

Yours faithfully,

…………………………..

(Authorised Signatory)

…………………………..

(Autorised Signatory

for and on behalf of
Deutsche Bank AG New York Branch

(as Security Agent)

Americas 90926218 (2K)

Exhibit S-2
Page 4

Americas 90926218 (2K)

EXHIBIT T-1

Page 5

Form of Customs Broker Agreement (Australia)

Name and Address of Customs Broker:

______________________________
______________________________
______________________________

Dear Sir/Madam:

Unless otherwise defined, all capitalised terms have the meaning given to them in the Credit Facility.

______________________________, a [proprietary] company incorporated and validly existing under the laws of ______________________________, Australia (the “Company”), among others, has entered into various financing agreements with Deutsche Bank AG New York Branch, a branch of Deutsche Bank AG, a corporation duly incorporated and existing under the laws of the Federal Republic of Germany, with License issued by the Banking Department of the State of New York, United States of America, with offices at 60 Wall Street, 2^nd Floor, New York, New York 10005, as Security Agent (in such capacity, the “Security Agent”) (including, the Syndicated Facility Agreement dated October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, between the Security Agent, the Company, the Borrowers (as defined therein) and others (as further amended, restated, modified and/or supplemented from time to time, the “Credit Facility”), for its own benefit and the benefit of certain other secured parties (the “Secured Creditors”) which are making loans or furnishing other financial accommodations to the Company or its Affiliates, pursuant to which agreements the Company, among others, has granted to the Security Agent, for its own benefit and the benefit of the other Secured Creditors, a security interest in and to, among other things, substantially all of the assets of the Company (the “Collateral”), including, without limitation, all of the Company’s inventory, goods, documents, bills of lading and other documents of title.

The Security Agent has requested that you (the “Customs Broker”) act as its agent for the limited purpose of more fully perfecting and protecting the interest of the Security Agent in such bills of lading, documents and other documents of title and in the goods and inventory for which such bills of lading, documents, or other documents of title have been issued, and the Customs Broker has agreed to do so. This letter shall set forth the terms of the Customs Broker’s engagement.

1.    Acknowledgment of Security Interest; Power of Attorney: The Customs Broker acknowledges, consents, and agrees that the Company has assigned to the Security Agent, for its own benefit and the benefit of the other Secured Creditors, all of the Company’s right, title, and interest in, to and under all goods constituting, evidencing, or relating to such inventory and any contracts or agreements with carriers, customs brokers, and/or freight forwarders for shipment or delivery of such goods. The Company further advises the Customs Broker, and the Customs Broker acknowledges, consents, and agrees, that the Company has irrevocably constituted and appointed the Security Agent as the Company’s true and lawful attorney, with full power of substitution to exercise all of such rights, title, and interest, which appointment has been coupled with an interest.

Exhibit T-1
Page 2

2.    Appointment of Customs Broker as Agent of Security Agent: The Customs Broker is hereby appointed as agent for the Security Agent to receive and retain possession of all bills of lading, waybills, documents, and any other documents of title or carriage constituting, evidencing, or relating to the Company’s inventory (collectively, the “Title Documents”) heretofore or at any time hereafter issued for any goods, inventory, or other property of the Company which are received by the Customs Broker for processing (collectively, the “Property”), such receipt and retention of possession being for the purpose of more fully perfecting and preserving the Security Agent’s security interests in the Title Documents and the Property. The Customs Broker will maintain possession of the Title Documents and the Property, subject to the security interest of the Security Agent, and will note the security interest of the Security Agent on the Customs Broker’s books and records. In the event that the Security Agent is designated as the consignor, co-consignor, consignee or co-consignee on any such Title Documents, subject to the terms and conditions hereof, the Security Agent hereby appoints the Customs Broker as its attorney-in-fact solely to execute and deliver any such Title Documents for and on behalf of the Security Agent pursuant to the terms of this Agreement.

3.    Delivery of Title Documents; Release of Goods: Until the Customs Broker receives written notification from the Security Agent to the contrary, the Customs Broker is authorized by the Security Agent to, and the Customs Broker may, deliver:

(a)    the Title Documents to the issuing carrier or to its agent (who shall act on the Customs Broker’s behalf as the Customs Broker’s sub-agent hereunder) for the purpose of permitting the Company, as consignee, to obtain possession or control of the Property subject to such Title Documents; and

(b)    the Property, in each instance as directed by the Company.

4.    Notice From Security Agent To Follow Security Agent’s Instructions: Upon the Customs Broker’s receipt of written notification from the Security Agent, the Customs Broker shall thereafter follow solely the instructions of the Security Agent concerning the disposition of the Title Documents and the Property and will not follow any instructions of the Company or any other person concerning the same. Such notice to the Customs Broker shall be given to the following address (or to such other address, written notice of which is given the Security Agent by or on behalf the Customs Broker):

If to the Customs Broker

______________________________
______________________________
______________________________

Attention:

Email:

Telephone:

Fax:

5.    Limited Authority: The Customs Broker’s sole authority as the agent of the Security Agent is to receive and maintain possession of the Title Documents on behalf of the Security Agent and to follow the instructions of the Security Agent as provided herein. Except as may be

Exhibit T-1
Page 3

specifically authorized and instructed by the Security Agent, the Customs Broker shall have no authority as the agent of the Security Agent to undertake any other action or to enter into any other commitments on behalf of the Security Agent.

6.    Expenses: The Security Agent shall not be obligated to compensate the Customs Broker for serving as agent hereunder, nor shall the Security Agent be responsible for any fees, expenses, customs, duties, taxes, or other charges relating to the Title Documents or the Property. The Customs Broker acknowledges that the Company is solely responsible for payment of any compensation and charges which are to the Company’s account. The Security Agent is not responsible for paying any fees, expenses, customs duties, taxes, or other charges which are, or may, accrue, to the account of the Title Documents or the Property. The Security Agent may authorize the Customs Broker to perform specified services on behalf of the Security Agent, at mutually agreed rates of compensation, which shall be charged to the Security Agent’s account and payable to the Customs Broker by the Security Agent (provided, however, such payment shall not affect any obligation of the Company to reimburse the Security Agent for any such compensation or other costs or expenses incurred by the Security Agent pursuant to the terms of the financing agreements referred to above).

7.    Term: (a) In the event that the Customs Broker desires to terminate this Agreement, the Customs Broker shall furnish the Security Agent with sixty (60) days prior written notice of the Customs Broker’s intention to do so. During such sixty (60) day period (which may be shortened by notice to the Customs Broker from the Security Agent), the Customs Broker shall continue to serve as agent hereunder. The Customs Broker shall also cooperate with the Security Agent and execute all such documentation and undertake all such action as may be reasonably required by the Security Agent in connection with such termination. Such notice shall be given to the following address (or to such other address, written notice of which is given the Customs Broker by or on behalf of the Security Agent):

If to the Security Agent:

Deutsche Bank AG New York Branch
60 Wall Street,
2^nd Floor,
New York, New York 10005
Attention: Dusan Lazarov    Telephone: (212) 250-0211
Telecopier No.: (212) 797-5695

(b)    Except as provided in Section 7(a), above, this Agreement shall remain in full force and effect until the Customs Broker receives written notification from the Security Agent of the termination of the Customs Broker’s responsibilities hereunder. This Agreement may be amended only by notice in writing signed by the Company and an officer of the Security Agent and may be terminated solely by written notice signed by the Company and an officer of the Security Agent.

Exhibit T-1
Page 4

8.    Custom Broker’s Lien: The Customs Broker shall have a lien, to the extent provided by law, on any Property then in the possession of the Customs Broker, which lien shall be to the extent of any out-of-pocket costs, fees, freight charges, storage charges, or other charges or out-of-pocket expenses incurred or paid by the Customs Broker with respect only to that Property then in the possession of the Customs Broker, for which the Customs Broker has not received payment, but not for any amount owed on account of any other Property, item, or matter.

9.    Counterparts; Integration: 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 constitutes the entire agreement between the Customs Broker and the Security Agent relating to the subject matter hereof. In the event of any conflict between this agreement and the terms of the underlying agreement between the Company and Customs Broker, the terms of this agreement shall govern. This agreement shall become effective when it shall have been executed by the parties and when the Security 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 other electronic transmission shall be effective as delivery of a manually executed counterpart of this agreement.

10.    Governing Law: This letter of agreement is governed by the law in force in New South Wales, Australia. Each party submits to the non-exclusive jurisdiction of the courts of that place. Each party waives any right it has to object to an action being brought in those courts, to claim that the action has been brought in an inconvenient forum, or to claim that those courts do not have jurisdiction.

[SIGNATURE PAGE FOLLOWS]

EXHIBIT T-1

Page 5

If the foregoing correctly sets forth our understanding, please indicate the Customs Broker’s assent below following which this letter will take effect as a sealed instrument.

Very truly yours,

COMPANY:

EXECUTED by [ ] in accordance with section 127(1) of the Corporations Act 2001 (Cwlth) by authority of its directors: Signature of director Name of director (block letters) ) ) ) ) ) ) ) ) ) ) ) ) Signature of director/company secretary* Name of director/company secretary* (block letters)

Exhibit T-1
Page 6

Agreed:

CUSTOMS BROKER:

EXECUTED by [ ] in accordance with section 127(1) of the Corporations Act 2001 (Cwlth) by authority of its directors: Signature of director Name of director (block letters) ) ) ) ) ) ) ) ) ) ) ) ) Signature of director/company secretary Name of director/company secretary* (block letters)

Exhibit T-1
Page 7

SECURITY AGENT:

DEUTSCHE BANK AG NEW YORK BRANCH

By:______________________________
Name: Title:    

By: ______________________________
Name: Title:

EXHIBIT T-2

Form of Customs Broker Agreement (UK)

Name and Address of Customs Broker:

______________________________
______________________________
______________________________

Dear Sir/Madam:

Unless otherwise defined, all capitalised terms have the meaning given to them in the Credit Facility.

Each of the companies listed in Exhibit A attached hereto (the “Companies”), among others, has entered into various financing agreements with Deutsche Bank AG New York Branch, a branch of Deutsche Bank AG, a corporation duly incorporated and existing under the laws of the Federal Republic of Germany, with License issued by the Banking Department of the State of New York, United States of America, with offices at 60 Wall Street, 2^nd Floor, New York, New York 10005, as security agent (in such capacity, the “Security Agent”) (including, the Syndicated Facility Agreement dated October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015, between the Security Agent, the Company, the Borrowers (as defined therein) and others (as further amended, restated, modified and/or supplemented from time to time, the “Credit Facility”), for its own benefit and the benefit of certain other secured parties (the “Secured Creditors”) which are making loans or furnishing other financial accommodations to the Companies or its Affiliates, pursuant to which agreements each of the Companies, among others, has granted to the Security Agent, for its own benefit and the benefit of the other Secured Creditors, a security interest in and to, among other things, substantially all of the assets of the Companies (the “Collateral”), including, without limitation, all of the Companies’ inventory, goods, documents, bills of lading and other documents of title.

The Security Agent has requested that you (the “Customs Broker”) act as its agent for the limited purpose of more fully perfecting and protecting the interest of the Security Agent in such bills of lading, documents and other documents of title and in the goods and inventory for which such bills of lading, documents, or other documents of title have been issued, and the Customs Broker has agreed to do so. This letter shall set forth the terms of the Customs Broker’s engagement.

1.    Acknowledgment of Security Interest; Power of Attorney: The Customs Broker acknowledges, consents, and agrees that each of the Companies has assigned to the Security Agent, for its own benefit and the benefit of the other Secured Creditors, all of the Company’s right, title, and interest in, to and under all goods constituting, evidencing, or relating to such inventory and any contracts or agreements with carriers, customs brokers, and/or freight forwarders for shipment or delivery of such goods. Each of the Companies further notifies the Customs Broker, and the Customs Broker acknowledges, consents, and agrees, that the Company has irrevocably constituted and appointed the Security Agent as the Company’s true and lawful attorney, with full power of substitution and delegation to exercise all of such rights, title, and interest, which appointment has been coupled with an interest.

Exhibit T-2
Page 2

2.    Appointment of Customs Broker as Agent of Security Agent: The Customs Broker is hereby appointed as agent for the Security Agent to receive and retain possession of all bills of lading, waybills, documents, and any other documents of title or carriage constituting, evidencing, or relating to each of the Companies’ inventory (collectively, the “Title Documents”) heretofore or at any time hereafter issued for any goods, inventory, or other property of each of the Companies which are received by the Customs Broker for processing (collectively, the “Property”), such receipt and retention of possession being for the purpose of more fully perfecting and preserving the Security Agent’s security interests in the Title Documents and the Property. The Customs Broker will maintain possession of the Title Documents and the Property, subject to the security interest of the Security Agent, and will note the security interest of the Security Agent on the Customs Broker’s books and records. In the event that the Security Agent is designated as the consignor, co-consignor, consignee or co-consignee on any such Title Documents, subject to the terms and conditions hereof, the Security Agent hereby appoints the Customs Broker as its attorney-in-fact solely to execute and deliver any such Title Documents for and on behalf of the Security Agent pursuant to the terms of this Agreement.

3.    Delivery of Title Documents; Release of Goods: Until the Customs Broker receives written notification from the Security Agent to the contrary, the Customs Broker is authorised by the Security Agent to, and the Customs Broker may, deliver:

(a)    the Title Documents to the issuing carrier or to its agent (who shall act on the Customs Broker’s behalf as the Customs Broker’s sub-agent hereunder) for the purpose of permitting each Company, as consignee, to obtain possession or control of the Property subject to such Title Documents; and

(b)    the Property, in each instance as directed by each Company.

4.    Notice From Security Agent To Follow Security Agent’s Instructions: Upon the Customs Broker’s receipt of written notification from the Security Agent, the Customs Broker shall thereafter follow solely the instructions of the Security Agent concerning the disposition of the Title Documents and the Property and will not follow any instructions of any of the Companies or any other person concerning the same save as required under applicable law. Such notice to the Customs Broker shall be given to the following address (or to such other address, written notice of which is given the Security Agent by or on behalf the Customs Broker):

If to the Customs Broker

______________________________
______________________________
______________________________

Attention:

Email:

Telephone:

Fax:

Exhibit T-2
Page 3

5.    Limited Authority: The Customs Broker’s sole authority as the agent of the Security Agent is to receive and maintain possession of the Title Documents on behalf of the Security Agent and to follow the instructions of the Security Agent as provided herein. Except as may be specifically authorised and instructed by the Security Agent, the Customs Broker shall have no authority as the agent of the Security Agent to undertake any other action or to enter into any other commitments on behalf of the Security Agent.

6.    Expenses: The Security Agent shall not be obligated to compensate the Customs Broker for serving as agent hereunder, nor shall the Security Agent be responsible for any fees, expenses, customs, duties, taxes, or other charges relating to the Title Documents or the Property. The Customs Broker acknowledges that each Company is solely responsible for payment of any compensation and charges which are to such Company’s account. The Security Agent is not responsible for paying any fees, expenses, customs duties, taxes, or other charges which are, or may, accrue, to the account of the Title Documents or the Property. The Security Agent may authorise the Customs Broker to perform specified services on behalf of the Security Agent, at mutually agreed rates of compensation, which shall be charged to the Security Agent’s account and payable to the Customs Broker by the Security Agent (provided, however, such payment shall not affect any obligation of each of the Companies to reimburse the Security Agent for any such compensation or other costs or expenses incurred by the Security Agent pursuant to the terms of the financing agreements referred to above).

7.    Term: (a) In the event that the Customs Broker desires to terminate this Agreement, the Customs Broker shall furnish the Security Agent with sixty (60) days prior written notice of the Customs Broker’s intention to do so. During such sixty (60) day period (which may be shortened by notice to the Customs Broker from the Security Agent), the Customs Broker shall continue to serve as agent hereunder. The Customs Broker shall also cooperate with the Security Agent and execute all such documentation and undertake all such action as may be reasonably required by the Security Agent in connection with such termination. Such notice shall be given to the following address (or to such other address, written notice of which is given the Customs Broker by or on behalf of the Security Agent):

If to the Security Agent:

Deutsche Bank AG New York Branch
60 Wall Street,
2^nd Floor,
New York, New York 10005
Attention: Dusan Lazarov    Telephone: (212) 250-0211
Telecopier No.: (212) 797-5695

(b)    Except as provided in Section 7(a), above, this Agreement shall remain in full force and effect until the Customs Broker receives written notification from the Security Agent of the termination of the Customs Broker’s responsibilities hereunder. This Agreement may be amended only by notice in writing signed by each of the Companies and an officer of the Security

Exhibit T-2
Page 4

Agent and may be terminated solely by written notice signed by each of the Companies and an officer of the Security Agent.

8.    Custom Broker’s Lien: The Customs Broker shall have a lien, to the extent provided by law, on any Property then in the possession of the Customs Broker, which lien shall be to the extent of any out-of-pocket costs, fees, freight charges, storage charges, or other charges or out-of-pocket expenses incurred or paid by the Customs Broker with respect only to that Property then in the possession of the Customs Broker, for which the Customs Broker has not received payment, but not for any amount owed on account of any other Property, item, or matter.

9.    Counterparts; Integration: 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 constitutes the entire agreement between the Customs Broker and the Security Agent relating to the subject matter hereof. In the event of any conflict between this agreement and the terms of the underlying agreement between the Companies and Customs Broker, the terms of this agreement shall govern. This agreement shall become effective when it shall have been executed by the parties and when the Security 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 other electronic transmission shall be effective as delivery of a manually executed counterpart of this agreement.

10.    Governing Law: THIS AGREEMENT AND ANY NON-CONTRACTUAL OBLIGATIONS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, ENGLISH LAW. EACH PARTY IRREVOCABLY AGREES THAT THE COURTS OF ENGLAND SHALL HAVE EXCLUSIVE JURISDICTION TO SETTLE ANY DISPUTES WHICH MAY ARISE OUT OF OR IN CONNECTION WITH THIS AGREEMENT (INCLUDING A DISPUTE REGARDING THE EXISTENCE, VALIDITY OR TERMINATION OF THIS AGREEMENT).

[SIGNATURE PAGE FOLLOWS]

Exhibit T-2
Page 5

If the foregoing correctly sets forth our understanding, please indicate the Customs Broker’s assent below following which this letter will take effect as a sealed instrument.

Very truly yours,

COMPANY:

_________________________________

By:______________________________

Name: Title:    

Agreed:

CUSTOMS BROKER:

_________________________________

By:______________________________
Name: Title:    

SECURITY AGENT:

DEUTSCHE BANK AG NEW YORK BRANCH

By:______________________________
Name: Title:    

By: ______________________________
Name: Title:

Exhibit T-2
Page 6

EXHIBIT A

EXHIBIT U

FORM OF SUBSIDIARY BORROWER ASSUMPTION AGREEMENT

SUBSIDIARY BORROWER ASSUMPTION AGREEMENT (the “Agreement”) dated as of _________, ____, by _______________, a ______________ corporation (the “Applicable Borrower”). Unless otherwise defined herein, capitalized terms used herein and defined in the Credit Agreement referred to below are used herein as so defined.

W I T N E S S E T H :

WHEREAS, TRU Europe Limited (the “European Parent Guarantor”), TRU Iberia Holdings 1, S.L.U. (formerly known as Nutley, S.L.U.) (the “Spanish Parent Guarantor”), TRU Australia Holdings, LLC (the “Australian Parent Guarantor”), Toys “R” Us (UK) Limited (the “UK Holdco”), Toys “R” Us Limited (“Toys UK” and together with the UK Holdco, the “U.K. Borrowers”), Toys “R” Us (Australia) Pty Ltd (ABN 77 057 455 026) “Australian Borrower”), Toys “R” US GmbH (the “German Borrower”), Toys “R” Us Iberia, S.A.U. (the “Spanish Borrower” and, together with the U.K. Borrowers, Australian Borrowers and German Borrower, collectively, the “Borrowers”), the other Obligors from time to time party thereto, the Lenders party thereto from time to time, Deutsche Bank AG New York Branch, as Administrative Agent and Security Agent, Deutsche Bank AG New York Branch and Bank of America, N.A., as Co-Collateral Agents, Deutsche Bank AG, London Branch, as Facility Agent and the other Agents party thereto from time to time are party to a Syndicated Facility Agreement, dated as of October 15, 2009, amended and restated as of March 8, 2011, amended as of March 20, 2013, and further amended and restated as of December 18, 2015 (as so amended and restated and as the same may be further amended, amended and restated, supplemented and/or otherwise modified from time to time, the “Credit Agreement”);

WHEREAS, pursuant to Section 9.13 of the Credit Agreement, the Obligor’s Agent may designate one of the European Parent Guarantor’s Wholly-Owned Subsidiaries as a Borrower;

WHEREAS, the Obligor’s Agent desires to designate the Applicable Borrower as a Borrower for purposes of the Credit Agreement and the other Credit Documents; and

WHEREAS, the Applicable Borrower desires to execute and deliver this Agreement in order to become a party to the Credit Agreement as a Borrower;

NOW, THEREFORE, IT IS AGREED:

1.    Assumption. By executing and delivering this Agreement, the Applicable Borrower hereby becomes a party to the Credit Agreement as a “Borrower” thereunder, and hereby expressly assumes all obligations and liabilities applicable to it as a “Borrower” thereunder.

2.    Representations, Warranties and Agreements.    In order to induce the Lenders to make Loans to, and issue Letters of Credit for the account of the Applicable Borrower as provided in the Credit Agreement, the Applicable Borrower hereby makes and undertakes, as the case may be, each representation and warranty as a Borrower pursuant to Section 8 of the Credit

Exhibit U
Page 2

Agreement as of the date hereof (except to the extent any such representation or warranty relates solely to an earlier date in which case such representation and warranty is made as of such earlier date).

3.    Guarantor Acknowledgment.    Each Guarantor acknowledges and agrees that all Obligations of the Applicable Borrower as a “Borrower” shall be fully guaranteed pursuant to the respective Guaranties as, and to the extent provided therein and in the Credit Agreement.

4.    Counterparts. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

5.    GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.

Exhibit U
Page 3

IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed and delivered as of the date first above written.

[APPLICABLE BORROWER]

By: Name:
Title:

ACKNOWLEDGED:

TRU EUROPE LIMITED,

as the Obligor’s Agent

By: Name:
Title:

[EACH OTHER CREDIT PARTY]

By: Name:
Title:

Deutsche Bank AG New York Branch,
as Administrative Agent

By: Name:
Title:

By: Name:
Title:

EX-10.17

EXHIBIT 10.17

AMENDMENT NO. 2 TO THE

STOCKHOLDERS AGREEMENT

October 14, 2015

This Amendment No. 2 (this “Amendment” or “Amendment No. 2”) to the Stockholders Agreement among Toys “R” Us, Inc. (as successor to Toys “R” Us Holdings, Inc.), 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, as amended by Amendment No. 1, dated as of June 10, 2008 (as amended, the “Agreement”) shall become effective as of the date first set forth above. Capitalized terms used but not otherwise defined in this Amendment have the meaning given to such terms in the Agreement.

1. Section 2.1. Section 2.1 of the Agreement is hereby deleted and replaced with the following:

2.1 Board of Directors.

2.1.1. Board Size. As of the date of Amendment No. 2, the number of members of the Board shall be fixed at eight (8), or such other number as is determined from time to time pursuant to Sections 2.5 and 2.6.1.

2.1.2. Designation of Directors. As of the date of Amendment No. 2, the Board shall be composed of the following, unless otherwise determined by the Board, in accordance with Section 2.6.1:

(a) two (2) persons designated by Bain (subject to Section 11.1), (the “Bain Designees”);

(b) two (2) persons designated by KKR (the “KKR Designees”);

(c) two (2) persons designated by Vornado (the “Vornado Designees” and together with the Bain Designees and the KKR Designees, the “Sponsor Designees”);

(d) the chief executive officer of the Company; and

(e) one Independent Director, to be selected by the Board.

2.1.3. Sell-Down Provisions. In the event that any Sponsor ceases to own at least 30% of such Sponsor’s Initial Shares but continues to own at least 15% of such Sponsor’s Initial Shares, such Sponsor shall no longer have the right to designate two (2) Sponsor Designees and shall have the right to designate only one (1) Sponsor Designee. In the event that any Sponsor ceases to own at least 15% of such Sponsor’s

Initial Shares, such Sponsor shall no longer have the right to designate any Sponsor Designees.

2. Section 2.4.1. Section 2.4.1 of the Agreement is hereby deleted and replaced with the following:

“The Board may from time to time designate one or more committees, each of which shall be a three (3) member committee, provided that the Audit Committee of the Board may be up to a four (4) member committee. Bain shall have the right to designate to each committee one (1) Bain Designee, KKR shall have the right to designate to each committee one (1) KKR Designee, and Vornado shall have the right to designate to each committee one (1) Vornado Designee; providedthat the Audit Committee may also include one Independent Director; and providedfurther that in the event that any Sponsor ceases to own at least 30% of such Sponsor’s Initial Shares, such Sponsor shall no longer have the right to have any Sponsor Designees serve as members of the Board’s committees. To the extent that any Sponsor, under this Section 2.4.1, is not entitled to designate any Sponsor Designees as members of the Board’s committees, such Sponsor shall send a written notice to the Secretary of the Company stating the names of the Sponsor Designees to be removed from the Board’s committees and, upon receipt of such notice by the Secretary of the Company, such Sponsor Designees shall be deemed to have resigned from such committees. Any vacancies on the Board’s committees shall be filled by the remaining committee members acting in accordance with the Company’s nomination and governance procedures and this Agreement and so long as two (but not three) Sponsors own at least 30% of such Sponsor’s Initial Shares, the size of the committees shall be two (2) member committees (or in the case of the Audit Committee, up to a three (3) member committee).”

3. Section 2.6.1. Section 2.6.1 of the Agreement is hereby amended by deleting clause (a) thereof.

4. Section 2.6.10. Section 2.6.10 of the Agreement is hereby deleted and replaced with the following:

“2.6.10. Dissolution; Liquidation; Reorganization; Bankruptcy. Dissolve, liquidate or engage in any recapitalization or reorganization of the Company or any Subsidiary which is a “significant subsidiary” as defined in Rule 1-02(w) of Regulation S-X, other than any Subsidiary acting as a holding company, or initiate a bankruptcy proceeding involving the Company or any Subsidiary.

5. Section 4.1.6. Section 4.1.6 of the Agreement is hereby deleted and replaced with the following:

“4.1.6. Rule 144(b)(1) Eligibility. Notwithstanding anything to the contrary in this Agreement, after the two-year anniversary of the Initial Public Offering, if eligible

to Sell all of its Shares pursuant to paragraph (b)(1) of Rule 144, a Stockholder shall no longer be eligible to participate in the Tag-Along rights provided in this Section 4.1.”

6. Section 8.4. Section 8.4 of the Agreement is hereby amended by deleting the reference to “paragraph (k) of Rule 144” and replacing it with a reference to “paragraph (b)(1) of Rule 144”.

7. Section 10.2. Section 10.2 of the Agreement is hereby amended by amending the following definitions as follows:

(a) the definition of “Majority Sponsor Approval” shall be amended by deleting the existing definition and replacing it with the following:

““Majority Sponsor Approval” means (i) the written approval of the Sponsor Majority or (ii) so long as at least one Sponsor continues to own at least 30% of its Initial Shares, unanimous approval (other than any director who has recused himself or herself as a result of any actual or potential interest in the transaction or matter being approved) of (a) the Board or (b) the Executive Committee of the Board (provided that the Executive Committee of the Board contains a designee of each Sponsor which continues to own at least 30% of its Initial Shares), either by action by written consent or approval at a duly called meeting of the Board or the Executive Committee of the Board, as applicable, where all members of the Board or the Executive Committee of the Board, as applicable, are present (other than any director who has recused himself or herself at such meeting).”

(b) the definition of “Senior Manager” shall be amended by deleting the existing definition and replacing it with the following:

““Senior Manager” shall mean the chief executive officer (or if none, the highest ranking executive officer) of the Company, the chief financial officer (or if none, the highest ranking financial officer) of the Company and any executive officer of the Company as determined by the Board from time to time.”

(c) the definition of “Unanimous Sponsor Approval” shall be amended by deleting the existing definition and replacing it with the following:

““Unanimous Sponsor Approval” means (i) the written approval of each of the Sponsors that continues to own at least 50% of its Initial Shares; provided that if none of the Sponsors continues to own at least 50% of its Initial Shares, Unanimous Sponsor Approval shall mean Majority Sponsor Approval or (ii) so long as at least one Sponsor continues to own at least 30% of its Initial Shares, unanimous approval (other than any director who has recused himself or herself as a result of any actual or potential interest in the transaction or matter being approved) of (a) the Board or (b) the Executive Committee of the Board (provided that the Executive Committee

of the Board contains a designee of each Sponsor which continues to own at least 30% of its Initial Shares), either by action by written consent or approval at a duly called meeting of the Board or the Executive Committee of the Board, as applicable, where all members of the Board or the Executive Committee of the Board, as applicable, are present (other than any director who has recused himself or herself at such meeting).”

8. Section 11.3. Section 11.3 of the Agreement is hereby amended by adding the following at the end thereof:

“Without exclusion of any other means of communication, consent or approval submitted to the Company via email communication to the Chief Executive Officer, Chief Financial Officer or the General Counsel of the Company shall constitute consent or approval for purposes of this Agreement.”

9. Continuing Force and Effect. The Agreement, as modified by the terms of this Amendment, shall continue in full force and effect from and after the date of the adoption of this Amendment set forth above.

10. Counterparts. This Amendment may be executed by the parties hereto in any number of separate counterparts (including facsimiled counterparts), each of which shall be deemed to be an original, and all of which taken together shall be deemed to constitute one and the same instrument.

11. Consent to Amendment. The execution of this Amendment by each of the parties thereto shall be deemed to constitute “Unanimous Sponsor Approval” of this Amendment and the matters contained therein pursuant to Section 2.6.1 and other applicable sections of the Agreement.

12. GOVERNING LAW. THIS AMENDMENT AND SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

IN WITNESS WHEREOF, the parties have executed this Amendment No. 2 to the Stockholders Agreement on the day and year first written above.

TOYS “R” US, INC.

By: /s/ David J. Schwartz            

Name: David J. Schwartz            

Title: EVP-General Counsel        

BAIN CAPITAL (TRU) VIII. L.P.

By: Bain Capital Partners VIII, L.P.

Its: General Partner

By: Bain Capital Investors, LLC

Its: General Partner

By: /s/ Matthew Levin            

Name: Matthew Levin            

Its:

BAIN CAPITAL (TRU) VIII-E, L.P.

By: Bain Capital Partners VIII-E, L.P.

Its: General Partner

By: Bain Capital Investors, LLC

Its: General Partner

By: /s/ Matthew Levin            

Name: Matthew Levin            

Its:

BAIN CAPITAL (TRU) VIII

COINVESTMENT, L.P.

By: Bain Capital Partners VIII, L.P.

Its: General Partner

By: Bain Capital Investors, LLC

Its: General Partner

By: /s/ Matthew Levin            

Name: Matthew Levin            

Its:

BAIN CAPITAL INTEGRAL

INVESTORS, LLC.

By: Bain Capital Investors, LLC.

Its: Administrative Member

By: /s/ Matthew Levin            

Name: Matthew Levin            

Its:

BCIP TCV, LLC

By: Bain Capital Investors, LLC.

Its: Administrative Member

By: /s/ Matthew Levin            

Name: Matthew Levin            

Its:

TOYBOX HOLDINGS, LLC

By: /s/ Nathaniel H. Taylor        

Name: Nathaniel H. Taylor        

Its:

VORNADO TRUCK, LLC.

By: Vornado Realty L.P.

Its: Sole Member

By: Vornado Realty Trust

Its: Sole Member

By: /s/ Joseph Macnow_____________

Name: Joseph Macnow_____________

Its: EVP-Chief Administration Officer_

EX-10.23

Exhibit 10.23

AMENDMENT NO. 5 TO THE

ADVISORY AGREEMENT

This Amendment No. 5 (this “Amendment”) to the Advisory Agreement among Toys “R” Us, Inc., (the “Company”), Bain Capital Partners, LLC, a Delaware limited liability company (“BCP”), Bain Capital, Ltd., a company organized under the laws of England and Wales (“BCL” and, together with BCP, “Bain”), Kohlberg Kravis Roberts & Co., L.P., a Delaware limited partnership (“KKR”), and Vornado Truck LLC, a Delaware limited liability company (“Vornado” and together with Bain and KKR, the “Advisors”), dated as of July 21, 2005, as amended on June 10, 2008, February 1, 2009, August 29, 2014 and June 1, 2015 (the “Agreement”), shall become effective as of December 1, 2015. Capitalized terms used but not otherwise defined in this Amendment shall have the meaning given to such terms in the Reorganization Agreement and/or the Agreement, as applicable.

1. Definition of Quarterly Fee Amount. The definition of “Quarterly Fee Amount” is hereby amended to add the following sentence at the end of the definition:

“For the avoidance of doubt, in the event of an IPO, the Company shall not have to pay the portion of the Quarterly Fee amount for fiscal years 2009 and 2014 that was previously deferred by the Advisors.”

2. Transaction Fees and Expenses. The Agreement is hereby amended to add the following sentence at the end of the Section 4(b):

“Notwithstanding the foregoing, effective December 1, 2015, the Company shall no longer be required to pay the Subsequent Transaction Fee in connection with the consummation of any transactions contemplated by this Section 4(b) including, with respect to any prior transactions for which the Company has not paid the Advisors a Subsequent Transaction Fee or any transactions where a portion of the Subsequent Transaction Fee is to be paid at the time the Company completes an IPO.”

3. Continuing Force and Effect. The Agreement, as modified by the terms of this Amendment, shall continue in full force and effect from and after the date of the adoption of this Amendment set forth above.

4. Counterparts. This Amendment may be executed by the parties hereto in any number of separate counterparts (including facsimiled counterparts), each of which shall be deemed to be an original, and all of which taken together shall be deemed to constitute one and the same instrument.

5. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

[*****]

IN WITNESS WHEREOF, the parties have executed this Amendment No. 5 to the Advisory Agreement on the day and year first written above.

TOYS “R” US, INC.

By: /s/David J. Schwartz________

Name: David J. Schwartz

Title: Executive Vice President –

General Counsel

BAIN CAPITAL PARTNERS, LLC

By: /s/ Matthew S. Levin_________

Name: Matthew S. Levin

Its:

BAIN CAPITAL, LTD.

By: /s/ Matthew S. Levin__________

Name: Matthew S. Levin

Its:

KOHLBERG KRAVIS ROBERTS & CO., L.P.

By: KKR & Co. LLC

By: /s/ Nathaniel H. Taylor____________

Name: Nathaniel H. Taylor

Its:

VORNADO TRUCK, LLC

By: /s/ Wendy Silverstein_____________

Name: Wendy Silverstein

Its: Authorized Signatory    

EX-10.27

Exhibit 10.27

TAD (Team Achievement Dividend) Plan

I. PURPOSE

Toys “R” Us, Inc. (the “Company”) has established the Team Achievement Dividend Plan (“TAD” or the “Plan”) to award annual cash incentives for purposes of motivating, rewarding and retaining eligible Team Members based in the Global Resource Center (“GRC”).

II. EFFECTIVE DATE

This Plan sets forth the annual bonus program for each fiscal year of the Company beginning with the _____ fiscal year and supersedes and replaces all previous annual cash incentive programs (whether written or oral, formal or informal) in effect for GRC Team Members.

III. ELIGIBILITY

1. All regular full-time and part-time Team Members working at the GRC are eligible to participate in TAD, unless otherwise specified in the annual TAD Plan Summary. For the purposes of TAD, a regular Team Member is defined as not having seasonal, contract or temporary employment status. For the avoidance of doubt, all Executive Officers of the Company shall be deemed as being based in GRC regardless of their geographic location.

2. New Team Members hired after the first day of a Plan Year but on or prior to November 15^th of such Plan Year will be eligible to receive a pro rata payment of a TAD award based on the number of days employed in such Plan Year. Team Members hired after November 15^th of any Plan Year will not be eligible to participate in TAD for that Plan Year.

3. Team Members must be employed on the payout date for each Plan Year to receive their potential TAD award for that Plan Year. Team Members who leave the Company, voluntarily or involuntarily, prior to the payout date will not be eligible to receive the TAD award except as may be required by any applicable employment agreement or as set forth in Section VI.

IV. METRIC DEFINITIONS & BUSINESS UNIT DEFINITIONS

EBITDA is adjusted EBITDA, and is defined as net earnings before interest expense, income tax, depreciation and amortization, 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-

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recurring.  Examples include private equity sponsor management and advisory fees, goodwill and asset impairment charges, restructuring charges, impact of litigation and net gains on sales of properties.

Financial Target is the fiscal budget/plan approved by the Board of Directors of the Company. For incentive purposes, the EBITDA results used to determine achievement against financial plan are net of any incentive award expenses.

Global Business Units are departments that, overall, have global responsibility and/or work on or support global initiatives. The following departments are considered Global Business Units:

•        Business Transformation •        Digital •        Finance •        Human Resources •        Information Technology •        Franchise •        Legal •        Logistics •        Procurement •        Public Relations/Communications •        Quality Assurance •        R Brands •        Real Estate

Leverage is the ability to earn a higher or lower TAD award based on the achievement of the financial metrics. Leverage only applies to Team Members whose TAD Award Target is based on a percentage (%) of annual base salary.

Plan Year means each applicable fiscal year of the Company during which the Plan is in effect.

TAD Award Target is the amount of the annual cash bonus target that a Team Member may be eligible to earn if the Company achieves its applicable EBITDA target(s). For Levels C, D, D1, E, F and G, target TAD Award Targets are a percentage (%) of your annual base salary and varies based on your grade level and/or role.

Your TAD Award Target is consistent with your previous annual bonus target. If you do not know what your TAD Award Target is, you may contact your HR Business Partner for clarification.

For Levels H60, H80, H90, A and B, the TAD Award Target will be set forth on Schedule B that will be attached to the TAD and updated for each Plan Year.

US Business Units are departments that, overall, support the US business. The following departments are considered US Business Units:

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•        Asset Protection •        Guest Services •        Marketing •        Merchandising •        Merchandise Presentation •        Planning & Allocations •        Regional Store Operations •        Store Operations •        Store Planning •        Supply Chain Operations •        Visual Merchandising

V. DESIGN & METRICS

TAD awards are based 100% on the financial performance of the Company in its achievement of its target EBITDA goals. The applicable EBITDA metrics vary by business unit for each Plan Year. The applicable target for each such metric will be set forth on the Schedule A that will be attached to the TAD and updated for each Plan Year.

Team Members whose TAD award is based on a percentage (%) of annual base salary will be leveraged based on achievement against the financial target(s). Achievements can result in a TAD award being between 0% - 150% of your TAD Award Target.

Team Members whose TAD award is a fixed payout are not leveraged. The financial target must be met in order for your fixed payout to be paid to you.

VI. PRO RATA RULES

For each Plan Year your award will be based upon your TAD Award Target and, where applicable, your rate of annual base salary as in effect on November 15^th of that Plan Year.

Any changes to a Team Member’s business unit, TAD Award Target and annual base salary rate after November 15^th will be prorated based upon the number of days the applicable element applies.

All eligibility rules outlined in Section III must still be met.

a. Movement Between Company Incentive Plans

If a Team Member changes positions during a Plan Year where a different incentive plan applies, results used will be prorated based on the number of days spent in each plan during that Plan Year.

b. Movement Between Business Units (Global vs US)

If a Team Member changes positions during a Plan Year that results in a change from a Global Business Unit to US Business Unit or vice versa, results used will be prorated based on the number of days spent in each Business Unit during that Plan Year.

c. New Hires

Team Members who commence employment after the first day of the Plan Year but on or prior to November 15^th of that Plan Year, will have their TAD award prorated based on the number of actual days spent in an eligible position during such Plan Year. If a

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Team Member commences employment after November 15^th of any Plan Year, he/she is not eligible to participate in the Plan for such Plan Year.

d. Promotions

For each Plan Year, the rate of annual base salary and TAD Award Target for Team Members who are promoted on or prior to November 15^th of that Plan Year will not be prorated. Any promotions that occur after November 15^th of any Plan Year will be prorated using November 15^th as the starting point.

e. Demotions

For each Plan Year, Team Members who are demoted after November 15^th of that Plan Year, will have their TAD award prorated based upon the number of actual days spent in each incentive eligible position, if applicable.

f. Rehires

Team Members who experience gaps in service during a Plan Year due to either: (a) separation from the Company and subsequent rehire, or (b) temporary suspension from job duties, will have their TAD award based on the total days worked in any incentive eligible position during a Plan Year.

g. Leaves of Absence

Team Members who were absent due to an approved leave(s) of absence remain eligible to receive a TAD award as long as they worked at least one day during the applicable Plan Year and are employed on the payout date.

h. Retirement

Team Members who retire from the Company after the close of the applicable Plan Year, but prior to the payout date, will still be eligible to receive their TAD award if they retire after attaining age 60 and have 10 or more years of continuous service from their most recent hire date.

i. Reduction In Force

Team Members impacted by a reduction in force after the close of the applicable Plan Year but who are not actively employed on the payout date remain eligible to receive their TAD award.

j. Death

In the case of an eligible Team Member who dies during a Plan Year, the amount of the TAD award, assuming the applicable performance goals are met, will be prorated based on the date of death and the number of days the team member was employed during such Plan Year. Any payment due will be paid to the Team Member’s beneficiary or estate at the time set forth in Section VII below.

VII. PAYMENTS

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For each Plan Year, if financial goals and all other terms and conditions are satisfied, TAD award payouts will be made to each eligible Team Member in one lump sum cash payment on a date selected by the Company during the 2 ½ month period following the close of such Plan Year. All payments are subject to applicable tax withholding and payroll deductions required by law, as well as any other previously defined Company or individual withholdings.

Prior to the payout of any TAD award for any Plan Year, the total incentive award spend will be reviewed and approved by an appropriate committee of the Board of Directors.

VIII. GENERAL PROVISIONS

a. The Company reserves the right to amend, suspend, or terminate all or part of the TAD, or to modify any payments thereunder, for any or no reason, with or without advance notice, until and including the day before the last day of the applicable Fiscal Year. As of the last day of any applicable Plan Year or thereafter, the Company is precluded from exercising the rights delineated in the previous sentence with respect to TAD awards for such Plan Year.

b. TAD awards may not be transferred, assigned, pledged or hypothecated (whether by operation of law or otherwise), except as provided by will or the applicable laws of descent and distribution, and no TAD awards shall be subject to execution, attachment or similar process. Any attempted assignment, transfer, pledge, hypothecation or other disposition of a TAD award not specifically permitted herein shall be null and void and without effect.

c.     Participation in the TAD is not a guarantee of continued or future employment and does not alter the “at-will” employment nature of the relationship between a Team Member and the Company.

d. Any proposed exceptions to the Plan must be submitted in writing to the GRC Compensation department. Approval must be obtained prior to any action being taken and/or discussions with a Team Member.

e. The Company will have the exclusive authority to administer and interpret this Plan in its sole discretion

5

Schedule A

TAD Plan Goals for the _____ Plan Year

6

Schedule B

TAD Award Targets for Levels H60, H80, H90, A and B for the _____ Plan Year

7

EX-10.31

Exhibit 10.31

AMENDMENT NO. 4 TO THE

TOYS “R” US, INC.

2010 INCENTIVE PLAN

This Amendment No. 4 (this “Amendment”) to the Toys “R” Us, Inc. 2010 Incentive Plan, as previously amended effective as of June 1, 2015 (the “Plan”), shall become effective as of March 22, 2016. Capitalized terms used but not otherwise defined in this Amendment shall have the meaning given to such terms in the Plan.

1. Prong (i) of the first sentence of Section 5.1 of the Plan is hereby deleted and replaced with the following:

“(i) 7,750,000 Shares; plus”.

2. Continuing Force and Effect. The Plan, as modified by the terms of this Amendment, shall continue in full force and effect from and after the date of the adoption of this Amendment set forth above.

[Signature page follows]

I hereby certify that the foregoing Amendment was duly adopted by the Board of Directors of Toys “R” Us, Inc. as of March 9, 2016.

Executed on this 22^nd day of March, 2016.

/s/ David J. Schwartz

David J. Schwartz

Secretary

EX-10.43

Exhibit 10.43

TIME-BASED

NONQUALIFIED STOCK OPTION AGREEMENT

OF

TOYS “R” US, INC.

THIS AGREEMENT (the “Agreement”), is made, effective as of the __ day of _____, _______ (the “Grant Date”), between Toys “R” Us, Inc., a Delaware corporation (the “Company”), and __________ (“Participant”). By accepting this Agreement, Participant agrees to all of the terms and conditions set forth herein, including without limitation, Sections 4 and 5 hereof.

RECITALS:

WHEREAS, the Company has adopted the Toys “R” Us, Inc. 2010 Incentive Plan, as amended (the “Plan”), which Plan is incorporated herein by reference and made a part of this Agreement. Capitalized terms not otherwise defined herein shall have the same meanings as in the Plan; and

WHEREAS, the Committee has determined that it would be in the best interests of the Company and its shareholders to grant the stock option provided for herein to Participant pursuant to the Plan and the terms set forth herein.

NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties agree as follows:

1.Grant of the Option. The Company hereby grants to Participant the right and option (the “Option”) to purchase, on the terms and conditions hereinafter set forth, all or any part of ________ Shares, subject to adjustment as set forth in the Plan. The purchase price of the Shares subject to the Option shall be $_______ per Share, which was determined by the Board as the Fair Market Value of the Shares as of the Grant Date (the “Option Price”). The Option is intended to be a non-qualified stock option, and is not intended to be treated as an option that complies with Section 422 of the Internal Revenue Code of 1986, as amended.

2.Vesting.

(a)[Vesting terms]

(b)If Participant’s employment with the Company and the Affiliates is terminated for any reason, the Option shall, to the extent not then vested (after giving effect to Section 2(c) below), be canceled by the Company without consideration and the Vested Portion of the Option shall remain exercisable for the period set forth in Section 3(a).

(c)If Participant’s employment with the Company and the Affiliates is terminated due to death, Disability or Retirement, the Option shall become fully vested and shall remain exercisable for the period set forth in Section 3(a).

1

(d)Notwithstanding any other provisions of this Agreement to the contrary, in the event of a Change in Control, the Option shall become fully vested and shall remain exercisable for the period set forth in Section 3(a).

3.Exercise of Option.

(a)Period of Exercise. Subject to the provisions of the Plan and this Agreement, Participant may exercise all or any part of the Vested Portion of the Option with respect to the Shares subject thereto at any time prior to theearliestto occur of:

(i)the 10th anniversary of the Grant Date;

(ii)one year following the date of Participant’s termination of employment either by the Company without Cause or by Participant for Good Reason (as defined below) or due to Participant’s death, Disability or Retirement;

(iii)90 days following the date of Participant’s termination of employment by Participant without Good Reason (unless such termination occurs after Participant has attained eligibility for Retirement); or

(iv)immediately prior to the date of Participant’s termination of employment by the Company for Cause (i.e., the Vested Portion and Unvested Portion of the Option shall be unexercisable and immediately forfeited in such event).

provided, in each case, the Unvested Portion shall be unexercisable and immediately forfeited.

For purposes of this Agreement, “Good Reason” shall have the meaning assigned to such term in the employment agreement then in effect between Participant and the Company or an Affiliate or, if not defined therein or if no such agreement exists, “Good Reason” shall mean the occurrence of any of the following events without Participant’s prior written consent: (i) a material reduction in Participant’s then current annual base salary or target bonus opportunity or (ii) a failure by the Company or an Affiliate to pay the compensation and benefits due to Participant. Notwithstanding the foregoing, Participant’s termination shall only constitute a termination for Good Reason hereunder if (x) Participant provides the Company with written notice of termination setting forth the specific facts or circumstances constituting Good Reason within 30 days after the initial existence of such facts or circumstances, (y) the Company has failed to cure such facts or circumstances within 30 days after receipt of such notice, and (z) the date of Participant’s termination of employment occurs no later than 90 days after the initial occurrence of the event constituting Good Reason.

(b)Method of Exercise.

(i)Subject to Section 3(a), the Vested Portion of the Option may be exercised by delivering to the Company at its principal office written notice of intent to so exercise; provided that, the Option may be exercised with respect to whole Shares only. Such notice shall specify the number of Shares for which the Option is being exercised and shall be accompanied by payment in full of the Option Price. The payment of the Option Price may be made at the election of Participant (i) in cash or its equivalent (e.g., by check), (ii) if there is no public market for the Shares at such time and subject to the prior written approval of the Committee, pursuant to a cashless exercise (as described below), (iii) if

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there is a public market for the Shares at such time, through the delivery of irrevocable instructions to a broker to sell Shares obtained upon the exercise of the Option and to deliver promptly to the Company an amount out of the proceeds of such Sale equal to the aggregate option price for the Shares being purchased, or (iv) any combination of cash and such other available method of exercise. Any cashless exercise shall be effectuated by the Company delivering Shares to Participant having a Fair Market Value equal to (a) the Fair Market Value of all Shares issuable upon exercise of the Option, minus (b) the aggregate exercise price for such Shares. Participant shall not have any rights to dividends or other rights of a stockholder with respect to Shares subject to the Option until Participant has given written notice of exercise of the Option, paid in full for such Shares and, if applicable, has satisfied any other conditions imposed by the Committee pursuant to the Plan.

(ii)Notwithstanding any other provision of the Plan or this Agreement to the contrary, the Option may not be exercised prior to the completion of any registration or qualification of the Option or the Shares under applicable state and federal securities or other laws, or under any ruling or regulation of any governmental body or national securities exchange that the Committee shall in its sole discretion determine to be necessary or advisable.

(iii)Upon the Company’s determination that the Option has been validly exercised as to any of the Shares, the Company shall issue an Award Certificate in Participant’s name for such Shares. However, the Company shall not be liable to Participant for damages relating to any delays in issuing the Award Certificate or any mistakes or errors in the Award Certificate.

(iv)In the event of Participant’s death, the Vested Portion of the Option shall remain exercisable by Participant’s executor or administrator, or the person or persons to whom Participant’s rights under this Agreement shall pass by will or by the laws of descent and distribution as the case may be, to the extent set forth in Section 3(a). Any heir or legatee of Participant shall take rights herein granted subject to the terms and conditions hereof.

4.Stockholders Agreement. Exercise of the Option shall constitute agreement by Participant to be bound by all of the terms and conditions of the Stockholders Agreement with respect to the Shares, or any other Company capital stock, issuable to or held by Participant. All of the terms of the Stockholders Agreement are incorporated herein by reference. For purposes of this Agreement, the term “Stockholders Agreement” shall mean the Management Stockholders Addendum, as amended, which is attached hereto as Exhibit A. Participant hereby acknowledges and agrees that the Stockholders Agreement includes the Appendix to the Management Stockholders Addendum, which Appendix applies (a) with respect to Section 2 thereof, to all Shares issued to Participant under the 2010 Plan (including Shares issued and issuable under Awards granted prior to the date hereof, (b) with respect to Section 3 thereof, to all Shares issued to Participant under any equity incentive plan of the Company and (c) with respect to Section 4 thereof, to all Awards of Restricted Stock and Restricted Stock Units issued to Participant under the Plan.

5.Restrictive Covenants. The Company and its Subsidiaries operate in a highly sensitive and competitive commercial environment. As part of Participant’s employment with the Company and its Subsidiaries, Participant will be exposed to highly confidential and sensitive information regarding the Company’s and its Subsidiaries’ business operations, including corporate strategy, pricing and other market information, know-how, trade secrets, and valuable customer, supplier, and employee relationships. It is critical that the Company take all necessary steps to

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safeguard its legitimate protectable interests in such information and to prevent any of its competitors or any other persons from obtaining any such information. Therefore, as consideration for the Company’s agreement to grant the Option to Participant, Participant shall agree to be bound by the following restrictive covenants:

(a)Confidentiality. Participant acknowledges that the information, observations and data obtained by him or her while employed by the Company and its Subsidiaries concerning the business or affairs of the Company or any of its Subsidiaries (“Confidential Information”) are the property of the Company or such Subsidiary. Therefore, Participant agrees that he or she shall not disclose to any unauthorized Person or use for his or her own purposes any Confidential Information without the prior written consent of the Board, unless and to the extent that the aforementioned matters become generally known to and available for use by the public other than as a result of Participant’s acts or omissions. Participant shall deliver to the Company or one of its Subsidiaries, at the termination of Participant’s employment, or at any other time the Company may request, all memoranda, notes, plans, records, reports, computer tapes, printouts and software and other documents and data (and copies thereof) relating to the Confidential Information, Work Product (as defined below) or the business of the Company or any of its Subsidiaries which he or she may then possess or have under his or her control.

(b)Assignment of Inventions. Participant acknowledges that all inventions, innovations, improvements, developments, methods, designs, analyses, drawings, reports, formulas, recipes, customer lists, and all similar or related information (whether or not patentable) which relate to the Company’s or any of its Subsidiaries’ actual or anticipated business, research and development or existing or future products or services and which are conceived, developed or made by Participant while employed by the Company and its Subsidiaries (“Work Product”) belong to the Company or such Subsidiary. Participant shall promptly disclose such Work Product to the Board and perform all actions reasonably requested by the Board (whether during or after the period of Participant’s employment) to establish and confirm such ownership (including, without limitation, assignments, consents, powers of attorney and other instruments).

(c)Non-Competition; Non-Solicitation. At any time during Participant’s Non-Competition Period, Participant shall not, for himself or herself or on behalf of any other Person, participate in, directly or indirectly, any Competing Business in any country in which the Company or any of its Subsidiaries or licensees operates or conducts business as of such time (or with respect to the period after the date of the termination of Participant’s employment, as of such date); provided that, nothing in this sentence shall restrict Participant from passive ownership of three (3) percent or less of the publicly traded securities of any Person. During Participant’s employment with the Company and/or its Subsidiaries and for 1 year thereafter, Participant shall not (i) induce or attempt to induce any employee of the Company or its Subsidiaries to leave the employ of the Company or its Subsidiaries, or in any way interfere with the relationship between the Company or its Subsidiaries and any employee thereof, (ii) hire directly or through another entity any person who was an employee (other than clerical or administrative support personnel) of the Company or its Subsidiaries at any time during the Non-Competition Period or (iii) induce or attempt to induce any customer, supplier, licensee or other business relation of the Company or its Subsidiaries to cease doing business with the Company or its Subsidiaries, or in any way interfere with the relationship between any such customer, supplier, licensee or business relation and the Company or its Subsidiaries (including, without limitation, making any negative statements or communications concerning the Company or its Subsidiaries); provided that, clauses (i) and (ii) above shall not apply with respect to any person solicited or employed after the date that is twelve (12) months after the date on which such person’s employment with the Company and its Subsidiaries is terminated.

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(d)No Restriction on Earning a Living. By his or her acceptance and/or acquisition of this Award, Participant thereby acknowledges that the provisions of this Section 5 do not preclude Participant from earning a livelihood, nor do they unreasonably impose limitations on Participant’s ability to earn a living. In addition, Participant thereby acknowledges that the potential harm to the Company and/or its Subsidiaries of non-enforcement of this Section 5 outweighs any harm to Participant of enforcement (by injunction or otherwise) of this Section 5 against him. If any portion of the provisions of this Section 5 is found to be invalid or unenforceable by a court of competent jurisdiction because its duration, territory, definition of activities covered, or definition of information covered is considered to be unreasonable in scope, the invalid or unenforceable term shall be redefined, or a new enforceable term provided, such that the intent of the Company and Participant in agreeing to the provisions of this Section 5 will not be impaired and the provision in question shall be enforceable to the fullest extent of applicable law.

(e)For purposes of this Section 5, the term “Non-Competition Period” for Participant means (i) in the case of termination by the Company with Cause, the period of Participant’s employment plus one (1) year after the date of Participant’s termination of employment, (ii) in the case of resignation for any reason (including Retirement), the period of Participant’s employment plus one (1) year after the date of Participant’s termination of employment, and (iii) otherwise, the period of Participant’s employment plus the greater of one (1) year after the date of Participant’s termination of employment or the length of time, if any, for which Participant receives (or is eligible to receive, where Participant declines or otherwise takes action to reject) in connection with Participant’s termination severance benefits or other similar payments from the Company or its Subsidiaries pursuant to an agreement with Participant, the severance policies of the Company and its Subsidiaries then in effect, at the Company’s or any of its Subsidiaries’ election, or otherwise (or the length of time in terms of compensation used to determine the amount of Participant’s severance benefits in the event such severance benefits are payable in a lump sum or on a schedule different than such length of time). In no event shall any amount received by Participant pursuant to any put or call provisions under the Stockholders Agreement constitute severance or other similar payments for purposes of this definition. For purposes of this Section 5, the term “Competing Business” shall mean, with respect to Participant at any time, any Person engaged wholly or in part (directly or through one or more Subsidiaries) in the retail sale or retail distribution (via stores, mail order, e-commerce, or similar means) of Competing Products, if more than one-third (1/3) of such Person’s gross sales for the twelve (12) month period preceding such time (or with respect to the period after the date of Participant’s termination of employment, as of such date) are generated by engaging in such sale or distribution of Competing Products. Without limiting the foregoing, Competing Businesses shall in any event include Wal-Mart, Sears (K-Mart), Target, Amazon.com, Buy Buy Baby, Mattel, Hasbro, Tesco, Carrefour, or any of their respective subsidiaries or affiliates. For purposes of this Section 5, the term “Competing Products” shall mean, with respect to Participant at any time, (i) toys and games, (ii) video games, computer software for children, and electronic toys or games, (iii) juvenile or baby: products, apparel, equipment, furniture, or consumables, (iv) wheeled goods for children, and (v) any other product or group of related products that represents more than twenty (20) percent of the gross sales of the Company and its Subsidiaries for the twelve (12) month period preceding such time (or with respect to the period after Participant’s termination of employment, as of such date).

6.No Right to Continued Employment. The granting of the Option evidenced hereby and this Agreement shall impose no obligation on the Company or any Affiliate to continue the employment of Participant and shall not lessen or affect the Company’s or any Affiliate’s right to terminate the employment of Participant.

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7.Legend on Award Certificates. The Award Certificate representing the Shares purchased by exercise of the Option shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which such Shares are listed, and any applicable Federal or state laws, and the Committee may cause a legend or legends to be put on the Award Certificate to make appropriate reference to such restrictions.

8.Transferability. The Option may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by Participant otherwise than as permitted by Section 13.3 of the Plan or by will or by the laws of descent and distribution, and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance which is impermissible shall be void and unenforceable against the Company or any Affiliate; provided that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance. No such permitted transfer of the Option to heirs or legatees of Participant shall be effective to bind the Company unless the Committee shall have been furnished with written notice thereof and a copy of such evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee or transferees of the terms and conditions hereof. During Participant’s lifetime, the Option is exercisable only by Participant.

9.Withholding. Participant may be required to pay to the Company or any Affiliate and the Company shall have the right and is hereby authorized to withhold, any applicable withholding taxes in respect of the Option, its exercise or any payment or transfer under or with respect to the Option and to take such other action as may be necessary in the opinion of the Committee to satisfy all obligations for the payment of such withholding taxes.

10.Securities Laws. Upon the acquisition of any Shares pursuant to the exercise of the Option, Participant will make or enter into such written representations, warranties and agreements as the Committee may reasonably request in order to comply with applicable securities laws or with this Agreement.

11.Notices. Any notice necessary under this Agreement shall be addressed to the Company in care of its Secretary at the principal executive office of the Company and to Participant at the address appearing in the personnel records of the Company for Participant or to either party at such other address as either party hereto may hereafter designate in writing to the other. Any such notice shall be deemed effective upon receipt thereof by the addressee.

12.Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO CONFLICTS OF LAWS. By accepting this Award, Participant hereby (i) agrees that any suit, action or proceeding brought by or against Participant in connection with the Plan or this Award shall be brought solely in the courts of the State of Delaware or the United States District Court for the District of Delaware, (ii) consents to the jurisdiction and venue of each such court, and (iii) agrees to accept service of process by the Company or any of its agents in connection with any such proceeding. BY ACCEPTING THIS AWARD, PARTICIPANT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY SUIT, ACTION OR OTHER PROCEEDING INSTITUTED BY OR AGAINST PARTICIPANT IN RESPECT OF HIS OR HER RIGHTS OR OBLIGATIONS HEREUNDER.

13.Option Subject to Plan. By entering into this Agreement Participant agrees and acknowledges that Participant has received and read a copy of the Plan. The Option is subject to the Plan. The terms and provisions of the Plan as it may be amended from time to time are hereby

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incorporated herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail (except that (i) notwithstanding anything to the contrary in Section 13.2 of the Plan, the Option shall be settled in the form of Stock only (not cash), and (ii) the terms of this Agreement shall govern and prevail with respect to any conflicting provision of Section 16.2 of the Plan).

14.Signature. This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement, as of the date first above written, which expressly includes Sections 4 and 5 of this Agreement.

TOYS “R” US, INC.

________________________________________

By: ___________________________________

PARTICIPANT

_______________________________________

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Exhibit A

MANAGEMENT STOCKHOLDERS ADDENDUM

This Management Stockholders Addendum (together with the Appendix attached hereto, this “Addendum”) may be incorporated in and made a part of the awards granted under the Toys “R” Us, Inc. 2010 Incentive Plan (the “Plan”). If specified in an Award Certificate (as defined in the Plan), upon the exercise of any Options or the purchase or acceptance of any Restricted Stock or Restricted Stock Unit, each Participant shall, without any action by such Participant, automatically become bound by the terms hereof with respect to the Award Stock or any other Company capital stock, issued to or held by such Participant under the Plan. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Plan.

1.Definition. For purposes of this Addendum, the following terms shall have the following meanings:

“Addendum” shall have the meaning set forth in the Preface.

“Approved Sale” shall have the meaning set forth in Section 4(b).

“Award Stock” with respect to a Participant, means any Stock issued to such Participant upon exercise of any Options granted under the Plan and any Stock issued to such Participant as Restricted Stock or Restricted Stock Unit. For all purposes of this Plan, Award Stock will continue to be Award Stock in the hands of any holder (including any Permitted Transferee) other than a Participant (except for the Company and purchasers pursuant to a Public Sale), and each such other holder of Award Stock will succeed to all rights and obligations attributable to such Participant as a holder of Award Stock hereunder. Award Stock will also include shares of the Company’s capital stock issued with respect to shares of Award Stock by way of a stock split, stock dividend or other recapitalization.

“Business Day” shall mean any day that is not a Saturday, a Sunday or other day on which banks are required or authorized by law to be closed in the City of New York.

“Executive Officer” shall mean any Management Stockholder who is an officer of the Company (as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended).

“Management Stockholder” shall mean any Participant (including Participants who hold vested Options) and any other holder of Shares, in either case so long as they hold any Shares.

“Participating Sellers”, with respect to Section 4(a), shall have the meaning set forth in Section 4(a)(ii), and with respect to Section 4(b) shall mean any Management Stockholder that is Transferring Shares in an Approved Sale.

“Permitted Vornado Transfer” shall mean any Transfer of shares of the Company’s capital stock by Vornado in order to ensure the preservation of its status as a real estate investment trust under federal tax laws.

“Permitted Transferee” with respect to any Participant means such Participant’s spouse and descendants (whether or not adopted) and any trust, family limited partnership or limited liability company that is and remains at all times solely for the benefit of such

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Participant and/or such Participant’s spouse and/or descendants, in each case which transferee has executed and delivered to the Company the documents required under Sections 13.3 or 13.4 of the Plan, as applicable.

“Piggyback Registration” shall have the meaning set forth in Section 5(a).

“Plan” shall have the meaning set forth in the Preface.

“Prospective Buyer” shall mean any Person, including the Company or any of its subsidiaries, proposing to purchase or otherwise acquire shares in a Sale under Section 4(a) or Section 4(b).

“Public Offering” shall mean a public offering and sale of Stock for cash pursuant to an effective registration statement under the Securities Act.

“Public Sale” shall mean any sale pursuant to a registered public offering under the Securities Act, any sale to the public through a broker, dealer or market maker pursuant to Rule 144 promulgated under the Securities Act, or, after an Initial Public Offering, any block sale to a financial institution in the ordinary course of its trading business.

“Registrable Securities” shall mean (i) any share of Stock issued to or otherwise acquired by any Management Stockholder and (ii) any equity securities issued or issuable directly or indirectly with respect to any of the foregoing securities referred to in clause (i) by way of stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization. As to any particular shares constituting Registrable Securities, such shares will cease to be Registrable Securities when they have been (x) effectively registered under the Securities Act and disposed of in accordance with the registration statement covering them, or (y) sold to the public pursuant to Rule 144 under the Securities Act. For purposes of this Addendum, a Person will be deemed to be a holder of Registrable Securities whenever such Person has the right to acquire directly or indirectly such Registrable Securities upon the exercise of Options, to the extent they are then fully vested and exercisable.

“Rule 144” shall mean Rule 144 under the Securities Act (or any successor rule).

“Sale” shall mean a Transfer for value and the terms “Sell” and “Sold” shall have correlative meanings.

“Securities Act” shall mean the Securities Act of 1933, as amended and in effect from time to time.

“Securities Commission” shall mean the Securities and Exchange Commission, or any successor regulatory body.

“Shares” means any shares of Award Stock under the Plan, and any other capital stock of the Company issued to or held by a holder of Award Stock. For all purposes of the Plan (including this Addendum), Shares will continue to be Shares in the hands of any holder (including any Permitted Transferee), and each such holder of Shares will succeed to all the rights and obligations attributable to such Person as a Management Stockholder hereunder with respect to such Shares, until such time as such Shares cease to be considered Shares pursuant to the express terms of Section 3(b) of this Addendum.

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“Sponsor” shall mean any of Bain Capital (TRU) VIII, LP., Bain Capital (TRU) VIII-E, L.P., Bain Capital (TRU) Coinvestment, L.P., Bain Capital Integral Investors, LLC, BCIP TCV, LLC, Toybox Holdings, LLC, and Vornado, in each case together with their respective Affiliates.

“Tag Along Deadline” shall have the meaning set forth in Section 4(a)(ii).

“Tag Along Holder” shall have the meaning set forth in Section 4(a)(i).

“Tag Along Notice” shall have the meaning set forth in Section 4(a)(i).

“Tag Along Offer” shall have the meaning set forth in Section 4(a)(ii).

“Transfer” shall mean any sale, pledge, assignment, encumbrance or other transfer or disposition of any Shares to any other person, whether directly, indirectly, voluntarily, involuntarily, by operation of law, pursuant to judicial process or otherwise; provided that the sale, pledge, assignment encumbrance or other transfer or disposition of the common shares or beneficial interest, par value $0.04, of Vornado Realty Trust, a Maryland Realty Trust, a Maryland real estate investment trust (or its successors), will not be deemed a Transfer.

“Vornado” means Vornado Truck, LLC.

2.Voting Agreement. Each Management Stockholder, shall at all times cast all votes to which such Management Stockholder is entitled in respect of such Management Stockholder’s Shares, whether at any annual or special meeting, by written consent or otherwise, in such manner as the Company may instruct by written notice. Further, each Management Stockholder hereby grants to the Company an irrevocable proxy coupled with an interest to vote, including in any action by written consent, such Management Stockholder’s Shares as the Company deems appropriate in its sole discretion, which proxy shall be valid and remain in effect with respect to all Shares until they cease, to be Shares pursuant to the terms hereof.

3.Transfer Restrictions.

(a)     General Transfer Restrictions. Each Management Stockholder understands and agrees that any Shares issued to or held by such Management Stockholder on the date hereof have not been registered under the Securities Act or under any state securities laws or the securities laws of any country. No Management Stockholder shall Transfer any such Shares (or solicit any offers in respect of any Transfer of such Shares), except in compliance with the Securities Act, or any applicable state or national securities laws and any restrictions on Transfer contained in the Plan (including this Addendum).

(a)Allowed Transfers. Until the expiration of the provisions of this Section 3, no Management Stockholder shall Transfer any of such Management Stockholder’s Shares to any other Person except as follows:

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(i) Permitted Transferees. A Management Stockholder may Transfer Shares to Permitted Transferees solely to the extent provided by, and in accordance with the terms of, Sections 13.3 and 13.4 of the Plan.

(ii) Participation in Drag Along and Tag-Along; Puts and Calls.

(A)Drag-Along. A Management Stockholder may Transfer such Management Stockholder’s Shares to the extent required pursuant to Section 4(b) below.

(B)Tag-Along. A Participating Seller may Transfer Shares pursuant to and in accordance with the provisions of Section 4(a) below.

Shares Transferred pursuant to this Section 3(b)(ii) shall conclusively be deemed thereafter not to be Shares under this Addendum.

(iii) Public Transfers. A Management Stockholder may Transfer Shares: (a) in a Public Offering pursuant to Section 5 below, or (b) (I) with respect to any Executive Officer, from and after the two-year anniversary of the closing of the Initial Public Offering, pursuant to Rule 144 or a block sale to a financial institution in the ordinary course of its trading business or any other legally permitted sale, or (II) with respect to any other Management Stockholder, from and after the six-month anniversary of the closing of the Initial Public Offering, pursuant to Rule 144 or a block sale to a financial institution in the ordinary course of its trading business or any other legally permitted sale. Shares Transferred pursuant to this Section 3(b)(iii) shall conclusively be deemed thereafter not to be Shares under this Addendum.

(b)Impermissible Transfer. Any attempted Transfer of Shares not permitted under the terms of this Section 3 shall be null and void, and the Company shall not in any way give effect to any such impermissible Transfer.

(c)Notice of Transfer. To the extent any Management Stockholder shall Transfer any Shares pursuant to Sections 3(b)(i) or 3(b)(iii), such Management Stockholder shall, within three (3) Business Days following (or, in the case of a Transfer to a Permitted Transferee, within three (3) Business Days prior to) consummation of such Transfer, deliver notice thereof to the Company, which shall then deliver such notice to the Sponsors.

(d)Period. Each of the foregoing provisions of this Section 3 shall expire upon a Change in Control.

1.“Tag Along” and “Drag Along” Rights.

(a)“Tag Along” Rights. In connection with any Sale by a Sponsor of any Shares of Stock to any Person (other than a Public Sale, a Permitted Vornado transfer, or any Sale between or among the Sponsors, their Affiliates, or any employee of the Company or any of its Subsidiaries):

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(i)Notice. The Company shall, prior to any such proposed Sale, deliver a written notice (the “Tag Along Notice”) to each Management Stockholder (each, a “Tag Along Holder”), specifying the principal terms and conditions of the Sale (including the number of shares of each class of the Company’s capital stock to be Sold in such Sale).

(ii)Exercise. Each Tag Along Holder may elect to participate in the Transfer by delivering written notice (the “Tag Along Offer”) within five (5) Business Days after the date of delivery of the Tag Along Notice to such Holder (such date the “Tag Along Deadline”) (each Tag Along Holder so electing, a “Participating Seller”). Each Tag Along Holder who does not make a Tag Along Offer prior to the Tag Along Deadline shall be deemed to have waived all of such holder’s rights to participate in such Sale. Each Tag Along holder will be given the opportunity to exercise their vested Options prior to or in connection with the consummation of a Sale pursuant to this Section 4(a) and the Award Stock issued upon exercise of such vested Options will be Shares for purposes of this Section 4(a).

(iii)Number of Shares Sold. Each Participating Seller will have the right to include in the Sale, on the same terms and conditions (subject to Section 4(c)(i)) with respect to each Share Sold as the Sponsor proposing such Sale, a number of Shares of each class of Stock to be Sold in such Sale equal to the product of (x) the number of shares of such class of Stock to be Sold in the contemplated Sale, times (y) the quotient obtained by dividing the number of Shares of such class of Stock owned by such Participating Seller by the number of Shares of such class of Stock owned by such Participating Seller and any other Persons participating in such Sale (including the proposing Sponsor and any other Participating Sellers).

(iv)Rule 144 Eligibility. Notwithstanding anything to the contrary herein, after the two year anniversary of the Initial Public Offering, upon becoming eligible to sell all of his or her shares pursuant to Rule 144, a Tag Along Holder shall no longer be eligible to participate in the Tag Along rights provided by this Section 4(a).

(b)“Drag Along” Rights. If the Board approves a Change in Control (an “Approved Sale”), each Management Stockholder hereby agrees, if and to the extent requested by the Board, to Sell any or all of such Management Stockholder’s Shares in such Approved Sale on the terms and conditions approved by the Board.

(i)Management Stockholder Actions. Each Management Stockholder will take all necessary or desirable actions in connection with the consummation of any Approved Sale (including, if such Approved Sale is structured as a merger or consolidation, waiving any dissenters rights, appraisal rights or similar rights in connection with such merger or consolidation).

(ii)Conditions. The obligations of the Management Stockholders with respect to an Approved Sale are subject to the satisfaction of the following conditions: (i) upon the consummation of the Approved Sale, each Management Stockholder will receive the same form and amount of consideration per share as received by the Sponsors for the corresponding class of shares of the Company’s capital stock, or if any Sponsor is given an option as to the form and amount of consideration to be received in respect of shares of the Company’s capital stock of any class, all Management Stockholders holding shares of the Company’s capital stock of such class will be given the same option; and (ii) each holder of vested and exercisable Options will be given the opportunity to exercise such rights prior to or in

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connection with the consummation of an Approved Sale and the Award Stock issued upon exercise of such vested Options will be Shares for purposes of this Section 4(b).

(c)Miscellaneous. The following provisions shall be applied to any proposed Sale to which Section 4(a) or 4(b) applies:

(i)Certain Legal Requirements. In the event the consideration to be paid in exchange for Shares in a proposed Sale pursuant to Section 4(a) or Section 4(b) includes any securities, and the receipt thereof by a Participating Seller would require under applicable law (A) the registration or qualification of such securities or of any Person as a broker or dealer or agent with respect to such securities where such registration or qualification is not otherwise required for the Sale or (B) the provision to any Participating Seller of any specified information regarding such securities or the issuer thereof that is material and not otherwise required to be provided for the Sale, then such Participating Seller shall not have the right to Sell Shares in such proposed Sale, and the Sponsors proposing such Sale (in the case of Section 4(a)) or the Board (in the case of Section 4(b)), as applicable, shall (x) in the case of a Sale that is not a Change in Control, have the right, but not the obligation, and (y) in the case of a Sale that is a Change in Control, have the obligation, to cause to be paid to such Participating Seller in lieu of the issuance of such securities, against surrender of the Shares which would have otherwise been Sold by such Participating Seller to the Prospective Buyer in the proposed Sale, an amount in cash equal to the Fair Market Value of such securities as of the date such securities would have been issued in exchange for such Shares.

(ii)Further Assurances. Each Participating Seller shall take or cause to be taken all such actions as may be reasonably necessary or reasonably desirable in order to expeditiously consummate each Sale pursuant to Section 4(a) or Section 4(b) and any related transactions, including executing acknowledging and delivering consents, assignments, waivers and other documents or instruments; furnishing information and copies of documents; filing applications, reports, returns, filings and other documents or instruments with governmental authorities: and otherwise cooperating with the Sponsor proposing such Sale or the Board (as applicable) and the Prospective Buyer, provided, however, that Participating Sellers shall be obligated to become liable in respect of any representations, warranties, covenants, indemnities or otherwise to the Prospective Buyer solely to the extent provided in the immediately following sentence. Without limiting the generality of the foregoing, each Participating Seller agrees to execute and deliver such agreements as may be reasonably specified by the Sponsor proposing such Sale or the Board (as applicable) to which other sellers will also be party, including agreements to (i)(A) make individual representations, warranties, covenants and other agreements as to the unencumbered title to its Shares and the power, authority and legal right to Transfer such Shares, the absence of any adverse claims with respect to such shares and the non-contravention of other agreements and (B) be liable as to such representations, warranties, covenants and other agreements, in each ease to the same extent (but with respect to its own Shares and with respect to its own representations, warranties, covenants and other agreements) as the other sellers, and (ii) be liable (whether by purchase price adjustment, indemnity payments or otherwise) in respect of representations, warranties, covenants and agreements in respect of the Company and its subsidiaries; provided, however, that the aggregate amount of liability described in this clause (ii) in connection with any Sale shall not exceed the lesser of (i) such Participating Seller’s pro rata portion of any such liability, to be determined in accordance with such Participating Seller’s portion of the aggregate proceeds to all sellers

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in connection with such Sate and (ii) the proceeds to such Participating Seller in connection with such Sale.

(iii)Sale Process. The Sponsor proposing such Sale, in the case of a proposed Sale pursuant to Section 4(a), or the Board, in the case of a proposed Sale pursuant to Section 4(b), shall, in its sole discretion, decide whether or not to pursue, consummate, postpone or abandon any proposed Sale and the terms and conditions thereof. If any proposed Sale is postponed, abandoned or not consummated, then the Sponsors or the Board, as applicable, shall comply with the provisions of this Section 4 with respect to any subsequent proposed Sale. No Company stockholder nor any Affiliate of any such holder shall have any liability to any Management Stockholder arising from, relating to or in connection with the pursuit, consummation, postponement, abandonment or terms and conditions of any proposed Sale.

(iv)Expenses. All reasonable costs and expenses incurred for the benefit of all holders of Stock in connection with any proposed Sale shall be paid by the Company (to the extent not otherwise paid by the acquiring party), subject to the following sentence. Any costs incurred by or on behalf of any Participating Sellers on their own behalf will not be considered costs of the Sale hereunder, and will be borne by such Participating Seller(s).

(d)Period. The provisions of Section 4(a) shall expire upon the earlier to occur of (i) the Initial Public Offering and (ii) a Change in Control. Each of the other provisions of this Section 4 above shall expire upon a Change in Control.

2.Registration Rights.

(a)Right to Piggyback. Whenever the Company proposes to conduct an underwritten registration of any of its securities under the Securities Act (other than (i) in an Initial Public Offering or (ii) in connection with registration on Form S-4 or Form S-8 or any successor or similar form) and the registration form to be used may be used for the registration of Registrable Securities (a “Piggyback Registration”), the Company will give prompt written notice to all holders of Registrable Securities of its intention to effect such a registration and, subject to Section 5(b), will include in such registration all Registrable Securities with respect to which the Company has received written requests for inclusion therein within 15 days after the delivery of the Company’s notice.

(b)Priority on Registrations. In any underwritten registration, if the managing underwriters advise the Company that in their opinion the number of Registrable Securities, or the total number of securities of the Company, requested or proposed to be included in such registration exceeds the number which can be sold in such offering without adversely affecting the marketability of such offering, the Company will include in such registration the Registrable Securities, and the other securities of the Company, that in the opinion of the managing underwriters can be sold without adversely affecting the marketability of such offering, as follows: (i) first, if the registration is a primary offering on behalf of the Company, the securities the Company proposes to sell, (ii) second, any securities of the Company requested to be included in such registration by holders that have a contractual right to include securities in such registration prior to the holders of Registrable Securities, (iii) third, the Registrable Securities and any other securities of the Company requested to be included in such registration, pro rata among the holders of such Registrable Securities and other securities on the basis of the number of shares owned by each such holder.

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(c)Further Assurances. Each holder of Registrable Securities will take all necessary or desirable action in connection with the consummation of any Piggyback Registration. including (a) agreeing to sell such Person’s securities on the basis provided in any underwriting arrangements approved by the Board; (b) completing and executing all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents required under the terms of such underwriting arrangements; and (c) providing in writing such information and affidavits as requested by the Board in connection with any registration statement or prospectus relating to such offering.

3.Legends.

(a)Restrictive Legend. Each certificate representing Shares shall have the following legend endorsed conspicuously thereupon:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN TRANSFER AND OTHER RESTRICTIONS PURSUANT TO THE TOYS “R” US, INC. 2010 INCENTIVE PLAN, AS AMENDED (THE “PLAN”) INCLUDING THE MANAGEMENT STOCKHOLDERS ADDENDUM ATTACHED THERETO AND MADE A PART THEREOF. A COPY OF THE PLAN WILL BE FURNISHED WITHOUT CHARGE BY TOYS “R” US HOLDINGS, INC. TO THE HOLDER HEREOF UPON WRITTEN REQUEST.”

Any Person who acquires Shares which cease to be subject to the terms of the Plan (including this Addendum) shall have the right to have such legend (or the applicable portion thereof) removed from certificates representing such Shares.

(b)Securities Act Legend. Each certificate representing Shares shall have the following legend endorsed conspicuously thereupon:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN A PRIVATE PLACEMENT WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. SUCH SECURITIES MAY NOT BE SOLD, ASSIGNED, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND SUCH LAWS OR QUALIFICATION FOR AN EXEMPTION THEREFROM.”

(c)Stop Transfer Instruction. The Company will instruct any transfer agent not to register the Transfer of any Management Stockholder’s Shares until the conditions specified in the foregoing legends and the Plan (including this Addendum) are satisfied.

(d)Termination of the Securities Act Legend. The requirement imposed by Section 6(b) shall cease and terminate as to any particular Management Stockholder’s Shares (i) when, in the opinion of counsel reasonably acceptable to the Company, such legend is no longer required in order to assure compliance by the Company with the Securities Act or (ii) when such Shares have been effectively registered under the Securities Act or transferred pursuant to Rule 144. Wherever (A) such requirement shall cease and terminate as to any Management Stockholders Shares or (B) such Shares shall be transferable under paragraph (k) of Rule 144, the holder thereof shall be entitled to receive from the Company, without expense, new certificates not bearing the legend set forth in Section 6(b).

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4.Notices. Notices required or permitted to be made under this Addendum shall be made in the manner specified in the Plan.

5.Section 16. The Company shall use its commercially reasonable efforts to cause any acquisition of Options or Award Stock under the Plan to be exempt under Rule 16b-3 promulgated trader the Securities Exchange Act of 1934.

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APPENDIX TO

MANAGEMENT STOCKHOLDERS ADDENDUM

This Appendix includes additional terms and conditions that govern Award Stock held by a Participant in the event of the Participant’s termination of employment with the Company or any of its Subsidiaries for any reason. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Addendum or the Plan.

1. Definitions. For purposes of this Appendix, the following terms shall have the following meanings:

“2005 Plan” shall mean the Toys “R” Us, Inc. 2005 Incentive Plan, as amended.

“Termination Date” means the date on which a Participant ceases to be employed by the Company or any of its Subsidiaries for any reason.

2. Repurchase of Shares (Call Right). This Section 2 shall apply to all Award Stock issued or issuable to a Participant in respect of Awards granted under the Plan.

(a) Repurchase Option. In the event that a Participant is no longer employed by the Company or any of its Subsidiaries for any reason, all Award Stock issued or issuable to such Participant (whether as Restricted Stock or upon the exercise of Options or the settlement of Restricted Stock Units), whether held by such Participant or one or more transferees of such Participant, will be subject to repurchase by the Company and the Sponsors (solely at their option), by delivery of one or more Repurchase Notices (as defined below) within the time period set forth below, pursuant to the terms and conditions set forth in this Section 2 (the “Repurchase Option”), unless otherwise set forth in the Award Certificate between the Company and the Participant; provided, that, if determined to be necessary by the Company in order to avoid an additional compensation expense, in no event shall the Company (or, if applicable, the Sponsors) be entitled to deliver any such notice with respect to any shares of Award Stock (including any shares of Award Stock issued upon the exercise of Options or similar purchase right) unless and until such shares of Award Stock have been issued, vested (if applicable) and outstanding for at least six months. The Repurchase Option shall terminate on the first to occur of a Change in Control or an Initial Public Offering.

(b) Termination of Employment. Unless otherwise specified in an Award Certificate, if a Participant’s employment with the Company or any of its Subsidiaries is terminated for any reason (including a termination by the Company with or without Cause, a resignation by the Participant for any reason, or a termination due to retirement, death or disability), then at any time during the one (1) year period commencing on the later of (i) the Termination Date and (ii) for each share of Award Stock acquired upon exercise of an Option, the date on which such share was acquired upon such exercise (the “Repurchase Period”), the Company may elect to purchase all or any portion of the Award Stock issued or issuable to such Participant at a price per share equal to the Fair Market Value thereof, in each case as determined as of a date determined by the Board that is the anticipated date of the Repurchase Closing (as defined in Section 2(c) below).

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(c) Repurchase Procedures. Pursuant to the Repurchase Option, the Company may elect to exercise the right to purchase all or any portion of the shares of Award Stock issued to a Participant by delivering written notice or notices (each, a “Repurchase Notice”) to the holder or holders of the such Award Stock at any time and from time to time prior to the expiration of the Repurchase Period; provided, that such period may be tolled in accordance with Section 2(f) below. Each Repurchase Notice will specifically identify the shares of Award Stock to be acquired from such holder(s), the repurchase price of such shares, the aggregate consideration to be paid for such shares and the time and place for the closing of the transaction (each, a “Repurchase Closing”). In the event that the Company elects to purchase a portion of such Award Stock pursuant to the terms of this Section 2(c), if any shares of such Award Stock are held by transferees of such Participant, the Company shall purchase the shares elected to be purchased first from such Participant to the extent of the shares of such Award Stock then held by such Participant and second purchase any remaining shares elected to be purchased from such other holder(s) of Award Stock pro rata according to the number of shares of Award Stock held by such other holder(s) at the time of delivery of such Repurchase Notice (determined as nearly as practicable to the nearest share) and the number of shares of each class of Award Stock to be purchased will be allocated among such other holders pro rata according to the total number of shares of Award Stock to be purchased from such persons.

(d) Sponsor Rights.

(i) If for any reason the Company does not elect to purchase all of the Award Stock (issued or issuable to a particular Participant) pursuant to the Repurchase Option pursuant to one or more Repurchase Notices, the Sponsors will be entitled to exercise the Repurchase Option, in the manner set forth in this Section 2(d), for the Award Stock the Company has not elected to purchase (the “Available Shares”). As soon as practicable after the Company has determined that there will be Available Shares, the Company shall give written notice (each, an “Option Notice”) to the Sponsors setting forth the number of Available Shares and the price for each Available Share as determined pursuant to the provisions of this Section 2.

(ii) The Sponsors may elect to purchase any number of Available Shares by delivering written notice (an “Election Notice”) to the Company and the Participant within 20 days after receipt of the Option Notice from the Company. If the Sponsors elect to purchase an aggregate number of shares greater than the number of Available Shares, each class of Available Shares shall be allocated among the Sponsors based upon the number of shares of Common Stock owned by each Sponsor on a fully-diluted basis.

(e) Closing of Repurchase. The closing of the transactions contemplated by this Section 2 will take place on the date designated in the applicable Repurchase Notice or Election Notice, as the case may be, which date will not be more than 60 days after the delivery of such notice. The Company and/or the Sponsors, as the case may be, will pay for the Award Stock to be purchased pursuant to the Repurchase Option by delivery of a check payable to the holder(s) of Award Stock or a wire transfer of immediately available funds. In addition, the Company may pay the repurchase price for such Award Stock by offsetting such amounts against any bona fide debts owed

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by Participant to the Company or any of its Subsidiaries. The Company and/or the Sponsors as the case may be, will receive customary representations and warranties from each seller regarding the sale of Award Stock including, but not limited to, the representation that such seller has good and marketable title to the Award Stock to be Transferred free and clear of all liens, claims and other encumbrances, and will be entitled to require all sellers’ signatures be guaranteed by a national bank or reputable securities broker. In the event that the Fair Market Value of the Award Stock has increased or decreased from the date on which it is determined to the date of closing pursuant to this Section 2(e), then the repurchase shall be consummated at such higher or lower price.

(f) Restrictions on Repurchase. Notwithstanding anything to the contrary contained in this Agreement, all repurchases of Award Stock by the Company shall be subject to applicable restrictions contained in the Delaware General Corporation Law and in the Company’s and its Subsidiaries’ debt and equity financing agreements. If any such restrictions prohibit the repurchase of Award Stock for cash and the Sponsors have not elected to acquire all Award Stock which the Company and the Sponsors have a right to repurchase pursuant to this Section 2, the Company shall have the right to deliver, as payment of the repurchase price, a subordinated note or notes payable in up to three equal annual installments beginning on the first anniversary of the closing of such repurchase and bearing interest (accruing quarterly) at a rate per annum equal to 7%. Any such notes issued by the Company shall be subject to any restrictive covenants which the Company is subject to at the time of repurchase. If any such restrictions prohibit the repurchase of Award Stock for such subordinated notes and the Sponsors have not elected to acquire all Award Stock which the Company and the Sponsors have a right to repurchase pursuant to this Section 2, the time periods provided in this Section 2 shall be suspended for a period of up to 12 months, and the Company may make such repurchases as soon as it is permitted to do so under such restrictions but in no event later than twelve months after the initial time periods hereunder.

3. Put Rights. Any put rights that a Participant may have in respect of either (a) Award Stock issued or issuable to the Participant pursuant to Awards granted under the Plan or (b) shares of Company Common Stock issued or issuable to the Participant pursuant equity awards granted under the 2005 Plan, in each case, as set forth in the applicable award agreement, employment agreement or other instrument governing the terms of the underlying Award or equity award, respectively, may only be exercised by the Participant with the prior written approval of the Committee.

4. Net Settlement Subject to Committee Approval. Any right that a Participant may have to cover taxes due upon the vesting of Awards of Restricted Stock or Restricted Stock Units granted under the Plan through net settlement, as set forth in the applicable award agreement, employment agreement or other instrument governing the terms of the underlying Award, may only be exercised by the Participant with the prior written approval of the Committee.

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EX-10.44

EXHIBIT 10.44

LEADERSHIP TEAM CASH LTIP AWARD AGREEMENT

OF

TOYS “R” US, INC.

THIS AGREEMENT (the “Agreement”), is made effective as of the __ day of _________, ____ (the “Grant Date”), between Toys “R” Us, Inc., a Delaware corporation (the “Company”), and [Name] (“Participant”). By accepting this Agreement, Participant agrees to all of the terms and conditions set forth herein.

RECITALS:

WHEREAS, the Company has adopted the Toys “R” Us, Inc. 2010 Incentive Plan, as amended (the “Plan”), which Plan is incorporated herein by reference and made a part of this Agreement. Capitalized terms not otherwise defined herein shall have the same meanings as in the Plan; and

WHEREAS, the Committee has determined that it would be in the best interests of the Company and its shareholders to grant the incentive award provided for herein to Participant pursuant to the Plan and the terms set forth herein.

NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties agree as follows:

1.Grant of the Incentive Award. Subject to the terms and conditions of the Plan and this Agreement, the Company hereby grants to Participant an incentive award in the amount of $[amount] (the “Incentive Award”). Subject to the achievement of the performance vesting condition set forth in Section 2(b), the Incentive Award shall vest in accordance with Section 2 hereof, and shall be paid (to the extent vested) in accordance with Section 3 hereof.

2.Vesting.

(a)Defined Terms for Vesting Provisions.

“Adjusted EBITDA less CapEx” means Adjusted EBITDA less CapEx.

“Adjusted EBITDA” for any fiscal year means adjusted EBITDA as reported in the Company’s audited financial statements for such fiscal year.

“CapEx” for any fiscal year means the average of the capital expenditures as reported on the Company’s audited financial statements for the three preceding fiscal years.

“Change in Control” shall mean any transaction or series of related transactions (whether by merger, consolidation or sale or transfer of the Company’s capital stock or assets (including stock of its Subsidiaries) or otherwise) in which any Person or group (within the meaning of Section 13

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(d)(3) of the 1934 Act) acquires directly or indirectly (i) shares of capital stock which represent more than 50% of the total voting power in the Company, or (ii) by lease, license, sale or otherwise, all or substantially all of the assets of the Company and its Subsidiaries on a consolidated basis; provided, that the acquisition of more than 50% of the total voting power in the Company by one or more of the Persons who are stockholders of the Company on the date of this Agreement or any affiliate thereof (each, a “Current Stockholder”) shall not be deemed to be a Change in Control so long as at least two of the Current Stockholders each continue to own shares of capital stock representing at least 25% of the total voting power in the Company (disregarding shares owned by current or former employees and other service providers of the Company) following such acquisition; and provided, further, that the acquisition of all of the outstanding shares of such capital stock of the Company by a holding company owned by the Persons who were stockholders of the Company immediately prior to the acquisition in the same proportions shall not be deemed to be a Change in Control.

“Good Reason” shall have the meaning set forth in the employment agreement between Participant and the Company or any Affiliate and if there is no such employment agreement between Participant and the Company or any Affiliate, “Good Reason” shall, for purposes of this Agreement, mean without the consent of Participant and other than in connection with a termination of Participant’s employment by the Company or any Affiliate for Cause or due to Participant’s death or Disability, (A) the failure of the Company to pay any undisputed amount due under this Agreement; or (B) a substantial reduction in Participant’s targeted compensation level (other than a general reduction in base salary or annual incentive compensation opportunities that affects all members of senior management of the Company proportionally); provided, that, none of the foregoing conditions shall constitute Good Reason unless (x) Participant provides written notice to the Company or any Affiliate, if applicable, of the condition claimed to constitute Good Reason within thirty (30) days of Participant’s initial awareness of such condition and (y) the Company or any Affiliate, as applicable, fails to remedy (or cause to be remedied) such condition within thirty (30) days of receiving such written notice.

“Performance Period End Date”means the last day of the Company’s fiscal year ending January 2018.

(b)Performance Vesting Condition. The performance vesting condition for the Incentive Award will be met if, in any fiscal year of the Company ending on or before the Performance Period End Date, the Company achieves USD $600,000,000 in Adjusted EBITDA less CapEx (the “Performance Vesting Date”). The determination of whether such performance vesting condition has been met shall be based on the annual audited financial statements of the Company. If the performance vesting condition is satisfied on the Performance Vesting Date,

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Participant’s right to receive all or a portion of the Incentive Award shall be subject to Section 2(d) below.

(c)    Time Vesting Condition. Except as is set forth below, if the Incentive Award is earned on the Performance Vesting Date, Participant must remain in continuous employment with the Company or any Affiliate through (i) the First Payment Date (as defined below) to receive the first installment of the Incentive Award and (ii) the Second Payment Date (as defined below) to receive the final installment of the Incentive Award.

(d)    Effect of Change in Control. Notwithstanding Sections 2(b) and 2(c) hereof, the Incentive Award shall be 100% vested upon the occurrence of a Change in Control (with the date of Change of Control being deemed the Performance Vesting Date), provided, that Participant remains in continuous employment with the Company or any Affiliate through the date of the consummation of such Change in Control and shall remain payable in accordance with Section 3 below; provided, that the fifth business day following the date of such Change in Control shall be deemed to be the First Payment Date.

(e)Effect of Termination of Employment without Cause or for Good Reason.

3. (i)     Termination Prior to the Performance Vesting Date. If, prior to the Performance Period End Date, Participant’s employment with the Company and the Affiliates is terminated by the Company without Cause (and other than due to death or Disability) or Participant resigns for Good Reason, Participant shall be entitled to receive $[amount] payable in accordance with Section 3 below if, and only if, the Performance Vesting Date occurs prior to the last day of fiscal year in which such termination occurs (and if the Performance Vesting Date does not so occur, Participant shall have no rights to payment of any portion of the Incentive Award).

4. (ii)     Termination Following the Performance Vesting Date.  If, after the Performance Vesting Date occurs, Participant’s employment with the Company and the Affiliates is terminated by the Company without Cause or Participant resigns for Good Reason, the Participant shall receive: (x) only $[amount] payable in accordance with Section 3 below if the termination occurred prior to the First Payment Date, or (y) $[amount] payable on the Second Payment Date (in addition to the $[amount] already paid on the First Payment Date, for a total of $[amount]) if the termination occurred after the First Payment Date but prior to the Second Payment Date.

(f)Effect of Termination of Employment due to Death or Disability. If prior to the Performance Period End Date, Participant’s employment with the Company and the Affiliates is terminated due to the Participant’s death or Disability, Participant shall be entitled to receive 100% of the Incentive Award payable in accordance with Section 3 below if, and only if, the Performance Vesting Date occurs prior to the last day of fiscal year in which such termination occurs (and if the Performance Vesting Date does not so occur, Participant shall have no rights to

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payment of any portion of the Incentive Award). If Participant’s employment with the Company and the Affiliates is terminated due to the Participant’s death or Disability after the Performance Vesting Date but prior to the First Payment Date or the Second Payment Date, as applicable, Participant shall be entitled to receive 100% of the remaining unpaid installments of the Incentive Award on each such date.

(g)Effect of Termination of Employment for Cause or without Good Reason. If Participant’s employment with the Company and the Affiliates is terminated by the Company for Cause or by Participant without Good Reason, any remaining unpaid installments of the Incentive Award shall be forfeited by Participant without consideration.

(h)Adjustments for Certain Changes. The performance vesting condition set forth in Sections 2(a) and 2(b) hereof will be appropriately and equitably adjusted by the Board in good faith to reflect each acquisition or disposition by the Company or any of its Affiliates subsequent to the Grant Date of any business, operation, entity (including the acquisition of only a portion of an entity whose results will be consolidated by the Company in accordance with generally accepted accounting principles), division of any entity or any assets outside the ordinary course of business. If the Company or any Affiliate makes such an acquisition or disposition in a given fiscal year, the performance vesting condition set forth in Sections 2(a) and 2(b) hereof, shall be proportionately adjusted, appropriately and equitably, and only to the extent deemed necessary by the Board, in the exercise of its good faith judgment, in order to accurately reflect the direct and measurable effect such acquisition or disposition has or is reasonably expected to have on the performance vesting condition. In addition, to the extent applicable, the performance vesting condition set forth in Sections 2(a) and 2(b) hereof will be adjusted by the Board (after consultation with the Company’s accountants) in good faith to reflect any changes in generally accepted accounting principles promulgated by accounting standard setters in order to accurately reflect the effect of such changes on such performance vesting condition. The intent of such adjustments is to keep the probability of achieving the performance vesting condition the same as if the event triggering such adjustment had not occurred. The Board’s determination of such necessary adjustment(s) shall be made within ninety (90) days following the completion or closing of such event, as applicable, and shall be based on the Company’s accounting as set forth in its audited financial statements and on the Company’s financial plan pursuant to which the performance vesting condition was originally established. Any such adjustment(s) made in good faith shall be final and binding on parties to this Agreement.

5.Payment of Incentive Award. The Incentive Award, to the extent vested and payable in accordance with Section 2 above, shall be paid to Participant in two equal installments, with the first installment to be paid, except as set forth in Section 2(d), within thirty (30) days following the date on which the annual audited financial statements of the Company are delivered to the Company and approved by the Board for the year in which the Performance Vesting Date occurs (the date on which payment is made, the “First Payment Date”), and the second installment to be paid on the first anniversary of the First Payment Date (the “Second Payment Date”). Payment of each installment of the Incentive Award shall be made entirely in cash.

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6.No Right to Continued Employment. The granting of the Incentive Award evidenced by this Agreement shall impose no obligation on the Company or any Affiliate to continue the employment of Participant and shall not lessen or affect the Company’s or its Affiliate’s right to terminate the employment of Participant.

7.Transferability. The Incentive Award may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by Participant otherwise than as permitted by Section 13.3 of the Plan or by will or by the laws of descent and distribution, and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance which is impermissible shall be void and unenforceable against the Company or any Affiliate; provided, that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance. No such permitted transfer of the Incentive Award to heirs or legatees of Participant shall be effective to bind the Company unless the Committee shall have been furnished with written notice thereof and a copy of such evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee or transferees of the terms and conditions hereof.

8.Withholding. Participant may be required to pay to the Company or any Affiliate, and the Company shall have the right and is hereby authorized to withhold, any applicable withholding taxes in respect of the Incentive Award, and to take such other action as may be necessary in the opinion of the Committee to satisfy all obligations for the payment of such withholding taxes.

9.Notices. Any notice necessary under this Agreement shall be addressed to the Company in care of its Secretary at the principal executive office of the Company and to Participant at the address appearing in the personnel records of the Company for Participant or to either party at such other address as either party hereto may hereafter designate in writing to the other. Any such notice shall be deemed effective upon receipt thereof by the addressee.

10.Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO CONFLICTS OF LAWS. By accepting this Award, Participant hereby (i) agrees that any suit, action or proceeding brought by or against Participant in connection with the Plan or this Award shall be brought solely in the courts of the State of Delaware or the United States District Court for the District of Delaware, (ii) consents to the jurisdiction and venue of each such court, and (iii) agrees to accept service of process by the Company or any of its agents in connection with any such proceeding. BY ACCEPTING THIS AWARD, PARTICIPANT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY SUIT, ACTION OR OTHER PROCEEDING INSTITUTED BY OR AGAINST PARTICIPANT IN RESPECT OF HIS RIGHTS OR OBLIGATIONS HEREUNDER.

11.Incentive Award Subject to Plan. By entering into this Agreement, Participant agrees and acknowledges that Participant has received and read a copy of the Plan. The Incentive Award is subject to the Plan. The terms and provisions of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a

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conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of this Agreement will govern and prevail.

12.Signature. This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement, as of the date first above written.

TOYS “R” US, INC.

________________________________________

By: Timothy Grace

EVP, Global Chief Talent Officer

PARTICIPANT

_______________________________________

[name]

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EX-10.51

EXHIBIT 10.51

EMPLOYMENT AGREEMENT

Richard Barry

This EMPLOYMENT AGREEMENT (the “Agreement”) is dated as of December 10, 2012 (the “Execution Date”) by and between Toys “R” Us, Inc. (the “Company”) and Richard Barry (the “Executive”).

WHEREAS, the Company previously entered into an employment agreement with Executive on October 7, 2012 (the “Prior Agreement”) and desires to amend and restate the Prior Agreement as set forth herein.

WHEREAS, as of the Execution Date, the Company desires to continue to employ Executive and to enter into an agreement embodying the terms of such employment and Executive desires to accept such employment and enter into such an agreement.

NOW, THEREFORE, in consideration of the premises and mutual covenants herein and for other good and valuable consideration, the parties agree as follows:

1.Term of Employment. Subject to the provisions of Section 7 of this Agreement, Executive shall be employed by the Company and designated indirect subsidiaries of the Company (each, a “Subsidiary”), for a period commencing on October 7, 2012 (the “Commencement Date”) and ending on the first anniversaryof the Commencement Date(the “Initial Term”),on the terms and subject to the conditions set forth in this Agreement.Following the Initial Term, the term of Executive’s employment hereunder shall automatically be renewed on the terms and conditions hereunder for additional one year periods commencing on each anniversary of the last day of the Initial Term (the Initial Term and any annual extensions of the term of this Agreement, subject to the provisions of Section 7 hereof, together, the “Employment Term”), unless either partygives written notice of non-renewal at least 60 daysprior to such anniversary.

2.Position.

a.During the Employment Term, Executive shall serve as the Executive Vice President – Chief Merchandising Officer of each of the Company, Toys “R” Us – Delaware, Inc. and any other indirect Subsidiaries that the Board of Directors of the Company(the “Board”) designates (such entities collectively referred to as the “TRU Group”). In such positions, Executive shall have such duties and authority as determined by the Board and the board of directors of each Subsidiary, as applicable (each, a “Subsidiary Board”) and commensurate with the position of the Executive Vice President – Chief Merchandising Officer of a company of similar size and nature to that of the TRU Group. During the Employment Term, the Executive shall report to the Chief Executive Officer of the Company (the “CEO”) and of each Subsidiary, as applicable or such other persons as the Company may determine from time to time.

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EXHIBIT 10.51

b.During the Employment Term, Executive will devote Executive’s full business time and reasonable best efforts to the performance of Executive’s duties hereunder and will not engage in any other business, profession or occupation for compensation or otherwise which would conflict or interfere in any material respect with the rendition of such services either directly or indirectly, without the prior written consent of the CEO; provided that nothing herein shall preclude Executive from continuing to serve on any board of directors or trustees, advisory board or government commission which is listed on Exhibit A attached hereto, or, subject to the prior approval of the CEO, from accepting appointment to serve on any board of directors or trustees of any business corporation or any charitable organization; provided in each case in the aggregate, that such activities do not conflict or interfere with the performance of Executive’s duties hereunder or conflict with Section 8.

3.Base Salary. During the Employment Term, the Company shall pay Executive a base salary at the annual rate of $475,000, payable in substantially equal periodic payments in accordance with the Company’s practices for other executive employees, as such practices may be determined from time to time. Executive shall be entitled to such increases in Executive’s base salary, if any, as may be determined from time to time in the sole discretion of the Board, which shall at least annually review Executive’s rate of base salary to determine if any such increase shall be made. Executive’s annual base salary, as in effect from time to time hereunder, is hereinafter referred to as the “Base Salary.”

4.Annual Bonus. During the Employment Term, Executive shall be eligible to earn an annual bonus award in respect of each fiscal year of the Company (an “Annual Bonus”), in a target amount of up to 100% of Executive’s Base Salary (the “Target Bonus”), payable upon the Company’s achievement of certain performance targets established by the Board or any appropriate committee or delegee thereof and pursuant to the terms of the Company’s incentive plan, as in effect from time to time. Notwithstanding the foregoing, in the event the Company’s performance exceeds such performance targets, Executive shall be eligible to earn an Annual Bonus in an amount in excess of the Target Bonus, as determined by the Board or any appropriate committee or delegee thereof in accordance with the Company’s incentive plan, as in effect from time to time. The Annual Bonus, if any, shall be paid to Executive not later than two and one-half (2½) months after the end of the applicable fiscal year of the Company. For fiscal year 2012, Executive’s bonus shall be prorated based upon the number of actual days that Executive is employed as an Executive Vice President through the fiscal year ending on or about January 31, 2013. For the time period during fiscal year 2012 that Executive served as a Senior Vice President, Executive’s bonus for that portion of the year shall be paid prorated and paid in accordance with the Company’s bonus payouts for other similarly situated Senior Vice Presidents.

5.Employee Benefits; Perquisites; Business and Relocation Expenses.

a.Employee Benefits. During the Employment Term, Executive and his spouse and dependents, as applicable, shall be entitled to participate in the Company’s welfare benefit plans and retirement plans, including, without limitation, the Company’s 401(k) and supplemental executive retirement plans and medical, dental and life insurance plans, as in effect

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from time to time (collectively, the “Employee Benefits”), on the same basis as those benefits are or may be made available to the other senior executives of the Company (other than benefits which have been terminated or for which participation has been frozen). The Company shall be permitted to modify such benefits from time to time consistent with any modifications that impact other senior executives of the Company.

b.Perquisites. During the Employment Term, Executive shall be entitled to receive such perquisites as are made available to other senior executives of the Company in accordance with the Company’s policies, as in effect from time to time. Executive shall be entitled to not less than four (4) weeks of paid vacation per year, which vacation shall be taken at such times as are reasonably acceptable to the Company in light of the Company’s operations, Executive’s performance of his duties, and in accordance with the terms of the Company’s vacation policy, as in effect from time to time, applicable to Executive.

c.Business Expenses. During the Employment Term, reasonable business expenses incurred by Executive in the performance of Executive’s duties hereunder shall be reimbursed by the Company in accordance with the Company’s policies, as in effect from time to time, applicable to senior executive officers of the Company.

6.Equity. Executive shall continue to participate in the Company’s Amended and Restated 2005 Management Equity Plan and shall participate in the Toys “R” Us, Inc. 2010 Incentive Plan (collectively, the “Incentive Plans”) in accordance with the policies and procedures of the Incentive Plans and any subsequent plans.

7.Termination. The Employment Term and Executive’s employment hereunder may be terminated by either party at any time and for any reason; provided that Executive will be required to give the Company at least 60 days’advance written notice of any resignation of Executive’s employment without Good Reason (as defined in Section 7(c) below) (other than due to Executive’s death or Disability). Notwithstanding any other provision of this Agreement, the provisions of this Section 7 shall exclusively govern Executive’s rights upon termination of employment with the TRU Group; provided, however, that nothing contained in this Section 7 shall alter Executive’s or the Company’s rights with respect to the Incentive Plans, which shall continue to govern Executive’s equity holdings following any termination in accordance herewith.

a.By the Company For Cause or By Executive Without Good Reason.

(i)The Employment Term and Executive’s employment hereunder may be terminated by the Company for Cause (as defined below) and shall terminate automatically upon Executive’s resignation without Good Reason (other than due to Executive’s death or Disability); provided that Executive will be required to give the Company at least 60 days’ advance written notice of such resignation.

(ii)For purposes of this Agreement, “Cause” shall mean any of the following, as determined by the CEO: (A) Executive’s willful failure to perform any material portion of his duties; (B) the commission of any fraud, misappropriation or misconduct by Executive that

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causes demonstrable injury, monetarily or otherwise, to the Company or an affiliate; (C) the conviction of, or pleading guilty or nolo contendere to, a felony involving moral turpitude; (D) an act resulting or intended to result, directly or indirectly, in material gain or personal enrichment to the Executive at the expense of the Company or an affiliate; (E) any material breach of Executive’s fiduciary duties to the Company or an affiliate as an employee or officer; (F) a violation of the Company’s Code of Ethical Standards, Business Practices and Conduct or any other violation of a TRU Group policy; (G) the failure by the Executive to comply, in any material respect, with the provisions of Sections 8 and 9 of this Agreement; or (H) the failure by the Executive to comply with any other undertaking set forth in this Agreement or any other agreement Executive has with the Company or any affiliate or any breach by Executive hereof or thereof if such failure or breach is reasonably likely to result in a material injury to the Company or an affiliate.

(iii)If Executive’s employment is terminated by the Company for Cause, or if Executive resigns without Good Reason, Executive shall be entitled to receive:

(A)    a lump sum payment of the Base Salary that is earned by Executive but unpaid as of the date of Executive’s termination of employment, paid in accordance with the Company’s payroll practices, but in no event later than thirty (30) days following Executive’s termination of employment;

(B)    a lump sum payment of any Annual Bonus that is earned by Executive but unpaid as of the date of termination for the immediately preceding fiscal year, paid in accordance with Section 4 (except to the extent payment is otherwise deferred pursuant to any applicable deferred compensation arrangement with the Company);

(C)    reimbursement, within 30 days following submission by Executive to the Company of appropriate supporting documentation, for any unreimbursed business expenses properly incurred by Executive in accordance with the Company policy referenced in Section 5(c) above prior to the date of Executive’s termination; provided claims for such reimbursement (accompanied by appropriate supporting documentation) are submitted to the Company within ninety (90) days following the date of Executive’s termination of employment; and

(D)    such Employee Benefits, if any, as to which Executive may be entitled under the employee benefit plans of the Company (the amounts described in clauses (A) through (D) hereof being referred to as the “Accrued Rights”).

Following such termination of Executive’s employment by the Company for Cause or resignation by Executive without Good Reason, except as set forth in this Section 7(a)(iii), Executive shall have no further rights to any compensation or any other benefits under this Agreement.

b.Disability or Death.

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(i)The Employment Term and Executive’s employment hereunder shall terminate upon Executive’s death and may be terminated by the Company upon the Executive’s Disability. For purposes of this Agreement, “Disability” shall mean the determination that the Executive is disabled pursuant to the terms of the Company’s long term disability plan.

(ii)Upon termination of Executive’s employment hereunder for either Disability or death, Executive or Executive’s estate (as the case may be) shall be entitled to receive:

(A)    the Accrued Rights; and

(B)    a pro rata portion of the Annual Bonus, if any, that Executive would have been entitled to receive pursuant to Section 4 hereof for such year based upon the Company’s actual results for the year of termination and the percentage of the fiscal year that shall have elapsed through the date of Executive’s termination of employment, payable to Executive pursuant to Section 4 had Executive’s employment not terminated.

Following Executive’s termination of employment due to Executive’s death or Disability, except as set forth in this Section 7(b)(ii), Executive or his estate, as applicable, shall have no further rights to any compensation or any other benefits under this Agreement.

c.By the Company Without Cause or by Executive for Good Reason.

(i)Executive’s employment hereunder may be terminated (A) by the Company without Cause (which shall not include Executive’s termination of employment due to his death or Disability) or (B) by Executive for Good Reason (as defined below).

(ii)For purposes of this Agreement, “Good Reason” shall mean, without the consent of the Executive and other than in connection with a termination of the Executive’s employment by the Company for Cause or due to Executive’s death or Disability, (A) the failure of the Company to pay any undisputed amount due under this Agreement; (B) a substantial reduction in Executive’s targeted compensation level (other than a general reduction in base salary or annual incentive compensation opportunities that affects all members of senior management of the Company proportionally) or (C) notice by the Company pursuant to Section 1 that it is not extending the Employment Term. Notwithstanding the foregoing, any termination by Executive for Good Reason may only occur if Executive provides a Notice of Termination (as defined in Section 7(d)) for Good Reason within 45 days after Executive learns (or reasonably should have learned) about the occurrence of the event giving rise to the claim of Good Reason. Notwithstanding the foregoing, resignation by Executive shall not be deemed for “Good Reason” if the basis for such Good Reason is cured within a reasonable period of time (determined in light of the cure appropriate to the basis of such Good Reason), but in no event more than thirty (30) business days after the Company receives the Notice of Termination specifying the basis of such Good Reason.

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(iii)If Executive’s employment is terminated by the Company without Cause (excluding by reason of Executive’s death or Disability) or by Executive for Good Reason, Executive shall be entitled to receive:

(A)    the Accrued Rights;

(B)    a pro rata portion of the Annual Bonus, if any, that Executive would have been entitled to receive pursuant to Section 4 hereof for such year based upon the Company’s actual results for the year of termination and the percentage of the fiscal year that shall have elapsed through the date of Executive’s termination of employment, payable to Executive pursuant to Section 4 had Executive’s employment not terminated;

(C)subject to Executive’s continued compliance with the provisions of Sections 8 and 9 and Executive’s execution (and non-revocation) of a release of all claims against the TRU Group in a form substantially similar to the Separation and Release Agreement attached hereto as Exhibit B, an amount equal to two (2) times the sum of (x) the Base Salary at the rate in effect immediately prior to the date of Executive’s termination of employment and (y) the target Annual Bonus, payable in twenty-four (24) equal monthly installments following the Executive’s termination; provided, however, that the aggregate amount described in this subsection (C) shall be in lieu of notice or any other severance amounts to which the Executive may otherwise be entitled and shall be reduced by any amounts owed by Executive to the Company or any affiliate; andprovidedfurther, that if Executive’s termination of employment under this Section 7(c) occurs within two (2) years after a Change in Control, Executive shall be entitled to receive all of the foregoing payments and benefits as set forth in this Section 7(c)(iii)(C) in a lump sum payment within sixty (60) days following Executive’s termination of employment. For purposes of this Agreement, “Change in Control” has the meaning ascribed to it in the Toys “R” Us, Inc. 2010 Incentive Plan; and

(D)    continuation of medical, dental and life insurance benefits (pursuant to the same benefit plans as in effect for active employees of the Company), with Executive paying a portion of such costs as if Executive’s employment had not terminated, until the earlier to occur of (x) twenty-four (24) months from the date of termination and (y) the date on which Executive commences to be eligible for coverage under substantially comparable medical, dental and life insurance benefit plans from any subsequent employer (the “Benefit Continuation Period”); provided if such continued coverage is not possible under the general terms and provisions of such plan(s) during such period, the Company shall pay an amount to Executive each month equal to the Company’s cost of providing such benefits to Executive as if Executive’s employment had not terminated (the “Company Subsidy”). In order to facilitate such coverage, Executive and his spouse and dependents, as applicable, in accordance with the Company’s policies in effect at the time of Executive’s termination, shall agree to elect continuation coverage in

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accordance with the provisions of the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended (“COBRA Coverage”) and the Company may satisfy its obligations hereunder by paying a portion of the premiums required for such COBRA Coverage. In the event that the Company, in its sole and absolute discretion, determines at any time that the continued payment of Executive’s COBRA premiums is in violation of the nondiscrimination rules set forth in Section 105(h) of the Internal Revenue Code, which will result in a detrimental tax result for Executive (taxability of Executive’s health benefits), the Company reserves the right to discontinue such practice to the extent necessary, and to thereafter pay to Executive the taxable Company Subsidy each month for the remainder of the Benefit Continuation Period, less applicable withholding. The medical, dental and life insurance coverage under this Section 7(c)(iii)(D) provided in any one calendar year shall not affect the amount of benefits to be provided in any other calendar year, and the reimbursement of an eligible expense must be made no later than December 31 of the year after the year in which the expense was incurred. Executive’s rights pursuant to this Section 7(c)(iii)(D) shall not be subject to liquidation or exchange for another benefit.

Following Executive’s termination of employment by the Company without Cause (excluding by reason of Executive’s death or Disability) or by Executive for Good Reason, except as set forth in this Section 7(c)(iii), Executive shall have no further rights to any compensation or any other benefits under this Agreement.

d.Notice of Termination. Any purported termination of employment by the Company or by Executive (other than due to Executive’s death or Disability) shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 12(h) hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of employment under the provision so indicated.

e.Board/Committee Resignation. Upon termination of Executive’s employment for any reason, Executive agrees to resign, as of the date of such termination and to the extent applicable, from the Board and any Subsidiary Boards (and any committees thereof).

8.Non-Competition.

a.Executive acknowledges and recognizes the highly competitive nature of the businesses of the Company and its affiliates and accordingly agrees as follows:

(i)During the Employment Term and a twenty-four (24) month period commencing on Executive’s termination of employment (the “Restricted Period”), Executive will not, whether on Executive’s own behalf or on behalf of or in conjunction with any person, firm, partnership, joint venture, association, corporation or other business organization, entity or enterprise whatsoever (“Person”), directly or indirectly:

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(A)    engage in any business that directly or indirectly is a “Competitive Business.” For purposes of this subsection (A) a “Competitive Business” means, with respect to the Executive at any time, any Person engaged wholly or in part (directly or through one or more subsidiaries) in the retail sale or distribution (including in stores or via mail order, e-commerce, or similar means) of “Competing Products,” if more than one-third (1/3) of such Person's gross sales for the twelve (12) month period preceding such time (or with respect to the period after Executive’s termination date, as of such termination date) are generated by engaging in such sale or distribution of Competing Products. Without limiting the foregoing, the term “Competitive Business” shall in any event include Wal-Mart, K-Mart/Sears, Target, Amazon.com, Buy Buy Baby, Mattel, Hasbro, Tesco, Carrefour and any of their respective parents, subsidiaries, affiliates or commonly controlled entities. For purposes of this subsection (A) “Competing Products” means, with respect to the Executive at any time, (1) toys and games, (2) video games, computer software for children, and electronic toys or games, (3) juvenile or baby products, apparel, equipment, furniture, or consumables, (4) wheeled goods for children, and (5) any other product or group of related products that represents more than twenty (20) percent of the gross sales of the Company and its subsidiaries for the twelve (12) month period preceding such time (or with respect to the period after the Executive’s termination date, as of such termination date);

(B)    enter the employ of, or render any services to, any Person (or any division or controlled or controlling affiliate of any Person) who or which engages in a Competitive Business;

(C)    acquire a financial interest in, or otherwise become actively involved with, any Competitive Business, directly or indirectly, as an individual, partner, shareholder, officer, director, principal, agent, trustee or consultant; or

(D)    interfere with, or attempt to interfere with, business relationships (whether formed before, on or after the date of this Agreement) between the Company or any of its affiliates and customers, clients, suppliers, partners, members or investors of the Company or its affiliates.

(E)    Notwithstanding anything to the contrary in this Agreement, Executive may, directly or indirectly own, solely as a passive investment, securities of any Person engaged in a Competitive Business which are publicly traded on a national or regional stock exchange or on the over-the-counter market or privately held if Executive (x) is not a controlling Person of, or a member of a group which controls, such Person and (y) does not, directly or indirectly, own 3% or more of any class of securities of such Person who is publicly traded or privately held.

(ii)During the Restricted Period, Executive will not, whether on Executive’s own behalf or on behalf of or in conjunction with any Person, directly or indirectly:

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(A)    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; or

(B)    hire any such employee (other than clerical or administrative support personnel) 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 Executive’s employment with the Company.

(iii)During the Restricted Period, Executive will not, directly or indirectly, solicit to leave the employment of, or encourage to cease to work with, as applicable, the Company or its affiliates any consultant, supplier or service provider then under contract with the Company or its affiliates.

(A) It is expressly understood and agreed that although Executive and the Company consider the restrictions contained in this Section 8 to be reasonable, if a final judicial determination is made by a court of competent jurisdiction that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction against Executive, the provisions of this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such maximum extent as such court may judicially determine or indicate to be enforceable. Alternatively, if any court of competent jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make it enforceable, such finding shall not affect the enforceability of any of the other restrictions contained herein.

(B) This Section 8 is intended to supersede the non-competition and non-solicitation provisions contained in Section 12.3 of the Company’s Amended and Restated 2005 Management Equity Plan, as amended and restated.

9.Confidentiality.

a.Executive will not at any time (whether during or after Executive’s employment with the Company), except when required to perform his or her duties to the TRU Group, (x) retain or use for the benefit, purposes or account of Executive or any other Person; or (y) disclose, divulge, reveal, communicate, share, transfer or provide access to any Person outside the TRU Group (other than its professional advisers who are bound by confidentiality obligations), any non-public, proprietary or confidential information --including without limitation rates, trade secrets, know-how, research and development, software, databases, inventions, processes, formulae, technology, designs and other intellectual property, information concerning finances, investments, profits, pricing, costs, products, services, vendors, customers, clients, partners, investors, personnel, compensation, recruiting, training, advertising, sales, marketing, promotions, government and regulatory activities and approvals -- concerning the past, current or future business, activities and operations of the Company and its subsidiaries and/or any third party that has disclosed or provided any of same to the Company and its

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subsidiaries on a confidential basis (“Confidential Information”) without the prior written authorization of the Board.

b.“Confidential Information” shall not include any information that is (x) generally known to the industry or the public other than as a result of Executive’s breach of this covenant or any breach of other confidentiality obligations by third parties; (y) required by law or judicial process to be disclosed; provided that Executive shall give prompt written notice to the Company of such requirement, disclose no more information than is so required, and cooperate with any attempts by the Company to obtain a protective order or similar treatment; or (z) disclosed in connection with a litigation or arbitration proceeding between the parties.

c.Except as required by law or judicial process, Executive will not disclose to anyone, other than Executive’s immediate family, legal and/or financial advisors, the existence or contents of this Agreement; provided that Executive may disclose to any prospective future employer the provisions of Sections 8 and 9 of this Agreement, provided they agree to maintain the confidentiality of such terms.

d.Upon termination of Executive’s employment with the TRU Group for any reason, Executive shall (x) cease and not thereafter commence use of any Confidential Information or intellectual property (including without limitation, any patent, invention, copyright, trade secret, trademark, trade name, logo, domain name or other source indicator) owned by the Company, its subsidiaries or affiliates; (y) immediately destroy, delete, or return to the Company, at the Company’s option, all originals and copies in any form or medium (including memoranda, books, papers, plans, computer files, letters and other data) in Executive’s possession or control (including any of the foregoing stored or located in Executive’s office, home, laptop or other computer, whether or not the Company’s property) that contain Confidential Information or otherwise relate to the business of the Company, its affiliates or subsidiaries (whether or not the retention or use thereof would reasonably be expected to result in a demonstrable injury to the Company, its affiliates or subsidiaries), except that Executive may retain only those portions of any personal notes, notebooks and diaries that do not contain any Confidential Information; and (z) notify and fully cooperate with the Company regarding the delivery or destruction of any other Confidential Information of which Executive is or becomes aware.

e.Executive shall not improperly use for the benefit of, bring to any premises of, divulge, disclose, communicate, reveal, transfer or provide access to, or share with the TRU Group any confidential, proprietary or non-public information or intellectual property relating to a former employer or other third party without the prior written permission of such third party. Executive hereby indemnifies, holds harmless and agrees to defend the TRU Group and its respective officers, directors, partners, employees, agents and representatives from any actual breach of the foregoing covenant. During the Employment Term, Executive shall comply with all relevant written policies and guidelines of the Company and its subsidiaries and affiliates which have been made available or disclosed to him, including regarding the protection of Confidential Information and intellectual property and potential conflicts of interest. Executive acknowledges that the Company and its subsidiaries and affiliates may amend any such policies

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and guidelines from time to time, and that Executive remains at all times bound by their most current version; provided, however, that Executive shall not be bound by any such amendments unless and until Executive receives notice of such amendments and copies thereof are made available or disclosed to him.

f.    The provisions of this Section 9 shall survive the termination of Executive’s employment for any reason.

10.Specific Performance. Executive acknowledges and agrees that the Company’s remedies at law for a breach or threatened breach of any of the provisions of Sections 8 or 9 would be inadequate and the Company and its subsidiaries and affiliates would suffer irreparable damages as a result of such breach or threatened breach. In recognition of this fact, Executive agrees that, in the event of such a breach or threatened breach, in addition to any remedies at law, the Company, without posting any bond, shall be entitled to cease making any payments or providing any benefit otherwise required by this Agreement and obtain equitable relief in the form of specific performance, temporary restraining order, temporary or permanent injunction or any other equitable remedy which may then be available.

11.Arbitration. Except as provided in Section 10, any other dispute arising out of or asserting breach of this Agreement, or any statutory or common law claim by Executive relating to his employment under this Agreement or the termination thereof (including any tort or discrimination claim), shall be exclusively resolved by binding statutory arbitration in accordance with the Employment Dispute Resolution Rules of the American Arbitration Association. Such arbitration process shall take place in New York, New York. A court of competent jurisdiction may enter judgment upon the arbitrator’s award. Each party shall pay the costs and expenses of arbitration (including fees and disbursements of counsel) incurred by such party in connection with any dispute arising out of or asserting breach of this Agreement.

12.Miscellaneous.

a.Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey,without regard to conflicts of laws principles thereof.

b.Entire Agreement/Amendments. This Agreement and the Incentive Plans contain the entire understanding of the parties with respect to the employment of Executive by the TRU Group. There are no restrictions, agreements, promises, warranties, covenants or undertakings between the parties with respect to the subject matter herein other than those expressly set forth herein and therein. This Agreement may not be altered, modified, or amended except by written instrument signed by the parties hereto.

c.No Waiver. The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive such party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement.

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d.Severability. In the event that any one or more of the provisions of this Agreement shall be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions of this Agreement shall not be affected thereby.

e.Assignment. This Agreement, and all of Executive’s rights and duties hereunder, shall not be assignable or delegable by Executive; provided, however, that if Executive shall die, all amounts then payable to Executive hereunder shall be paid in accordance with the terms of this Agreement to Executive’s devisee, legatee or other designee or, if there be no such devisee, legatee or designee, to Executive’s estate. Any purported assignment or delegation by Executive in violation of the foregoing shall be null and void ab initio and of no force and effect. This Agreement may be assigned by the Company to a person or entity which is an affiliate, and shall be assigned to any successor in interest to substantially all of the business operations of the Company. Upon such assignment, the rights and obligations of the Company hereunder shall become the rights and obligations of such affiliate or successor person or entity.Further, the Company will require any successor (whether, direct or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company and any successor to its business and/or assets which is required by this Section 12(e) to assume and agree to perform this Agreement or which otherwise assumes and agrees to perform this Agreement; provided, however, in the event that any successor, as described above, agrees to assume this Agreement in accordance with the preceding sentence, as of the date such successor so assumes this Agreement, the Company shall cease to be liable for any of the obligations contained in this Agreement.

f.Set Off; Mitigation. The Company’s obligation to pay Executive the amounts provided and to make the arrangements provided hereunder shall not be subject to set-off, counterclaim or recoupment, other than amounts loaned or advanced to Executive by the Company or its affiliates, amounts owed by Executive under the Incentive Plans, or otherwise as provided in Section 7(c) hereof. Executive shall not be required to mitigate the amount of any payment provided for pursuant to this Agreement by seeking other employment or otherwise and the amount of any payment provided for pursuant to this Agreement shall not be reduced by any compensation earned as a result of Executive’s other employment or otherwise.

g.Notice. For the purpose of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given when delivered by hand or overnight courier or three days after it has been mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth below in this Agreement, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

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If to the Company:

Toys “R” Us, Inc.

One Geoffrey Way

Wayne, New Jersey 07470
Attention: General Counsel

If to Executive:

To the most recent address of Executive set forth in the personnel records of the Company.

h.Executive Representation. Executive hereby represents to the Company that the execution and delivery of this Agreement by Executive and the performance by Executive of Executive’s duties hereunder shall not constitute a breach of, or otherwise contravene, the terms of any employment agreement or other agreement or policy to which Executive is a party or otherwise bound.

i.Prior Agreements. This Agreement supersedes all prior agreements and understandings (including verbal agreements) between Executive and the Company and/or its affiliates regarding the terms and conditions of Executive’s employment with the Company and/or its affiliates; provided, however, that the Incentive Plans shall govern the terms and conditions of Executive’s equity holdings in the Company, except as set forth in Section 8(c) hereof.

j.Cooperation. Executive shall provide Executive’s reasonable cooperation in connection with any action or proceeding (or any appeal from any action or proceeding) which relates to events occurring during Executive’s employment hereunder, but only to the extent the Company requests such cooperation with reasonable advance notice to Executive and in respect of such periods of time as shall not unreasonably interfere with Executive’s ability to perform his duties with any subsequent employer; provided, however, that the Company shall pay any reasonable travel, lodging and related expenses that Executive may incur in connection with providing all such cooperation, to the extent approved by the Company prior to incurring such expenses.If Executive is entitled to be paid or reimbursed for any expenses under this Section 12(j), the amount reimbursable in any one calendar year shall not affect the amount reimbursable in any other calendar year, and the reimbursement of an eligible expense must be made no later than December 31 of the year after the year in which the expense was incurred. Executive’s rights to payment or reimbursement of expenses pursuant to this Section 12(j) shall expire at the end of 20 years after the Execution Date and shall not be subject to liquidation or exchange for another benefit.

k.Withholding Taxes. The Company may withhold from any amounts payable under this Agreement such Federal, state and local taxes as may be required to be withheld pursuant to any applicable law or regulation.

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l.Counterparts. This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

m.Compliance with Section 409A. This Agreement shall be interpreted and administered in a manner so that any amount or benefit payable hereunder shall be paid or provided in a manner that is either exempt from or compliant with the requirements Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and applicable advice and regulations issued thereunder. Notwithstanding anything in this Agreement to the contrary, to the extent that any amount or benefit that would constitute non-exempt “deferred compensation” for purposes of Section 409A of the Code would otherwise be payable or distributable under the Agreement by reason of Executive’s termination of employment, such amount or benefit will not be payable or distributable to Executive by reason of such circumstance unless the circumstances giving rise to such termination of employment meet any description or definition of “separation from service” in Section 409A of the Code and applicable regulations (without giving effect to any elective provisions that may be available under such definition). This provision does not affect the dollar amount or prohibit the vesting of any amount upon a termination of employment, however defined. If this provision prevents the payment or distribution of any amount or benefit, such payment or distribution shall be made at the time and in the form that would apply on the next earliest payment or distribution date or event specified in the Agreement that is permissible under Section 409A.

Whenever in this Agreement the provision of a payment or benefit is conditioned on Executive’s execution and non-revocation of a release of claims, such release must be executed, and all revocation periods shall have expired, within 60 days after the date of termination of Executive’s employment, failing which such payment or benefit shall be forfeited. If such payment or benefit constitutes non-exempt deferred compensation, and if such 60-day period begins in one calendar year and ends in the next calendar year, the payment or benefit shall not be made or commence before the second such calendar year, even if the release becomes irrevocable in the first such calendar year.

Each payment of termination benefits under Section 7 of this Agreement, including, without limitation, each installment payment and each payment or reimbursement of premiums for continued medical, dental or life insurance coverage under Section 7(c)(iii), shall be considered a separate payment, as described in Treas. Reg. Section 1.409A-2(b)(2), for purposes of Section 409A of the Code.

Notwithstanding anything herein to the contrary, (i) if at the time of Executive’s termination of employment with the TRU Group Executive is a “specified employee” as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the deferral of the commencement of any payments or benefits otherwise payable hereunder as a result of such termination of employment is necessary in order to prevent the imposition of any accelerated or additional tax under Section 409A of the Code, then the Company will defer the commencement of the payment of any such payments or benefits hereunder (without any reduction in such payments or benefits ultimately paid or provided to

14

EXHIBIT 10.51

Executive) until the date that is six months following Executive’s termination of employment with the TRU Group (or the earliest date as is permitted under Section 409A of the Code) and (ii) if any other payment of money or other benefits due to Executive hereunder could cause the application of an accelerated or additional tax under Section 409A of the Code, such payment or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Section 409A of the Code, or otherwise such payment or other benefits shall be restructured, to the extent possible, in a manner, determined by the Board (but subject to the reasonable consent of the Executive), that does not cause such an accelerated or additional tax or result in an additional cost to the Company. The Company shall consult with Executive in good faith regarding the implementation of the provisions of this Section 12(m); provided that neither the Company nor any of its employees or representatives shall have any liability to Executive with respect thereto. Notwithstanding anything herein to the contrary, this Section 12(m) shall not apply to any payments or benefits due to Executive under the Incentive Plans.

[Signatures on next page.]

15

EXHIBIT 10.51

IN WITNESS WHEREOF, the parties hereto have duly executed this amended and restated Agreement as of the day and year first above written.

TOYS “R” US, INC.

By: /s/ David J. Schwartz______________

David J. Schwartz

Executive Vice President,

General Counsel and Corporate Secretary

EXECUTIVE

/s/ Richard Barry_____________________

Richard Barry

16

EXHIBIT A

None.

1

EXHIBIT B

SEPARATION AND RELEASE AGREEMENT

This Separation and Release Agreement (“Agreement”) is entered into as of this ___ day of __________________________, 20__, between TOYS “R” US, INC. and any successor thereto (collectively, the “Company”) and Richard Barry (the “Executive”).

The Executive and the Company agree as follows:

1.The employment relationship between the Executive and the Company and its subsidiaries and affiliates, as applicable, terminated on _________________________________ (the “Termination Date”).

2.In accordance with the Executive’s Employment Agreement, Executive is entitled to receive certain payments and benefits after the Termination Date.

3.In consideration of the above, the sufficiency of which the Executive hereby acknowledges, the Executive, on behalf of the Executive and the Executive’s heirs, executors and assigns, hereby releases and forever discharges the Company and its members, parents, affiliates, subsidiaries, divisions, any and all current and former directors, officers, employees, agents, and contractors and their heirs and assigns, and any and all employee pension benefit or welfare benefit plans of the Company, including current and former trustees and administrators of such employee pension benefit and welfare benefit plans, from all claims, charges, or demands, in law or in equity, whether known or unknown, which may have existed or which may now exist from the beginning of time to the date of this Agreement, including, without limitation, any claims the Executive may have arising from or relating to the Executive’s employment or termination from employment with the Company and its subsidiaries and affiliates, as applicable, including a release of any rights or claims the Executive may have under Title VII of the Civil Rights Act of 1964, as amended, and the Civil Rights Act of 1991 (which prohibit discrimination in employment based upon race, color, sex, religion, and national origin); the Americans with Disabilities Act of 1990, as amended, and the Rehabilitation Act of 1973 (which prohibit discrimination based upon disability); the Family and Medical Leave Act of 1993 (which prohibits discrimination based on requesting or taking a family or medical leave); Section 1981 of the Civil Rights Act of 1866 (which prohibits discrimination based upon race); Section 1985(3) of the Civil Rights Act of 1871 (which prohibits conspiracies to discriminate); the Employee Retirement Income Security Act of 1974, as amended (which prohibits discrimination with regard to benefits); any other federal, state or local laws against discrimination; or any other federal, state, or local statute, or common law relating to employment, wages, hours, or any other terms and conditions of employment. This includes a release by the Executive of any claims for wrongful discharge, breach of contract, torts or any other claims in any way related to the Executive’s employment with or resignation or termination from the Company and its subsidiaries and affiliates, as applicable. This release also includes a release of any claims for age discrimination under the Age Discrimination in Employment Act, as amended (“ADEA”). The ADEA requires that the Executive be advised to consult with an attorney before the Executive waives any claim under ADEA. In addition, the ADEA provides the Executive with at least 21

1

days to decide whether to waive claims under ADEA and seven days after the Executive signs the Agreement to revoke that waiver. This release does not release the Company from any obligations due to the Executive under the Executive’s Employment Agreement or under this Agreement, any rights Executive has to indemnification by the Company and any vested rights Executive has under the Company’s employee pension benefit and welfare benefit plans.

Additionally, in consideration of the foregoing, the Company agrees to release and forever discharge the Executive and the Executive’s heirs, executors and assigns from any claims, charges or demands, and/or causes of action whatsoever, in law or in equity, whether known or unknown, which may have existed or which may now exist from the beginning of time to the date of this Agreement, including, but not limited to, any claim, matter or action related to the Executive’s employment and/or affiliation with, or termination and separation from the Company and its subsidiaries and affiliates; provided that such release shall not release the Executive from any loan or advance by the Company or its subsidiaries or affiliates, as applicable, a breach of Executive’s fiduciary obligations under New Jersey state law or a breach under Section 8 or 9 of the Executive’s Employment Agreement.

4.This Agreement is not an admission by either the Executive or the Company or its subsidiaries or affiliates of any wrongdoing or liability.

5.The Executive waives any right to reinstatement or future employment with the Company and its subsidiaries and affiliates following the Executive’s separation from the Company and its subsidiaries and affiliates on the Termination Date.

6.The Executive agrees not to engage in any act after execution of the Agreement that is intended, or may reasonably be expected to harm the reputation, business, prospects or operations of the Company or its subsidiaries or affiliates or their respective officers, directors, stockholders or employees. The Company further agrees that it will engage in no act which is intended, or may reasonably be expected to harm the reputation, business or prospects of the Executive.

7.The Executive shall continue to be bound by Sections 8 and 9 of the Executive’s Employment Agreement.

8.The Executive shall promptly return all Company and subsidiary and affiliate property in the Executive’s possession, including, but not limited to, Company or subsidiary or affiliate keys, credit cards, cellular phones, computer equipment, software and peripherals and originals or copies of books, records, or other information pertaining to the Company or subsidiary or affiliate business.

9.This Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey, without reference to the principles of conflict of laws. Exclusive jurisdiction with respect to any legal proceeding brought concerning any subject matter contained in this Agreement shall be settled by arbitration as provided in the Executive’s Employment Agreement.

2

10.This Agreement represents the complete agreement between the Executive and the Company concerning the subject matter in this Agreement and supersedes all prior agreements or understandings, written or oral. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

11.Each of the sections contained in this Agreement shall be enforceable independently of every other section in this Agreement, and the invalidity or unenforceability of any section shall not invalidate or render unenforceable any other section contained in this Agreement.

12.It is further understood that for a period of 7 days following the execution of this Agreement in duplicate originals, the Executive may revoke this Agreement, and this Agreement shall not become effective or enforceable until the revocation period has expired. No revocation of this Agreement by the Executive shall be effective unless the Company has received within the 7 day revocation period, written notice of any revocation, all monies received by the Executive under this Agreement and the Executive’s Employment Agreement and all originals and copies of this Agreement.

13.This Agreement has been entered into voluntarily and not as a result of coercion, duress, or undue influence. The Executive acknowledges that the Executive has read and fully understands the terms of this Agreement and has been advised to consult with an attorney before executing this Agreement. Additionally, the Executive acknowledges that the Executive has been afforded the opportunity of at least 21 days to consider this Agreement.

The parties to this Agreement have executed this Agreement as of the day and year first written above.

TOYS “R” US, INC.

By: _________________________

Name:

Title:

EXECUTIVE

/s/ Richard Barry_______________

Richard Barry

3

EX-10.52

Exhibit 10.52

October 20, 2014

BY HAND DELIVERY

Richard Barry

RE:    Global Chief Merchandising Officer

Richard:

As discussed, the Company is pleased to offer you the opportunity to serve as the Executive Vice President, Global Chief Merchandising Officer, reporting directly to me, the Chief Executive Officer of the Company.

Currently, the role includes serving as the Head of the Global Commercial Committee. Along with the other members of the Global Commercial Committee, you shall be responsible for the development of our global vendor strategies, our global vendor relations and the coordination of all merchandise activities around the globe. As such, all global lead merchants, including the head merchants for the U.S., both for Toys and Babies, would have an indirect reporting relationship to you.

In addition, you will have direct responsibility for Private Label Development and Sourcing. This includes Product Development, Sourcing, Brand Management, the China Sourcing Office, and any other Global Sourcing capability that the Company may develop in the future. As you know, Private Label is one of our key long term strategic initiatives, critical to the TRU Transformation. In fact, in our most recent October Board of Directors meeting, the Sponsors identified “Private Label/Global Sourcing” as one of our three long term strategic initiatives, along with “Store of the Future” and “Grow Asia.”

Finally, you will also be leading the Company’s global “Store of the Future” initiative, which is an innovation role that includes working with the different teams both in the U.S. and internationally to identify and implement new product categories to introduce to our stores.

Essentially, in this new role, by broadening your merchandising scope from U.S. to global, you will have the opportunity to impact the company at a more strategic, game-changing level, as well as have responsibility for leading two out of three of the key long term strategic initiatives for the Company. In recognition of these new responsibilities, you will be awarded a special one-time stock option grant of 20,000 options, with a strike price of $8.00, as soon as administratively possible. Those options will vest over a 4 year period, in 25% increments.

Please sign below to acknowledge your acceptance of your new role. Other than your title and responsibilities, all other aspects of your compensation will remain unchanged. Your employment agreement will be updated to reflect your new title and position.

Sincerely,

/s/ Antonio Urcelay

Antonio Urcelay

Chief Executive Officer

Acknowledged and Agreed:

/s/ Richard Barry

RICHARD BARRY

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 30, 2016			January 31, 2015			February 1, 2014			February 2, 2013			January 28, 2012
Consolidated pretax (loss) earnings from continuing operations	(48		)	(256		)	$	(867	)	$	92		$	150
Noncontrolling interest	6			4			3			1			2
Interest capitalized during period	—			—			—			(1		)	(1		)
Total fixed charges	595			631			714			716			688
Adjusted earnings (loss) from continuing operations	$	553		$	379		$	(150	)	$	808		$	839
Fixed Charges
Interest expense	429			451			$	524		$	480		$	442
Interest capitalized during period	—			—			—			1			1
Interest portion of rental expense	166			180			190			235			245
Total Fixed Charges	$	595		$	631		$	714		$	716		$	688
Ratio of Earnings to Fixed Charges	0.93			0.60			(0.21		)	1.13			1.22

(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	$	546		$	601		$	609		$	628		$	588
Capitalization factor	3.7			3.7			4.4			4.6			5.2
Weighted average cost of long-term debt	8.2		%	8.1		%	7.1		%	8.1		%	8.0		%
Interest in rent expense	$	166		$	180		$	190		$	235		$	245
% of interest to rent expense	30		%	30		%	31		%	37		%	42		%

EX-21

Exhibit 21 Subsidiaries of the Registrant as of January 30, 2016

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
Toys “R” Us (Canada) Ltd./Toys “R” Us (Canada) Ltee	Canada
Toys “R” Us SARL	France
Toys “R” Us France Real Estate SAS	France

Name	Jurisdiction
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 Brinquedos e Artigos Juvenis, Lda.	Portugal
Toys‘R’Us (Singapore) Pte. Ltd.	Singapore
Toys R Us Iberia, S.A.U.	Spain
Toys R Us Madrid, S.L.U.	Spain
Toys R Us Iberia Real Estate, S.L.U.	Spain
Toys “R” Us, Inc. Sucursal en Espaῆa	Spain
TRU Iberia Holdings 1, S.L.U.	Spain
TRU Iberia Holdings 2, S.L.U.	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
TRU Europe Limited	United Kingdom
TRU (UK) H7 Limited	United Kingdom
TRU (UK) H8 Limited	United Kingdom
TRU (UK) H9 Limited	United Kingdom
TRU (Holdings) 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 David A. Brandon, Michael J. 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 30, 2016, 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 17th day of March, 2016.

Name	Title	Signature
Joshua Bekenstein	Director	/s/ Joshua Bekenstein
Richard Goodman	Director	/s/ Richard Goodman
Matthew S. Levin	Director	/s/ Matthew S, Levin
Joseph Macnow	Director	/s/ Joseph Macnow
Paul Raether	Director	/s/Paul Raether
Wendy Silverstein	Director	/s/ Wendy Silverstein
Nathaniel H. Taylor	Director	/s/ Nathaniel H. Taylor

EX-31.1

Exhibit 31.1

CERTIFICATION

I, David A. Brandon, 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 24, 2016

/s/ David A. Brandon

David A. Brandon

Chairman of the Board 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 24, 2016

/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, David A. Brandon, 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 30, 2016 (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 24, 2016

/s/ David A. Brandon

David A. Brandon

Chairman of the Board 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 30, 2016 (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 24, 2016

/s/ Michael J. Short

Michael J. Short

Executive Vice President -

Chief Financial Officer

(Principal Financial Officer)

XML

Document and Entity Information Document - USD ($)	12 Months Ended
	Jan. 30, 2016	Mar. 01, 2016	Aug. 01, 2015
Document Information [Line Items]
Entity Registrant Name	TOYS R US INC
Entity Central Index Key	0001005414
Current Fiscal Year End Date	--01-30
Entity Filer Category	Non-accelerated Filer
Document Type	10-K
Document Period End Date	Jan. 30, 2016
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Common Stock, Shares Outstanding		49,347,672
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	Yes
Entity Current Reporting Status	Yes
Entity Public Float			$ 0

XML

Consolidated Statements of Operations - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Consolidated Statements of Operations [Abstract]
Net sales	$ 11,802	$ 12,361	$ 12,543
Cost of sales	7,576	7,931	8,154
Gross margin	4,226	4,430	4,389
Selling, general and administrative expenses	3,593	3,915	4,010
Depreciation and amortization	343	377	388
Goodwill impairment	0	0	378
Other income, net	(88)	(53)	(37)
Total operating expenses	3,848	4,239	4,739
Operating loss	378	191	(350)
Interest expense	(429)	(451)	(524)
Interest income	3	4	7
Loss before income taxes	(48)	(256)	(867)
Income tax expense	76	32	169
Net loss	(124)	(288)	(1,036)
Less: Net earnings attributable to noncontrolling interest	6	4	3
Net loss attributable to Toys “R” Us, Inc.	$ (130)	$ (292)	$ (1,039)

XML

Consolidated Statement of Comprehensive Income - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Consolidated Statements of Comprehensive Income [Abstract]
Net loss	$ (124)	$ (288)	$ (1,036)
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustments	(47)	(128)	(82)
Unrealized gain on hedged transactions	1	1	1
Unrecognized actuarial gains (losses)	20	(33)	0
Total other comprehensive loss, net of tax	(26)	(160)	(81)
Comprehensive loss, net of tax	(150)	(448)	(1,117)
Less: Net earnings attributable to noncontrolling interest	6	4	3
Comprehensive loss attributable to Toys “R” Us, Inc.	$ (156)	$ (452)	$ (1,120)

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Consolidated Balance Sheets - USD ($) $ in Millions		Jan. 30, 2016		Jan. 31, 2015
Current Assets:
Cash and cash equivalents		$ 680		$ 698
Accounts and other receivables		225		225
Merchandise inventories		2,270		2,064
Current deferred tax assets		0	[1]	45
Prepaid expenses and other current assets		113		122
Total current assets		3,288		3,154
Property and equipment, net		3,163		3,335
Goodwill		64		64
Deferred tax assets		96	[1]	133
Restricted cash		52		53
Other assets		305		376
Total Assets		6,968		7,115
Current Liabilities:
Accounts payable		1,699		1,571
Accrued expenses and other current liabilities		994		1,032
Income taxes payable		32		20
Current portion of long-term debt		73		176
Total current liabilities		2,798		2,799
Long-term debt	[2]	4,670		4,612
Deferred tax liabilities		64	[1]	112
Deferred rent liabilities		345		347
Other non-current liabilities		245		255
Temporary Equity		111		85
Stockholders’ Deficit:
Common stock (par value $0.001 and $0.001; shares authorized 60,000,000 and 55,000,000; shares outstanding 49,347,672 and 49,195,396 at January 30, 2016 and January 31, 2015, respectively)		0		0
Treasury stock		0		(5)
Additional paid-in capital		67		68
Accumulated deficit		(1,062)		(914)
Accumulated other comprehensive loss		(270)		(244)
Total Stockholders’ Deficit		(1,265)		(1,095)
Total Liabilities, Temporary Equity and Stockholders’ Deficit		$ 6,968		$ 7,115

[1] In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The guidance is effective for interim and annual periods beginning after December 15, 2016, and may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. As permitted, the Company elected to early adopt this guidance effective January 30, 2016, and has applied the guidance prospectively. The adoption of this guidance did not have a significant impact on the Company’s financial statements, other than the prospective classification of deferred tax liabilities and assets as noncurrent in accordance with the new presentation requirements.

[2] 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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Consolidated Balance Sheets (Parentheticals) - $ / shares	Jan. 30, 2016	Jan. 31, 2015
Consolidated Balance Sheets [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	60,000,000	55,000,000
Common stock, shares issued and outstanding	49,347,672	49,195,396

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Consolidated Statements of Cash Flows - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Consolidated Statements of Cash Flows [Abstract]
Amortization of Debt Discount (Premium)				$ 22
Cash Flows from Operating Activities:
Net loss		$ (124)	$ (288)	(1,036)
Adjustments to reconcile Net loss to Net cash provided by operating activities:
Depreciation and amortization		343	377	388
Amortization and write-off of debt issuance costs and debt discount (1)	[1]	28	59	73
Net gains on sales of properties		(20)	(5)	(8)
Deferred income taxes		17	(1)	133
Non-cash portion of asset impairments and other charges		20	20	49
Goodwill impairment		0	0	378
Proceeds from settlement of derivatives		0	9	0
Unrealized losses (gains) on foreign exchange		10	15	(1)
Other		(1)	23	16
Changes in operating assets and liabilities:
Accounts and other receivables		(2)	(6)	(1)
Merchandise inventories		(256)	(16)	13
Prepaid expenses and other operating assets		18	14	21
Accounts payable, Accrued expenses and other liabilities		190	283	160
Income taxes payable, net		15	(8)	(41)
Net cash provided by operating activities		238	476	144
Cash Flows from Investing Activities:
Capital expenditures		(219)	(207)	(238)
Increase in restricted cash		(2)	(5)	(34)
Proceeds from sales of fixed assets		13	18	35
Acquisitions		2	1	0
Property insurance recovery		0	2	0
Purchases of debt securities		0	0	(20)
Proceeds from redemption of debt securities		0	0	52
Net cash used in investing activities		(210)	(193)	(205)
Cash Flows from Financing Activities:
Long-term debt borrowings		1,451	2,866	3,159
Long-term debt repayments		(1,472)	(3,010)	(3,491)
Short-term debt borrowings, net		0	(12)	(2)
Capitalized debt issuance costs		(6)	(35)	(47)
Other		0	0	(7)
Net cash used in financing activities		(27)	(191)	(388)
Effect of exchange rate changes on Cash and cash equivalents		(19)	(38)	(25)
Cash and cash equivalents:
Net (decrease) increase during period		(18)	54	(474)
Cash and cash equivalents at beginning of period		698	644	1,118
Cash and cash equivalents at end of period		680	698	644
Supplemental Disclosures of Cash Flow Information:
Interest paid		393	380	458
Net income tax payments		39	43	71
Non-Cash Operating Information:
Purchases of property and equipment included in Accounts payable, Accrued expenses and other current liabilities		$ 56	$ 42	$ 24

[1] Fiscal 2013 includes $22 million of amortization and write-off of debt discount, which was previously presented within Other.

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Consolidated Statements of Stockholders’ (Deficit) Equity - USD ($) shares in Millions, $ in Millions	Total	Common Stock Issued Shares	Common Stock Treasury Amount	Additional Paid-in Capital	Total Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Toys R Us, Inc.
Balance (shares) at Feb. 02, 2013		49
Balance at Feb. 02, 2013			$ (4)	$ 47	$ 445	$ (3)	$ 485
Net loss attributable to Toys “R” Us, Inc.	$ (1,039)				(1,039)		(1,039)
Total other comprehensive loss, net of tax	(81)					(81)	(81)
Restricted stock forfeitures			(2)	2			0
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)			(8)
Adjustment of noncontrolling interest to redemption value	(18)				(18)		(18)
Balance (shares) at Feb. 01, 2014		49
Balance at Feb. 01, 2014			(9)	49	(612)	(84)	(656)
Net loss attributable to Toys “R” Us, Inc.	(292)				(292)		(292)
Total other comprehensive loss, net of tax	(160)					(160)	(160)
Stock compensation expense				15			15
Adjustment of noncontrolling interest to redemption value	(10)				(10)		(10)
Issuance of restricted stock			4	(4)			0
Value of formerly redeemable shares from temporary equity	8			8			8
Balance (shares) at Jan. 31, 2015		49
Balance at Jan. 31, 2015			(5)	68	(914)	(244)	(1,095)
Net loss attributable to Toys “R” Us, Inc.	(130)				(130)		(130)
Total other comprehensive loss, net of tax	(26)					(26)	(26)
Stock compensation expense				4			4
Adjustment of noncontrolling interest to redemption value	$ (18)				(18)		(18)
Issuance of restricted stock			5	(5)			0
Balance (shares) at Jan. 30, 2016		49
Balance at Jan. 30, 2016			$ 0	$ 67	$ (1,062)	$ (270)	$ (1,265)

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Jan. 30, 2016

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 omnichannel offerings that leverage our brick-and-mortar stores and e-commerce. As of January 30, 2016, we operated 1,622 stores and licensed an additional 252 stores. These stores are located in 39 countries and jurisdictions around the world under the Toys “R” Us and Babies “R” Us banners. In addition, we operate smaller format Toys “R” Us Express stores (“Express stores”), some of which are open on a short-term basis during the holiday season. Our omnichannel experience incorporates our websites including Toysrus.com and Babiesrus.com, as well as other e-commerce sites in our international markets.

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 (“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 retail destination for children of all ages 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
2015	52	January 30, 2016
2014	52	January 31, 2015
2013	52	February 1, 2014

Basis of Presentation

The accompanying consolidated financial statements as of January 30, 2016 and January 31, 2015 and for each of the three year periods ended January 30, 2016, January 31, 2015 and February 1, 2014, have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). In November 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-17 “Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes” (“ASU 2015-17”). ASU 2015-17 simplifies the presentation of deferred taxes by requiring all deferred tax assets and liabilities to be classified as noncurrent on the balance sheet. Under the previous practice, the requirement was to separate deferred taxes into current and noncurrent amounts on the balance sheet. The Company early adopted the amendments in ASU 2015-17 as of January 30, 2016 on a prospective basis and therefore updated the balance sheet presentation in the current year. The prior period has not been restated.

Principles of Consolidation

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

Variable Interest Entities

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 30, 2016 and January 31, 2015, we had restricted cash of $52 million and $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 net realizable value, 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 30, 2016 and January 31, 2015, we had $67 million and $63 million, respectively, recorded for ARO.

Goodwill

At January 30, 2016 and January 31, 2015 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. In the fourth quarter of fiscal 2014, we performed a quantitative assessment for our Toys-China and Southeast Asia reporting unit and it was determined that the goodwill was not impaired. 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 2015 annual impairment tests.

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.

In the fourth quarter of fiscal 2015, we performed a qualitative assessment for our Toys-China and Southeast Asia reporting unit and determined that it was more likely than not that the respective fair value substantially exceeded the carrying value and noted no goodwill impairment indicators.

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 30, 2016 and January 31, 2015 were $82 million and $139 million, respectively. Deferred financing fees amortized to Interest expense for fiscals 2015, 2014 and 2013 were $20 million, $48 million and $51 million, respectively, which is inclusive of accelerated amortization due to certain debt repayments and refinancings prior to maturity. During fiscal 2015, there was a reversal of $30 million of unamortized deferred debt issuance costs as a result of an amendment to the advisory agreement which waived any previously incurred transaction fees payable to our Sponsors in connection with prior refinancings. Refer to Note 16 within our Consolidated Financial Statements entitled “RELATED PARTY TRANSACTIONS” for further details.

Acquisition of Debt Securities

There were no acquisitions of debt securities during fiscal 2015 and fiscal 2014. 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 and business interruption, $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 30, 2016 and January 31, 2015, we had $100 million and $99 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 30, 2016 and January 31, 2015, accumulated depreciation related to capital leases for property and equipment was $25 million and $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 $354 million and $359 million at January 30, 2016 and January 31, 2015, respectively, of which $9 million and $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 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 30, 2016 and January 31, 2015.

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 $45 million, $43 million and $56 million for fiscals 2015, 2014 and 2013, respectively, are included in Net sales. Other revenues consist of warranty income, licensing revenue 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 revenue was $17 million for fiscals 2015 and 2014, respectively, and $16 million for fiscal 2013.

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 $9 million and $10 million at January 30, 2016 and January 31, 2015, 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 $326 million, $379 million and $433 million in fiscals 2015, 2014 and 2013, 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 $37 million, $34 million and $31 million for fiscals 2015, 2014 and 2013, respectively.

Other Income, Net

Other income, net includes the following:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Credit card program income	$	48		$	36		$	33
Gift card breakage income	30			27			24
Net gains on sales of properties	20			5			8
Foreign currency transactions	(14		)	(19		)	(1		)
Impairment of long-lived assets	(16		)	(13		)	(44		)
Other (1)	20			17			17
Total	$	88		$	53		$	37

(1) Includes advertising income from our websites, layaway income 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. We also receive profit sharing revenue based on a percentage of outstanding customer credit card indebtedness. Bounty fees, royalties and profit sharing revenue are recognized when earned and realizable. In fiscal 2015, we received $8 million in profit sharing revenue after reaching the contractual milestone. During fiscals 2015, 2014 and 2013, we recognized credit card program income of $48 million, $36 million and $33 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 $30 million, $27 million and $24 million of gift card breakage income in fiscals 2015, 2014 and 2013, respectively.

Net Gains on Sales of Properties

Net gains on sales of properties were $20 million, $5 million and $8 million for fiscals 2015, 2014 and 2013, 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 the carrying value of 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 2015, 2014 and 2013, we recorded total impairment losses of $16 million, $13 million and $44 million, respectively. These impairments were primarily due to the identification of underperforming stores, the relocation of certain stores and property sales.

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 Transactions

Unrealized and realized gains and losses resulting from foreign currency transactions related to operations are included in Other income, net. In fiscal 2015, we recorded foreign currency losses of $14 million, which included an unrealized loss on foreign exchange of $11 million related to the re-measurement 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. 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 Tranche A-1 Loan. For fiscal 2013, we recorded foreign exchange losses of $1 million. 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 operating 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 U.S. Dollar (“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 within the Consolidated Statements of Stockholders’ (Deficit) Equity.

Foreign Currency Transactions - Short-Term Intercompany Loans

Foreign currency transactions related to short-term, cross-currency intercompany loans, which we economically hedge, amounted to gains of $5 million, $9 million and $1 million for fiscals 2015, 2014 and 2013, respectively. Such amounts were included in Interest expense. The related foreign currency forward 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. For fiscal years 2015, 2014 and 2013, we recorded losses of $5 million, $9 million and $1 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 30, 2016 and January 31, 2015, we reported unrecognized tax benefits in 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 (“Asia JV”), 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, all these awards had vested and redemption was 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, 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
Net earnings attributable to noncontrolling interest	6
Adjustment of noncontrolling interest to redemption value	18
Capital contribution	2
Balance, January 30, 2016	$	111

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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SHORT-TERM BORROWINGS AND LONG-TERM DEBT

12 Months Ended

Jan. 30, 2016

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 30, 2016 and January 31, 2015 is outlined in the table below:

(In millions)	January 30, 2016		January 31, 2015
Short-term borrowings
Asia JV uncommitted lines of credit	$	—	$	—
Long-term debt
Spanish real estate credit facility, due fiscal 2015 (EURIBOR+6.00%) (1)	—		34
Toys-Japan unsecured credit lines, expire fiscals 2016-2017 (2)	—		—
10.375% senior notes, due fiscal 2017 (3)	448		448
8.500% senior secured notes, due fiscal 2017 (4)	722		721
French real estate credit facility, due fiscal 2018 (EURIBOR+4.50%)	50		53
Incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (5)	130		133
Second incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (5)	65		67
7.375% senior notes, due fiscal 2018 (3)	402		402
$1.85 billion secured revolving credit facility, expires fiscal 2019 (5)	80		—
Senior unsecured term loan facility, due fiscal 2019 (LIBOR+5.00%) (6)	923		965
Tranche A-1 loan facility, due fiscal 2019 (LIBOR+7.25%) (5)	273		272
Secured term B-4 loan facility, due fiscal 2020 (LIBOR+8.75%) (5)	1,002		1,010
UK real estate credit facility, due fiscal 2020 (6.85%)	375		396
European and Australian asset-based revolving credit facility, expires fiscal 2020 (7)	—		—
Toys-Japan 1.85%-2.18% loans, due fiscals 2016-2021 (8)	49		63
8.750% debentures, due fiscal 2021 (9)	22		22
Finance obligations associated with capital projects	183		189
Capital lease and other obligations	19		13
	4,743		4,788
Less: current portion	73		176
Total Long-term debt (10)	$	4,670	$	4,612

(1) On January 29, 2016, Toys “R” Us Iberia Real Estate S.L.U., using cash on hand, paid the €24 million final installment of its senior secured term loan facility (the “Spain Propco Facility Agreement.”)

(2) On June 30, 2015, Toys “R” Us - Japan, Ltd. (“Toys-Japan”) entered into an agreement to refinance its committed line of credit (“Tranche 1” due fiscal 2015) into Tranche 1A due fiscal 2017 (“Tranche 1A”) and Tranche 1B due fiscal 2016 (“Trance 1B”).

(3) 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.

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

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

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

(7) On December 18, 2015, certain of our foreign subsidiaries amended and restated the European and Australian asset-based revolving credit facility (the “European ABL Facility”) to extend the maturity date of the facility and amend certain other provisions.

(8) On January 29, 2016, Toys-Japan entered into an additional bank loan with an aggregate principal amount of ¥4.1 billion.

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

(10) 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 30, 2016, we had total indebtedness of $4.7 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 $448 million as of January 30, 2016. 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 30, 2016, we have funds available to finance our operations under our $1.85 billion secured revolving credit facility (“ABL Facility”) through March 2019, subject to an earlier springing maturity, our European ABL Facility through December 2020 and our Toys-Japan unsecured credit lines with two tranches maturing June 2016 and a tranche maturing June 2017. In addition, Asia JV and Toys-Japan have uncommitted lines of credit due on demand.

The annual maturities of our Long-term debt, including current portion, at January 30, 2016 are as follows:

(In millions)	Annual Maturities
2016	$	73
2017	1,215
2018	659
2019	1,280
2020	1,363
2021 and subsequent	183
Total	$	4,773

Asia JV uncommitted lines of credit, due on demand ($0 million at January 30, 2016)

Asia JV has several uncommitted unsecured lines of credit with various financial institutions with total availability of HK$221 million ($28 million at January 30, 2016). As of January 30, 2016, we had no borrowings and $4 million of bank guarantees issued under these facilities. The remaining availability under these facilities was $24 million.

Toys-Japan unsecured credit lines, expire fiscals 2016-2017 ($0 million at January 30, 2016)

Toys-Japan currently has an agreement with a syndicate of financial institutions, which includes three unsecured loan commitment lines of credit (Tranche 1A, Tranche 1B and “Tranche 2” due fiscal 2016).

On June 30, 2015, Toys-Japan entered into an agreement with a syndicate of financial institutions to refinance Tranche 1. As a result, Tranche 1 was refinanced into Tranche 1A and Tranche 1B. Tranche 1A is available in amounts of up to ¥9.45 billion ($78 million at January 30, 2016), expires on June 30, 2017 and bears an interest rate of Tokyo Interbank Offered Rate (“TIBOR”) plus 0.80% per annum. As of January 30, 2016 we had no outstanding borrowings under Tranche 1A, with $78 million of remaining availability. Tranche 1B is available in amounts of up to ¥2.0 billion ($17 million at January 30, 2016), expires on June 30, 2016 and bears an interest rate of TIBOR plus 0.80% per annum. As of January 30, 2016 we had no outstanding borrowings under Tranche 1B, with $17 million of remaining availability. In addition, a commitment fee accrues on any unused portion of Tranche 1A and Tranche 1B at a rate of 0.250% per annum. We paid fees of $2 million to refinance Tranche 1, of which $1 million is capitalized as deferred debt issuance costs and amortized over the term of the agreement.

Tranche 2 is available in amounts of up to ¥3.5 billion ($29 million at January 30, 2016), expires on June 30, 2016 and bears an interest rate of TIBOR plus 0.80% per annum. As of January 30, 2016, we had no outstanding borrowings under Tranche 2, with $29 million of remaining availability. Additionally, on June 30, 2015, Toys-Japan amended an uncommitted line of credit reducing its total availability from ¥1.5 billion to ¥1.0 billion ($8 million at January 30, 2016), which renews August 1 of each year unless otherwise canceled. The uncommitted line of credit continues to bear an interest rate of TIBOR plus 0.50%. As of January 30, 2016 we had no outstanding borrowings under the uncommitted line of credit.

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 accounting principles generally accepted in Japan (“JGAAP”), as defined in the credit agreements. The agreements also restrict Toys-Japan from paying dividends or making loans to affiliates without lender consent.

Toys-Japan has an additional uncommitted line of credit with total availability of ¥0.5 billion ($4 million at January 30, 2016). As of January 30, 2016, we had no outstanding borrowings under the uncommitted line of credit.

$1.85 billion secured revolving credit facility, expires fiscal 2019 ($80 million at January 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 provides 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.

At January 30, 2016, under our ABL Facility, we had $80 million of outstanding borrowings, a total of $99 million of outstanding letters of credit and excess availability of $1,009 million. We are also subject to a minimum excess availability covenant of $125 million, with remaining availability of $884 million in excess of the covenant at January 30, 2016. Deferred debt issuance costs for this credit facility were $19 million and $38 million as of January 30, 2016 and January 31, 2015, 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 $1,026 million due fiscal 2020 (“Secured Term B-4 Loan”) and $280 million due fiscal 2019 (“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).

European and Australian asset-based revolving credit facility, expires fiscal 2020 ($0 million at January 30, 2016)

On December 18, 2015, certain of our foreign subsidiaries amended and restated the credit agreement for the European ABL Facility in order to extend the maturity date of the facility and amend certain other provisions. The European ABL Facility, as amended, provides for a five-year £138 million ($197 million at January 30, 2016) asset-based senior secured revolving credit facility which will expire on December 18, 2020. Loans under the European ABL Facility as amended bear interest at a rate of LIBOR or Euro Interbank Offered Rate (“EURIBOR”) plus a margin of 2.50% through the first fiscal quarter of 2016 and thereafter 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. In connection with the amended and restated credit agreement, we incurred transaction fees of $4 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 amendment, unamortized debt issuance costs were less than$1 millionand the remaining amount will be amortized over the term of the amended and restated credit agreement.

At January 30, 2016, under our European ABL Facility, we had no outstanding borrowings, with $81 million of remaining availability under the European ABL Facility. Deferred debt issuance costs for this credit facility were $4 million and $2 million as of January 30, 2016 and January 31, 2015, 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 our foreign subsidiaries organized in Australia, England, Wales and France. The terms of the European ABL Facility include a customary cash dominion trigger requiring the cash of certain of our foreign 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 TRU Europe Limited, TRU Iberia Holdings 1, S.L.U., TRU Australia Holdings, LLC (collectively, the “Parent Guarantors”) 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 the Parent Guarantors and the UK, Wales 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 the Parent Guarantors 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.

10.375% senior notes, due fiscal 2017 ($448 million at January 30, 2016)

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. Deferred debt issuance costs for these notes were $5 million and $8 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

The indenture governing the 2017 Notes contain covenants that, among other things, restrict the ability of the Parent 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 30, 2016, 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 30, 2016, the 2017 Notes were not “investment grade.” In addition, the indenture contains customary terms and covenants, including certain events of default upon which the 2017 Notes may be due and payable immediately.

The 2017 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, 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 ($722 million at January 30, 2016)

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. Deferred debt issuance costs for these notes were $7 million and $10 million as of January 30, 2016 and January 31, 2015, 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 ($50 million at January 30, 2016)

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 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this credit facility were $1 million and $2 million as of January 30, 2016 and January 31, 2015, 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 30, 2016)

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 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Senior unsecured term loan facility, due fiscal 2019 ($923 million at January 30, 2016)

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 $16 million and $17 million of the Propco I Term Loan Facility as of January 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this loan were $12 million and $23 million as of January 30, 2016 and January 31, 2015, 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 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”). As a result, TRU Propco I made a prepayment of $25 million on May 11, 2015. 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 a result, on August 28, 2015, TRU Propco I made a prepayment of $16 million. As of January 30, 2016, an aggregate amount of $38 million has been classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 30, 2016. Propco I may optionally prepay the outstanding principal balance of the loan at any time.

The Propco I Term Loan Facility contains certain 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 to 1.0 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 ($273 million at January 30, 2016)

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. Deferred debt issuance costs for this loan were $2 million and $7 million as of January 30, 2016 and January 31, 2015, respectively, 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%).

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 ($130 million at January 30, 2016)

Second incremental secured term loan, due fiscal 2018 ($65 million at January 30, 2016)

Secured term B-4 loan facility, due fiscal 2020 ($1,002 million at January 30, 2016)

On October 24, 2014, Toys-Delaware amended the credit agreement for our secured term loan facilities (“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.  KKR owned an aggregate of $2 million and $96 million of the Secured Term B-4 Loan as of January 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this loan were $16 million and $26 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

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 2018 (“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 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 30, 2016. 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 of the Incremental Secured Term Loan as of January 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this loan were $1 million as of January 30, 2016 and January 31, 2015, 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 30, 2016. 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 of the Second Incremental Secured Term Loan as of January 30, 2016 and January 31, 2015, respectively. Deferred debt issuance costs for this loan was $1 million as of January 30, 2016 and January 31, 2015, 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 30, 2016. 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. The October 24, 2014 amendment to the agreement waived the excess cash flow provision that would have applied to fiscal 2014 and no repayment was therefore required during fiscal 2015. We do not believe we will need to make a payment for fiscal 2015 excess cash flows in fiscal 2016. 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 ($375 million at January 30, 2016)

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. 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 ($19 million and $20 million as of January 30, 2016 and January 31, 2015, respectively) 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. The fair value of the Company’s investment in these notes at January 30, 2016 and January 31, 2015 was $19 million and $20 million, respectively. 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 $11 million and $16 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

Toys-Japan bank loans (1.85% to 2.18%), due fiscals 2016-2021 ($49 million at January 30, 2016)

Toys-Japan had four bank loans with various financial institutions totaling $49 million at January 30, 2016. 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 30, 2016). As of January 30, 2016, the outstanding balance of this loan was ¥80 million or $1 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 30, 2016). As of January 30, 2016, the outstanding balance of this loan was ¥0.4 billion or $3 million. On January 29, 2016, Toys-Japan entered into a bank loan with a syndicate of financial institutions for ¥4.1 billion. The loan will mature on January 29, 2021 and bears an interest rate of TIBOR plus 1% per annum. Toys-Japan is required to make semi-annual principal payments of ¥410 million ($3 million at January 30, 2016). As of January 30, 2016 the outstanding balance of this loan was ¥4.1 billion or $34 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 30, 2016). As of January 30, 2016, the outstanding balance of this loan was ¥1.4 billion or $11 million. For these loans, the semi-annual principal payments due within one year totaling $7 million are classified as Current portion of long-term debt on our Consolidated Balance Sheet as of January 30, 2016. Deferred debt issuance costs for these loans were $1 million and less than $1 million as of January 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets. In addition, during fiscal 2015, one of the previously outstanding loans matured, and contemporaneous with the maturity, the associated interest rate swap expired.

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 30, 2016)

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 30, 2016 and January 31, 2015, respectively, and have been included in Other assets on our Consolidated Balance Sheets.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

12 Months Ended

Jan. 30, 2016

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 30, 2016, we had one interest rate cap which is designated as a cash flow hedge 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; 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 2015, 2014 and 2013, respectively. Reclassifications from Accumulated other comprehensive loss to Interest expense primarily relate to realized Interest expense on interest rate swaps and caps and the amortization of gains recorded on de-designated caps. We expect to reclassify a net loss of less than $1 million in fiscal 2016 to Interest expense from Accumulated other comprehensive loss.

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 2015, we held no interest rate contracts which were designated for fair value hedging. 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. In conjunction with the de-designation of the fair value hedge, 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 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. We recorded net gains of less than $1 million in earnings related to ineffectiveness for fiscal 2013.

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 30, 2016 and January 31, 2015, there were no interest rate derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 30, 2016 and January 31, 2015, we were not required to post collateral for any of these derivatives.

The following table presents our outstanding interest rate contracts as of January 30, 2016 and January 31, 2015:

			January 30, 2016		January 31, 2015
(In millions)	Effective Date	Maturity Date	Notional Amount		Notional Amount
Interest Rate Swaps
6 Month JPY TIBOR Float to Fixed Interest Rate Swap (1)	January 2011	January 2016	$	—	$	42
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (1)	January 2011	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap	January 2011	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap (2)	January 2012	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap	January 2012	April 2015	—		500
3 Month EURIBOR Interest Rate Cap (1)	January 2013	January 2016	—		34
3 Month EURIBOR Interest Rate Cap (1)	February 2013	February 2018	50		53
1 Month USD LIBOR Interest Rate Cap	January 2014	April 2015	—		311

(1) These derivatives were designated for hedge accounting.

(2) The Company de-designated a portion of this interest rate cap in fiscal 2010. Prior to its April 2015 maturity, 40% of the $500 million interest rate cap was 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. As of January 30, 2016, there were no foreign exchange derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 31, 2015, derivative liabilities related to agreements that contain credit-risk related contingent features had a fair value of $2 million. We were not required to post collateral for any of these derivative contracts.

The following table presents our outstanding foreign exchange contracts as of January 30, 2016 and January 31, 2015:

			January 30, 2016		January 31, 2015
(In millions)	Effective Date	Maturity Date	Notional  Amount		Notional  Amount
Foreign-Exchange Forwards
Short-term cross-currency intercompany loans	Varies	Varies	$	128	$	98
Merchandise purchases	Varies	Varies	18		—

The following table sets forth the net impact of the effective portion of derivatives designated as cash flow hedges on Accumulated other comprehensive loss on our Consolidated Statements of Stockholders’ (Deficit) Equity for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015			February 1, 2014
Derivatives designated as cash flow hedges:
Beginning balance	$	—	$	(1	)	$	(2	)
Change in fair value recognized in Accumulated other comprehensive loss - Interest Rate Contracts	—		—			—
Reclassifications from Accumulated other comprehensive loss - Interest Rate Contracts	1		1			1
Ending balance	$	1	$	—		$	(1	)

The following table sets forth the impact of derivatives on Interest expense on our Consolidated Statements of Operations for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Derivatives not designated for hedge accounting:
Loss on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	$	(5	)	$	(9	)	$	(1	)
Loss on the change in fair value - Interest Rate Contracts	—			(2		)	—
Gain on the change in fair value - Merchandise Purchases Program Foreign Exchange Contracts	9			9			2
	4			(2		)	1
Derivatives designated as cash flow hedges:
Amortization of hedged caps	(1		)	(2		)	(1		)
	(1		)	(2		)	(1		)
Derivative designated as a fair value hedge:
Amortization of swap basis adjustment - Interest Rate Contract	—			—			(1		)
Loss on the change in fair value - Interest Rate Contract	—			(2		)	(5		)
Gain recognized in Interest expense on hedged item	—			2			5
	—			—			(1		)
Total Interest expense	$	3		$	(4	)	$	(1	)

(1) 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 30, 2016 and January 31, 2015:

	January 30, 2016				January 31, 2015
(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	$	—	$	—	$	734	$	—
Other assets	50		—		53		—
Accrued expenses and other current liabilities	—		—		42		—
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	—		—		1,611		—
Foreign Currency Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	53		1		8		—
Accrued expenses and other current liabilities	93		—		90		(2		)
Total derivative contracts outstanding:
Prepaid expenses and other current assets	53		1		2,353		—
Other assets	50		—		53		—
Total derivative assets (1)	103		1		2,406		—
Accrued expenses and other current liabilities	93		—		132		(2		)
Total derivative liabilities (1)	$	93	$	—	$	132	$	(2	)

(1) Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the classification of our derivative instruments 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. There was no aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets as of January 30, 2016. The aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets was nominal as of January 31, 2015. The aggregate gross fair value of derivative assets which could be net settled against our derivative liabilities was nominal as of January 30, 2016 and January 31, 2015, respectively. As of January 30, 2016 and January 31, 2015, none of the master netting arrangements involved collateral.

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FAIR VALUE MEASUREMENTS

12 Months Ended

Jan. 30, 2016

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 30, 2016 and January 31, 2015, aggregated by level in the fair value hierarchy within which those measurements fall.

Fiscal 2015

(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	$	—	$	—	$	—	$	—
Foreign exchange contracts	—		1		—		1
Total assets	$	—	$	1	$	—	$	1

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

For the fiscal years ended January 30, 2016 and January 31, 2015, 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. Impairment of long-lived assets is included in Other income, net on our Consolidated Statements of Operations.

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.

There have been no changes in valuation technique or related inputs for long-lived assets for the fiscal years ended January 30, 2016 and January 31, 2015. The table below presents our long-lived assets evaluated for impairment and measured at fair value on a nonrecurring basis for the fiscal years ended January 30, 2016 and January 31, 2015, 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 30, 2016 and January 31, 2015. As of January 30, 2016 and January 31, 2015, we did not have any long-lived assets classified as Level 1 or Level 2 within the fair value hierarchy, respectively.

Fiscal 2015

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3)		Impairment Losses (1)
Long-lived assets held and used	$	11	$	4	$	7
Long-lived assets held for sale	25		16		9
Total	$	36	$	20	$	16

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

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

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 30, 2016 and January 31, 2015. The table below presents the carrying values and fair values of our Long-term debt including current portion as of January 30, 2016 and January 31, 2015, 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 30, 2016	$	4,743	$	4,107	$	1,309	$	2,037	$	761
January 31, 2015	4,788		4,416		1,346		2,315		755

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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PROPERTY AND EQUIPMENT

12 Months Ended

Jan. 30, 2016

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 30, 2016		January 31, 2015
Land		$	676	$	695
Buildings	45-50	1,932		1,967
Furniture and equipment	3-20	1,472		1,639
Property and leasehold improvements	5-25	2,493		2,500
Costs of computer software	5	224		210
Construction in progress		71		32
Leased equipment under capital lease	3-5	32		51
		6,900		7,094
Less: accumulated depreciation and amortization		3,721		3,759
		3,179		3,335
Less: net assets held for sale		16		—
Total		$	3,163	$	3,335

Assets held for sale

Assets held for sale represent assets owned by us that we have committed to sell. In fiscal 2015, we entered into a contract to sell surplus real estate property. The sale is contingent upon the buyer obtaining municipal approval to re-zone the property and may extend the period required to complete the sale beyond one year. As a result, the asset has been classified as non-current and included in Other assets on our Consolidated Balance Sheet. As of January 31, 2015, there were no assets held for sale. The following assets were classified as held for sale as of January 30, 2016:

(In millions)	January 30, 2016
Land	$	25
Less: accumulated impairment	9
Net assets held for sale	$	16

Net gains on sales of properties

During fiscals 2015, 2014 and 2013, we sold certain properties and assets for cash proceeds of $13 million, $18 million and $35 million, respectively, resulting in net gains of $20 million, $5 million and $8 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. 30, 2016

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 30, 2016 and January 31, 2015 is outlined in the table below:

(In millions)	January 30, 2016		January 31, 2015
Merchandise accounts payable (1)	$	1,488	$	1,373
Non-merchandise accounts payable (2)	211		198
Accounts payable	$	1,699	$	1,571
Gift card and certificate liability	$	222	$	205
Accrued bonus	109		110
Sales and use tax and value added tax payable	87		84
Accrued interest	63		55
Accrued property taxes	48		52
Accrued payroll	41		42
Accrued vacation	29		44
Accrued sponsor transaction fees (3)	—		47
Other (4)	395		393
Accrued expenses and other current liabilities	$	994	$	1,032

(1) Includes $44 million and $36 million of book overdraft cash as of January 30, 2016 and January 31, 2015, respectively.

(2) Includes $90 million and $84 million of book overdraft cash as of January 30, 2016 and January 31, 2015, respectively.

(3) January 31, 2015 includes fees payable to the Sponsors as a result of certain financing transactions. In December 2015, the Company’s Advisory Agreement was amended to waive all Transaction Fees including any prior accrued and unpaid transaction fees. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

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

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STOCK-BASED COMPENSATION

12 Months Ended

Jan. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

STOCK-BASED COMPENSATION

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. 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 stockholders of the Company. 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.

On May 31, 2015, the Board of Directors adopted amendments to the 2010 Incentive Plan and Amended and Restated Certificate of Incorporation, which were adopted by the stockholders of the Company on June 1, 2015. Amendment No. 3 to the 2010 Incentive Plan increased the number of shares available thereunder by 3,000,000 shares and Amendment No. 1 to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of Common Stock by 5,000,000 shares.

All outstanding options issued under the 2010 Incentive Plan are scheduled to expire on dates ranging from August 6, 2017 to October 16, 2025. We expect to satisfy future option exercises by issuing shares held in treasury or authorized but unissued new shares.

Subsequent Event

On March 9, 2016, the Board of Directors of the Company adopted amendments to the 2010 Incentive Plan and the Amended and Restated Certificate of Incorporation, as amended, which were adopted by the stockholders of the Company on March 22, 2016. The amendment to the Company’s 2010 Incentive Plan increased the number of shares of the Company’s common stock available thereunder by 1,000,000 shares and the amendment to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of the Company’s common stock by 5,000,000 shares.

Stock options

In fiscals 2015, 2014 and 2013, 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 2015, except for those granted to David A. Brandon, Chairman of the Board and Chief Executive Officer, and those granted under the Award Exchange described below, 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. 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. Options granted in fiscal 2013, 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. These awards are subject to the participants continued employment with us and will vest automatically upon change of control of the Company.

Additionally, certain options issued in fiscals 2015 and 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 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 fiscals 2015 and 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 fiscal 2013, concurrent with the grant of options, additional awards were granted under the 2010 Incentive Plan consisting of service-based restricted stock units, which were valued at a fair market value on the date of grant of $30.00 per share. 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 vested 100% on the second anniversary of the award, subject to the participant’s continued employment with the Company, and were scheduled to vest automatically upon a change in control of the Company.

In September 2014, the Company accelerated the vesting of certain restricted share units and restricted share awards issued under the 2010 Incentive Plan. 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.

Certain of the awards have provided holders with rights to put shares to the Company in certain circumstances. The Company currently 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 fiscal 2014, in accordance with ASC 718 and ASC 480, the shares were reclassified from temporary equity to permanent equity as redemption of these equity awards was no longer considered probable or redeemable at the option of the holder.

Award 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 (“2014 Old Options”) under the Toys “R” Us, Inc. 2005 Management Equity Plan or the 2010 Incentive Plan for new stock options granted under the 2010 Incentive Plan (“2014 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 2014 Old Options canceled and an equal amount of 2014 New Options issued under the 2010 Incentive Plan. The 2014 New Options have an exercise price of $8.00 and vest as follows: (i) 2014 New Options granted in exchange for 2014 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) 2014 New Options granted in exchange for 2014 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 less than $1 million and $2 million in fiscals 2015 and 2014, respectively, which were recorded in SG&A.

In June 2015, certain participants under the 2010 Incentive Plan were offered an opportunity to exchange their unvested outstanding restricted stock units granted May 24, 2013 (“RSUs”) for a grant of two new stock options (“2015 New Options”) for every one RSU canceled. The 2015 New Options have an exercise price of $8.00. On July 31, 2015, the Company closed its offer with a total of 64,381 RSUs canceled and a total of 128,762 2015 New Options issued under the 2010 Incentive Plan. The 2015 New Options have a grant date of August 3, 2015 and vest 50% on each of May 24, 2016 and May 24, 2017, subject to the participant’s continued employment with the Company, and will vest automatically upon change of control of the Company. These options expire ten years from the date of grant, subject to the earlier expiration in accordance with the 2015 New Option award agreement. We accounted for the modification in accordance with ASC Topic 718, “Compensation – Stock Compensation”. Management has concluded that the modification had no impact on compensation costs.

2015 One-time awards

On June 1, 2015, the Company entered into an employment agreement with David A. Brandon to serve as Chairman of the Board and Chief Executive Officer. The employment agreement provided a one-time award of stock options under the 2010 Incentive Plan subject to time and performance based vesting conditions, which had a grant date of July 1, 2015. The award will vest ratably over forty-eight months commencing on the first month anniversary of the grant date and will only be deemed fully vested when the performance based obligations pursuant to Mr. Brandon’s employment agreement are satisfied. The one-time award has a grant date fair value of $9 million, at $8.00 per share.

Valuation Assumptions

The fair value of each option award modified or granted under the 2010 Incentive 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 30, 2016		January 31, 2015		February 1, 2014
Volatility	45.0	%	45.0	%	40.0%-45.0%
Risk-free interest rate	2.0% - 2.4%		1.4%-2.4%		2.0%-2.7%
Expected term	4.0 years		4.0-5.5 years		3.8-5.2 years
Dividend Yield	—		—		—
Weighted-average grant-date fair value per option:	$3.05		$2.55		$9.67

For fiscals 2015, 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 2015, 2014 and 2013 is presented below:

	Fiscal Years Ended
	January 30, 2016				January 31, 2015				February 1, 2014
	Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price
Outstanding at beginning of fiscal year	3,922,371		$	8.23	2,661,025		$	29.40	3,483,283		$	36.02
Granted	3,245,012		8.00		3,901,217		8.00		1,587,057		25.25
Exercised	—		—		—		—		(1,057,773	)	26.37
Forfeited/Canceled	(1,127,521	)	8.00		(2,639,871	)	29.23		(1,351,542	)	43.97
Outstanding at end of fiscal year	6,039,862		$	8.15	3,922,371		$	8.23	2,661,025		$	29.40

	Options	Weighted-average Exercise Price		Weighted-average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Options vested or expected to vest at January 30, 2016	6,014,672	$	8.00	8.5	$	—
Options exercisable at January 30, 2016	—	$	—	—	$	—

There were no options exercised in fiscals 2015 and 2014. The aggregate intrinsic value of options exercised, which includes options exercised on a net settlement basis, was $4 million in fiscal 2013. The total fair value of options vested was $2 million, $2 million and $19 million in fiscals 2015, 2014 and 2013, respectively. We received no proceeds from the exercise of options in fiscals 2015, 2014 and 2013. We did not cash settle share-based liability awards in fiscals 2015 and 2014. We paid $2 million in fiscal 2013 to cash settle share-based liability awards. We paid less than $1 million and $8 million in fiscals 2015 and 2013, respectively, to repurchase shares. We did not repurchase shares in fiscal 2014.

As of January 30, 2016, there was $10 million of total unrecognized compensation cost related to option share-based compensation arrangements granted under the 2010 Incentive Plan. This cost is expected to be recognized over a weighted-average period of 2.7 years.

Restricted Shares and Units

A summary of outstanding restricted stock unit activity under the 2010 Incentive Plan during fiscals 2015, 2014 and 2013 is presented below:

	Fiscal Years Ended
	January 30, 2016				January 31, 2015				February 1, 2014
	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	290,000		$	14.01	945,878		$	29.05	215,849		$	46.04
Granted	50,000		8.00		50,000		8.00		791,165		25.40
Units converted	(185,453	)	26.29		(156,079	)	45.20		(20,694	)	51.93
Forfeited/Canceled	(142,047	)	11.32		(549,799	)	30.49		(40,442	)	36.66
Outstanding units at end of fiscal year	12,500		$	8.00	290,000		$	14.01	945,878		$	29.05

As of January 30, 2016, there was less than $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 less than 1 year.

The fair value of restricted shares vested and restricted stock units converted was $5 million, $9 million and $4 million for fiscals 2015, 2014 and 2013, respectively, and we did not recognize any tax benefits as a result of the vesting and conversion.

Performance-Based Shares and Units

As of January 30, 2016 and January 31, 2015, we did not have outstanding performance-based share awards as the performance-based share awards and units granted on May 26, 2011 and May 21, 2012 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 2015, 2014 and 2013 was as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
SG&A	$	5	$	15	$	15
Total recognized tax benefit	—		—		—

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ACCUMULATED OTHER COMPREHENSIVE INCOME

12 Months Ended

Jan. 30, 2016

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME

ACCUMULATED OTHER COMPREHENSIVE LOSS

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 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) gains, net of tax			Accumulated other comprehensive loss
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		)
Current period change	(47		)	1			20			(26		)
Balance, January 30, 2016	$	(249	)	$	1		$	(22	)	$	(270	)

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LEASES

12 Months Ended

Jan. 30, 2016

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 30, 2016 are as follows:

	Operating Leases (1)						Capital Leases and Financing Obligations
(In millions)	Gross Minimum Rentals		Sublease Income		Net Minimum Rentals		Lease Obligation
2016	$	505	$	14	$	491	$	33
2017	445		12		433		30
2018	377		11		366		27
2019	316		9		307		22
2020	262		7		255		19
2021 and subsequent	952		18		934		71
Total	$	2,857	$	71	$	2,786	$	202

(1) Excluded from the minimum rental commitments displayed above are $1.4 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 2021 and thereafter.

Total rent expense, net of sublease income, was $546 million, $601 million and $609 million in fiscals 2015, 2014 and 2013, respectively. Sublease income was $17 million, $18 million and $19 million in fiscals 2015, 2014 and 2013, 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 $354 million and $359 million at January 30, 2016 and January 31, 2015, respectively, of which $9 million and $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 $12 million for fiscal 2015 and $10 million for fiscals 2014 and 2013, 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 30, 2016 and January 31, 2015, the carrying amounts of our financing obligations, which primarily represent properties for which we are the deemed the “owner”, were $183 million and $189 million, respectively. These carrying amounts approximate fair value. 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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INCOME TAXES

12 Months Ended

Jan. 30, 2016

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

(Loss) earnings before income taxes are as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
U.S.	$	(169	)	$	(263	)	$	(851	)
Foreign	121			7			(16		)
Loss before income taxes	$	(48	)	$	(256	)	$	(867	)

Income tax expense (benefit) is as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015			February 1, 2014
Current:
U.S. Federal	$	1	$	(13	)	$	(7	)
Foreign	54		46			46
State	4		—			(3		)
Total current income tax expense	$	59	$	33		$	36
Deferred:
U.S. Federal	$	—	$	1		$	42
Foreign	17		(2		)	72
State	—		—			19
Total deferred income tax expense (benefit)	$	17	$	(1	)	$	133
Total income tax expense	$	76	$	32		$	169

Included within Income tax expense is an expense of $2 million, benefit of less than $1 million and benefit of less than $1 million related to interest and penalties in fiscals 2015, 2014 and 2013, 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 30, 2016		January 31, 2015		February 1, 2014
U.S. Federal statutory tax rate	35.0	%	35.0	%	35.0	%
State taxes, net of U.S. Federal benefit	(5.4	)%	—	%	(1.2	)%
Foreign operations (1)	(183.7	)%	(13.5	)%	(12.3	)%
U.S. Federal valuation allowance	(10.4	)%	(36.6	)%	(27.9	)%
Unrecognized tax benefits (2)	—	%	3.0	%	—	%
Goodwill impairment (3)	—	%	—	%	(13.4	)%
Other	6.2	%	(0.4	)%	0.3	%
Effective tax rate	(158.3	)%	(12.5	)%	(19.5	)%

(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 enacted changes in the tax laws or rates or a change in the status of the enterprise.

(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. Refer to “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 30, 2016			January 31, 2015
Deferred tax assets:
U.S. Federal tax loss and other carryforwards	$	358		$	385
State tax loss and other carryforwards	83			84
Foreign tax loss and other carryforwards	164			169
Straight line rent	127			127
Inventory	60			52
Insurance loss reserve	38			35
Restructuring charges	5			7
Other	148			158
Gross deferred tax assets before valuation allowance	983			1,017
Valuation allowance	(656		)	(621		)
Total deferred tax assets	$	327		$	396
Deferred tax liabilities:
Fixed assets (1)	$	(39	)	$	(67	)
Undistributed earnings of foreign subsidiaries	(214		)	(222		)
Foreign currency translation	(28		)	(24		)
Other	(14		)	(21		)
Total deferred tax liabilities	$	(295	)	$	(334	)
Net deferred tax assets	$	32		$	62

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

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

(In millions)	January 30,  2016 (1)			January 31, 2015
Current deferred tax assets	$	—		$	45
Current deferred tax liabilities (2)	—			(4		)
Non-current deferred tax assets	96			133
Non-current deferred tax liabilities	(64		)	(112		)
	$	32		$	62

(1) In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The guidance is effective for interim and annual periods beginning after December 15, 2016, and may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. As permitted, the Company elected to early adopt this guidance effective January 30, 2016, and has applied the guidance prospectively. The adoption of this guidance did not have a significant impact on the Company’s financial statements, other than the prospective classification of deferred tax liabilities and assets as noncurrent in accordance with the new presentation requirements.

(2) The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities on our prior year Consolidated Balance Sheet.

Our gross deferred tax assets above include an offset of $8 million and $7 million of unrecognized tax benefits related to tax loss carryforwards as of January 30, 2016 and January 31, 2015, 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 $358 million of U.S. Federal tax loss and other carryforwards, none will expire during the next 5 years, $172 million will expire during the next 6 to 20 years and $186 million may be carried forward indefinitely. Of our $83 million of state tax loss and other carryforwards, $10 million will expire during the next 5 years, $61 million will expire during the next 6 to 20 years and $12 million may be carried forward indefinitely. Of our $164 million of foreign tax loss and other carryforwards, $5 million will expire during the next 5 years, $2 million will expire during the next 6 to 20 years and $157 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 2015, we have incurred a pre-tax cumulative loss over the past three fiscal years. During fiscal 2015, our valuation allowance increased by $35 million. This includes a$17 million increase for U.S. Federal tax, a $4 million increase for state tax and a $14 million increase for foreign tax.

Of our total valuation allowance of $656 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 30, 2016			January 31, 2015			February 1, 2014
Beginning balance	$	30		$	37		$	32
Additions for tax positions of the current year	2			4			4
Additions for tax positions of prior years	2			5			6
Reductions for tax positions of prior years (1)	—			(11		)	(1		)
Settlements	—			—			—
Currency translation adjustment	(1		)	(4		)	—
Lapse of statute of limitations	(1		)	(1		)	(4		)
Ending balance	$	32		$	30		$	37

(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 30, 2016, $25 million of the $32 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 $6 million and less than $1 million of accrued interest and penalties, respectively, at January 30, 2016. We had $4 million and less than $1 million of accrued interest and penalties, respectively, at January 31, 2015, and $5 million and less than $1 million of accrued interest and penalties, respectively, at February 1, 2014.

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 2008 and forward; Australia for fiscal 2009 and forward; Canada for fiscal 2008 and forward; France for fiscal 2012 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 $38 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

12 Months Ended

Jan. 30, 2016

Segment Reporting [Abstract]

SEGMENTS

SEGMENTS

We generate sales, operating earnings and cash flows by retailing a variety of toy and baby product offerings worldwide. We operate all of our “R” Us branded retail stores in the United States, Puerto Rico and Guam and 75% of our 1,008 “R” Us branded retail stores internationally excluding stores with a cumulative lease term of less than two years (“Temporary Express”). The balance of our “R” Us branded retail stores internationally are operated by licensees. Licensing revenue did not have a material impact on our Net sales and accounted for $17 million in fiscals 2015 and 2014 respectively, and $16 million in fiscal 2013. We also own and operate websites including Toysrus.com and Babiesrus.com, as well as other e-commerce sites 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 through 866 stores that operate in 49 states in the United States, Puerto Rico and Guam and through e-commerce. As of January 30, 2016, our Domestic stores consisted of 361 traditional toy stores, 224 baby stores, 213 side-by-side (“SBS”) stores and 68 smaller format stores with cumulative lease terms of at least two years (“Permanent Express”), as well as Temporary Express locations.

• International — Our International segment sells a variety of products through 756 operated and 252 licensed stores in 38 countries and jurisdictions and through e-commerce. As of January 30, 2016, our International stores consisted of 534 traditional toy stores, 202 SBS stores, 15 baby stores and 5 Permanent Express stores, as well as Temporary Express 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.

Our CEO, who is our 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 30, 2016		January 31, 2015		February 1, 2014
Baby	36.9	%	37.9	%	37.7	%
Core Toy	18.4	%	17.2	%	15.9	%
Entertainment	9.0	%	10.2	%	11.3	%
Learning	23.5	%	22.6	%	22.6	%
Seasonal	11.4	%	11.2	%	11.3	%
Other (1)	0.8	%	0.9	%	1.2	%
Total	100	%	100	%	100	%

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

	Fiscal Years Ended
International:	January 30, 2016		January 31, 2015		February 1, 2014
Baby	20.5	%	20.2	%	20.4	%
Core Toy	23.2	%	23.5	%	22.7	%
Entertainment	7.1	%	8.5	%	10.0	%
Learning	32.8	%	31.1	%	30.8	%
Seasonal	15.7	%	15.9	%	15.3	%
Other (1)	0.7	%	0.8	%	0.8	%
Total	100	%	100	%	100	%

(1) Consists primarily of non-product related revenues, including licensing revenue 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 30, 2016			January 31, 2015			February 1, 2014
Net sales
Domestic	$	7,356		$	7,524		$	7,638
International	4,446			4,837			4,905
Total Net sales	$	11,802		$	12,361		$	12,543
Operating earnings (loss)
Domestic (1) (2)	$	484		$	332		$	(197	)
International (1)	271			229			203
Corporate and other	(377		)	(370		)	(356		)
Operating earnings (loss)	378			191			(350		)
Interest expense	(429		)	(451		)	(524		)
Interest income	3			4			7
Loss before income taxes	$	(48	)	$	(256	)	$	(867	)

(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 30, 2016		January 31, 2015		February 1, 2014
Depreciation and amortization
Domestic	$	180	$	210	$	216
International	107		116		123
Corporate	56		51		49
Total Depreciation and amortization	$	343	$	377	$	388
Capital expenditures
Domestic	$	74	$	67	$	113
International	74		83		86
Corporate	71		57		39
Total Capital expenditures	$	219	$	207	$	238

(In millions)	January 30, 2016		January 31, 2015
Merchandise inventories
Domestic	$	1,559	$	1,353
International	711		711
Total Merchandise inventories	$	2,270	$	2,064
Total Assets
Domestic	$	3,718	$	3,633
International	2,032		2,122
Corporate and other (1)	1,218		1,360
Total Assets	$	6,968	$	7,115

(1) Includes cash and cash equivalents, deferred tax assets and other corporate assets.

Our Net sales, inclusive of each market’s respective e-commerce operations, and long-lived assets by market are as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Net sales
United States (1)	$	7,356	$	7,524	$	7,638
Europe (2)	1,211		1,405		1,447
Japan	1,182		1,308		1,374
Canada	809		834		883
UK	666		710		680
China and Southeast Asia	365		333		277
Australia	196		230		228
Licensing revenue	17		17		16
Total Net sales	$	11,802	$	12,361	$	12,543

(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.

(In millions)	January 30, 2016		January 31, 2015
Long-lived assets
United States (1)	$	2,275	$	2,372
Europe (2)	339		352
Japan	277		306
UK	266		281
Canada	157		180
China and Southeast Asia	43		41
Australia	12		14
Total Long-lived assets	$	3,369	$	3,546

(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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DEFINED BENEFIT PENSION PLANS

12 Months Ended

Jan. 30, 2016

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 30, 2016			January 31, 2015
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	174		$	137
Service cost	5			5
Interest cost	5			5
Benefits paid	(3		)	(6		)
Actuarial (gain) loss	(25		)	52
Foreign currency impact	(8		)	(19		)
Projected benefit obligation at end of year	$	148		$	174

(In millions)	January 30, 2016			January 31, 2015
Change in fair value of plan assets:
Fair value of plan assets at beginning of year	$	123		$	118
Actual return on plan assets	(2		)	17
Employer contributions	11			7
Benefits paid	(3		)	(6		)
Foreign currency impact	(6		)	(13		)
Fair value of plan assets at end of year	$	123		$	123

(In millions)	January 30, 2016			January 31, 2015
Reconciliation of funded status to total amount recognized:
Funded status	$	(25	)	$	(51	)
Amounts recognized in Consolidated Balance Sheets:
Other non-current liabilities	$	(25	)	$	(51	)
Amounts recognized in Accumulated other comprehensive loss:
Unrecognized actuarial losses, net of tax	$	22		$	42

Of the $22 million of unrecognized actuarial losses, net of tax in Accumulated other comprehensive loss as of January 30, 2016, $1 million is expected to be amortized into net periodic benefit cost in fiscal 2016.

Information for Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets:

(In millions)	January 30, 2016		January 31, 2015
Projected benefit obligation	$	148	$	174
Accumulated benefit obligation	129		150
Fair value of plan assets	123		123

Components of Net Periodic Benefit Cost During Each Fiscal Year:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Service cost	$	5		$	5		$	5
Interest cost	5			5			5
Expected return on plan assets	(4		)	(5		)	(5		)
Actuarial losses recognized	2			—			—
Net periodic benefit cost	$	8		$	5		$	5

Contributions

For fiscal 2016, 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
2016	$	1
2017	1
2018	1
2019	1
2020	1
2021 through 2025	7

Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs at Fiscal Year End:

	January 30, 2016		January 31, 2015		February 1, 2014
Discount rate	2.7	%	3.7	%	4.1	%
Expected rate of return on plan assets	3.4	%	4.5	%	4.9	%
Rate of compensation increase	2.6	%	2.6	%	2.7	%

Weighted-average Assumptions Used to Determine Benefit Obligations at Fiscal Year End:

	Fiscal Years Ended
	January 30, 2016		January 31, 2015
Discount rate	3.2	%	2.7	%
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 92% 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 2016 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 2016, as well as the actual asset allocations as of January 30, 2016 and January 31, 2015:

	2016 Target Allocation		January 30, 2016		January 31, 2015
Equity securities	29.6	%	29.6	%	28.3	%
Debt securities	56.6	%	56.6	%	58.3	%
Insurance contracts	7.4	%	7.4	%	7.3	%
Cash and cash equivalents	6.4	%	6.4	%	6.1	%
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 30, 2016 and January 31, 2015. 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 30, 2016 and January 31, 2015. In May 2015, the FASB issued ASU 2015-07, “Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)” (“ASU 2015-07”). The amendments apply to reporting entities that elect to measure the fair value of an investment using the net asset value (“NAV”) per share (or its equivalent) practical expedient. The amendments remove the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the NAV per share practical expedient. The Company early adopted the amendments in ASU 2015-07, effective February 2, 2015, and the prior period has been restated.

Fiscal 2015

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Insurance Contracts (1)	$	—	$	9	$	9
Cash and cash equivalents (2)	8		—		8
Equity Securities: (3)
Domestic					11
International					25
Fixed Income: (3)
Domestic					6
International					64
Total	$	8	$	9	$	123

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Insurance Contracts (1)	$	—	$	9	$	9
Cash and cash equivalents (2)	7		—		7
Equity Securities: (3)
Domestic					11
International					24
Fixed Income: (3)
Domestic					4
International					68
Total	$	7	$	9	$	123

(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) In accordance with ASU 2015-07, securities which are measured at fair value using the NAV per share practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are to reconcile the fair value hierarchy to the total fair value of plan assets.

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OTHER EMPLOYEE RETIREMENT AND COMPENSATION BENEFITS

12 Months Ended

Jan. 30, 2016

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 five years of employment with the Company. During fiscals 2015 and 2014 we recorded SERP expenses of less than $1 million, respectively. During fiscal 2013, we recorded SERP expenses of $1 million. As of January 30, 2016 and January 31, 2015, the SERP liability was $2 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 $25 million in fiscal 2015 and $24 million in fiscals 2014 and 2013, respectively. The Board of Directors did not elect to contribute to the profit sharing portion of the Savings Plan in fiscals 2015, 2014 and 2013.

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LITIGATION AND LEGAL PROCEEDINGS

12 Months Ended

Jan. 30, 2016

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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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Jan. 30, 2016

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 30, 2016.

As of January 30, 2016, 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 $51 million through September 2032. The impact of these obligations is not material to our Consolidated Financial Statements.

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RELATED PARTY TRANSACTIONS

12 Months Ended

Jan. 30, 2016

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

Sponsor Advisory Agreement

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, August 29, 2014, June 1, 2015 and December 1, 2015 (“Advisory Agreement”). The initial term of the Advisory Agreement was ten years, with the ability to extend annually for one year unless we or the Sponsors provide notice of termination to the other. 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 management and advisory fees (the “Advisory 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.

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.  The amendment provided that 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.

In June 2015, the Advisory Agreement was further amended in order to reduce the Advisory Fees payable in fiscal 2015 and thereafter from $17 million to $6 million annually with no further adjustment upon an IPO for such reductions. We recorded Advisory Fees of $6 million, $17 million and $22 million for fiscals 2015, 2014 and 2013, respectively. During fiscals 2015, 2014 and 2013, we also paid the Sponsors for out-of-pocket expenses, which were less than $1 million, respectively.

Additionally, the original Advisory Agreement provided 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”). Transaction Fees were capitalized as deferred debt issuance costs and amortized over the term of the related debt agreement and included in Other assets on our prior year Consolidated Balance Sheet. In December 2015, the Advisory Agreement was further amended to waive all Transaction Fees including prior accrued and unpaid transaction fees of $47 million as well as any fees to be paid upon an IPO.

Other Relationships and Transactions with our Sponsors

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. KKR owned the following aggregate amounts of our debt as of January 30, 2016 and January 31, 2015. For further details, refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

(In millions)	January 30, 2016		January 31, 2015
Propco I Term Loan Facility	$	16	$	17
Incremental Secured Term Loan	12		12
Secured Term B-4 Loan	2		96
Second Incremental Secured Term Loan	2		2
2017 Notes	—		9
Total	$	32	$	136

During fiscals 2015, 2014 and 2013, affiliates of 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 $7 million in fiscal 2015 and $10 million in fiscals 2014 and 2013, respectively.

Additionally, under lease agreements with affiliates of Vornado Realty Trust (“Vornado”), we paid an aggregate amount of $8 million in fiscals 2015, 2014 and 2013, respectively, with respect to 0.6%, 0.7% and 0.8%, respectively, of our operated stores, which include Express stores. Of the aggregate amount paid in fiscals 2015, 2014 and 2013, $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. After a competitive bidding process, on February 1, 2015, we entered into an agreement with SquareTrade Inc. (“SquareTrade”), which is a Portfolio Company of Bain Capital Partners, LLC. SquareTrade provides protection plans for electronic and other products that cover the repair, replacement or refund of such products. Under the agreement, we are licensed to sell protection plans on behalf of SquareTrade and receive a fixed percentage commission fee for each sale. For fiscal 2015, we recorded $21 million in commissions within Net sales. Receivables from SquareTrade were less than $1 million as of January 30, 2016 and included in Accounts and other receivables on our Consolidated Balance Sheet. Payables to SquareTrade were $3 million as of January 30, 2016 and included in Accrued expenses and other current liabilities on our Consolidated Balance Sheet. 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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ACQUISITIONS

12 Months Ended

Jan. 30, 2016

Business Combination, Description [Abstract]

ACQUISITIONS

ACQUISITIONS

On October 31, 2011, the Company acquired a 70% ownership interest in Asia JV 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, as amended, provide us with the future option to acquire Li & Fung’s 30% interest in the business and also provides Li & Fung the option to require us to buy their 30% interest in the business beginning on April 30, 2017. 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. During fiscal 2015, we further amended the agreement to extend the future option to commence after April 30, 2017.

The Company paid the final $2 million and $1 million of contingent consideration related to the Asia JV acquisition during fiscals 2015 and 2014, respectively, which was previously accrued for in our Consolidated Balance Sheets. The Company did not make any payments during fiscal 2013.

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. Refer to Note 1 entitled “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” for a reconciliation of the change in Noncontrolling interest to redemption value as of January 30, 2016 and January 31, 2015.

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RECENT ACCOUNTING PRONOUNCEMENTS

12 Months Ended

Jan. 30, 2016

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

In March 2016, the FASB issued ASU 2016-07 “Investments - Equity Method and Joint Ventures (Topic 323), Simplifying the Transition to the Equity Method of Accounting” (“ASU 2016-07”). ASU 2016-07 eliminates the requirement that when an investment subsequently qualifies for use of the equity method as a result of an increase in level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. This ASU requires that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and to adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. In addition, ASU 2016-07 requires that an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting recognize through earnings the unrealized gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method. The amendments of this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Management is currently assessing the impact the adoption of ASU 2016-07 will have on our Consolidated Financial Statements.

In March 2016, the FASB issued ASU 2016-06 “Derivatives and Hedging (Topic 815), Contingent Put and Call Options in Debt Instruments” (“ASU 2016-06”). ASU 2016-06 clarifies the requirements for assessing whether contingent put or call options that can accelerate the payment of principal on debt instruments are clearly and closely related. Under current GAAP, two divergent approaches developed. Under the first approach, the assessment of whether contingent put or call options are clearly and closely related to the debt host only requires an analysis of the four-step decision sequence of ASC 815-15-25-42. Under the second approach, in addition to the four-step decision sequence of ASC 815-15-2-42, some entities evaluate whether the ability to exercise the put or call options are triggered by the entities interest rates or credit risk. ASU 2016-06 clarifies that an entity is required to assess whether the economic characteristics and risks of embedded put or call options are clearly and closely related to those of their debt hosts only in accordance with the four-step decision sequence of ASC 815-15-2-42. An entity should not assess whether the event that triggers the ability to exercise a put or call option is related to interest rates or credit risk of the entity. ASU 2016-06 does not change the existing criteria for determining when bifurcation of an embedded put or call option in a debt instrument is required. The amendments of this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Entities are required to apply the guidance to existing debt instruments using a modified retrospective transition method as of the period of adoption. Management is currently assessing the impact the adoption of ASU 2016-06 will have on our Consolidated Financial Statements.

In March 2016, the FASB issued ASU 2016-05 “Derivatives and Hedging (Topic 815), Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships” (“ASU 2016-05”). ASU 2015-05 provides guidance clarifying that the novation of a derivative contract (i.e. a change in counterparty) in a hedge accounting relationship does not, in and of itself, require dedesignation of that hedge accounting relationship. This ASU amends ASC 815 to clarify that such a change does not, in and of itself, represent a termination of the original derivative instrument or a change in the critical terms of the hedge relationship. ASU 2016-05 allows the hedging relationship to continue uninterrupted if all of the other hedge accounting criteria are met, including the expectation that the hedge will be highly effective when the creditworthiness of the new counterpart to the derivative contract is considered. The amendments of this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Entities may adopt the guidance prospectively or use a modified retrospective approach. Management is currently assessing the impact the adoption of ASU 2016-05 will have on our Consolidated Financial Statements.

In March 2016, the FASB issued ASU 2016-04 “Liabilities - Extinguishments of Liabilities (Subtopic 405-20), Recognition of Breakage for Certain Prepaid Stored-Value Products” (“ASU 2016-04”). ASU 2015-04 requires entities that sell prepaid stored-value products redeemable for goods, services or cash at third-party merchants to recognize breakage (i.e. the value that is ultimately not redeemed by the consumer) in a way that is consistent with how it will be recognized under the new revenue recognition standard. Under current GAAP, there is diversity in practice in how entities account for breakage that results when a consumer does not redeem the entire product balance. Some entities view liabilities for prepaid stored-value products that can be redeemed only for goods or services from a third-party as nonfinancial because the issuer’s obligation to the consumer will be settled by the transfer of goods or services (albeit by a third-party), not cash. Others view these liabilities as financial, given that the issuer is ultimately obligated to transfer cash to a third-party. This ASU clarifies that an entity’s liability for prepaid stored-value products within its scope meets the definition of a financial liability. The amendments of this ASU are effective for reporting periods beginning after December 15, 2017, with early adoption permitted. Entities will apply the guidance using either a modified retrospective approach or a full retrospective approach. Management is currently assessing the impact the adoption of ASU 2016-04 will have on our Consolidated Financial Statements.

In February 2016, the FASB issued ASU 2016-02 “Leases (Topic 842)” (“ASU 2016-02”). The FASB issued ASU 2016-02 to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Under ASU 2016-02, a lessee will recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-to-use asset representing its right to use the underlying asset for the lease term. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from current GAAP. ASU 2016-02 retains a distinction between finance leases (i.e. capital leases under current GAAP) and operating leases. The classification criteria for distinguishing between finance leases and operating leases will be substantially similar to the classification criteria for distinguishing between capital leases and operating leases under current GAAP. The accounting applied by the lessor is largely unchanged from that applied under current GAAP. The amendments of this ASU are effective for reporting periods beginning after December 15, 2018, with early adoption permitted. An entity will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. Management is currently assessing the impact the adoption of ASU 2016-02 will have on our Consolidated Financial Statements.

In January 2016, the FASB issued ASU 2016-01 “Financial Instruments-Overall (Subtopic 825-10), Recognition and measurement of Financial Assets and Financial Liabilities” (“ASU 2016-01”). ASU 2016-01 requires the fair value measurement of equity investments that do not result in consolidation and are not accounted for under the equity method. Entities will recognize the changes in fair value through net income. ASU 2016-01 eliminates an entity’s ability to be able to recognize unrealized holding gains and losses on equity securities that are classified as available-for-sale in other comprehensive income. Entities will also no longer be able to use the cost method of accounting for equity securities that do not have readily determinable fair values. A practical expedient will be available for equity investments that do not have readily determinable fair values and do not qualify for the practical expedient to estimate fair value under ASC 820, Fair Value Measurement (i.e. net asset value practical expedient). ASU 2016-01 does not change the guidance for classifying and measuring investments in debt securities and loans. In addition, for financial liabilities measured using the fair value option in ASC 825, ASU 2016-01 requires the change in fair value caused by a change in instrument-specific credit risk to be presented separately in other comprehensive income. Under ASU 2016-01, entities will be required to present financial assets and financial liabilities separately, grouped by measurement category and form of financial asset in the statement of financial position or in the accompanying notes to the financial statements. The amendments of this ASU are effective for reporting periods beginning after December 15, 2017, with early adoption permitted for certain provisions. The adoption of ASU 2016-01, is not expected to have an impact on our Consolidated Financial Statements.

In September 2015, the FASB issued ASU 2015-16 “Business Combinations (Topic 805), Simplifying the Accounting for Measurement-Period Adjustments” (“ASU 2015-16”). ASU 2015-16 eliminates the requirement that an acquirer in a business combination account for measurement-period adjustments retrospectively. Under the previous guidance, an acquirer must recognize adjustments to provisional amounts during the measurement period retrospectively (i.e. as if the accounting for the business combination had been completed at the acquisition date). That is, the acquirer must revise comparative information on the income statement and balance sheet for any prior periods affected. Under ASU 2015-16, acquirers must recognize measurement-period adjustments in the period in which they determine the amounts, including the effect on earnings of any amounts they would have recorded in previous periods if the accounting had been completed at the acquisition date. The amendments in ASU 2015-16 require an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earning by line item that would have been in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. ASU 2015-16 did not change the criteria for determining whether an adjustment qualifies as a measurement-period adjustment and does not change the length of the measurement period. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. The adoption of ASU 2015-16, is not expected to have an impact on our Consolidated Financial Statements.

In July 2015, the FASB issued ASU 2015-12 “Plan Accounting: Defined Benefit Pension Plans (Topic 960), Defined Contribution Plans (Topic 962), Health and Welfare Benefit Plans (Topic 965)” (“ASU 2015-12”). The amendments in Part I of ASU 2015-12 eliminated the requirements that employee benefit plans measure the fair value of fully benefit-responsive investment contracts and provide the related fair value disclosures, rather these contracts will be measured and disclosed only at contract value. The amendments in Part II of this ASU will require plans to disaggregate their investments measured using fair value only by general type, either on the financial statements or in the notes. Part II of this ASU also eliminated the requirement to disclose the net appreciation/depreciation in fair value of investments by general type and the requirement to disclose individual investments that represent 5% or more of net assets available for benefits. The amendments in Part III of ASU 2015-12 provides a practical expedient to permit plans to measure its investments and investment related accounts as of a month-end date closest to its fiscal year for a plan with a fiscal year end that does not coincide with the end of a calendar month. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. The adoption of ASU 2015-12, is not expected to have an impact on our Consolidated Financial Statements.

In April 2015, the FASB issued ASU No. 2015-05, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement (“ASU 2015-05”). Existing GAAP does not include explicit guidance about a customer’s accounting for fees paid in a cloud computing arrangement. The amendments in this ASU provide guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software licenses element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. As a result of the amendments, all software licenses within the scope of Subtopic 350-40 will be accounted for consistent with other licenses of intangible assets. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. An entity can elect to adopt the amendments either (1) prospectively to all arrangements entered into or materially modified after the effective date; or (2) retrospectively. For prospective transition, the only disclosure requirements at transition are the nature of and reason for the change in accounting principle, the transition method, and a qualitative description of the financial statement line items affected by the change. For retrospective transition, the disclosure requirements at transition include the requirements for prospective transition and quantitative information about the effects of the accounting change. The adoption of ASU 2015-05 is not expected to have an impact on our Consolidated Financial Statements.

In April 2015, the FASB issued ASU 2015-04, “Compensation - Retirement Benefits (Topic 715): Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets” (“ASU 2015-04”). For entities with a fiscal year-end that does not coincide with a month-end, ASU 2015-04 provides a practical expedient that permits the entity to measure defined benefit plan assets and obligations using the month-end that is closest to the entity’s fiscal year-end and apply that practical expedient consistently from year-to-year. Under the previous practice, entities with fiscal year-ends that did not coincide with a month-end, had to adjust the fair value of the plan assets reported by the third-party service provider to reflect the fair value of plan assets as of their fiscal year. The practical expedient should be applied consistently to all plans if an entity has more than one plan. An entity is required to disclose the accounting policy election and the date used to measure defined benefit plan assets and obligations in accordance with the amendments in this ASU. Additional disclosures are required if a contribution or significant event caused by the entity occurs between the month-end date used to measure the defined benefit plan assets and obligations and an entity’s fiscal year-end. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. Entities should apply the amendments in this update prospectively. The adoption of ASU 2015-04 is not expected to have an impact on our Consolidated Financial Statements.

In April 2015, the FASB issued ASU No. 2015-03, “Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”). ASU 2015-03 simplifies the presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Under the previous practice, debt issuance costs were recognized as a deferred charge (that is, an asset). This ASU will create consistencies with the guidance in International Financial Reporting Standards as well as the guidance in FASB Concepts Statement No. 6, “Elements of Financial Statements”, which states that debt issuance costs are similar to debt discounts and in effect reduce the proceeds of borrowing, thereby increasing the effective interest rate. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. In August 2015, the FASB issued ASU 2015-15 “Interest - Imputed Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements” (“ASU 2015-15”), which clarifies that the guidance in ASU 2015-03 does not apply to line-of-credit arrangements. According to ASU 2015-15, line-of-credit arrangements will continue to defer and present debt issuance costs as an asset and subsequently amortize the deferred debt costs ratably over the term of the arrangement. Upon transition, an entity is required to comply with the applicable disclosures for a change in an accounting principle. The amendments in ASU 2015-03 are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. A reporting entity should apply the amendments on a retrospective basis to all prior periods presented in the financial statements. Other than the revised balance sheet presentation of debt issuance costs from an asset to a deduction from the carrying amount of the debt liability and related disclosures, the adoption of ASU 2015-03 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 of ASU 2014-09 were effective for reporting periods beginning after December 15, 2016, with early adoption prohibited. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption.

Subsequent to issuing ASU 2014-09, the FASB issued the following amendments concerning the adoption and clarification of ASU 2014-09. In August 2015, the FASB issued ASU 2015-14 “Revenue from Contracts with Customers (Topic 606), Deferral of the Effective Date,” which deferred the effective date one year. As a result, the amendments of ASU 2014-09 are effective for reporting periods beginning after December 15, 2017, with early adoption permitted only as of annual reporting periods beginning after December 15, 2016. In March 2016, the FASB issued ASU 2016-08 “Revenue from Contracts with Customers (Topic 606), Principal versus Agent Considerations (Reporting Revenue versus Net)” (“ASU 2016-08”), which clarifies the implementation guidance on principal versus agent considerations in the new revenue recognition standard. ASU 2016-08 clarifies how an entity should identify the unit of accounting (i.e. the specified good or service) for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements. Management is currently assessing the adoption methodology and the impact the adoption of these ASUs will have on our Consolidated Financial Statements.

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SCHEDULE I - PARENT COMPANY INFORMATION

12 Months Ended

Jan. 30, 2016

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Schedule 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 30, 2016			January 31, 2015			February 1, 2014
Revenues	$	—		$	—		$	—
General and administrative expenses	58			25			21
Depreciation and amortization	—			1			3
Other expense, net	—			—			1
Total operating expenses	58			26			25
Operating loss	(58		)	(26		)	(25		)
Interest expense, net	(81		)	(78		)	(76		)
Intercompany interest expense, net	(78		)	(54		)	(63		)
Equity (deficit) in pre-tax earnings (loss) of consolidated subsidiaries	163			(102		)	(706		)
Loss before income taxes	(54		)	(260		)	(870		)
Income tax expense	76			32			169
Net loss	$	(130	)	$	(292	)	$	(1,039	)
Comprehensive loss	$	(156	)	$	(452	)	$	(1,120	)

See accompanying Notes to the Condensed Financial Statements.

Toys “R” Us, Inc.

Schedule I — Condensed Balance Sheets

(In millions)	January 30, 2016			January 31, 2015
ASSETS
Current Assets:
Cash and cash equivalents	$	1		$	11
Income taxes receivable	18			20
Prepaid expenses and other current assets	16			9
Due from subsidiary	364			376
Total current assets	399			416
Property and equipment, net	1			1
Deferred tax assets	—			2
Other assets	11			12
Total Assets	$	411		$	431
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accrued expenses and other current liabilities	$	77		$	121
Income taxes payable	2			2
Total current liabilities	79			123
Long-term debt	872			872
Due to subsidiaries, net	638			461
Other non-current liabilities	87			70
Stockholders’ deficit	(1,265		)	(1,095		)
Total Liabilities and Stockholders’ Deficit	$	411		$	431

See accompanying Notes to the Condensed Financial Statements.

Toys “R” Us, Inc.

Schedule I — Condensed Statements of Cash Flows

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Cash Flows from Operating Activities	$	(25	)	$	(13	)	$	(21	)
Cash Flows from Investing Activities:
Investments in subsidiaries	7			5			(180		)
Intercompany loan repayments by subsidiaries	1,548			2,056			1,956
Loans to subsidiaries	(1,540		)	(2,116		)	(2,251		)
Proceeds from redemption of debt securities	—			—			52
Net cash provided by (used in) investing activities	15			(55		)	(423		)
Cash Flows from Financing Activities	—			—			(7		)
Cash and cash equivalents:
Net decrease during period	(10		)	(68		)	(451		)
Cash and cash equivalents at beginning of period	11			79			530
Cash and cash equivalents at end of period	$	1		$	11		$	79
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	77		$	77		$	78

See accompanying Notes to the 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.

Due to Subsidiaries, Net - Due to subsidiaries, net, on the Condensed Balance Sheets, is comprised of the Parent Company’s net investment in its subsidiaries under the equity method of accounting, as well as other non-current receivables from and liabilities to subsidiaries. As of January 30, 2016 and January 31, 2015, the Parent Company had net investments in subsidiaries of $21 million and $119 million, respectively under the equity method.

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 30, 2016 and January 31, 2015, Due to subsidiaries, net included the outstanding net intercompany receivable balance from Toys Limited of $176 million and $175 million, respectively.

Additionally included within Due to subsidiaries, net, as of January 30, 2016 and January 31, 2015 is a net intercompany payable to Toys-Delaware of $835 million and $755 million, respectively, which includes accrued interest. The intercompany payable to Toys-Delaware primarily consists of long-term notes payable by Parent to Toys-Delaware for which the amounts are listed in the table below. All of the notes are documented, unsecured, and include a market rate of interest. As of January 30, 2016 and January 31, 2015, the long-term notes payable by Parent to Toys-Delaware were offset by $92 million and $89 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 as of January 30, 2016 and January 31, 2015, respectively.

(In millions)	January 30, 2016		January 31, 2015
Note issued by Parent in fiscal 2005	$	326	$	299
Note issued by Parent in fiscal 2009	253		222
Note issued by Parent in fiscal 2012 (1)	254		229
Note issued by Parent in fiscal 2012	90		90
Total Long-term notes payable by Parent to Toys-Delaware (2)	$	923	$	840

(1) Note is expressly subordinated in right of payment to the senior obligations of the Parent.

(2) Includes accrued and unpaid interest.

Due from Subsidiary - As of January 30, 2016 and January 31, 2015, an outstanding short-term loan of $364 million and $376 million, respectively, to Toys-Delaware was recorded in Due from subsidiary on the Condensed Balance Sheets.

Income Taxes - For fiscals 2015, 2014 and 2013, the income tax expense of $76 million, $32 million and $169 million, respectively, represents the Parent Company’s consolidated income tax expense. Such amounts include income tax expense of $143 million, $91 million and $127 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 30, 2016 and January 31, 2015 is outlined in the table below:

(In millions)	January 30, 2016		January 31, 2015
10.375% senior notes, due fiscal 2017	$	448	$	448
7.375% senior notes, due fiscal 2018	402		402
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 30, 2016 and January 31, 2015, respectively, were $653 million and $639 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 30, 2016 are as follows:

(In millions)	Annual Maturities
2016	$	—
2017	450
2018	400
2019	—
2020	—
2021 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 that all future principal and interest payments will be funded through the operating cash flows of Toys-Delaware. During fiscals 2015, 2014 and 2013, Toys-Delaware recorded interest expense related to the outstanding debentures due fiscal 2021 of $2 million, respectively, which is reflected as part of Equity (deficit) in pre-tax earnings (loss) 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 Asia JV in an aggregate amount up to HK$194 million ($25 million at January 30, 2016) for future borrowings.

For a discussion of the debt obligations of the Parent Company and its subsidiaries, refer to Note 2 to our 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 30, 2016, we had no open derivative contracts as all of our interest rate contracts had matured.

At January 31, 2015, we had no derivative liabilities related to agreements that contain credit-risk related contingent features. As of January 31, 2015, 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:

			January 31, 2015
(In millions)	Effective Date	Maturity Date	Notional  Amount
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (1)	January 2011	April 2015	$	500
1 Month USD LIBOR Interest Rate Cap (1)	January 2012	April 2015	500
1 Month USD LIBOR Interest Rate Cap (1)	January 2014	April 2015	311

(1) These interest rate caps were 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. 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. We are not required to post collateral for these contracts. As of January 30, 2016 and January 31, 2015, we had no outstanding foreign exchange 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 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015			February 1, 2014
Derivatives previously designated as cash flow hedges:
Beginning balance	$	—	$	1		$	1
Reclassifications from Accumulated other comprehensive      (loss) income - Interest Rate Contracts	—		(1		)	—
Ending balance	$	—	$	—		$	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 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	$	2	$	—	$	(1	)
Derivatives previously designated as cash flow hedges:
Amortization of hedged caps	—		1		—
Total Interest expense, net	$	2	$	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:

	January 31, 2015
(In millions)	Notional Amount		Fair Value Assets/ (Liabilities)
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	$	1,311	$	—

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. The aggregate gross fair value of derivative liabilities which could be net settled against our derivative assets was nominal as of January 31, 2015. The aggregate gross fair value of derivative assets which could be net settled against our derivative liabilities was nominal as of January 31, 2015. As of January 31, 2015, 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, refer to 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 as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Property subsidiaries
TRU Propco I	$	100	$	86	$	115
Other	7		7		8
Total property subsidiaries	107		93		123
Toys-Delaware	—		—		79
Total cash distributions	$	107	$	93	$	202
Distributions included:
Return of capital from property subsidiaries	$	11	$	—	$	109

Capital Contributions

During fiscals 2015 and 2014, the Parent Company made capital contributions of $4 million and $5 million, respectively, to TRU Asia, Ltd., of which $2 million and $1 million, respectively, was used to pay contingent consideration related to the Asia JV acquisition.

During fiscal 2013, the 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 in the fourth quarter of fiscal 2013. Refer to Note 2 to our Consolidated Financial Statements entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT” for further details.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Jan. 30, 2016

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
2015	52	January 30, 2016
2014	52	January 31, 2015
2013	52	February 1, 2014

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

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 30, 2016 and January 31, 2015, we had restricted cash of $52 million and $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 net realizable value, 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 30, 2016 and January 31, 2015, we had $67 million and $63 million, respectively, recorded for ARO.

Goodwill

Goodwill

At January 30, 2016 and January 31, 2015 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. In the fourth quarter of fiscal 2014, we performed a quantitative assessment for our Toys-China and Southeast Asia reporting unit and it was determined that the goodwill was not impaired. 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 2015 annual impairment tests.

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.

In the fourth quarter of fiscal 2015, we performed a qualitative assessment for our Toys-China and Southeast Asia reporting unit and determined that it was more likely than not that the respective fair value substantially exceeded the carrying value and noted no goodwill impairment indicators.

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 30, 2016 and January 31, 2015 were $82 million and $139 million, respectively. Deferred financing fees amortized to Interest expense for fiscals 2015, 2014 and 2013 were $20 million, $48 million and $51 million, respectively, which is inclusive of accelerated amortization due to certain debt repayments and refinancings prior to maturity. During fiscal 2015, there was a reversal of $30 million of unamortized deferred debt issuance costs as a result of an amendment to the advisory agreement which waived any previously incurred transaction fees payable to our Sponsors in connection with prior refinancings. Refer to Note 16 within our Consolidated Financial Statements entitled “RELATED PARTY TRANSACTIONS” for further details.

Acquisition of Debt Securities

Acquisition of Debt Securities

There were no acquisitions of debt securities during fiscal 2015 and fiscal 2014. 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 and business interruption, $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 30, 2016 and January 31, 2015, we had $100 million and $99 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 30, 2016 and January 31, 2015, accumulated depreciation related to capital leases for property and equipment was $25 million and $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 $354 million and $359 million at January 30, 2016 and January 31, 2015, respectively, of which $9 million and $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 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 30, 2016 and January 31, 2015.

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 $45 million, $43 million and $56 million for fiscals 2015, 2014 and 2013, respectively, are included in Net sales. Other revenues consist of warranty income, licensing revenue 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 revenue was $17 million for fiscals 2015 and 2014, respectively, and $16 million for fiscal 2013.

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 $9 million and $10 million at January 30, 2016 and January 31, 2015, 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 $326 million, $379 million and $433 million in fiscals 2015, 2014 and 2013, 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 $37 million, $34 million and $31 million for fiscals 2015, 2014 and 2013, respectively.

Other Income, net

Other Income, Net

Other income, net includes the following:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Credit card program income	$	48		$	36		$	33
Gift card breakage income	30			27			24
Net gains on sales of properties	20			5			8
Foreign currency transactions	(14		)	(19		)	(1		)
Impairment of long-lived assets	(16		)	(13		)	(44		)
Other (1)	20			17			17
Total	$	88		$	53		$	37

(1) Includes advertising income from our websites, layaway income 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. We also receive profit sharing revenue based on a percentage of outstanding customer credit card indebtedness. Bounty fees, royalties and profit sharing revenue are recognized when earned and realizable. In fiscal 2015, we received $8 million in profit sharing revenue after reaching the contractual milestone. During fiscals 2015, 2014 and 2013, we recognized credit card program income of $48 million, $36 million and $33 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 $30 million, $27 million and $24 million of gift card breakage income in fiscals 2015, 2014 and 2013, 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 the carrying value of 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 2015, 2014 and 2013, we recorded total impairment losses of $16 million, $13 million and $44 million, respectively. These impairments were primarily due to the identification of underperforming stores, the relocation of certain stores and property sales.

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 Transactions

Unrealized and realized gains and losses resulting from foreign currency transactions related to operations are included in Other income, net. In fiscal 2015, we recorded foreign currency losses of $14 million, which included an unrealized loss on foreign exchange of $11 million related to the re-measurement 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. 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 Tranche A-1 Loan. For fiscal 2013, we recorded foreign exchange losses of $1 million. 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 operating 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 U.S. Dollar (“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 within the Consolidated Statements of Stockholders’ (Deficit) Equity.

Foreign Currency Transactions - Short-Term Intercompany Loans

Foreign currency transactions related to short-term, cross-currency intercompany loans, which we economically hedge, amounted to gains of $5 million, $9 million and $1 million for fiscals 2015, 2014 and 2013, respectively. Such amounts were included in Interest expense. The related foreign currency forward 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. For fiscal years 2015, 2014 and 2013, we recorded losses of $5 million, $9 million and $1 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 30, 2016 and January 31, 2015, we reported unrecognized tax benefits in 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 (“Asia JV”), 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, all these awards had vested and redemption was 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, 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
Net earnings attributable to noncontrolling interest	6
Adjustment of noncontrolling interest to redemption value	18
Capital contribution	2
Balance, January 30, 2016	$	111

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.”

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Jan. 30, 2016

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
2015	52	January 30, 2016
2014	52	January 31, 2015
2013	52	February 1, 2014

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 30, 2016			January 31, 2015			February 1, 2014
Credit card program income	$	48		$	36		$	33
Gift card breakage income	30			27			24
Net gains on sales of properties	20			5			8
Foreign currency transactions	(14		)	(19		)	(1		)
Impairment of long-lived assets	(16		)	(13		)	(44		)
Other (1)	20			17			17
Total	$	88		$	53		$	37

(1) Includes advertising income from our websites, layaway income 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, 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
Net earnings attributable to noncontrolling interest	6
Adjustment of noncontrolling interest to redemption value	18
Capital contribution	2
Balance, January 30, 2016	$	111

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT (Tables)

12 Months Ended

Jan. 30, 2016

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 30, 2016 and January 31, 2015 is outlined in the table below:

(In millions)	January 30, 2016		January 31, 2015
Short-term borrowings
Asia JV uncommitted lines of credit	$	—	$	—
Long-term debt
Spanish real estate credit facility, due fiscal 2015 (EURIBOR+6.00%) (1)	—		34
Toys-Japan unsecured credit lines, expire fiscals 2016-2017 (2)	—		—
10.375% senior notes, due fiscal 2017 (3)	448		448
8.500% senior secured notes, due fiscal 2017 (4)	722		721
French real estate credit facility, due fiscal 2018 (EURIBOR+4.50%)	50		53
Incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (5)	130		133
Second incremental secured term loan facility, due fiscal 2018 (LIBOR+3.75%) (5)	65		67
7.375% senior notes, due fiscal 2018 (3)	402		402
$1.85 billion secured revolving credit facility, expires fiscal 2019 (5)	80		—
Senior unsecured term loan facility, due fiscal 2019 (LIBOR+5.00%) (6)	923		965
Tranche A-1 loan facility, due fiscal 2019 (LIBOR+7.25%) (5)	273		272
Secured term B-4 loan facility, due fiscal 2020 (LIBOR+8.75%) (5)	1,002		1,010
UK real estate credit facility, due fiscal 2020 (6.85%)	375		396
European and Australian asset-based revolving credit facility, expires fiscal 2020 (7)	—		—
Toys-Japan 1.85%-2.18% loans, due fiscals 2016-2021 (8)	49		63
8.750% debentures, due fiscal 2021 (9)	22		22
Finance obligations associated with capital projects	183		189
Capital lease and other obligations	19		13
	4,743		4,788
Less: current portion	73		176
Total Long-term debt (10)	$	4,670	$	4,612

(1) On January 29, 2016, Toys “R” Us Iberia Real Estate S.L.U., using cash on hand, paid the €24 million final installment of its senior secured term loan facility (the “Spain Propco Facility Agreement.”)

(2) On June 30, 2015, Toys “R” Us - Japan, Ltd. (“Toys-Japan”) entered into an agreement to refinance its committed line of credit (“Tranche 1” due fiscal 2015) into Tranche 1A due fiscal 2017 (“Tranche 1A”) and Tranche 1B due fiscal 2016 (“Trance 1B”).

(3) 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.

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

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

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

(7) On December 18, 2015, certain of our foreign subsidiaries amended and restated the European and Australian asset-based revolving credit facility (the “European ABL Facility”) to extend the maturity date of the facility and amend certain other provisions.

(8) On January 29, 2016, Toys-Japan entered into an additional bank loan with an aggregate principal amount of ¥4.1 billion.

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

(10) 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 30, 2016 are as follows:

(In millions)	Annual Maturities
2016	$	73
2017	1,215
2018	659
2019	1,280
2020	1,363
2021 and subsequent	183
Total	$	4,773

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

12 Months Ended

Jan. 30, 2016

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 30, 2016 and January 31, 2015:

			January 30, 2016		January 31, 2015
(In millions)	Effective Date	Maturity Date	Notional Amount		Notional Amount
Interest Rate Swaps
6 Month JPY TIBOR Float to Fixed Interest Rate Swap (1)	January 2011	January 2016	$	—	$	42
Interest Rate Caps
1 Month USD LIBOR Interest Rate Cap (1)	January 2011	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap	January 2011	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap (2)	January 2012	April 2015	—		500
1 Month USD LIBOR Interest Rate Cap	January 2012	April 2015	—		500
3 Month EURIBOR Interest Rate Cap (1)	January 2013	January 2016	—		34
3 Month EURIBOR Interest Rate Cap (1)	February 2013	February 2018	50		53
1 Month USD LIBOR Interest Rate Cap	January 2014	April 2015	—		311

(1) These derivatives were designated for hedge accounting.

(2) The Company de-designated a portion of this interest rate cap in fiscal 2010. Prior to its April 2015 maturity, 40% of the $500 million interest rate cap was 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 30, 2016 and January 31, 2015:

			January 30, 2016		January 31, 2015
(In millions)	Effective Date	Maturity Date	Notional  Amount		Notional  Amount
Foreign-Exchange Forwards
Short-term cross-currency intercompany loans	Varies	Varies	$	128	$	98
Merchandise purchases	Varies	Varies	18		—

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 on our Consolidated Statements of Stockholders’ (Deficit) Equity for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015			February 1, 2014
Derivatives designated as cash flow hedges:
Beginning balance	$	—	$	(1	)	$	(2	)
Change in fair value recognized in Accumulated other comprehensive loss - Interest Rate Contracts	—		—			—
Reclassifications from Accumulated other comprehensive loss - Interest Rate Contracts	1		1			1
Ending balance	$	1	$	—		$	(1	)

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 30, 2016, January 31, 2015 and February 1, 2014:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Derivatives not designated for hedge accounting:
Loss on the change in fair value - Intercompany Loan Foreign Exchange Contracts (1)	$	(5	)	$	(9	)	$	(1	)
Loss on the change in fair value - Interest Rate Contracts	—			(2		)	—
Gain on the change in fair value - Merchandise Purchases Program Foreign Exchange Contracts	9			9			2
	4			(2		)	1
Derivatives designated as cash flow hedges:
Amortization of hedged caps	(1		)	(2		)	(1		)
	(1		)	(2		)	(1		)
Derivative designated as a fair value hedge:
Amortization of swap basis adjustment - Interest Rate Contract	—			—			(1		)
Loss on the change in fair value - Interest Rate Contract	—			(2		)	(5		)
Gain recognized in Interest expense on hedged item	—			2			5
	—			—			(1		)
Total Interest expense	$	3		$	(4	)	$	(1	)

(1) 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 30, 2016 and January 31, 2015:

	January 30, 2016				January 31, 2015
(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	$	—	$	—	$	734	$	—
Other assets	50		—		53		—
Accrued expenses and other current liabilities	—		—		42		—
Interest Rate Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	—		—		1,611		—
Foreign Currency Contracts not designated for hedge accounting:
Prepaid expenses and other current assets	53		1		8		—
Accrued expenses and other current liabilities	93		—		90		(2		)
Total derivative contracts outstanding:
Prepaid expenses and other current assets	53		1		2,353		—
Other assets	50		—		53		—
Total derivative assets (1)	103		1		2,406		—
Accrued expenses and other current liabilities	93		—		132		(2		)
Total derivative liabilities (1)	$	93	$	—	$	132	$	(2	)

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

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FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Jan. 30, 2016

Fair Value Disclosures [Abstract]

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 30, 2016 and January 31, 2015, aggregated by level in the fair value hierarchy within which those measurements fall.

Fiscal 2015

(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	$	—	$	—	$	—	$	—
Foreign exchange contracts	—		1		—		1
Total assets	$	—	$	1	$	—	$	1

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

Fair Value Measurements, Nonrecurring

As of January 30, 2016 and January 31, 2015, we did not have any long-lived assets classified as Level 1 or Level 2 within the fair value hierarchy, respectively.

Fiscal 2015

(In millions)	Carrying Value Prior to Impairment		Significant Unobservable Inputs (Level 3)		Impairment Losses (1)
Long-lived assets held and used	$	11	$	4	$	7
Long-lived assets held for sale	25		16		9
Total	$	36	$	20	$	16

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

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

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 30, 2016 and January 31, 2015, 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 30, 2016	$	4,743	$	4,107	$	1,309	$	2,037	$	761
January 31, 2015	4,788		4,416		1,346		2,315		755

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PROPERTY AND EQUIPMENT (Tables)

12 Months Ended

Jan. 30, 2016

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 30, 2016		January 31, 2015
Land		$	676	$	695
Buildings	45-50	1,932		1,967
Furniture and equipment	3-20	1,472		1,639
Property and leasehold improvements	5-25	2,493		2,500
Costs of computer software	5	224		210
Construction in progress		71		32
Leased equipment under capital lease	3-5	32		51
		6,900		7,094
Less: accumulated depreciation and amortization		3,721		3,759
		3,179		3,335
Less: net assets held for sale		16		—
Total		$	3,163	$	3,335

Disclosure of Long Lived Assets Held-for-sale [Table Text Block]

The following assets were classified as held for sale as of January 30, 2016:

(In millions)	January 30, 2016
Land	$	25
Less: accumulated impairment	9
Net assets held for sale	$	16

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ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)

12 Months Ended

Jan. 30, 2016

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 30, 2016 and January 31, 2015 is outlined in the table below:

(In millions)	January 30, 2016		January 31, 2015
Merchandise accounts payable (1)	$	1,488	$	1,373
Non-merchandise accounts payable (2)	211		198
Accounts payable	$	1,699	$	1,571
Gift card and certificate liability	$	222	$	205
Accrued bonus	109		110
Sales and use tax and value added tax payable	87		84
Accrued interest	63		55
Accrued property taxes	48		52
Accrued payroll	41		42
Accrued vacation	29		44
Accrued sponsor transaction fees (3)	—		47
Other (4)	395		393
Accrued expenses and other current liabilities	$	994	$	1,032

(1) Includes $44 million and $36 million of book overdraft cash as of January 30, 2016 and January 31, 2015, respectively.

(2) Includes $90 million and $84 million of book overdraft cash as of January 30, 2016 and January 31, 2015, respectively.

(3) January 31, 2015 includes fees payable to the Sponsors as a result of certain financing transactions. In December 2015, the Company’s Advisory Agreement was amended to waive all Transaction Fees including any prior accrued and unpaid transaction fees. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

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

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STOCK-BASED COMPENSATION (Tables)

12 Months Ended

Jan. 30, 2016

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 30, 2016		January 31, 2015		February 1, 2014
Volatility	45.0	%	45.0	%	40.0%-45.0%
Risk-free interest rate	2.0% - 2.4%		1.4%-2.4%		2.0%-2.7%
Expected term	4.0 years		4.0-5.5 years		3.8-5.2 years
Dividend Yield	—		—		—
Weighted-average grant-date fair value per option:	$3.05		$2.55		$9.67

Summary of Service Based Option Activity

A summary of option activity under the 2010 Incentive Plan and Management Equity Plan during fiscals 2015, 2014 and 2013 is presented below:

	Fiscal Years Ended
	January 30, 2016				January 31, 2015				February 1, 2014
	Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price
Outstanding at beginning of fiscal year	3,922,371		$	8.23	2,661,025		$	29.40	3,483,283		$	36.02
Granted	3,245,012		8.00		3,901,217		8.00		1,587,057		25.25
Exercised	—		—		—		—		(1,057,773	)	26.37
Forfeited/Canceled	(1,127,521	)	8.00		(2,639,871	)	29.23		(1,351,542	)	43.97
Outstanding at end of fiscal year	6,039,862		$	8.15	3,922,371		$	8.23	2,661,025		$	29.40

	Options	Weighted-average Exercise Price		Weighted-average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Options vested or expected to vest at January 30, 2016	6,014,672	$	8.00	8.5	$	—
Options exercisable at January 30, 2016	—	$	—	—	$	—

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

STOCK-BASED COMPENSATION

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. 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 stockholders of the Company. 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.

On May 31, 2015, the Board of Directors adopted amendments to the 2010 Incentive Plan and Amended and Restated Certificate of Incorporation, which were adopted by the stockholders of the Company on June 1, 2015. Amendment No. 3 to the 2010 Incentive Plan increased the number of shares available thereunder by 3,000,000 shares and Amendment No. 1 to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of Common Stock by 5,000,000 shares.

All outstanding options issued under the 2010 Incentive Plan are scheduled to expire on dates ranging from August 6, 2017 to October 16, 2025. We expect to satisfy future option exercises by issuing shares held in treasury or authorized but unissued new shares.

Subsequent Event

On March 9, 2016, the Board of Directors of the Company adopted amendments to the 2010 Incentive Plan and the Amended and Restated Certificate of Incorporation, as amended, which were adopted by the stockholders of the Company on March 22, 2016. The amendment to the Company’s 2010 Incentive Plan increased the number of shares of the Company’s common stock available thereunder by 1,000,000 shares and the amendment to the Amended and Restated Certificate of Incorporation increased the number of authorized shares of the Company’s common stock by 5,000,000 shares.

Stock options

In fiscals 2015, 2014 and 2013, 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 2015, except for those granted to David A. Brandon, Chairman of the Board and Chief Executive Officer, and those granted under the Award Exchange described below, 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. 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. Options granted in fiscal 2013, 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. These awards are subject to the participants continued employment with us and will vest automatically upon change of control of the Company.

Additionally, certain options issued in fiscals 2015 and 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 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 fiscals 2015 and 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 fiscal 2013, concurrent with the grant of options, additional awards were granted under the 2010 Incentive Plan consisting of service-based restricted stock units, which were valued at a fair market value on the date of grant of $30.00 per share. 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 vested 100% on the second anniversary of the award, subject to the participant’s continued employment with the Company, and were scheduled to vest automatically upon a change in control of the Company.

In September 2014, the Company accelerated the vesting of certain restricted share units and restricted share awards issued under the 2010 Incentive Plan. 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.

Certain of the awards have provided holders with rights to put shares to the Company in certain circumstances. The Company currently 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 fiscal 2014, in accordance with ASC 718 and ASC 480, the shares were reclassified from temporary equity to permanent equity as redemption of these equity awards was no longer considered probable or redeemable at the option of the holder.

Award 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 (“2014 Old Options”) under the Toys “R” Us, Inc. 2005 Management Equity Plan or the 2010 Incentive Plan for new stock options granted under the 2010 Incentive Plan (“2014 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 2014 Old Options canceled and an equal amount of 2014 New Options issued under the 2010 Incentive Plan. The 2014 New Options have an exercise price of $8.00 and vest as follows: (i) 2014 New Options granted in exchange for 2014 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) 2014 New Options granted in exchange for 2014 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 less than $1 million and $2 million in fiscals 2015 and 2014, respectively, which were recorded in SG&A.

In June 2015, certain participants under the 2010 Incentive Plan were offered an opportunity to exchange their unvested outstanding restricted stock units granted May 24, 2013 (“RSUs”) for a grant of two new stock options (“2015 New Options”) for every one RSU canceled. The 2015 New Options have an exercise price of $8.00. On July 31, 2015, the Company closed its offer with a total of 64,381 RSUs canceled and a total of 128,762 2015 New Options issued under the 2010 Incentive Plan. The 2015 New Options have a grant date of August 3, 2015 and vest 50% on each of May 24, 2016 and May 24, 2017, subject to the participant’s continued employment with the Company, and will vest automatically upon change of control of the Company. These options expire ten years from the date of grant, subject to the earlier expiration in accordance with the 2015 New Option award agreement. We accounted for the modification in accordance with ASC Topic 718, “Compensation – Stock Compensation”. Management has concluded that the modification had no impact on compensation costs.

2015 One-time awards

On June 1, 2015, the Company entered into an employment agreement with David A. Brandon to serve as Chairman of the Board and Chief Executive Officer. The employment agreement provided a one-time award of stock options under the 2010 Incentive Plan subject to time and performance based vesting conditions, which had a grant date of July 1, 2015. The award will vest ratably over forty-eight months commencing on the first month anniversary of the grant date and will only be deemed fully vested when the performance based obligations pursuant to Mr. Brandon’s employment agreement are satisfied. The one-time award has a grant date fair value of $9 million, at $8.00 per share.

Valuation Assumptions

The fair value of each option award modified or granted under the 2010 Incentive 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 30, 2016		January 31, 2015		February 1, 2014
Volatility	45.0	%	45.0	%	40.0%-45.0%
Risk-free interest rate	2.0% - 2.4%		1.4%-2.4%		2.0%-2.7%
Expected term	4.0 years		4.0-5.5 years		3.8-5.2 years
Dividend Yield	—		—		—
Weighted-average grant-date fair value per option:	$3.05		$2.55		$9.67

For fiscals 2015, 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 2015, 2014 and 2013 is presented below:

	Fiscal Years Ended
	January 30, 2016				January 31, 2015				February 1, 2014
	Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price		Options		Weighted-average Exercise Price
Outstanding at beginning of fiscal year	3,922,371		$	8.23	2,661,025		$	29.40	3,483,283		$	36.02
Granted	3,245,012		8.00		3,901,217		8.00		1,587,057		25.25
Exercised	—		—		—		—		(1,057,773	)	26.37
Forfeited/Canceled	(1,127,521	)	8.00		(2,639,871	)	29.23		(1,351,542	)	43.97
Outstanding at end of fiscal year	6,039,862		$	8.15	3,922,371		$	8.23	2,661,025		$	29.40

	Options	Weighted-average Exercise Price		Weighted-average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Options vested or expected to vest at January 30, 2016	6,014,672	$	8.00	8.5	$	—
Options exercisable at January 30, 2016	—	$	—	—	$	—

There were no options exercised in fiscals 2015 and 2014. The aggregate intrinsic value of options exercised, which includes options exercised on a net settlement basis, was $4 million in fiscal 2013. The total fair value of options vested was $2 million, $2 million and $19 million in fiscals 2015, 2014 and 2013, respectively. We received no proceeds from the exercise of options in fiscals 2015, 2014 and 2013. We did not cash settle share-based liability awards in fiscals 2015 and 2014. We paid $2 million in fiscal 2013 to cash settle share-based liability awards. We paid less than $1 million and $8 million in fiscals 2015 and 2013, respectively, to repurchase shares. We did not repurchase shares in fiscal 2014.

As of January 30, 2016, there was $10 million of total unrecognized compensation cost related to option share-based compensation arrangements granted under the 2010 Incentive Plan. This cost is expected to be recognized over a weighted-average period of 2.7 years.

Restricted Shares and Units

A summary of outstanding restricted stock unit activity under the 2010 Incentive Plan during fiscals 2015, 2014 and 2013 is presented below:

	Fiscal Years Ended
	January 30, 2016				January 31, 2015				February 1, 2014
	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	290,000		$	14.01	945,878		$	29.05	215,849		$	46.04
Granted	50,000		8.00		50,000		8.00		791,165		25.40
Units converted	(185,453	)	26.29		(156,079	)	45.20		(20,694	)	51.93
Forfeited/Canceled	(142,047	)	11.32		(549,799	)	30.49		(40,442	)	36.66
Outstanding units at end of fiscal year	12,500		$	8.00	290,000		$	14.01	945,878		$	29.05

As of January 30, 2016, there was less than $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 less than 1 year.

The fair value of restricted shares vested and restricted stock units converted was $5 million, $9 million and $4 million for fiscals 2015, 2014 and 2013, respectively, and we did not recognize any tax benefits as a result of the vesting and conversion.

Performance-Based Shares and Units

As of January 30, 2016 and January 31, 2015, we did not have outstanding performance-based share awards as the performance-based share awards and units granted on May 26, 2011 and May 21, 2012 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 2015, 2014 and 2013 was as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
SG&A	$	5	$	15	$	15
Total recognized tax benefit	—		—		—

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 2015, 2014 and 2013 was as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
SG&A	$	5	$	15	$	15
Total recognized tax benefit	—		—		—

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 2015, 2014 and 2013 is presented below:

	Fiscal Years Ended
	January 30, 2016				January 31, 2015				February 1, 2014
	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	290,000		$	14.01	945,878		$	29.05	215,849		$	46.04
Granted	50,000		8.00		50,000		8.00		791,165		25.40
Units converted	(185,453	)	26.29		(156,079	)	45.20		(20,694	)	51.93
Forfeited/Canceled	(142,047	)	11.32		(549,799	)	30.49		(40,442	)	36.66
Outstanding units at end of fiscal year	12,500		$	8.00	290,000		$	14.01	945,878		$	29.05

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ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables)

12 Months Ended

Jan. 30, 2016

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

Accumulated other comprehensive loss 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) gains, net of tax			Accumulated other comprehensive loss
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		)
Current period change	(47		)	1			20			(26		)
Balance, January 30, 2016	$	(249	)	$	1		$	(22	)	$	(270	)

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LEASES (Tables)

12 Months Ended

Jan. 30, 2016

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 30, 2016 are as follows:

	Operating Leases (1)						Capital Leases and Financing Obligations
(In millions)	Gross Minimum Rentals		Sublease Income		Net Minimum Rentals		Lease Obligation
2016	$	505	$	14	$	491	$	33
2017	445		12		433		30
2018	377		11		366		27
2019	316		9		307		22
2020	262		7		255		19
2021 and subsequent	952		18		934		71
Total	$	2,857	$	71	$	2,786	$	202

(1) Excluded from the minimum rental commitments displayed above are $1.4 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 2021 and thereafter.

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INCOME TAXES (Tables)

12 Months Ended

Jan. 30, 2016

Income Tax Disclosure [Abstract]

Earnings before Income Taxes

(Loss) earnings before income taxes are as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
U.S.	$	(169	)	$	(263	)	$	(851	)
Foreign	121			7			(16		)
Loss before income taxes	$	(48	)	$	(256	)	$	(867	)

Income Tax (Benefit) Expense

Income tax expense (benefit) is as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015			February 1, 2014
Current:
U.S. Federal	$	1	$	(13	)	$	(7	)
Foreign	54		46			46
State	4		—			(3		)
Total current income tax expense	$	59	$	33		$	36
Deferred:
U.S. Federal	$	—	$	1		$	42
Foreign	17		(2		)	72
State	—		—			19
Total deferred income tax expense (benefit)	$	17	$	(1	)	$	133
Total income tax expense	$	76	$	32		$	169

Effective Tax Rate Reconciliation

The effective tax rate reconciliations are as follows:

	Fiscal Years Ended
	January 30, 2016		January 31, 2015		February 1, 2014
U.S. Federal statutory tax rate	35.0	%	35.0	%	35.0	%
State taxes, net of U.S. Federal benefit	(5.4	)%	—	%	(1.2	)%
Foreign operations (1)	(183.7	)%	(13.5	)%	(12.3	)%
U.S. Federal valuation allowance	(10.4	)%	(36.6	)%	(27.9	)%
Unrecognized tax benefits (2)	—	%	3.0	%	—	%
Goodwill impairment (3)	—	%	—	%	(13.4	)%
Other	6.2	%	(0.4	)%	0.3	%
Effective tax rate	(158.3	)%	(12.5	)%	(19.5	)%

(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 enacted changes in the tax laws or rates or a change in the status of the enterprise.

(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. Refer to “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.

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 30, 2016			January 31, 2015
Deferred tax assets:
U.S. Federal tax loss and other carryforwards	$	358		$	385
State tax loss and other carryforwards	83			84
Foreign tax loss and other carryforwards	164			169
Straight line rent	127			127
Inventory	60			52
Insurance loss reserve	38			35
Restructuring charges	5			7
Other	148			158
Gross deferred tax assets before valuation allowance	983			1,017
Valuation allowance	(656		)	(621		)
Total deferred tax assets	$	327		$	396
Deferred tax liabilities:
Fixed assets (1)	$	(39	)	$	(67	)
Undistributed earnings of foreign subsidiaries	(214		)	(222		)
Foreign currency translation	(28		)	(24		)
Other	(14		)	(21		)
Total deferred tax liabilities	$	(295	)	$	(334	)
Net deferred tax assets	$	32		$	62

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 30,  2016 (1)			January 31, 2015
Current deferred tax assets	$	—		$	45
Current deferred tax liabilities (2)	—			(4		)
Non-current deferred tax assets	96			133
Non-current deferred tax liabilities	(64		)	(112		)
	$	32		$	62

(1) In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The guidance is effective for interim and annual periods beginning after December 15, 2016, and may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. As permitted, the Company elected to early adopt this guidance effective January 30, 2016, and has applied the guidance prospectively. The adoption of this guidance did not have a significant impact on the Company’s financial statements, other than the prospective classification of deferred tax liabilities and assets as noncurrent in accordance with the new presentation requirements.

(2) The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities on our prior year Consolidated Balance Sheet.

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 30, 2016			January 31, 2015			February 1, 2014
Beginning balance	$	30		$	37		$	32
Additions for tax positions of the current year	2			4			4
Additions for tax positions of prior years	2			5			6
Reductions for tax positions of prior years (1)	—			(11		)	(1		)
Settlements	—			—			—
Currency translation adjustment	(1		)	(4		)	—
Lapse of statute of limitations	(1		)	(1		)	(4		)
Ending balance	$	32		$	30		$	37

(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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SEGMENTS (Tables)

12 Months Ended

Jan. 30, 2016

Segment Reporting Information [Line Items]

Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Table Text Block]

A summary of financial results by reportable segment is as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Net sales
Domestic	$	7,356		$	7,524		$	7,638
International	4,446			4,837			4,905
Total Net sales	$	11,802		$	12,361		$	12,543
Operating earnings (loss)
Domestic (1) (2)	$	484		$	332		$	(197	)
International (1)	271			229			203
Corporate and other	(377		)	(370		)	(356		)
Operating earnings (loss)	378			191			(350		)
Interest expense	(429		)	(451		)	(524		)
Interest income	3			4			7
Loss before income taxes	$	(48	)	$	(256	)	$	(867	)

(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.

Depreciation Amortization And Capital Expenditure [Table Text Block]

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Depreciation and amortization
Domestic	$	180	$	210	$	216
International	107		116		123
Corporate	56		51		49
Total Depreciation and amortization	$	343	$	377	$	388
Capital expenditures
Domestic	$	74	$	67	$	113
International	74		83		86
Corporate	71		57		39
Total Capital expenditures	$	219	$	207	$	238

Total Merchandise Inventories And Total Assets Table [Table Text Block]

(In millions)	January 30, 2016		January 31, 2015
Merchandise inventories
Domestic	$	1,559	$	1,353
International	711		711
Total Merchandise inventories	$	2,270	$	2,064
Total Assets
Domestic	$	3,718	$	3,633
International	2,032		2,122
Corporate and other (1)	1,218		1,360
Total Assets	$	6,968	$	7,115

(1) Includes cash and cash equivalents, deferred tax assets and other corporate assets.

Other Noncurrent Assets [Member]

Segment Reporting Information [Line Items]

Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block]

(In millions)	January 30, 2016		January 31, 2015
Long-lived assets
United States (1)	$	2,275	$	2,372
Europe (2)	339		352
Japan	277		306
UK	266		281
Canada	157		180
China and Southeast Asia	43		41
Australia	12		14
Total Long-lived assets	$	3,369	$	3,546

(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.

Sales [Member]

Segment Reporting Information [Line Items]

Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block]

Our Net sales, inclusive of each market’s respective e-commerce operations, and long-lived assets by market are as follows:

	Fiscal Years Ended
(In millions)	January 30, 2016		January 31, 2015		February 1, 2014
Net sales
United States (1)	$	7,356	$	7,524	$	7,638
Europe (2)	1,211		1,405		1,447
Japan	1,182		1,308		1,374
Canada	809		834		883
UK	666		710		680
China and Southeast Asia	365		333		277
Australia	196		230		228
Licensing revenue	17		17		16
Total Net sales	$	11,802	$	12,361	$	12,543

(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.

Domestic

Segment Reporting Information [Line Items]

Revenue from External Customers by Products and Services [Table Text Block]

The following tables show our percentage of Net sales by product category:

	Fiscal Years Ended
Domestic:	January 30, 2016		January 31, 2015		February 1, 2014
Baby	36.9	%	37.9	%	37.7	%
Core Toy	18.4	%	17.2	%	15.9	%
Entertainment	9.0	%	10.2	%	11.3	%
Learning	23.5	%	22.6	%	22.6	%
Seasonal	11.4	%	11.2	%	11.3	%
Other (1)	0.8	%	0.9	%	1.2	%
Total	100	%	100	%	100	%

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

International

Segment Reporting Information [Line Items]

Revenue from External Customers by Products and Services [Table Text Block]

	Fiscal Years Ended
International:	January 30, 2016		January 31, 2015		February 1, 2014
Baby	20.5	%	20.2	%	20.4	%
Core Toy	23.2	%	23.5	%	22.7	%
Entertainment	7.1	%	8.5	%	10.0	%
Learning	32.8	%	31.1	%	30.8	%
Seasonal	15.7	%	15.9	%	15.3	%
Other (1)	0.7	%	0.8	%	0.8	%
Total	100	%	100	%	100	%

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

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DEFINED BENEFIT PENSION PLANS (Tables)

12 Months Ended

Jan. 30, 2016

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 30, 2016			January 31, 2015
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	174		$	137
Service cost	5			5
Interest cost	5			5
Benefits paid	(3		)	(6		)
Actuarial (gain) loss	(25		)	52
Foreign currency impact	(8		)	(19		)
Projected benefit obligation at end of year	$	148		$	174

Changes in Fair Value of Plan Assets

(In millions)	January 30, 2016			January 31, 2015
Change in fair value of plan assets:
Fair value of plan assets at beginning of year	$	123		$	118
Actual return on plan assets	(2		)	17
Employer contributions	11			7
Benefits paid	(3		)	(6		)
Foreign currency impact	(6		)	(13		)
Fair value of plan assets at end of year	$	123		$	123

Funded Status

(In millions)	January 30, 2016			January 31, 2015
Reconciliation of funded status to total amount recognized:
Funded status	$	(25	)	$	(51	)
Amounts recognized in Consolidated Balance Sheets:
Other non-current liabilities	$	(25	)	$	(51	)
Amounts recognized in Accumulated other comprehensive loss:
Unrecognized actuarial losses, net of tax	$	22		$	42

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 30, 2016		January 31, 2015
Projected benefit obligation	$	148	$	174
Accumulated benefit obligation	129		150
Fair value of plan assets	123		123

Components of Net Periodic Benefit Cost

Components of Net Periodic Benefit Cost During Each Fiscal Year:

	Fiscal Years Ended
(In millions)	January 30, 2016			January 31, 2015			February 1, 2014
Service cost	$	5		$	5		$	5
Interest cost	5			5			5
Expected return on plan assets	(4		)	(5		)	(5		)
Actuarial losses recognized	2			—			—
Net periodic benefit cost	$	8		$	5		$	5

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
2016	$	1
2017	1
2018	1
2019	1
2020	1
2021 through 2025	7

Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs and Benefit Obligations

Weighted-average Assumptions Used to Determine Benefit Obligations at Fiscal Year End:

	Fiscal Years Ended
	January 30, 2016		January 31, 2015
Discount rate	3.2	%	2.7	%
Rate of compensation increase	2.6	%	2.6	%

Weighted-average Assumptions Used to Determine Net Periodic Benefit Costs at Fiscal Year End:

	January 30, 2016		January 31, 2015		February 1, 2014
Discount rate	2.7	%	3.7	%	4.1	%
Expected rate of return on plan assets	3.4	%	4.5	%	4.9	%
Rate of compensation increase	2.6	%	2.6	%	2.7	%

Weighted Average Asset Allocation by Asset Category

The following represents our pension plan target asset allocations for fiscal 2016, as well as the actual asset allocations as of January 30, 2016 and January 31, 2015:

	2016 Target Allocation		January 30, 2016		January 31, 2015
Equity securities	29.6	%	29.6	%	28.3	%
Debt securities	56.6	%	56.6	%	58.3	%
Insurance contracts	7.4	%	7.4	%	7.3	%
Cash and cash equivalents	6.4	%	6.4	%	6.1	%
Total	100	%	100	%	100	%

Schedule of Fair Value of Plan Assets

Fiscal 2015

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Insurance Contracts (1)	$	—	$	9	$	9
Cash and cash equivalents (2)	8		—		8
Equity Securities: (3)
Domestic					11
International					25
Fixed Income: (3)
Domestic					6
International					64
Total	$	8	$	9	$	123

Fiscal 2014

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Total
Insurance Contracts (1)	$	—	$	9	$	9
Cash and cash equivalents (2)	7		—		7
Equity Securities: (3)
Domestic					11
International					24
Fixed Income: (3)
Domestic					4
International					68
Total	$	7	$	9	$	123

(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) In accordance with ASU 2015-07, securities which are measured at fair value using the NAV per share practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are to reconcile the fair value hierarchy to the total fair value of plan assets.

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RELATED PARTY TRANSACTIONS (Tables)

12 Months Ended

Jan. 30, 2016

Related Party Transaction [Line Items]

Schedule of Related Party Transactions [Table Text Block]

KKR owned the following aggregate amounts of our debt as of January 30, 2016 and January 31, 2015. For further details, refer to Note 2 entitled “SHORT-TERM BORROWINGS AND LONG-TERM DEBT.”

(In millions)	January 30, 2016		January 31, 2015
Propco I Term Loan Facility	$	16	$	17
Incremental Secured Term Loan	12		12
Secured Term B-4 Loan	2		96
Second Incremental Secured Term Loan	2		2
2017 Notes	—		9
Total	$	32	$	136

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) £ in Millions		12 Months Ended
		Jan. 30, 2016 USD ($) countries stores	Jan. 31, 2015 USD ($)	Feb. 01, 2014 USD ($)	Feb. 02, 2013 USD ($)	Oct. 24, 2014 USD ($)	Mar. 28, 2013 USD ($)	Mar. 28, 2013 GBP (£)	Oct. 31, 2011 USD ($)	Jul. 21, 2005 USD ($)	Jan. 31, 1994 countries stores
Summary of Significant Accounting Policies [Line Items]
Number of Stores | stores		1,622
Number of Countries in which Entity Operates | countries		39									17
Debt Instrument, Face Amount		$ 4,773,000,000
Restricted cash		52,000,000	$ 53,000,000
Asset Retirement Obligation		67,000,000	63,000,000
Goodwill		64,000,000	64,000,000
Goodwill impairment		0	0	$ 378,000,000
Unamortized Debt Issuance Expense		82,000,000	139,000,000
Amortization of Financing Costs		20,000,000	48,000,000	51,000,000
Acquisition of Debt Securities		0	0
Self Insurance Reserve		100,000,000	99,000,000
Capital Leases, Lessee Balance Sheet, Assets by Major Class, Accumulated Depreciation		25,000,000	41,000,000
Deferred rent liabilities		354,000,000	359,000,000
Deferred rent liabilities, current, recorded in Accrued expenses and other current liabilities		9,000,000	12,000,000
Other Revenue, Net		45,000,000	43,000,000	56,000,000
Licenses Revenue		17,000,000	17,000,000	16,000,000
Revenue Recognition, Sales Returns, Reserve for Sales Returns		9,000,000	10,000,000
Advertising Expense		326,000,000	379,000,000	433,000,000
Capitalized Computer Software, Amortization		37,000,000	34,000,000	31,000,000
Term of Credit Card Program Agreement					7 years
Credit card program income		48,000,000	36,000,000	33,000,000
Gift card breakage income		30,000,000	27,000,000	24,000,000
Net gains on sales of properties		20,000,000	5,000,000	8,000,000
Impairment on long-lived assets		16,000,000	13,000,000	44,000,000
Unrealized losses (gains) on foreign exchange		14,000,000	19,000,000	1,000,000
Foreign Currency Transaction Gain (Loss), Unrealized		(10,000,000)	(15,000,000)	1,000,000
Gains (Losses) from Intercompany Foreign Currency Transactions		5,000,000	9,000,000	1,000,000
Temporary Equity		111,000,000	85,000,000	78,000,000	$ 49,000,000				$ 24,000,000
Interest Expense [Member] | Intercompany Loan Foreign Exchange Contracts [Member] | Derivatives not designated for hedge accounting:
Summary of Significant Accounting Policies [Line Items]
Gain (loss) on the change in fair value	[1]	(5,000,000)	(9,000,000)	(1,000,000)
Profit Sharing Revenue [Member]
Summary of Significant Accounting Policies [Line Items]
Credit card program income		$ 8,000,000
Computer Software, Intangible Asset [Member]
Summary of Significant Accounting Policies [Line Items]
Property, Plant and Equipment, Useful Life		5 years
Employment Practices Liability [Member]
Summary of Significant Accounting Policies [Line Items]
Insurance deductible		$ 15,000,000
Catastrophe [Member]
Summary of Significant Accounting Policies [Line Items]
Insurance deductible		8,000,000
Property Liability [Member]
Summary of Significant Accounting Policies [Line Items]
Insurance deductible		5,000,000
General Liability [Member]
Summary of Significant Accounting Policies [Line Items]
Insurance deductible		5,000,000
Auto Liability [Member]
Summary of Significant Accounting Policies [Line Items]
Insurance deductible		4,000,000
Workers' Compensation Liability [Member]
Summary of Significant Accounting Policies [Line Items]
Insurance deductible		1,000,000
Debussy [Member]
Summary of Significant Accounting Policies [Line Items]
Debt Instrument, Face Amount							$ 20,000,000	£ 13
Toys (Labuan) Holdings Limited [Member]
Summary of Significant Accounting Policies [Line Items]
Business Acquisition, Percentage of Voting Interests Acquired									70.00%
New UK Propco Loan [Member]
Summary of Significant Accounting Policies [Line Items]
Debt Instrument, Face Amount | £								£ 263
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]
Summary of Significant Accounting Policies [Line Items]
Debt Instrument, Face Amount	[2]					$ 280,000,000
Unamortized Debt Issuance Expense		2,000,000	7,000,000
Foreign Currency Transaction Gain (Loss), Unrealized		11,000,000	15,000,000
The Sponsors [Member]
Summary of Significant Accounting Policies [Line Items]
Merger, value										$ 6,600,000,000
Toys (Labuan) Holdings Limited [Member]
Summary of Significant Accounting Policies [Line Items]
Goodwill		64,000,000	$ 64,000,000
The Sponsors [Member]
Summary of Significant Accounting Policies [Line Items]
Write off of Deferred Debt Issuance Cost		$ 30,000,000
Minimum [Member]
Summary of Significant Accounting Policies [Line Items]
Number of Stores | stores											1,000
Maximum [Member]
Summary of Significant Accounting Policies [Line Items]
Cash Equivalents, Original Maturity		3 months
International
Summary of Significant Accounting Policies [Line Items]
Number of Stores | stores		1,008
Number of Stores Operated by Franchisees | stores		252
Number of Countries in which Entity Operates | countries		38
Goodwill impairment				$ 17,000,000

[1] 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] Represents obligations of Toys “R” Us - Delaware, Inc. (“Toys-Delaware”).

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fiscal Years (Details)	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of Weeks	52	52	52
Fiscal Year End Date	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cost of Sales and Selling, General & Administrative Expenses (Details)	12 Months Ended
	Jan. 30, 2016
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 - Other Income, Net (Details) - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Credit card program income		$ 48	$ 36	$ 33
Gift card breakage income		30	27	24
Net gains on sales of properties		20	5	8
Foreign currency transactions		(14)	(19)	(1)
Impairment of long-lived assets		(16)	(13)	(44)
Other	[1]	20	17	17
Total		$ 88	$ 53	$ 37

[1] Includes advertising income from our websites, layaway income and other miscellaneous income and expense charges.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Temporary Equity - Noncontrolling Interest (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013	Oct. 31, 2011
Temporary Equity Disclosure [Abstract]
Temporary Equity	$ 111	$ 85	$ 78	$ 49	$ 24
Less: Net earnings attributable to noncontrolling interest	6	4	3
Adjustment of noncontrolling interest to redemption value	18	10	18
Redemption value of redeemable shares			$ 8
Value of formerly redeemable shares to equity		(8)
Capital contribution	$ 2	$ 1

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Narrative (Details) € in Millions, ¥ in Millions, £ in Millions, HKD in Millions													12 Months Ended
		Jan. 30, 2016 EUR (€)	Aug. 29, 2015	May. 12, 2015	Oct. 25, 2014 USD ($)	Aug. 22, 2013 USD ($)	Feb. 28, 2013 JPY (¥)	Aug. 02, 2012 USD ($)	Apr. 11, 2012 USD ($)	May. 26, 2011 USD ($)	Nov. 21, 2009 USD ($)	Sep. 23, 2003 USD ($)	Jan. 30, 2016 USD ($)	Jan. 30, 2016 JPY (¥)	Jan. 31, 2015 USD ($)		Feb. 01, 2014 USD ($)	Jan. 30, 2016 HKD Properties	Jan. 30, 2016 USD ($) Properties	Jan. 30, 2016 GBP (£) Properties	Jan. 30, 2016 EUR (€) Properties	Jan. 30, 2016 JPY (¥) Properties	Jan. 29, 2016 JPY (¥)	Jun. 30, 2015 JPY (¥)	Oct. 31, 2014 JPY (¥)	Oct. 24, 2014 USD ($)	Aug. 21, 2013 USD ($)	Mar. 28, 2013 USD ($)	Mar. 28, 2013 GBP (£)	Feb. 27, 2013 EUR (€)	Aug. 01, 2012 USD ($)	Apr. 10, 2012 USD ($)	May. 25, 2011 USD ($)	Feb. 28, 2011 JPY (¥)	Nov. 20, 2009 USD ($)	Dec. 01, 2006 USD ($)	Sep. 22, 2003 USD ($)	Aug. 29, 1991 USD ($)
Short-term Debt [Line Items]
Debt Instrument, Face Amount																			$ 4,773,000,000
Long-term debt																			4,700,000,000
Secured Debt																			2,700,000,000
Amount of Restricted Net Assets for Consolidated and Unconsolidated Subsidiaries																			448,000,000
Payments of Debt Issuance Costs													$ 6,000,000		$ 35,000,000		$ 47,000,000
Unamortized Debt Issuance Expense															139,000,000				82,000,000
Current portion of long-term debt															176,000,000				73,000,000
Long-term debt borrowings													1,451,000,000		2,866,000,000		3,159,000,000
Interest Expense													$ 429,000,000		451,000,000		524,000,000
Debussy [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount																												$ 20,000,000	£ 13
Financial Instruments, Owned, Corporate Debt, at Fair Value															20,000,000				19,000,000
Held-to-maturity Securities															20,000,000				19,000,000	£ 13
KKR [Member]
Short-term Debt [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value															136,000,000				32,000,000
Spanish real estate credit facility, due fiscal two thousand fifteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal | €		€ 24
Long-term debt	[1]														$ 34,000,000				0
Debt Instrument, Basis Spread on Variable Rate													6.00%	6.00%	6.00%
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member]
Short-term Debt [Line Items]
Long-term debt	[2]														$ 63,000,000				49,000,000
Unamortized Debt Issuance Expense																			1,000,000
Current portion of long-term debt																			$ 7,000,000
Number of Bank Loans with Financial Institutions																		4	4	4	4	4
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Minimum [Member]
Short-term Debt [Line Items]
Covenant Term of Profitability													2 years	2 years
Debt Instrument, Interest Rate, Stated Percentage															1.85%			1.85%	1.85%	1.85%	1.85%	1.85%
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Maximum [Member]
Short-term Debt [Line Items]
Unamortized Debt Issuance Expense															$ 1,000,000
Debt Instrument, Interest Rate, Stated Percentage															2.18%			2.18%	2.18%	2.18%	2.18%	2.18%
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Toys-Japan loan maturing January two thousand twenty one [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal													$ 3,000,000	¥ 410
Debt Instrument, Face Amount | ¥																							¥ 4,100
Long-term debt																			$ 34,000,000
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Toys-Japan loan maturing January two thousand twenty one [Member] | Tokyo Interbank Offered Rate (TIBOR) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													1.00%	1.00%
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Toys-Japan loan maturing February two thousand sixteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal | ¥														¥ 115
Debt Instrument, Face Amount | ¥																																		¥ 1,000
Long-term debt																			$ 1,000,000			¥ 80
Debt Instrument, Interest Rate, Stated Percentage																		1.85%	1.85%	1.85%	1.85%	1.85%
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Toys-Japan loan maturing February two thousand sixteen [Member] | Maximum [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal													$ 1,000,000
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Toys-Japan loan maturing October two thousand nineteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal | ¥														50
Debt Instrument, Face Amount | ¥																									¥ 500
Long-term debt																			$ 3,000,000			¥ 400
Debt Instrument, Interest Rate, Stated Percentage																		1.85%	1.85%	1.85%	1.85%	1.85%
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Toys-Japan loan maturing October two thousand nineteen [Member] | Maximum [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal													1,000,000
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Toys-Japan loan maturing February two thousand twenty one [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal													$ 1,000,000	¥ 125
Debt Instrument, Face Amount | ¥							¥ 2,000
Long-term debt																			$ 11,000,000			¥ 1,400
Debt Instrument, Interest Rate, Stated Percentage																		2.18%	2.18%	2.18%	2.18%	2.18%
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Toys Japan remaining loans [Member]
Short-term Debt [Line Items]
Number of Bank Loans with Financial Institutions																		1	1	1	1	1
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Long-term debt	[3]														$ 0				$ 80,000,000
Line of Credit Facility, Maximum Borrowing Capacity																			1,850,000,000
Line of Credit Facility, Potential Increase to Maximum Borrowing Capacity																			1,150,000,000
ABL Facility Springing Maturity Period													30 days	30 days
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage													0.25%	0.25%
Debt Instrument, Covenant, Minimum Excess Availability																			125,000,000
Debt Instrument, Covenant Repayment, Minimum Excess Availability																			130,000,000
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member] | Minimum [Member]
Short-term Debt [Line Items]
Debt Instrument, Covenant Excess Availability Prepayment																			150,000,000
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													1.50%	1.50%
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member] | Minimum [Member] | Prime Rate [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													0.50%	0.50%
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member] | Maximum [Member]
Short-term Debt [Line Items]
ABL Facility Excess Availability Days													3 days	3 days
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													1.75%	1.75%
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member] | Maximum [Member] | Prime Rate [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													0.75%	0.75%
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Line of Credit Facility, Remaining Borrowing Capacity																			884,000,000
Unamortized Debt Issuance Expense															38,000,000				19,000,000
Letters of Credit Outstanding, Amount																			99,000,000
Line of Credit Facility, Current Borrowing Capacity																			1,009,000,000
Debt Instrument, Covenant, Minimum Excess Availability																			$ 125,000,000
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Toys-Japan unsecured credit lines, maturing fiscal two thousand sixteen [Member]
Short-term Debt [Line Items]
Number of Unsecured Loan Commitment Lines of Credit																		2	2	2	2	2
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Toys-Japan unsecured credit lines, maturing fiscal two thousand seventeen [Member]
Short-term Debt [Line Items]
Number of Unsecured Loan Commitment Lines of Credit																		1	1	1	1	1
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Long-term debt	[4]														0				$ 0
Number of Unsecured Loan Commitment Lines of Credit																		3	3	3	3	3
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Tranche One A [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Long-term debt																			$ 0
Line of Credit Facility, Maximum Borrowing Capacity																			78,000,000			¥ 9,450
Line of Credit Facility, Remaining Borrowing Capacity																			0
Line of Credit Facility, Interest Rate During Period													0.80%	0.80%
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Tranche One B [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Long-term debt																			0
Line of Credit Facility, Maximum Borrowing Capacity																			17,000,000			2,000
Line of Credit Facility, Remaining Borrowing Capacity																			0
Line of Credit Facility, Interest Rate During Period													0.80%	0.80%
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Tranche One A and One B [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Line of Credit Facility, Commitment Fee Percentage													0.25%	0.25%
Payments of Debt Issuance Costs													$ 2,000,000
Unamortized Debt Issuance Expense																			1,000,000
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Tranche One A and One B [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Covenant Term of Profitability													2 years	2 years
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Tranche Two [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Long-term debt																			0
Line of Credit Facility, Maximum Borrowing Capacity																			29,000,000			3,500
Line of Credit Facility, Remaining Borrowing Capacity																			0
Labuan uncommitted lines of credit [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity																		HKD 221	28,000,000
Short-term Debt															0				0
Guarantor Obligations, Current Carrying Value																			4,000,000
Line of Credit Facility, Remaining Borrowing Capacity																			24,000,000
Labuan uncommitted lines of credit [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Short-term Debt																			0
Toys-Japan Uncommitted Line of Credit [Member] | Tranche Two [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity																			4,000,000			500
Short-term Debt																			0
Line of Credit Facility, Interest Rate During Period													0.80%	0.80%
Toys-Japan Uncommitted Line of Credit [Member] | Tranche One [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity																			8,000,000			¥ 1,000		¥ 1,500
Short-term Debt																			0
Line of Credit Facility, Interest Rate During Period													0.50%	0.50%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount	[3]																									$ 1,026,000,000
Long-term debt	[3]														1,010,000,000				1,002,000,000
Unamortized Debt Issuance Expense															$ 26,000,000				16,000,000
Debt Instrument, Basis Spread on Variable Rate													8.75%	8.75%	8.75%
Debt Instrument, Unamortized Discount																										$ 19,000,000
Current portion of long-term debt																			10,000,000
Redemption Premium					$ 6,000,000
Long-term Debt, Refinanced, Amount					$ 380,000,000
Debt Instrument, Redemption Price, Percentage					101.844%
Interest Expense, Debt					$ 35,000,000
Debt Instrument, Periodic Payment Percent, Principal					1.00%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | Secured Term B-four Loan Facility, option (i) [Member]
Short-term Debt [Line Items]
Refinancing Anniversary													1 year 183 days	1 year 183 days
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | Secured Term B-four Loan Facility, option (ii) [Member]
Short-term Debt [Line Items]
Debt instrument, Periodic Prepayment Percent, Principal					2.00%
Refinancing Anniversary													2 years 183 days	2 years 183 days
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | Secured Term B-four Loan Facility, option (iii) [Member]
Short-term Debt [Line Items]
Prepayment Premium on Debt Principal Prepaid																										1.00%
Refinancing Anniversary													3 years 183 days	3 years 183 days
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]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Interest					2.00%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | Secured Term B-four Loan Facility, option (i) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate					8.75%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | Secured Term B-four Loan Facility, option (ii) (x) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate					0.50%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | Secured Term B-four Loan Facility, option (ii) (z) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate					1.00%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | Secured Term B-four Loan Facility, option (ii) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate					7.75%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | KKR [Member]
Short-term Debt [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value															$ 96,000,000				2,000,000
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | London Interbank Offered Rate (LIBOR) [Member] | Secured Term B-four Loan Facility, option (i) [Member]
Short-term Debt [Line Items]
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum					1.00%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | London Interbank Offered Rate (LIBOR) [Member] | Secured Term B-four Loan Facility, option (ii) (z) [Member]
Short-term Debt [Line Items]
Maximum Length of Time, Interbank Offered Rate					1 month
Secured term B-four loan facility, due fiscal two thousand and twenty [Member] | London Interbank Offered Rate (LIBOR) [Member] | Secured Term B-four Loan Facility, option (ii) [Member]
Short-term Debt [Line Items]
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum					2.00%
European and Australian asset-based revolving credit facility, expires fiscal two thousand twenty [Member]
Short-term Debt [Line Items]
Credit Facility Expiration Period													5 years	5 years
European and Australian asset-based revolving credit facility, expires fiscal two thousand twenty [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Long-term debt															0	[5]			0
Line of Credit Facility, Maximum Borrowing Capacity | £																				£ 138
Line of Credit Facility, Remaining Borrowing Capacity																			81,000,000
European and Australian asset-based revolving credit facility, expires fiscal two thousand twenty [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Unamortized Debt Issuance Expense															2,000,000				$ 4,000,000
European and Australian asset-based revolving credit facility, expires fiscal two thousand twenty [Member] | Line of Credit [Member] | Mid
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													2.50%	2.50%
European and Australian asset-based revolving credit facility, expires fiscal two thousand twenty [Member] | Line of Credit [Member] | Minimum [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													2.25%	2.25%
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage													0.375%	0.375%
Fixed Charge Coverage Ratio																		1.00	1.00	1.00	1.00	1.00
European and Australian asset-based revolving credit facility, expires fiscal two thousand twenty [Member] | Line of Credit [Member] | Maximum [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													2.75%	2.75%
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage													0.50%	0.50%
Fixed Charge Coverage Ratio																		1.00	1.00	1.00	1.00	1.00
European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] | Line of Credit [Member]
Short-term Debt [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity																			$ 197,000,000
Debt Issuance Costs Incurred During Noncash or Partial Noncash Transaction													$ 4,000,000
European and Australian asset-based revolving credit facility, expires fiscal two thousand sixteen [Member] | Line of Credit [Member] | Maximum [Member]
Short-term Debt [Line Items]
Debt Instrument, Unamortized Discount																			1,000,000
Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount	[6]																														$ 450,000,000
Long-term debt	[7]														448,000,000				448,000,000
Unamortized Debt Issuance Expense															$ 8,000,000				$ 5,000,000
Debt Instrument, Unamortized Discount																															$ 4,000,000
Debt Instrument, Interest Rate, Stated Percentage															10.375%			10.375%	10.375%	10.375%	10.375%	10.375%
Proceeds from Issuance of Debt								$ 446,000,000
Changes of Control Percentage of Principal Amount																		101.00%	101.00%	101.00%	101.00%	101.00%
Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member] | KKR [Member]
Short-term Debt [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value															$ 9,000,000				$ 0
Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount																																			$ 725,000,000
Long-term debt	[6]														721,000,000				722,000,000
Unamortized Debt Issuance Expense															$ 10,000,000				$ 7,000,000
Debt Instrument, Unamortized Discount																																			$ 10,000,000
Debt Instrument, Interest Rate, Stated Percentage															8.50%			8.50%	8.50%	8.50%	8.50%	8.50%
Changes of Control Percentage of Principal Amount																		101.00%	101.00%	101.00%	101.00%	101.00%
TRU Propco II Master Lease Rent Increase																																			10.00%
TRU Propco II Master Lease Period											5 years
Proceeds from Issuance of Secured Debt											$ 715,000,000
Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member] | Maximum [Member]
Short-term Debt [Line Items]
TRU Propco II Master Lease Period											20 years
French real estate credit facility, due fiscal two thousand eighteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount | €																														€ 48
Long-term debt															$ 53,000,000				$ 50,000,000		€ 47
Unamortized Debt Issuance Expense															$ 2,000,000				1,000,000
Debt Instrument, Basis Spread on Variable Rate													4.50%	4.50%	4.50%
Debt Instrument, Term							5 years
Current portion of long-term debt															$ 1,000,000				$ 1,000,000
Debt Instrument, Periodic Payment Percent, Principal													1.25%	1.25%
French real estate credit facility, due fiscal two thousand eighteen [Member] | Euro Interbank Offered Rate (EURIBOR) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													4.50%	4.50%
Derivative, Cap Interest Rate																														2.50%
French real estate credit facility, due fiscal two thousand thirteen [Member]
Short-term Debt [Line Items]
Number of Real Estate Properties | Properties																		9	9	9	9	9
Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount																																					$ 400,000,000
Long-term debt	[7]														402,000,000				$ 402,000,000
Unamortized Debt Issuance Expense															$ 1,000,000				$ 1,000,000
Debt Instrument, Unamortized Discount																																					$ 2,000,000
Debt Instrument, Interest Rate, Stated Percentage															7.375%			7.375%	7.375%	7.375%	7.375%	7.375%
Long-term debt borrowings												$ 398,000,000
Payment Received from Termination of Interest Rate Swaps																			$ 10,000,000
Percentage of Consolidated Net Tangible Assets																		10.00%	10.00%	10.00%	10.00%	10.00%
Percentage of Consolidated Capitalization																		15.00%	15.00%	15.00%	15.00%	15.00%
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount																											$ 985,000,000
Long-term debt	[8]														$ 965,000,000				$ 923,000,000
Unamortized Debt Issuance Expense															$ 23,000,000				12,000,000
Debt Instrument, Basis Spread on Variable Rate													5.00%	5.00%	5.00%
Debt Instrument, Unamortized Discount																											10,000,000
Proceeds from Issuance of Debt						$ 975,000,000
Current portion of long-term debt																			38,000,000
Excess Annual Cash Flow Repayment Percentage													25.00%	25.00%
Appraised Property Value Repayment Percentage													65.00%	65.00%
Excess Cash Flow Distribution Percentage													75.00%	75.00%
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | Fixed Charge Ratio [Member]
Short-term Debt [Line Items]
Excess Cash Flow Distribution Percentage													50.00%	50.00%
Fixed Charge Ratio													1.0	1.0
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | TRU Propco I Term Loan Facility, option (ii)(x) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate						0.50%
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | TRU Propco I Term Loan Facility, option (ii)(z) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate						4.00%
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | KKR [Member]
Short-term Debt [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value															$ 17,000,000				16,000,000
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | TRU Property Company I [Member]
Short-term Debt [Line Items]
Long-term Debt, Contingent Payment of Principal or Interest			16	25
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | London Interbank Offered Rate (LIBOR) [Member]
Short-term Debt [Line Items]
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum						1.00%
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | London Interbank Offered Rate (LIBOR) [Member] | TRU Propco I Term Loan Facility, option (i) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate						5.00%
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | London Interbank Offered Rate (LIBOR) [Member] | TRU Propco I Term Loan Facility, option (ii)(z) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate						1.00%
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member] | Minimum [Member] | Fixed Charge Ratio [Member]
Short-term Debt [Line Items]
Fixed Charge Ratio													2.0	2.0
Ten point seven five percent senior notes, due fiscal two thousand seventeen [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount																											$ 950,000,000
Debt Instrument, Interest Rate, Stated Percentage																											10.75%
Interest Expense						$ 77,000,000
Redemption Premium						$ 51,000,000
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount	[3]																									$ 280,000,000
Long-term debt	[3]														272,000,000				273,000,000
Unamortized Debt Issuance Expense															$ 7,000,000				2,000,000
Debt Instrument, Basis Spread on Variable Rate													7.25%	7.25%	7.25%
Debt Instrument, Covenant, Minimum Excess Availability																										125,000,000
Debt Instrument, Unamortized Discount																										8,000,000
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] | Tranche A-one Loan Facility, option (i) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate					7.25%
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] | Tranche A-one Loan Facility, option (ii) (z) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate					1.00%
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] | Tranche A-one Loan Facility, option (ii) (y) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate					0.50%
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] | Tranche A-one Loan Facility, option (ii) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate					6.25%
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] | Toys R Us - Canada [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount																										$ 125,000,000
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member] | London Interbank Offered Rate (LIBOR) [Member] | Tranche A-one Loan Facility, option (ii) (z) [Member]
Short-term Debt [Line Items]
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum					1.00%
Maximum Length of Time, Interbank Offered Rate					1 month
Incremental secured term loan facility, due fiscal two thousand eighteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal													$ 4,000,000
Debt Instrument, Face Amount																																	$ 400,000,000
Long-term debt	[3]														$ 133,000,000				130,000,000
Unamortized Debt Issuance Expense															$ 0				$ 1,000,000
Debt Instrument, Basis Spread on Variable Rate													3.75%	3.75%	3.75%
Debt Instrument, Unamortized Discount																																	$ 4,000,000
Proceeds from Issuance of Secured Debt										$ 396,000,000
Long-term Debt, Refinanced, Amount					$ 237,000,000
Debt Instrument, Periodic Payment Percent, Principal													0.25%	0.25%
Debt Instrument, Step-Down Percentage																		0.25%	0.25%	0.25%	0.25%	0.25%
Incremental secured term loan facility, due fiscal two thousand eighteen [Member] | KKR [Member]
Short-term Debt [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value															$ 12,000,000				$ 12,000,000
Incremental secured term loan facility, due fiscal two thousand eighteen [Member] | London Interbank Offered Rate (LIBOR) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													3.75%	3.75%
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum													1.50%	1.50%
Secured term loan facility, due fiscal two thousand sixteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount																																$ 225,000,000
Second incremental secured term loan facility, due fiscal two thousand eighteen [Member]
Short-term Debt [Line Items]
Debt Instrument, Periodic Payment, Principal													$ 2,000,000
Long-term debt	[3]														67,000,000				65,000,000
Unamortized Debt Issuance Expense															$ 0				$ 1,000,000
Debt Instrument, Basis Spread on Variable Rate													3.75%	3.75%	3.75%
Debt Instrument, Unamortized Discount																																$ 5,000,000
Proceeds from Issuance of Secured Debt									$ 220,000,000
Long-term Debt, Refinanced, Amount					$ 143,000,000
Debt Instrument, Periodic Payment Percent, Principal													0.25%	0.25%
Debt Instrument, Step-Down Percentage																		0.25%	0.25%	0.25%	0.25%	0.25%
Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] | KKR [Member]
Short-term Debt [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value															$ 2,000,000				$ 2,000,000
Second incremental secured term loan facility, due fiscal two thousand eighteen [Member] | London Interbank Offered Rate (LIBOR) [Member]
Short-term Debt [Line Items]
Debt Instrument, Basis Spread on Variable Rate													3.75%	3.75%
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum													1.50%	1.50%
U.K. real estate credit facility, due fiscal two thousand twenty [Member]
Short-term Debt [Line Items]
Long-term debt															396,000,000				375,000,000	£ 263
Unamortized Debt Issuance Expense															16,000,000				$ 11,000,000
New UK Propco Loan [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount | £																													£ 263
Number of Real Estate Properties | Properties																		31	31	31	31	31
Debt, Weighted Average Interest Rate																		6.85%	6.85%	6.85%	6.85%	6.85%
New UK Propco Loan [Member] | Occuring During First Year [Member]
Short-term Debt [Line Items]
Prepayment Premium on Debt Principal Prepaid																												3.00%	3.00%
New UK Propco Loan [Member] | Occuring During Second Year [Member]
Short-term Debt [Line Items]
Prepayment Premium on Debt Principal Prepaid																												2.00%	2.00%
New UK Propco Loan [Member] | Occuring During Third Year [Member]
Short-term Debt [Line Items]
Prepayment Premium on Debt Principal Prepaid																												1.00%	1.00%
Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Short-term Debt [Line Items]
Debt Instrument, Face Amount																																						$ 200,000,000
Long-term debt	[9]														$ 22,000,000				$ 22,000,000
Debt Instrument, Interest Rate, Stated Percentage															8.75%			8.75%	8.75%	8.75%	8.75%	8.75%
Debt Instrument, Tender Offer, Aggregate Amount																																				$ 178,000,000
Tender Offer, Percentage of Debt Instrument Purchased																																				89.00%
Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] | Toys R Us - Delaware [Member]
Short-term Debt [Line Items]
Interest Expense													$ 2,000,000		$ 2,000,000		$ 2,000,000
Eight point seven five percent debentures, due fiscal two thousand twenty one [Member] | Maximum [Member]
Short-term Debt [Line Items]
Unamortized Debt Issuance Expense															$ 0				$ 0

[1] On January 29, 2016, Toys “R” Us Iberia Real Estate S.L.U., using cash on hand, paid the €24 million final installment of its senior secured term loan facility (the “Spain Propco Facility Agreement.”)

[2] On January 29, 2016, Toys-Japan entered into an additional bank loan with an aggregate principal amount of ¥4.1 billion.

[3] Represents obligations of Toys “R” Us - Delaware, Inc. (“Toys-Delaware”).

[4] On June 30, 2015, Toys “R” Us - Japan, Ltd. (“Toys-Japan”) entered into an agreement to refinance its committed line of credit (“Tranche 1” due fiscal 2015) into Tranche 1A due fiscal 2017 (“Tranche 1A”) and Tranche 1B due fiscal 2016 (“Trance 1B”).

[5] On December 18, 2015, certain of our foreign subsidiaries amended and restated the European and Australian asset-based revolving credit facility (the “European ABL Facility”) to extend the maturity date of the facility and amend certain other provisions.

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

[7] 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.

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

[9] Represents obligations of the Parent Company and Toys-Delaware.

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Consolidated Short-term borrowings and Long-term debt (Details) € in Millions, £ in Millions, HKD in Millions		12 Months Ended
		Jan. 30, 2016 HKD	Jan. 31, 2015 USD ($)		Jan. 30, 2016 USD ($)	Jan. 30, 2016 GBP (£)	Jan. 30, 2016 EUR (€)
Long-term debt
Long-term debt					$ 4,700,000,000
Carrying Value			$ 4,788,000,000		4,743,000,000
Long-term Debt and Capital Lease Obligations, Current			176,000,000		73,000,000
Long-term Debt and Capital Lease Obligations	[1]		4,612,000,000		4,670,000,000
Labuan uncommitted lines of credit [Member] | Line of Credit [Member]
Short-term borrowings
Short-term Debt					0
Labuan uncommitted lines of credit [Member] | Line of Credit [Member]
Short-term borrowings
Short-term Debt			0		0
Long-term debt
Line of Credit Facility, Maximum Borrowing Capacity		HKD 221			28,000,000
Spanish real estate credit facility, due fiscal two thousand fifteen [Member]
Long-term debt
Long-term debt	[2]		$ 34,000,000		0
Debt Instrument, Basis Spread on Variable Rate		6.00%	6.00%
Toys-Japan unsecured credit lines, expire fiscals two thousand sixteen two thousand seventeen [Member] | Line of Credit [Member]
Long-term debt
Long-term debt	[3]		$ 0		$ 0
Number of Unsecured Loan Commitment Lines of Credit		3			3	3	3
Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member]
Long-term debt
Long-term debt	[4]		$ 448,000,000		$ 448,000,000
Debt Instrument, Interest Rate, Stated Percentage		10.375%	10.375%		10.375%	10.375%	10.375%
Eight point five percent senior secured notes, due fiscal two thousand seventeen [Member]
Long-term debt
Long-term debt	[5]		$ 721,000,000		$ 722,000,000
Debt Instrument, Interest Rate, Stated Percentage		8.50%	8.50%		8.50%	8.50%	8.50%
French real estate credit facility, due fiscal two thousand eighteen [Member]
Long-term debt
Long-term debt			$ 53,000,000		$ 50,000,000		€ 47
Long-term Debt and Capital Lease Obligations, Current			$ 1,000,000		1,000,000
Debt Instrument, Basis Spread on Variable Rate		4.50%	4.50%
Incremental secured term loan facility, due fiscal two thousand eighteen [Member]
Long-term debt
Long-term debt	[6]		$ 133,000,000		130,000,000
Debt Instrument, Basis Spread on Variable Rate		3.75%	3.75%
Second incremental secured term loan facility, due fiscal two thousand eighteen [Member]
Long-term debt
Long-term debt	[6]		$ 67,000,000		65,000,000
Debt Instrument, Basis Spread on Variable Rate		3.75%	3.75%
Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member]
Long-term debt
Long-term debt	[4]		$ 402,000,000		$ 402,000,000
Debt Instrument, Interest Rate, Stated Percentage		7.375%	7.375%		7.375%	7.375%	7.375%
Secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member]
Long-term debt
Line of Credit Facility, Maximum Borrowing Capacity			$ 1,850,000,000		$ 1,850,000,000
One point eight five billion secured revolving credit facility, expires fiscal two thousand nineteen [Member] | Line of Credit [Member]
Long-term debt
Long-term debt	[6]		0		80,000,000
Line of Credit Facility, Maximum Borrowing Capacity					1,850,000,000
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]
Long-term debt
Long-term debt	[7]		$ 965,000,000		923,000,000
Long-term Debt and Capital Lease Obligations, Current					38,000,000
Debt Instrument, Basis Spread on Variable Rate		5.00%	5.00%
Tranche A-one loan facility, due fiscal two thousand and nineteen [Member]
Long-term debt
Long-term debt	[6]		$ 272,000,000		273,000,000
Debt Instrument, Basis Spread on Variable Rate		7.25%	7.25%
Secured term B-four loan facility, due fiscal two thousand and twenty [Member]
Long-term debt
Long-term debt	[6]		$ 1,010,000,000		1,002,000,000
Long-term Debt and Capital Lease Obligations, Current					10,000,000
Debt Instrument, Basis Spread on Variable Rate		8.75%	8.75%
U.K. real estate credit facility, due fiscal two thousand twenty [Member]
Long-term debt
Long-term debt			$ 396,000,000		$ 375,000,000	£ 263
Debt Instrument, Interest Rate, Effective Percentage		6.85%	6.85%		6.85%	6.85%	6.85%
European and Australian asset-based revolving credit facility, expires fiscal two thousand twenty [Member] | Line of Credit [Member]
Long-term debt
Long-term debt			$ 0	[8]	$ 0
Line of Credit Facility, Maximum Borrowing Capacity | £						£ 138
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member]
Long-term debt
Long-term debt	[9]		$ 63,000,000		49,000,000
Long-term Debt and Capital Lease Obligations, Current					$ 7,000,000
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Minimum [Member]
Long-term debt
Debt Instrument, Interest Rate, Stated Percentage		1.85%	1.85%		1.85%	1.85%	1.85%
Toys-Japan one point eight five percent two point one eight percent loans due fiscals two thousand sixteen two thousand twenty one [Member] [Member] [Member] | Maximum [Member]
Long-term debt
Debt Instrument, Interest Rate, Stated Percentage		2.18%	2.18%		2.18%	2.18%	2.18%
Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Long-term debt
Long-term debt	[10]		$ 22,000,000		$ 22,000,000
Debt Instrument, Interest Rate, Stated Percentage		8.75%	8.75%		8.75%	8.75%	8.75%
Finance obligations associated with capital projects [Member]
Long-term debt
Long-term debt			$ 189,000,000		$ 183,000,000
Capital lease obligations [Member]
Long-term debt
Capital Lease Obligations			$ 13,000,000		$ 19,000,000

[1] 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.

[2] On January 29, 2016, Toys “R” Us Iberia Real Estate S.L.U., using cash on hand, paid the €24 million final installment of its senior secured term loan facility (the “Spain Propco Facility Agreement.”)

[3] On June 30, 2015, Toys “R” Us - Japan, Ltd. (“Toys-Japan”) entered into an agreement to refinance its committed line of credit (“Tranche 1” due fiscal 2015) into Tranche 1A due fiscal 2017 (“Tranche 1A”) and Tranche 1B due fiscal 2016 (“Trance 1B”).

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

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

[8] On December 18, 2015, certain of our foreign subsidiaries amended and restated the European and Australian asset-based revolving credit facility (the “European ABL Facility”) to extend the maturity date of the facility and amend certain other provisions.

[9] On January 29, 2016, Toys-Japan entered into an additional bank loan with an aggregate principal amount of ¥4.1 billion.

[10] Represents obligations of the Parent Company and Toys-Delaware.

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Annual Maturities of Short-term borrowings and Long-term debt (Details) $ in Millions	Jan. 30, 2016 USD ($)
Debt Disclosure [Abstract]
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months	$ 73
Long-term Debt, Maturities, Repayments of Principal in Year Two	1,215
Long-term Debt, Maturities, Repayments of Principal in Year Three	659
Long-term Debt, Maturities, Repayments of Principal in Year Four	1,280
Long-term Debt, Maturities, Repayments of Principal in Year Five	1,363
Long-term Debt, Maturities, Repayments of Principal after Year Five	183
Debt Instrument, Face Amount	$ 4,773

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Narrative (Details) - USD ($)		12 Months Ended
		Jan. 28, 2017	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Derivative [Line Items]
Derivative Liability, Fair Value, Gross Asset and Right to Reclaim Cash, Offset			$ 0	$ 0
Derivative Asset, Fair Value, Gross Liability and Obligation to Return Cash, Offset			0	0
Foreign-Exchange Forwards
Derivative [Line Items]
Derivative, Net Liability Position, Aggregate Fair Value			$ 0	2,000,000
Average Remaining Maturity of Foreign Currency Derivatives			12 months
Interest Rate Caps | One Month Usd Libor De-designated [Member]
Derivative [Line Items]
Notional Amount	[1]		$ 0	500,000,000
Interest Rate Contract [Member]
Derivative [Line Items]
Derivative, Net Liability Position, Aggregate Fair Value			$ 0	0
One Month Usd Libor De-designated [Member] | Interest Rate Caps
Derivative [Line Items]
Percentage of Derivative Instrument Designated as Cash Flow Hedge			40.00%
Derivatives designated as cash flow hedges: | Interest Rate Caps
Derivative [Line Items]
Number of Interest Rate Derivatives Held			1
Derivatives designated as cash flow hedges: | Interest Rate Contract [Member] | Designated as Hedging Instrument [Member]
Derivative [Line Items]
Notional Amount				350,000,000
Derivative, Proceeds from Termination of Derivative				10,000,000
Accrued Investment Income Receivable				1,000,000
Derivatives designated as cash flow hedges: | Interest Rate Contract [Member] | Designated as Hedging Instrument [Member] | Maximum [Member]
Derivative [Line Items]
Gain (Loss) on Fair Value Hedge Ineffectiveness, Net					$ 1,000,000
Derivatives designated as cash flow hedges: | Interest Rate Contract [Member] | Designated as Hedging Instrument [Member] | Maximum [Member] | Scenario, Forecast [Member]
Derivative [Line Items]
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months		$ (1,000,000)
Derivative designated as a fair value hedge: | Interest Rate Contract [Member]
Derivative [Line Items]
Number of Interest Rate Derivatives Held			0
Gains (Losses) on Extinguishment of Debt				$ 4,000,000

[1] The Company de-designated a portion of this interest rate cap in fiscal 2010. Prior to its April 2015 maturity, 40% of the $500 million interest rate cap was designated as a cash flow hedge.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Outstanding Interest Rate Contracts (Details) - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015
Interest Rate Swaps | Six Month Jpy Tibor Float to Fixed [Member]
Interest Rate Swaps
Effective Date	[1]	January 2011
Maturity Date	[1]	January 2016
Notional Amount	[1]	$ 0	$ 42
Interest Rate Caps | One Month Usd Libor Designated [Member]
Interest Rate Swaps
Effective Date	[1]	January 2011
Maturity Date	[1]	April 2015
Notional Amount	[1]	$ 0	500
Interest Rate Caps | One Month Usd Libor Not Designated, Two Thousand Eleven [Member]
Interest Rate Swaps
Effective Date		January 2011
Maturity Date		April 2015
Notional Amount		$ 0	500
Interest Rate Caps | One Month Usd Libor De-designated [Member]
Interest Rate Swaps
Effective Date	[2]	January 2012
Maturity Date	[2]	April 2015
Notional Amount	[2]	$ 0	500
Interest Rate Caps | One Month Usd Libor Not Designated, Two Thousand Twelve [Member]
Interest Rate Swaps
Effective Date		January 2012
Maturity Date		April 2015
Notional Amount		$ 0	500
Interest Rate Caps | Three Month Euribor [Member]
Interest Rate Swaps
Effective Date	[1]	January 2013
Maturity Date	[1]	January 2016
Notional Amount	[1]	$ 0	34
Interest Rate Caps | Three Month Euribor [Member] | French real estate credit facility, due fiscal two thousand eighteen [Member]
Interest Rate Swaps
Effective Date	[1]	February 2013
Maturity Date	[1]	February 2018
Notional Amount	[1]	$ 50	53
Interest Rate Caps | One Month Usd Libor Not Designated, Two Thousand Fourteen [Member]
Interest Rate Swaps
Effective Date		January 2014
Maturity Date		April 2015
Notional Amount		$ 0	$ 311

[1] These derivatives were designated for hedge accounting.

[2] The Company de-designated a portion of this interest rate cap in fiscal 2010. Prior to its April 2015 maturity, 40% of the $500 million interest rate cap was designated as a cash flow hedge.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Outstanding Foreign Exchange Contracts (Details) - Foreign-Exchange Forwards - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015
Short-term cross-currency intercompany loans
Foreign-Exchange Forwards
Effective Date	Varies
Maturity Date	Varies
Notional Amount	$ 128	$ 98
Merchandise purchases
Foreign-Exchange Forwards
Effective Date	Varies
Maturity Date	Varies
Notional Amount	$ 18	$ 0

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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	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Derivatives previously designated as cash flow hedges:
Balance, Unrealized (loss) gain on hedged transactions, net of tax	$ 0	$ (1)	$ (2)
Unrealized (loss) gain on hedged transactions	1	1	1
Balance, Unrealized (loss) gain on hedged transactions, net of tax	1	0	(1)
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	0	(1)	(2)
Change in fair value recognized in Accumulated other comprehensive loss - Interest Rate Contracts	0	0	0
Reclassifications from Accumulated other comprehensive loss - Interest Rate Contracts	1	1	1
Balance, Unrealized (loss) gain on hedged transactions, net of tax	$ 1	$ 0	$ (1)

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Impact of Derivatives on Interest Expense (Details) - Interest Expense [Member] - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Derivative designated as a fair value hedge:
Total Interest expense (related to derivatives)		$ 3	$ (4)	$ (1)
Derivatives not designated for hedge accounting:
Derivative designated as a fair value hedge:
Total Interest expense (related to derivatives)		4	(2)	1
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	[1]	(5)	(9)	(1)
Derivatives not designated for hedge accounting: | Interest Rate Contract [Member]
Derivatives not designated for hedge accounting:
Gain (loss) on the change in fair value		0	(2)	0
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	9	2
Designated as Hedging Instrument [Member] | Derivatives designated as cash flow hedges:
Derivative designated as a fair value hedge:
Total Interest expense (related to derivatives)		(1)	(2)	(1)
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		0	2	5
Total Interest expense (related to derivatives)		0	0	(1)
Designated as Hedging Instrument [Member] | Interest Rate Contract [Member] | Derivatives designated as cash flow hedges:
Derivatives designated as cash flow hedges:
Amortization of hedged caps		(1)	(2)	(1)
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	0	(1)
Loss on the change in fair value - Interest Rate Contract		$ 0	$ (2)	$ (5)

[1] 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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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Notional Amounts and Related Fair Values of Derivatives (Details) - USD ($) $ in Millions		Jan. 30, 2016	Jan. 31, 2015
Derivative [Line Items]
Derivative Asset, Notional Amount	[1]	$ 103	$ 2,406
Derivative Asset, Fair Value	[1]	1	0
Derivative Liability, Notional Amount	[1]	93	132
Derivative Liability, Fair Value	[1]	0	(2)
Other assets
Derivative [Line Items]
Derivative Asset, Notional Amount		50	53
Derivative Asset, Fair Value		0	0
Accrued expenses and other current liabilities
Derivative [Line Items]
Derivative Liability, Notional Amount		93	132
Derivative Liability, Fair Value		0	2
Prepaid expenses and other current assets
Derivative [Line Items]
Derivative Asset, Notional Amount		53	2,353
Derivative Asset, Fair Value		1	0
Derivatives not designated for hedge accounting: | Interest Rate Contract [Member] | Prepaid expenses and other current assets
Derivative [Line Items]
Derivative Asset, Notional Amount		0	1,611
Derivative Asset, Fair Value		0	0
Derivatives not designated for hedge accounting: | Foreign-Exchange Forwards | Accrued expenses and other current liabilities
Derivative [Line Items]
Derivative Liability, Notional Amount		93	90
Derivative Liability, Fair Value		0	2
Derivatives not designated for hedge accounting: | Foreign-Exchange Forwards | Prepaid expenses and other current assets
Derivative [Line Items]
Derivative Asset, Notional Amount		53	8
Derivative Asset, Fair Value		1	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		50	53
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
Derivative [Line Items]
Derivative Liability, Notional Amount		0	42
Derivative Liability, Fair Value		0	0
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		0	734
Derivative Asset, Fair Value		$ 0	$ 0

[1] Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the classification of our derivative instruments within the fair value hierarchy.

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FAIR VALUE MEASUREMENTS - Narrative (Details) - Fair Value, Measurements, Recurring [Member] - USD ($)	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015
Significant Unobservable Inputs (Level 3)
Fair Value Assets And Liablities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Interest Rate Derivatives, at Fair Value, Net	$ 0	$ 0
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value Assets And Liablities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Long-lived assets held and used	0	0
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	$ 0	$ 0

XML

FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Millions	Jan. 30, 2016	Jan. 31, 2015
Derivative financial instruments:
Interest rate contracts	$ 0
Foreign exchange contracts	1
Total assets	1
Derivative financial instruments:
Interest rate contracts		$ 0
Foreign exchange contracts		2
Total liabilities		2
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
Foreign exchange contracts		0
Total liabilities		0
Significant Other Observable Inputs (Level 2)
Derivative financial instruments:
Interest rate contracts	0
Foreign exchange contracts	1
Total assets	1
Derivative financial instruments:
Interest rate contracts		0
Foreign exchange contracts		2
Total liabilities		2
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
Foreign exchange contracts		0
Total liabilities		$ 0

XML

FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis (Details) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Millions		Jan. 30, 2016	Jan. 31, 2015
Impairment Losses
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset Held For Use, Long Lived, Fair Value Disclosure	[1]	$ 7	$ 13
Assets Held-for-sale, Long Lived, Fair Value Disclosure	[1]	9
Total assets	[1]	16	13
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset Held For Use, Long Lived, Fair Value Disclosure		4	7
Assets Held-for-sale, Long Lived, Fair Value Disclosure		16
Total assets		20	7
Carrying Value Prior to Impairment
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset Held For Use, Long Lived, Fair Value Disclosure		11	20
Assets Held-for-sale, Long Lived, Fair Value Disclosure		25
Total assets		$ 36	$ 20

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

XML

FAIR VALUE MEASUREMENTS - Schedule of Fair Value, Long-term Debt (Details) - USD ($) $ in Millions	Jan. 30, 2016	Jan. 31, 2015
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Carrying Value	$ 4,743	$ 4,788
Long-term Debt, Fair Value	4,107	4,416
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	1,309	1,346
Significant Other Observable Inputs (Level 2)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Long-term Debt, Fair Value	2,037	2,315
Significant Unobservable Inputs (Level 3)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Long-term Debt, Fair Value	$ 761	$ 755

XML

PROPERTY AND EQUIPMENT - Narrative (Details) - USD ($)	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Property, Plant and Equipment [Line Items]
Net assets held for sale	$ 16,000,000	$ 0
Proceeds from Sale of Property, Plant, and Equipment	13,000,000	18,000,000	$ 35,000,000
Gain (Loss) on Sale of Properties	$ 20,000,000	$ 5,000,000	$ 8,000,000
Minimum [Member]
Property, Plant and Equipment [Line Items]
Period Required to Complete Sale, Assets Held-for-sale	1 year

XML

PROPERTY AND EQUIPMENT - Property, Plant and Equipment (Details) - USD ($)	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015
Property, Plant and Equipment [Line Items]
Land	$ 676,000,000	$ 695,000,000
Buildings	1,932,000,000	1,967,000,000
Furniture and equipment	1,472,000,000	1,639,000,000
Property and leasehold improvements	2,493,000,000	2,500,000,000
Costs of computer software	224,000,000	210,000,000
Construction in progress	71,000,000	32,000,000
Leased equipment under capital lease	32,000,000	51,000,000
Propert and equipment	6,900,000,000	7,094,000,000
Less: accumulated depreciation and amortization	3,721,000,000	3,759,000,000
Property plant and equipment net including assets held for sale, total	3,179,000,000	3,335,000,000
Net assets held for sale	16,000,000	0
Property and equipment, net	$ 3,163,000,000	$ 3,335,000,000
Building [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	45 years
Building [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	50 years
Furniture and Fixtures [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	3 years
Furniture and Fixtures [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	20 years
Leasehold Improvements [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	5 years
Leasehold Improvements [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	25 years
Computer Software, Intangible Asset [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	5 years
Assets Held under Capital Leases [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	3 years
Assets Held under Capital Leases [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful life (in years)	5 years

XML

PROPERTY AND EQUIPMENT - Disclosure of Long Lived Assets Held-for-sale (Details) - USD ($)	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015
Property, Plant and Equipment [Abstract]
Land	$ 25,000,000
Less: accumulated impairment	9,000,000
Net assets held for sale	$ 16,000,000	$ 0

XML

ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Narrative (Details) - USD ($) $ in Millions	Jan. 30, 2016	Jan. 31, 2015
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	$ 44	$ 36
Non-merchandise accounts payable [Member]
Accrued and Other Current Liabilities [Line Items]
Bank Overdrafts	$ 90	$ 84

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ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Schedule of Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Millions		Jan. 30, 2016	Jan. 31, 2015
Accrued and Other Current Liabilities [Line Items]
Accounts payable		$ 1,699	$ 1,571
Gift card and certificate liability		222	205
Accrued bonus		109	110
Sales and use tax and value added tax payable		87	84
Accrued interest		63	55
Accrued property taxes		48	52
Accrued payroll		41	42
Accrued vacation		29	44
Accrued Sponsor Transaction Fees	[1]	0	47
Other	[2]	395	393
Accrued expenses and other current liabilities		994	1,032
Merchandise accounts payable [Member]
Accrued and Other Current Liabilities [Line Items]
Accounts payable	[3]	1,488	1,373
Non-merchandise accounts payable [Member]
Accrued and Other Current Liabilities [Line Items]
Accounts payable	[4]	$ 211	$ 198

[1] January 31, 2015 includes fees payable to the Sponsors as a result of certain financing transactions. In December 2015, the Company’s Advisory Agreement was amended to waive all Transaction Fees including any prior accrued and unpaid transaction fees. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

[2] Includes, among other items, employee benefits, accrued lease liabilities and other accruals. No individual amount included exceeds 5% of Total current liabilities.

[3] Includes $44 million and $36 million of book overdraft cash as of January 30, 2016 and January 31, 2015, respectively.

[4] Includes $90 million and $84 million of book overdraft cash as of January 30, 2016 and January 31, 2015, respectively.

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STOCK-BASED COMPENSATION - Narrative (Details)								3 Months Ended		12 Months Ended
	May. 25, 2017	May. 25, 2016	Aug. 01, 2015 shares	Jul. 02, 2015 USD ($) $ / shares	Dec. 24, 2013 shares	May. 22, 2012	May. 27, 2011	Apr. 30, 2016 shares	Aug. 01, 2015 shares	Jan. 30, 2016 USD ($) $ / shares shares	Jan. 31, 2015 USD ($) shares $ / shares	Feb. 01, 2014 USD ($) $ / shares shares	Feb. 02, 2013 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common Stock, Shares Authorized										60,000,000	55,000,000
Amendment Number One to the Amended and Restated Certificate of Incorporation [Member] | Common Stock Issued Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common Stock, Shares Authorized			5,000,000						5,000,000
Amendment Number One to the Amended and Restated Certificate of Incorporation [Member] | Common Stock Issued Shares | Subsequent Event [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common Stock, Shares Authorized								5,000,000
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 | $ / shares										$ 8.00	$ 8.00	$ 25.25
Granted										3,245,012	3,901,217	1,587,057
Exercised | $ / shares										$ 0	$ 0.00	$ 26.37
Weighted-average grant-date fair value per option: | $ / shares										$ 3.05	$ 2.55	$ 9.67
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period										0	0	1,057,773
Aggregate intrinsic value of service based options exercised | $												$ 4,000,000
Fair value of service based vested options | $										$ 2,000,000	$ 2,000,000	19,000,000
Proceeds from Stock Options Exercised | $										0	0	0
Employee Service Share-based Compensation, Cash Flow Effect, Cash Used to Settle Awards | $												2,000,000
Payments to repurchase shares previously issued to employees | $											$ 0	$ 8,000,000
Stock Options [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Payments to repurchase shares previously issued to employees | $										$ 1,000,000
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 | $ / shares										$ 8.00	$ 8.00	$ 25.40
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number										12,500	290,000	945,878	215,849
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
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized									3,000,000
2010 Incentive Plan | Subsequent Event [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized								1,000,000
2010 Incentive Plan | Stock Options [Member]
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					2 years					2 years	1 year	2 years
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period										10 years
Incremental expenses | $											$ 2,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exchange Ratio										2		1
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares											$ 8.00	$ 22.00
Exercised | $ / shares										$ 8.00
Total unrecognized compensation cost | $										$ 10,000,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition										2 years 256 days
2010 Incentive Plan | Stock Options [Member] | Chief Executive 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				48 months
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value | $				$ 9,000,000
Weighted-average grant-date fair value per option: | $ / shares				$ 8.00
2010 Incentive Plan | Stock Options [Member] | Scenario, Forecast [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested	50.00%	50.00%
2010 Incentive Plan | Stock Options [Member] | 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
2010 Incentive Plan | Stock Options [Member] | 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
2010 Incentive Plan | Stock Options [Member] | 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			128,762		459,805
2010 Incentive Plan | Stock Options [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, Forfeitures in Period					919,599						1,566,307
2010 Incentive Plan | Stock Options [Member] | 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
2010 Incentive Plan | Stock Options [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total number of shares issued under incentive plan										500,000
Incremental expenses | $										$ 1,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exchange Ratio												2
2010 Incentive Plan | Stock Options [Member] | 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
2010 Incentive Plan | 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 | $ / shares												$ 30.00
Weighted-average grant-date fair value per option: | $ / shares										$ 8.00	$ 8.00
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $										$ 5,000,000	$ 9,000,000	$ 4,000,000
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | $										$ 0	$ 0	$ 0
2010 Incentive Plan | Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of options vested										100.00%	100.00%	100.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period										1 year	1 year	2 years
Incremental expenses | $											$ 1,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exchange Ratio										1
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period			64,381
2010 Incentive Plan | Performance Shares [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					104,240
2010 Incentive Plan | Nonvested Restricted Shares and Restricted Units [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation cost | $										$ 1,000,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition										1 year
2010 Incentive Plan | Peformance-based shares and Performance-based stock units [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	3 years
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number										0	0

XML

STOCK-BASED COMPENSATION - Weighted Average Valuation Assumptions (Details) - Stock Options [Member] - $ / shares	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility	45.00%	45.00%
Expected term	4 years
Dividend Yield	0.00%	0.00%	0.00%
Weighted-average grant-date fair value per option:	$ 3.05	$ 2.55	$ 9.67
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility			40.00%
Risk-free interest rate	2.00%	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%	2.40%	2.70%
Expected term		5 years 183 days	5 years 73 days

XML

STOCK-BASED COMPENSATION - Summary of Service Based Option Activity (Details) - Stock Options [Member] - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding at beginning of fiscal year	3,922,371	2,661,025	3,483,283
Granted	3,245,012	3,901,217	1,587,057
Exercised	0	0	(1,057,773)
Forfeited/Canceled	(1,127,521)	(2,639,871)	(1,351,542)
Outstanding at end of fiscal year	6,039,862	3,922,371	2,661,025
Outstanding at beginning of fiscal year	$ 8.23	$ 29.40	$ 36.02
Granted	8.00	8.00	25.25
Exercised	0	0.00	26.37
Forfeited/Canceled	8.00	29.23	43.97
Outstanding at end of fiscal year	$ 8.15	$ 8.23	$ 29.40
Stock options, shares vested or expected to vest	6,014,672
Stock options, shares exercisable	0
Weighted average exercise price of stock options vested or expected to vest	$ 8.00
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	$ 0.0
Aggregate intrinsic value of stock options exercisable	$ 0.0

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STOCK-BASED COMPENSATION - Summary of Nonvested Restricted Share and Restricted Unit Activity (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested shares / Outstanding units at beginning of fiscal year	290,000	945,878	215,849
Granted	50,000	50,000	791,165
Shares vested / Units converted	(185,453)	(156,079)	(20,694)
Forfeited/Canceled	(142,047)	(549,799)	(40,442)
Nonvested shares / Outstanding units at end of fiscal year	12,500	290,000	945,878
Nonvested shares / Outstanding units at beginning of fiscal year	$ 14.01	$ 29.05	$ 46.04
Granted	8.00	8.00	25.40
Shares vested / Units converted	26.29	45.20	51.93
Forfeited/Canceled	11.32	30.49	36.66
Nonvested shares / Outstanding units at end of fiscal year	$ 8.00	$ 14.01	$ 29.05

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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	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total recognized tax benefit	$ 0	$ 0	$ 0
Selling, General and Administrative Expenses [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
SG&A	$ 5	$ 15	$ 15

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ACCUMULATED OTHER COMPREHENSIVE INCOME - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax	$ (249)	$ (202)	$ (74)	$ 8
Unrealized (loss)gain on hedged transactions, net of tax, balance	1	0	(1)	(2)
Accumulated Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax	(22)	(42)	(9)	$ (9)
Accumulated other comprehensive (loss) income, balance	(244)	(84)	(3)
Foreign currency translation adjustments, net of tax	(47)	(128)	(82)
Unrealized gain (loss) on hedged transactions, net of tax	1	1	1
Unrecognized actuarial (losses) gains, net of tax	(20)	33	0
Accumulated other comprehensive loss	$ (26)	$ (160)	$ (81)

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LEASES - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Operating Leased Assets [Line Items]
Future Minimum Payments of Lease Extended Amount	$ 1,400
Operating Leases, Rent Expense, Net	546	$ 601	$ 609
Operating Leases, Income Statement, Sublease Revenue	17	18	19
Deferred rent liabilities	354	359
Deferred rent liabilities, current, recorded in Accrued expenses and other current liabilities	9	12
Operating Leases, Rent Expense, Contingent Rentals	12	10	$ 10
Long-term debt	4,700
Finance obligations associated with capital projects [Member]
Operating Leased Assets [Line Items]
Long-term debt	$ 183	$ 189

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LEASES - Schedule of Future Minimum Rental Payments for Operating Leases and Capital Leases (Details) $ in Millions	Jan. 30, 2016 USD ($)
Leases [Abstract]
Operating Leases, Future Minimum Payments Due, Next Twelve Months	$ 505	[1]
Operating Leases, Sublease Income Due, Next Twelve Months	14	[1]
Operating Leases, Net Future Minimum Payments Due, Next Twelve Months	491	[1]
Capital Leases, Future Minimum Payments Due, Next Twelve Months	33
Operating Leases, Future Minimum Payments, Due in Rolling Year Two	445	[1]
Operating Leases, Sublease Income Due, Due in Rolling Year Two	12	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling Year Two	433	[1]
Capital Leases, Future Minimum Payments, Due in Rolling Year Two	30
Operating Leases, Future Minimum Payments, Due in Rolling Year Three	377	[1]
Operating Leases, Sublease Income Due, Due in Rolling Year Three	11	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling Year Three	366	[1]
Capital Leases, Future Minimum Payments, Due in Rolling Year Three	27
Operating Leases, Future Minimum Payments, Due in Rolling Year Four	316	[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	307	[1]
Capital Leases, Future Minimum Payments, Due in Rolling Year Four	22
Operating Leases, Future Minimum Payments, Due in Rolling Year Five	262	[1]
Operating Leases, Sublease Income Due, Due in Rolling Year Five	7	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling Year Five	255	[1]
Capital Leases, Future Minimum Payments, Due in Rolling Year Five	19
Operating Leases, Future Minimum Payments, Due in Rolling after Year Five	952	[1]
Operating Leases, Sublease Income Due, Due in Rolling after Year Five	18	[1]
Operating Leases, Net Future Minimum Payments Due, Due in Rolling after Year Five	934	[1]
Capital Leases, Future Minimum Payments, Due in Rolling after Year Five	71
Operating Leases, Gross Minimum Rentals	2,857	[1]
Operating Leases, Sublease Income Due	71	[1]
Operating Leases, Net Minimum Rentals	2,786	[1]
Capital Leases and Financing Obligations, Lease Obligation	$ 202

[1] Excluded from the minimum rental commitments displayed above are $1.4 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 2021 and thereafter.

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INCOME TAXES - Narrative (Details) - USD ($)	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Schedule of Income Taxes [Line Items]
Interest and penalties	$ (2,000,000)
Deferred Tax Liabilities, Undistributed Foreign Earnings	214,000,000	$ 222,000,000
Unrecognized tax benefits	32,000,000	30,000,000	$ 37,000,000	$ 32,000,000
U.S. Federal tax loss and other carryforwards	358,000,000	385,000,000
State tax loss and other carryforwards	83,000,000	84,000,000
Foreign tax loss and other carryforwards	164,000,000	169,000,000
Increase (decrease) in valuation allowance	35,000,000
Valuation allowance	656,000,000	621,000,000
Deferred Tax Assets, Valuation Allowance, Foreign	6,000,000
Unrecognized tax benefits, affect effective tax rate	25,000,000
Unrecognized tax benefits that would impact deferred tax accounts	7,000,000
Unrecognized tax benefits, accrued interest	6,000,000	4,000,000	5,000,000
Unrecognized Tax Benefits Including Income Tax Penalties and Interest Accrued	38,000,000
Tax Loss Carryforward [Member]
Schedule of Income Taxes [Line Items]
Unrecognized tax benefits	8,000,000	7,000,000
Expire During the Next Five Years [Member]
Schedule of Income Taxes [Line Items]
U.S. Federal tax loss and other carryforwards	$ 0
Carryforwards Expiration Period	5 years
State tax loss and other carryforwards	$ 10,000,000
Foreign tax loss and other carryforwards	5,000,000
Expire During the Next Six to Twenty Years [Member]
Schedule of Income Taxes [Line Items]
U.S. Federal tax loss and other carryforwards	172,000,000
State tax loss and other carryforwards	61,000,000
Foreign tax loss and other carryforwards	2,000,000
Indefinite Expiration Years [Member]
Schedule of Income Taxes [Line Items]
U.S. Federal tax loss and other carryforwards	186,000,000
State tax loss and other carryforwards	12,000,000
Foreign tax loss and other carryforwards	157,000,000
U.S. Federal Tax Credit and Other Carryforwards [Member]
Schedule of Income Taxes [Line Items]
Increase (decrease) in valuation allowance	17,000,000
State Tax Loss And Other Carryforwards [Member]
Schedule of Income Taxes [Line Items]
Increase (decrease) in valuation allowance	4,000,000
Foreign Tax Loss And Other Carryforwards [Member]
Schedule of Income Taxes [Line Items]
Increase (decrease) in valuation allowance	14,000,000
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
Maximum [Member]
Schedule of Income Taxes [Line Items]
Interest and penalties		(1,000,000)	(1,000,000)
Unrecognized tax benefits, accrued penalties	$ 1,000,000	$ 1,000,000	$ 1,000,000
Maximum [Member] | Expire During the Next Six to Twenty Years [Member]
Schedule of Income Taxes [Line Items]
Carryforwards Expiration Period	20 years
Minimum [Member] | Expire During the Next Six to Twenty Years [Member]
Schedule of Income Taxes [Line Items]
Carryforwards Expiration Period	6 years

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INCOME TAXES - Earnings before Income Taxes (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Income Tax Disclosure [Abstract]
U.S.	$ (169)	$ (263)	$ (851)
Foreign	121	7	(16)
Loss before income taxes	$ (48)	$ (256)	$ (867)

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INCOME TAXES - Income Tax (Benefit) Expense (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Current:
U.S. Federal	$ 1	$ (13)	$ (7)
Foreign	54	46	46
State	4	0	(3)
Total current income tax expense	59	33	36
Deferred:
U.S. Federal	0	1	42
Foreign	17	(2)	72
State	0	0	19
Total deferred income tax expense (benefit)	17	(1)	133
Total income tax expense	$ 76	$ 32	$ 169

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INCOME TAXES - Effective Tax Rate Reconciliation (Details)		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Income Tax Disclosure [Abstract]
U.S. Federal statutory tax rate		35.00%	35.00%	35.00%
State taxes, net of U.S. Federal benefit		(5.40%)	0.00%	(1.20%)
Foreign operations	[1]	(183.70%)	(13.50%)	(12.30%)
U.S. Federal valuation allowance		(10.40%)	(36.60%)	(27.90%)
Unrecognized tax benefits	[2]	0.00%	3.00%	0.00%
Goodwill Impairment	[3]	0.00%	0.00%	(13.40%)
Other		6.20%	(0.40%)	0.30%
Effective tax rate		(158.30%)	(12.50%)	(19.50%)

[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 enacted changes in the tax laws or rates or a change in the status of the enterprise.

[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. Refer to “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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INCOME TAXES - Summary of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions		Jan. 30, 2016		Jan. 31, 2015
Deferred tax assets:
U.S. Federal tax loss and other carryforwards		$ 358		$ 385
State tax loss and other carryforwards		83		84
Foreign tax loss and other carryforwards		164		169
Straight line rent		127		127
Inventory		60		52
Insurance loss reserve		38		35
Restructuring charges		5		7
Other		148		158
Gross deferred tax assets before valuation allowance		983		1,017
Valuation allowance		(656)		(621)
Total deferred tax assets		327		396
Deferred tax liabilities:
Fixed assets (1)	[1]	(39)		(67)
Undistributed earnings of foreign subsidiaries		(214)		(222)
Foreign currency translation		(28)		(24)
Other		(14)		(21)
Total deferred tax liabilities		(295)		(334)
Net deferred tax assets		$ 32	[2]	$ 62

[1] Includes deferred impact of finance obligations associated with capital projects.

[2] In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The guidance is effective for interim and annual periods beginning after December 15, 2016, and may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. As permitted, the Company elected to early adopt this guidance effective January 30, 2016, and has applied the guidance prospectively. The adoption of this guidance did not have a significant impact on the Company’s financial statements, other than the prospective classification of deferred tax liabilities and assets as noncurrent in accordance with the new presentation requirements.

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INCOME TAXES - Summary of Deferred Tax Assets and Liabilities Reflected in Consolidated Balance Sheets (Details) - USD ($) $ in Millions		Jan. 30, 2016	[1]	Jan. 31, 2015
Income Tax Disclosure [Abstract]
Current deferred tax assets		$ 0		$ 45
Current deferred tax liabilities	[2]	0		(4)
Non-current deferred tax assets		96		133
Non-current deferred tax liabilities		(64)		(112)
Net deferred tax assets		$ 32		$ 62

[1] In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The guidance is effective for interim and annual periods beginning after December 15, 2016, and may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. As permitted, the Company elected to early adopt this guidance effective January 30, 2016, and has applied the guidance prospectively. The adoption of this guidance did not have a significant impact on the Company’s financial statements, other than the prospective classification of deferred tax liabilities and assets as noncurrent in accordance with the new presentation requirements.

[2] The current deferred tax liabilities are included as components of Accrued expenses and other current liabilities on our prior year Consolidated Balance Sheet.

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INCOME TAXES - Reconciliation of Beginning and Ending Amount of Gross Unrecognized Tax Benefits (Excluding Interest and Penalties) (Details) - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Income Tax Disclosure [Abstract]
Beginning balance		$ 30	$ 37	$ 32
Additions for tax positions of the current year		2	4	4
Additions for tax positions of prior years		2	5	6
Reductions for tax positions of prior years	[1]	0	(11)	(1)
Settlements		0	0	0
Currency translation adjustment		(1)	4	0
Lapse of statute of limitations		(1)	(1)	(4)
Ending balance		$ 32	$ 30	$ 37

[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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SEGMENTS - Narrative (Details) $ in Millions	12 Months Ended
	Jan. 30, 2016 USD ($) countries stores states	Jan. 31, 2015 USD ($)	Feb. 01, 2014 USD ($)	Jan. 31, 1994 countries stores
Segment Reporting Information [Line Items]
Number of Stores	1,622
Licenses Revenue | $	$ 17	$ 17	$ 16
Number of Reportable Segments	2
Number of Countries in which Entity Operates | countries	39			17
Goodwill impairment | $	$ 0	$ 0	378
Inventory Write-down | $			51
Minimum [Member]
Segment Reporting Information [Line Items]
Number of Stores				1,000
Lessee Leasing Arrangements, Operating Leases, Term of Contract	1 year
Domestic
Segment Reporting Information [Line Items]
Number of Stores	866
Number of States in which Entity Operates | states	49
Goodwill impairment | $			361
Domestic | Minimum [Member]
Segment Reporting Information [Line Items]
Lessee Leasing Arrangements, Operating Leases, Term of Contract	2 years
Domestic | Traditional Toy Stores [Member]
Segment Reporting Information [Line Items]
Number of Stores	361
Domestic | Baby Stores [Member]
Segment Reporting Information [Line Items]
Number of Stores	224
Domestic | Side by Side Stores [Member]
Segment Reporting Information [Line Items]
Number of Stores	213
Domestic | Express Stores [Member]
Segment Reporting Information [Line Items]
Number of Stores	68
International
Segment Reporting Information [Line Items]
Percentage of Operated Stores	75.00%
Number of Stores	1,008
Number of Licensed Stores	252
Number of Countries in which Entity Operates | countries	38
Goodwill impairment | $			$ 17
International | Wholly Owned Properties [Member]
Segment Reporting Information [Line Items]
Number of Stores	756
International | Maximum [Member]
Segment Reporting Information [Line Items]
Lessee Leasing Arrangements, Operating Leases, Term of Contract	2 years
International | Traditional Toy Stores [Member] | Wholly Owned Properties [Member]
Segment Reporting Information [Line Items]
Number of Stores	534
International | Baby Stores [Member] | Wholly Owned Properties [Member]
Segment Reporting Information [Line Items]
Number of Stores	15
International | Side by Side Stores [Member] | Wholly Owned Properties [Member]
Segment Reporting Information [Line Items]
Number of Stores	202
International | Express Stores [Member] | Wholly Owned Properties [Member]
Segment Reporting Information [Line Items]
Number of Stores	5

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SEGMENTS - Percentage of Consolidated Net Sales from Product Category (Details)		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Domestic
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		100.00%	100.00%	100.00%
Domestic | Baby
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		36.90%	37.90%	37.70%
Domestic | Core Toy
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		18.40%	17.20%	15.90%
Domestic | Entertainment
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		9.00%	10.20%	11.30%
Domestic | Learning
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		23.50%	22.60%	22.60%
Domestic | Seasonal
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		11.40%	11.20%	11.30%
Domestic | Other
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage	[1]	0.80%	0.90%	1.20%
International
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		100.00%	100.00%	100.00%
International | Baby
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		20.50%	20.20%	20.40%
International | Core Toy
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		23.20%	23.50%	22.70%
International | Entertainment
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		7.10%	8.50%	10.00%
International | Learning
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		32.80%	31.10%	30.80%
International | Seasonal
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage		15.70%	15.90%	15.30%
International | Other
Segment Reporting Information [Line Items]
Product Category Net Sales Percentage	[2]	0.70%	0.80%	0.80%

[1] Consists primarily of non-product related revenues.

[2] Consists primarily of non-product related revenues, including licensing revenue from unaffiliated third parties.

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SEGMENTS - Reconciliation Schedule of Operating Profit (Loss) from Segments to Consolidated (Details) - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Net sales
Net sales		$ 11,802	$ 12,361	$ 12,543
Operating earnings (loss)
Operating loss		378	191	(350)
Interest expense		(429)	(451)	(524)
Interest income		3	4	7
Loss before income taxes		(48)	(256)	(867)
Domestic
Net sales
Net sales		7,356	7,524	7,638
Operating earnings (loss)
Operating loss	[1],[2]	484	332	(197)
International
Net sales
Net sales		4,446	4,837	4,905
Operating earnings (loss)
Operating loss	[1]	271	229	203
Corporate and other
Operating earnings (loss)
Operating loss		$ (377)	$ (370)	$ (356)

[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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SEGMENTS - Summary of Depreciation, Amortization and Capital Expenditure (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Depreciation and amortization
Depreciation and amortization	$ 343	$ 377	$ 388
Capital expenditures
Capital expenditures	219	207	238
Domestic
Depreciation and amortization
Depreciation and amortization	180	210	216
Capital expenditures
Capital expenditures	74	67	113
International
Depreciation and amortization
Depreciation and amortization	107	116	123
Capital expenditures
Capital expenditures	74	83	86
Corporate
Depreciation and amortization
Depreciation and amortization	56	51	49
Capital expenditures
Capital expenditures	$ 71	$ 57	$ 39

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SEGMENTS - Summary of Total Merchandise Inventories and Total Assets Table (Details) - USD ($) $ in Millions		Jan. 30, 2016	Jan. 31, 2015
Merchandise inventories
Merchandise inventories		$ 2,270	$ 2,064
Assets [Abstract]
Total Assets		6,968	7,115
Domestic
Merchandise inventories
Merchandise inventories		1,559	1,353
Assets [Abstract]
Total Assets		3,718	3,633
International
Merchandise inventories
Merchandise inventories		711	711
Assets [Abstract]
Total Assets		2,032	2,122
Corporate and other
Assets [Abstract]
Total Assets	[1]	$ 1,218	$ 1,360

[1] Includes cash and cash equivalents, deferred tax assets and other corporate assets.

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SEGMENTS - Net Sales and Long Lived Assets by Country or Region (Details) - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Net sales
Net sales		$ 11,802	$ 12,361	$ 12,543
Long-lived assets
Long-lived assets		3,369	3,546
United States
Net sales
Net sales	[1]	7,356	7,524	7,638
Long-lived assets
Long-lived assets	[2]	2,275	2,372
Europe
Net sales
Net sales	[3]	1,211	1,405	1,447
Long-lived assets
Long-lived assets	[4]	339	352
Japan
Net sales
Net sales		1,182	1,308	1,374
Long-lived assets
Long-lived assets		277	306
Canada
Net sales
Net sales		809	834	883
Long-lived assets
Long-lived assets		157	180
UK
Net sales
Net sales		666	710	680
Long-lived assets
Long-lived assets		266	281
China and Southeast Asia
Net sales
Net sales		365	333	277
Long-lived assets
Long-lived assets		43	41
Australia
Net sales
Net sales		196	230	228
Long-lived assets
Long-lived assets		12	14
Other
Net sales
Franchise Revenue		$ 17	$ 17	$ 16

[1] Includes our wholly-owned operations in Puerto Rico and Guam.

[2] Includes our wholly-owned operations in Puerto Rico and Guam.

[3] Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

[4] Includes our wholly-owned operations in Germany, Austria, Switzerland, France, Spain, Portugal and Poland.

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DEFINED BENEFIT PENSION PLANS - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 28, 2017	Jan. 30, 2016	Jan. 31, 2015
Defined Benefit Plan Disclosure [Line Items]
Unrecognized net actuarial losses, net of tax		$ (22)	$ (42)
Maximum [Member]
Defined Benefit Plan Disclosure [Line Items]
Cash Equivalents, Original Maturity		3 months
Defined benefit pension plans
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Amortization of Net Gains (Losses)		$ 1
Defined benefit pension plans | Minimum [Member] | UK and Japan Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Percentage of plan assets related to U.K. and Japan pension plans		92.00%
Defined benefit pension plans | Scenario, Forecast [Member]
Defined Benefit Plan Disclosure [Line Items]
Contribution to pension plan	$ 6

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DEFINED BENEFIT PENSION PLANS - Changes in Projected Benefit Obligations (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Compensation and Retirement Disclosure [Abstract]
Projected benefit obligation at beginning of year	$ 174	$ 137
Service cost	5	5	$ 5
Interest cost	5	5	5
Benefits paid	(3)	(6)
Actuarial (gain) loss	(25)	52
Foreign currency impact	(8)	(19)
Projected benefit obligation at end of year	$ 148	$ 174	$ 137

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DEFINED BENEFIT PENSION PLANS - Changes in Fair Value of Plan Assets (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015
Compensation and Retirement Disclosure [Abstract]
Fair value of plan assets at beginning of year	$ 123	$ 118
Actual return on plan assets	(2)	17
Employer contributions	11	7
Benefits paid	(3)	(6)
Foreign currency impact	(6)	(13)
Fair value of plan assets at end of year	$ 123	$ 123

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DEFINED BENEFIT PENSION PLANS - Funded Status (Details) - USD ($) $ in Millions	Jan. 30, 2016	Jan. 31, 2015
Reconciliation of funded status to total amount recognized:
Funded status	$ (25)	$ (51)
Amounts recognized in Consolidated Balance Sheets:
Other non-current liabilities	(25)	(51)
Amounts recognized in Accumulated other comprehensive loss:
Unrecognized actuarial losses, net of tax	$ 22	$ 42

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DEFINED BENEFIT PENSION PLANS - Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets (Details) - USD ($) $ in Millions	Jan. 30, 2016	Jan. 31, 2015
Compensation and Retirement Disclosure [Abstract]
Projected benefit obligation	$ 148	$ 174
Accumulated benefit obligation	129	150
Fair value of plan assets	$ 123	$ 123

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DEFINED BENEFIT PENSION PLANS - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Compensation and Retirement Disclosure [Abstract]
Service cost	$ 5	$ 5	$ 5
Interest cost	5	5	5
Expected return on plan assets	(4)	(5)	(5)
Actuarial losses recognized	(2)	0	0
Net periodic benefit cost	$ 8	$ 5	$ 5

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DEFINED BENEFIT PENSION PLANS - Estimated Future Payments (Details) $ in Millions	Jan. 30, 2016 USD ($)
Compensation and Retirement Disclosure [Abstract]
2016	$ 1
2017	1
2018	1
2019	1
2020	1
2021 through 2025	$ 7

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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. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Compensation and Retirement Disclosure [Abstract]
Discount rate	2.70%	3.70%	4.10%
Expected rate of return on plan assets	3.40%	4.50%	4.90%
Rate of compensation increase	2.60%	2.60%	2.70%
Discount rate	3.20%	2.70%
Rate of compensation increase	2.60%	2.60%

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DEFINED BENEFIT PENSION PLANS - Weighted Average Asset Allocation by Asset Category (Details)	12 Months Ended
	Jan. 28, 2017	Jan. 30, 2016	Jan. 31, 2015
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		29.60%	28.30%
Debt securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations		56.60%	58.30%
Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations		7.40%	7.30%
Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations		6.40%	6.10%
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	29.60%
Scenario, Forecast [Member] | Debt securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Target Plan Asset Allocations	56.60%
Scenario, Forecast [Member] | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Target Plan Asset Allocations	7.40%
Scenario, Forecast [Member] | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Target Plan Asset Allocations	6.40%

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DEFINED BENEFIT PENSION PLANS - Schedule of Fair Value of Plan Assets (Details) - USD ($) $ in Millions		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets		$ 123	$ 123	$ 118
Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	[1]	9	9
Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	[2]	8	7
Domestic | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	[3]	11	11
Domestic | Fixed income
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	[3]	6	4
International | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	[3]	25	24
International | Fixed income
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	[3]	64	68
Quoted Prices in Active Markets for Identical Assets (Level 1)
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets		8	7
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	[1]	0	0
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	[2]	8	7
Significant Other Observable Inputs (Level 2)
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets		9	9
Significant Other Observable Inputs (Level 2) | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	[1]	9	9
Significant Other Observable Inputs (Level 2) | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Fair Value of Plan Assets	[2]	$ 0	$ 0

[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] In accordance with ASU 2015-07, securities which are measured at fair value using the NAV per share practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are to reconcile the fair value hierarchy to the total fair value of plan assets.

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OTHER EMPLOYEE RETIREMENT AND COMPENSATION BENEFITS - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
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	$ 2
Period of Service for Eligibility in the Savings Plan	12 months
Period of Service for Eligibility in the Savings Plan	1,000 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	$ 25	24	$ 24
Maximum [Member]
Defined Benefit Plan Disclosure [Line Items]
Supplemental executive retirement plan expenses	$ 1	$ 1

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LITIGATION AND LEGAL PROCEEDINGS - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
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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COMMITMENTS AND CONTINGENCIES - Narrative (Details) $ in Millions	12 Months Ended
	Jan. 30, 2016 USD ($)
Loss Contingencies [Line Items]
Leases assigned to third parties, potential future lease related payments	$ 51
Minimum [Member]
Loss Contingencies [Line Items]
Lessee Leasing Arrangements, Operating Leases, Term of Contract	1 year

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RELATED PARTY TRANSACTIONS - Narrative (Details) - USD ($) $ in Millions			12 Months Ended
		Dec. 02, 2015	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014	Feb. 01, 2009
Related Party Transaction [Line Items]
Accrued Sponsor Transaction Fees	[1]		$ 0	$ 47
The Sponsors [Member]
Related Party Transaction [Line Items]
Term of Advisory Agreement		10 years
Advisory Agreement Extension Period		1 year
Sponsor Fees			6	17	$ 22
Transaction Fees Percentage						1.00%
The Sponsors [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Related Party, Management and Advisory Fee, Out of Pocket Expense			1	1	0
The Sponsors [Member] | Service Agreements [Member]
Related Party Transaction [Line Items]
Sponsor Fees			6	17
KKR [Member]
Related Party Transaction [Line Items]
Interest Expense, Related Party			$ 7	$ 10	$ 10
Vornado [Member]
Related Party Transaction [Line Items]
Percentage of Operated Stores			0.60%	0.70%	0.80%
Operating Leases, Rent Expense			$ 8	$ 8	$ 8
Unaffiliated Joint-Venture Parties [Member]
Related Party Transaction [Line Items]
Operating Leases, Rent Expense			2	$ 2	$ 2
Bain [Member]
Related Party Transaction [Line Items]
Revenue from Related Parties			21
Accounts Payable, Related Parties			3
Bain [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Accounts Receivable, Related Parties			$ 1

[1] January 31, 2015 includes fees payable to the Sponsors as a result of certain financing transactions. In December 2015, the Company’s Advisory Agreement was amended to waive all Transaction Fees including any prior accrued and unpaid transaction fees. Refer to Note 16 entitled “RELATED PARTY TRANSACTIONS” for further details.

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RELATED PARTY TRANSACTIONS Schedule of Sponsor Debt Ownership (Details) - KKR [Member] - USD ($) $ in Millions	Jan. 30, 2016	Jan. 31, 2015
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	$ 32	$ 136
Senior unsecured term loan facility, due fiscal two thousand and nineteen [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	16	17
Incremental secured term loan facility, due fiscal two thousand eighteen [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	12	12
Secured term B-four loan facility, due fiscal two thousand and twenty [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	2	96
Second incremental secured term loan facility, due fiscal two thousand eighteen [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	2	2
Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member]
Related Party Transaction [Line Items]
Financial Instruments, Owned, Corporate Debt, at Fair Value	$ 0	$ 9

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ACQUISITIONS - Narrative (Details) - Toys (Labuan) Holdings Limited [Member] - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014	Oct. 31, 2011
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, Contingent Consideration, Cash Payment	$ 2	$ 1	$ 0
Noncontrolling interest				$ 24

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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule I - Condensed Statements of Operations and Comprehensive Income (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Condensed Financial Statements, Captions [Line Items]
Revenues	$ 11,802	$ 12,361	$ 12,543
Depreciation and amortization	343	377	388
Other expense, net	88	53	37
Total operating expenses	3,848	4,239	4,739
Operating loss	378	191	(350)
Interest expense	(429)	(451)	(524)
Income tax expense	76	32	169
Net loss attributable to Toys “R” Us, Inc.	(130)	(292)	(1,039)
Comprehensive loss	(156)	(452)	(1,120)
Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Revenues	0	0	0
General and administrative expenses	58	25	21
Depreciation and amortization	0	1	3
Other expense, net	0	0	(1)
Total operating expenses	58	26	25
Operating loss	(58)	(26)	(25)
Interest expense	(81)	(78)	(76)
Intercompany interest expense, net	(78)	(54)	(63)
Equity (deficit) in pre-tax earnings (loss) of consolidated subsidiaries	163	(102)	(706)
Loss before income taxes	(54)	(260)	(870)
Income tax expense	76	32	169
Net loss attributable to Toys “R” Us, Inc.	$ (130)	$ (292)	$ (1,039)

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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule I - Condensed Balance Sheets (Details) - USD ($) $ in Millions	Jan. 30, 2016		Jan. 31, 2015	Feb. 01, 2014	Feb. 02, 2013
Current Assets:
Cash and cash equivalents	$ 680		$ 698	$ 644	$ 1,118
Prepaid expenses and other current assets	113		122
Total current assets	3,288		3,154
Property and equipment, net	3,163		3,335
Deferred tax assets	96	[1]	133
Other assets	305		376
Total Assets	6,968		7,115
Current Liabilities:
Accrued expenses and other current liabilities	994		1,032
Income taxes payable	32		20
Total current liabilities	2,798		2,799
Long-term debt	4,700
Other non-current liabilities	245		255
Stockholders’ deficit	(1,265)		(1,095)
Total Liabilities, Temporary Equity and Stockholders’ Deficit	6,968		7,115
Parent Company [Member]
Current Assets:
Cash and cash equivalents	1		11	$ 79	$ 530
Income taxes receivable	18		20
Prepaid expenses and other current assets	16		9
Due from subsidiary	364		376
Total current assets	399		416
Property and equipment, net	1		1
Deferred tax assets	0		2
Other assets	11		12
Total Assets	411		431
Current Liabilities:
Accrued expenses and other current liabilities	77		121
Income taxes payable	2		2
Total current liabilities	79		123
Long-term debt	872		872
Due to subsidiaries, net	638		461
Other non-current liabilities	87		70
Stockholders’ deficit	(1,265)		(1,095)
Total Liabilities, Temporary Equity and Stockholders’ Deficit	$ 411		$ 431

[1] In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires entities to classify deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The guidance is effective for interim and annual periods beginning after December 15, 2016, and may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. As permitted, the Company elected to early adopt this guidance effective January 30, 2016, and has applied the guidance prospectively. The adoption of this guidance did not have a significant impact on the Company’s financial statements, other than the prospective classification of deferred tax liabilities and assets as noncurrent in accordance with the new presentation requirements.

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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule I - Condensed Statements of Cash Flows (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Condensed Financial Statements, Captions [Line Items]
Cash Flows from Operating Activities	$ 238	$ 476	$ 144
Cash Flows from Investing Activities:
Proceeds from redemption of debt securities	0	0	52
Net cash used in investing activities	(210)	(193)	(205)
Net cash used in financing activities	(27)	(191)	(388)
Cash and cash equivalents:
Net (decrease) increase during period	(18)	54	(474)
Cash and cash equivalents at beginning of period	698	644	1,118
Cash and cash equivalents at end of period	680	698	644
Supplemental Disclosures of Cash Flow Information:
Interest paid	393	380	458
Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Cash Flows from Operating Activities	(25)	(13)	(21)
Cash Flows from Investing Activities:
Investments in subsidiaries	7	5	(180)
Intercompany loan repayments by subsidiaries	1,548	2,056	1,956
Loans to subsidiaries	(1,540)	(2,116)	(2,251)
Proceeds from redemption of debt securities	0	0	52
Net cash used in investing activities	15	(55)	(423)
Net cash used in financing activities	0	0	(7)
Cash and cash equivalents:
Net (decrease) increase during period	(10)	(68)	(451)
Cash and cash equivalents at beginning of period	11	79	530
Cash and cash equivalents at end of period	1	11	79
Supplemental Disclosures of Cash Flow Information:
Interest paid	$ 77	$ 77	$ 78

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SCHEDULE I - PARENT COMPANY INFORMATION - Narrative (Details) £ in Millions, HKD in Millions		12 Months Ended
		Jan. 30, 2016 USD ($)	Jan. 31, 2015 USD ($)	Feb. 01, 2014 USD ($)	Jan. 30, 2016 HKD	Jan. 30, 2016 USD ($)	Jan. 30, 2016 GBP (£)	Jul. 21, 2005 USD ($)	Jul. 21, 2005 GBP (£)
Condensed Financial Statements, Captions [Line Items]
Income tax benefit		$ (76,000,000)	$ (32,000,000)	$ (169,000,000)
Long-term debt						$ 4,700,000,000
Long-term Debt, Fair Value			4,416,000,000			4,107,000,000
Interest expense		(429,000,000)	(451,000,000)	(524,000,000)
Derivative Liability, Fair Value, Gross Asset and Right to Reclaim Cash, Offset			0			0
Derivative Asset, Fair Value, Gross Liability and Obligation to Return Cash, Offset			0			0
Capital contribution		2,000,000	1,000,000
Interest Rate Contract [Member]
Condensed Financial Statements, Captions [Line Items]
Derivative, Net Liability Position, Aggregate Fair Value			0			0
Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Condensed Financial Statements, Captions [Line Items]
Long-term debt	[1]		22,000,000			22,000,000
U.K. real estate credit facility, due fiscal two thousand twenty [Member]
Condensed Financial Statements, Captions [Line Items]
Long-term debt			396,000,000			375,000,000	£ 263
Spanish real estate credit facility, due fiscal two thousand fifteen [Member]
Condensed Financial Statements, Captions [Line Items]
Long-term debt	[2]		34,000,000			0
Subsidiaries [Member]
Condensed Financial Statements, Captions [Line Items]
Income tax benefit		(143,000,000)	(91,000,000)	(127,000,000)
Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Due from subsidiary			376,000,000			364,000,000
Income tax benefit		(76,000,000)	(32,000,000)	(169,000,000)
Long-term debt			872,000,000			872,000,000
Long-term Debt, Fair Value			639,000,000			$ 653,000,000
Interest expense		$ (81,000,000)	$ (78,000,000)	(76,000,000)
Average Remaining Maturity of Foreign Currency Derivatives		12 months
Number of Foreign Currency Derivatives Held			0		0	0	0
Derivative Liability, Fair Value, Gross Asset and Right to Reclaim Cash, Offset			$ 0
Derivative Asset, Fair Value, Gross Liability and Obligation to Return Cash, Offset			0
Parent Company [Member] | Interest Rate Contract [Member]
Condensed Financial Statements, Captions [Line Items]
Number of Interest Rate Derivatives Held					0	0	0
Derivative, Net Liability Position, Aggregate Fair Value						$ 0
Parent Company [Member] | Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Condensed Financial Statements, Captions [Line Items]
Long-term debt	[3]		22,000,000			22,000,000
Parent Company [Member] | Labuan uncommitted lines of credit [Member]
Condensed Financial Statements, Captions [Line Items]
Line of Credit Facility, Future Borrowings, Amount Guaranteed					HKD 194	25,000,000
Toys R Us - Delaware [Member] | Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Condensed Financial Statements, Captions [Line Items]
Interest expense		$ (2,000,000)	(2,000,000)	(2,000,000)
Toys (Labuan) Holdings Limited [Member]
Condensed Financial Statements, Captions [Line Items]
Business Acquisition, Contingent Consideration, Cash Payment		2,000,000	1,000,000	0
Subsidiaries [Member] | Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Related Party Transaction, Due from (to) Related Party			(119,000,000)			(21,000,000)
Toys R Us (UK) Limited [Member] | Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Related Party Transaction, Due from (to) Related Party			(175,000,000)			(176,000,000)
Notes Payable, Related Parties, Noncurrent								$ 770,000,000
Promissory Note Received as Dividend								$ 887,000,000	£ 509
Toys R Us - Delaware [Member] | Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Related Party Transaction, Due from (to) Related Party			755,000,000			$ 835,000,000
Insurance Liabilities, Related Party		92,000,000
Insurance Liabilities, Third Party			89,000,000
Other Payables, Related Parties		4,000,000	4,000,000
TRU Asia, Ltd. [Member] | Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Capital contribution		4,000,000	5,000,000
Toys (Labuan) Holdings Limited [Member] | Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Business Acquisition, Contingent Consideration, Cash Payment		$ 2,000,000	$ 1,000,000
Toys-Europe [Member] | Parent Company [Member] | U.K. real estate credit facility, due fiscal two thousand twenty [Member]
Condensed Financial Statements, Captions [Line Items]
Capital contribution				274,000,000
Toys-Europe [Member] | Parent Company [Member] | Spanish real estate credit facility, due fiscal two thousand fifteen [Member]
Condensed Financial Statements, Captions [Line Items]
Capital contribution				$ 10,000,000

[1] Represents obligations of the Parent Company and Toys-Delaware.

[2] On January 29, 2016, Toys “R” Us Iberia Real Estate S.L.U., using cash on hand, paid the €24 million final installment of its senior secured term loan facility (the “Spain Propco Facility Agreement.”)

[3] Represents obligations of Toys “R” Us, Inc. and Toys–Delaware.

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SCHEDULE I - PARENT COMPANY INFORMATION - Long-term Notes Payable by Parent (Details) - Parent Company [Member] - Toys R Us - Delaware [Member] - USD ($) $ in Millions		Jan. 30, 2016	Jan. 31, 2015
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties	[1]	$ 923	$ 840
Note Issued by Parent FY 2005 [Member]
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties		326	299
Note Issued by Parent FY 2009 [Member]
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties		253	222
Senior Subordinated Note Issued by Parent in FY 2012 [Member]
Schedule of Accounts, Notes, Loans and Financing Payable [Line Items]
Notes Payable, Related Parties	[2]	254	229
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.

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SCHEDULE I - PARENT COMPANY INFORMATION - Summary of the Parent Company's Long-Term Debt (Details) - USD ($) $ in Millions		Jan. 30, 2016	Jan. 31, 2015
Debt Instrument [Line Items]
Long-term debt		$ 4,700
Ten point three seven five percent senior notes, due fiscal two thousand seventeen [Member]
Debt Instrument [Line Items]
Long-term debt	[1]	$ 448	$ 448
Debt Instrument, Interest Rate, Stated Percentage		10.375%	10.375%
Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member]
Debt Instrument [Line Items]
Long-term debt	[1]	$ 402	$ 402
Debt Instrument, Interest Rate, Stated Percentage		7.375%	7.375%
Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Debt Instrument [Line Items]
Long-term debt	[2]	$ 22	$ 22
Debt Instrument, Interest Rate, Stated Percentage		8.75%	8.75%
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]
Long-term debt		$ 448	$ 448
Debt Instrument, Interest Rate, Stated Percentage		10.375%	10.375%
Parent Company [Member] | Seven point three seven five percent senior notes, due fiscal two thousand eighteen [Member]
Debt Instrument [Line Items]
Long-term debt		$ 402	$ 402
Debt Instrument, Interest Rate, Stated Percentage		7.375%	7.375%
Parent Company [Member] | Eight point seven five percent debentures, due fiscal two thousand twenty one [Member]
Debt Instrument [Line Items]
Long-term debt	[3]	$ 22	$ 22
Debt Instrument, Interest Rate, Stated Percentage		8.75%	8.75%

[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] Represents obligations of the Parent Company and Toys-Delaware.

[3] Represents obligations of Toys “R” Us, Inc. and Toys–Delaware.

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SCHEDULE I - PARENT COMPANY INFORMATION - Annual Maturities of the Parent Company's Long-Term Debt (Details) $ in Millions	Jan. 30, 2016 USD ($)
Debt Instrument [Line Items]
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months	$ 73
Long-term Debt, Maturities, Repayments of Principal in Year Two	1,215
Long-term Debt, Maturities, Repayments of Principal in Year Three	659
Long-term Debt, Maturities, Repayments of Principal in Year Four	1,280
Long-term Debt, Maturities, Repayments of Principal in Year Five	1,363
Long-term Debt, Maturities, Repayments of Principal after Year Five	183
Debt Instrument, Face Amount	4,773
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	450
Long-term Debt, Maturities, Repayments of Principal in Year Three	400
Long-term Debt, Maturities, Repayments of Principal in Year Four	0
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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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule of Outstanding Interest Rate Contracts (Details) - Interest Rate Caps - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015
One Month Usd Libor Not Designated, Two Thousand Eleven [Member]
Interest Rate Caps
Effective Date		January 2011
Maturity Date		April 2015
Notional Amount		$ 0	$ 500
One Month Usd Libor Not Designated, Two Thousand Twelve [Member]
Interest Rate Caps
Effective Date		January 2012
Maturity Date		April 2015
Notional Amount		$ 0	500
One Month Usd Libor Not Designated, Two Thousand Fourteen [Member]
Interest Rate Caps
Effective Date		January 2014
Maturity Date		April 2015
Notional Amount		$ 0	311
Parent Company [Member] | One Month Usd Libor Not Designated, Two Thousand Eleven [Member]
Interest Rate Caps
Effective Date	[1]	January 2011
Maturity Date	[1]	April 2015
Notional Amount	[1]		500
Parent Company [Member] | One Month Usd Libor Not Designated, Two Thousand Twelve [Member]
Interest Rate Caps
Effective Date	[1]	January 2012
Maturity Date	[1]	April 2015
Notional Amount	[1]		500
Parent Company [Member] | One Month Usd Libor Not Designated, Two Thousand Fourteen [Member]
Interest Rate Caps
Effective Date	[1]	January 2014
Maturity Date	[1]	April 2015
Notional Amount	[1]		$ 311

[1] These interest rate caps were not designated as cash flow hedges in accordance with ASC 815.

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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	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Derivatives previously designated as cash flow hedges:
Balance, Unrealized (loss) gain on hedged transactions, net of tax	$ 0	$ (1)	$ (2)
Balance, Unrealized (loss) gain on hedged transactions, net of tax	1	0	(1)
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	0	(1)	(2)
Reclassifications from Accumulated other comprehensive loss - Interest Rate Contracts	1	1	1
Balance, Unrealized (loss) gain on hedged transactions, net of tax	1	0	(1)
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	0	1	1
Reclassifications from Accumulated other comprehensive loss - Interest Rate Contracts	0	(1)	0
Balance, Unrealized (loss) gain on hedged transactions, net of tax	$ 0	$ 0	$ 1

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SCHEDULE I - PARENT COMPANY INFORMATION - Impact of Derivatives on Interest Expense (Details) - Interest Expense [Member] - USD ($) $ in Millions		12 Months Ended
		Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Derivatives Instruments Previously Designated as Hedging Instruments [Abstract]
Total Interest expense (related to derivatives)		$ 3	$ (4)	$ (1)
Derivatives not designated for hedge accounting:
Derivatives Instruments Previously Designated as Hedging Instruments [Abstract]
Total Interest expense (related to derivatives)		4	(2)	1
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	[1]	(5)	(9)	(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		0	(2)	0
Parent Company [Member]
Derivatives Instruments Previously Designated as Hedging Instruments [Abstract]
Total Interest expense (related to derivatives)		2	1	(1)
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	[2]	2	0	(1)
Parent Company [Member] | Interest Rate Contract [Member] | Derivatives designated as cash flow hedges: | Previously Designated as Hedging Instrument [Member]
Derivatives Instruments Previously Designated as Hedging Instruments [Abstract]
Amortization of hedged caps		$ 0	$ 1	$ 0

[1] 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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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule of Notional Amounts and Related Fair Values of Derivatives (Details) - USD ($) $ in Millions		Jan. 30, 2016	Jan. 31, 2015
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount	[1]	$ 103	$ 2,406
Derivative Asset, Fair Value	[1]	1	0
Prepaid expenses and other current assets
Interest Rate Contracts not designated for hedge accounting:
Derivative Asset, Notional Amount		53	2,353
Derivative Asset, Fair Value		1	0
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		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
Derivative Asset, Fair Value			$ 0

[1] Refer to Note 4 entitled “FAIR VALUE MEASUREMENTS” for the classification of our derivative instruments within the fair value hierarchy.

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SCHEDULE I - PARENT COMPANY INFORMATION - Schedule of Distributions (Details) - Parent Company [Member] - USD ($) $ in Thousands	12 Months Ended
	Jan. 30, 2016	Jan. 31, 2015	Feb. 01, 2014
Schedule of Distributions [Line Items]
Cash Distributions Paid to Parent Company by Consolidated Subsidiaries	$ 0	$ 0	$ 0
Proceeds from Cash Distributions, Return of Capital	0	0	0
Other Controlled Companies [Member]
Schedule of Distributions [Line Items]
Cash Distributions Paid to Parent Company by Consolidated Subsidiaries	0	0	0
Property Subsidiaries [Member]
Schedule of Distributions [Line Items]
Cash Distributions Paid to Parent Company by Consolidated Subsidiaries	0	0	0
Toys R Us - Delaware [Member]
Schedule of Distributions [Line Items]
Cash Distributions Paid to Parent Company by Consolidated Subsidiaries	0	0	79
Ten point seven five percent senior notes, due fiscal two thousand seventeen [Member] | Toys R Us Property Company I, LLC [Member]
Schedule of Distributions [Line Items]
Cash Distributions Paid to Parent Company by Consolidated Subsidiaries	$ 0	$ 0	$ 0