Related Party Transactions

9 Months Ended

Oct. 29, 2016

11.

Related Party Transactions

The Company, Parent, and affiliates have purchased and may, from time to time, purchase portions of the Company’s indebtedness. All of these purchases have been open market transactions and any interest payments to Parent or affiliates made thereon are paid in accordance with the associated indenture.

On September 20, 2016, pursuant to the Affiliated Holder Exchange, the Parent and affiliates exchanged all $58.7 million aggregate principal amount of Subordinated Notes, and all $183.6 million aggregate principal amount of PIK Subordinated Notes held by them for $10.5 million aggregate principal amount of Claire’s Stores Term Loans, $34.2 million aggregate principal amount of CLSIP Term Loans and $15.8 million aggregate principal amount of Claire’s Gibraltar Term Loans.

As of October 29, 2016 and January 30, 2016, Parent and affiliates held $60.6 million and $233.0 million, respectively, of the Company’s indebtedness and the Company had accrued interest payable associated with the indebtedness in the amounts of $20.0 million and $4.0 million, respectively. For the three and nine months ended October 29, 2016 and October 31, 2015, the Company recognized interest expense related to the indebtedness held by Parent and affiliates of $3.6 million, $16.0 million, $5.8 million and $17.1 million, respectively. On June 1, 2016, the Company issued an additional $9.2 million aggregate principal amount of New PIK Subordinated Notes in payment of interest due June 1, 2016.