19. GUARANTOR AND NON-GUARANTOR SUBSIDIARIES

Certain debt obligations of the Company, which constitute debt obligations of the Issuer, are guaranteed by the Parent and by each of its subsidiaries, other than the Issuer, that is an Obligor under the Company's Second Amended Revolving Credit Facility. Separate financial statements of the Parent, the Issuer and such subsidiary guarantors are not presented because the guarantees by the Parent and each wholly owned subsidiary guarantor are joint and several, full and unconditional, except for certain customary limitations which are applicable only to a subsidiary guarantor. These customary limitations include releases of a guarantee (1) if the subsidiary guarantor no longer guarantees other indebtedness of the Issuer; (2) if there is a sale or other disposition of the capital stock of a subsidiary guarantor and if such sale complies with the covenant regarding asset sales; and (3) if the subsidiary guarantor is properly designated as an "unrestricted subsidiary."

The condensed consolidating financial information for the Parent, the Issuer and the guarantor and non-guarantor subsidiaries as of February 2, 2013 and January 28, 2012 and for 2012, 2011 and 2010 as presented below has been prepared from the books and records maintained by the Parent, the Issuer and the guarantor and non-guarantor subsidiaries. The condensed financial information may not necessarily be indicative of the results of operations or financial position had the guarantor and non-guarantor subsidiaries operated as independent entities. Certain intercompany revenues and expenses included in the subsidiary records are eliminated in consolidation. As a result of this activity, an amount due to/due from affiliates will exist at any time.

On December 31, 2012, The Elder-Beerman Stores Corp. (a guarantor subsidiary) was merged with and into the Issuer, with the Issuer as the surviving corporation. Subsequently, the Issuer contributed three stores to Carson Pirie Scott II, Inc. (a guarantor subsidiary), which then contributed those same stores to McRIL, LLC (a guarantor subsidiary). For comparative purposes, the condensed consolidating financial information as presented below has been retrospectively adjusted as if the activity described above occurred at the beginning of each period presented.

The Bon-Ton Stores, Inc.
Condensed Consolidating Balance Sheet
February 2, 2013

	Parent		Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Eliminations			Company Consolidated

Assets
Current assets:
Cash and cash equivalents	$	1	$	3,414	$	4,511	$	—		$	—		$	7,926
Merchandise inventories		—		493,780		264,620		—			—			758,400
Prepaid expenses and other current assets		—		62,855		4,414		3,910			(578	)		70,601

Total current assets		1		560,049		273,545		3,910			(578	)		836,927

Property, fixtures and equipment at cost, net		—		221,966		179,437		251,419			—			652,822
Deferred income taxes		—		6,216		8,794		—			—			15,010
Intangible assets, net		—		36,666		73,897		—			—			110,563
Investment in and advances to (from) affiliates		110,605		366,851		328,183		(52	)		(805,587	)		—
Other long-term assets		—		17,389		343		1,155			—			18,887

Total assets	$	110,606	$	1,209,137	$	864,199	$	256,432		$	(806,165	)	$	1,634,209

Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable	$	—	$	193,898	$	—	$	—		$	—		$	193,898
Accrued payroll and benefits		—		26,899		5,511		—			—			32,410
Accrued expenses		—		86,686		79,350		78			(578	)		165,536
Current maturities of long-term debt and obligations under capital leases		—		69,874		3,034		6,903			—			79,811
Deferred income taxes		—		9,777		10,479		—			—			20,256
Income taxes payable		—		12		727		—			—			739

Total current liabilities		—		387,146		99,101		6,981			(578	)		492,650

Long-term debt and obligations under capital leases, less current maturities		—		555,532		46,279		219,531			—			821,342
Other long-term liabilities		—		155,208		52,815		1,588			—			209,611

Total liabilities		—		1,097,886		198,195		228,100			(578	)		1,523,603

Shareholders' equity		110,606		111,251		666,004		28,332			(805,587	)		110,606

Total liabilities and shareholders' equity	$	110,606	$	1,209,137	$	864,199	$	256,432		$	(806,165	)	$	1,634,209

The Bon-Ton Stores, Inc.
Condensed Consolidating Balance Sheet
January 28, 2012

	Parent		Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Eliminations			Company Consolidated

Assets
Current assets:
Cash and cash equivalents	$	1	$	4,695	$	9,576	$	—	$	—		$	14,272
Merchandise inventories		—		447,581		251,923		—		—			699,504
Prepaid expenses and other current assets		—		59,637		9,238		547		(390	)		69,032

Total current assets		1		511,913		270,737		547		(390	)		782,808

Property, fixtures and equipment at cost, net		—		215,913		194,054		267,166		—			677,133
Deferred income taxes		—		3,982		8,403		—		—			12,385
Intangible assets, net		—		40,358		78,807		—		—			119,165
Investment in and advances to affiliates		131,606		377,086		246,130		1,103		(755,925	)		—
Other long-term assets		—		22,534		823		3,355		—			26,712

Total assets	$	131,607	$	1,171,786	$	798,954	$	272,171	$	(756,315	)	$	1,618,203

Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable	$	—	$	205,492	$	—	$	—	$	—		$	205,492
Accrued payroll and benefits		—		26,654		4,982		—		—			31,636
Accrued expenses		—		92,619		68,620		2,006		(390	)		162,855
Current maturities of long-term debt and obligations under capital leases		—		1,568		2,797		8,066		—			12,431
Deferred income taxes		—		6,794		9,437		—		—			16,231

Total current liabilities		—		333,127		85,836		10,072		(390	)		428,645

Long-term debt and obligations under capital leases, less current maturities		—		590,557		49,555		230,836		—			870,948
Other long-term liabilities		—		145,955		39,571		1,477		—			187,003

Total liabilities		—		1,069,639		174,962		242,385		(390	)		1,486,596

Shareholders' equity		131,607		102,147		623,992		29,786		(755,925	)		131,607

Total liabilities and shareholders' equity	$	131,607	$	1,171,786	$	798,954	$	272,171	$	(756,315	)	$	1,618,203

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Operations
2012

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Company Consolidated

Net sales	$	—		$	1,697,211		$	1,222,200		$	—		$	—		$	2,919,411
Other income		—			33,379			26,046			—			—			59,425

		—			1,730,590			1,248,246			—			—			2,978,836
Costs and expenses:
Costs of merchandise sold		—			1,095,635			778,255			—			—			1,873,890
Selling, general and administrative		—			567,907			399,362			(3,458	)		(27,636	)		936,175
Depreciation and amortization		—			42,168			35,024			11,084			—			88,276
Amortization of lease-related interests		—			1,952			2,744			—			—			4,696
Impairment charges		—			423			5,377			—			—			5,800

Income (loss) from operations		—			22,505			27,484			(7,626	)		27,636			69,999
Other income (expense):
Intercompany rental and royalty income		—			—			120			27,516			(27,636	)		—
Equity in (losses) earnings of subsidiaries		(21,325	)		21,761			—			—			(436	)		—
Interest expense, net		—			(58,275	)		(9,377	)		(15,187	)		—			(82,839	)
Loss on exchange/extinguishment of debt		—			(7,316	)		—			(1,169	)		—			(8,485	)

(Loss) income before income taxes		(21,325	)		(21,325	)		18,227			3,534			(436	)		(21,325	)
Income tax provision		228			228			1,215			—			(1,443	)		228

Net (loss) income	$	(21,553	)	$	(21,553	)	$	17,012		$	3,534		$	1,007		$	(21,553	)

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Comprehensive (Loss) Income
2012

	Parent			Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Eliminations			Company Consolidated

Net (loss) income	$	(21,553	)	$	(21,553	)	$	17,012	$	3,534	$	1,007		$	(21,553	)
Other comprehensive income, net of tax:
Pension and postretirement benefit plans		1,114			1,114			—		—		(1,114	)		1,114

Other comprehensive income		1,114			1,114			—		—		(1,114	)		1,114

Comprehensive (loss) income	$	(20,439	)	$	(20,439	)	$	17,012	$	3,534	$	(107	)	$	(20,439	)

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Operations
2011

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Company Consolidated

Net sales	$	—		$	1,683,970		$	1,200,691		$	—		$	—		$	2,884,661
Other income		—			38,333			30,536			—			—			68,869

		—			1,722,303			1,231,227			—			—			2,953,530
Costs and expenses:
Costs of merchandise sold		—			1,083,018			764,351			—			—			1,847,369
Selling, general and administrative		—			576,164			395,048			80			(35,232	)		936,060
Depreciation and amortization		—			43,359			40,506			11,168			—			95,033
Amortization of lease-related interests		—			2,293			2,454			—			—			4,747
Impairment charges		—			1,050			2,640			—			—			3,690

Income (loss) from operations		—			16,419			26,228			(11,248	)		35,232			66,631
Other income (expense):
Intercompany rental and royalty income		—			—			6,844			28,388			(35,232	)		—
Equity in (losses) earnings of subsidiaries		(14,147	)		25,134			—			—			(10,987	)		—
Interest expense, net		—			(64,429	)		(9,223	)		(15,855	)		—			(89,507	)
Gain on extinguishment of debt		—			8,729			—			—			—			8,729

(Loss) income before income taxes		(14,147	)		(14,147	)		23,849			1,285			(10,987	)		(14,147	)
Income tax (benefit) provision		(2,019	)		(2,019	)		21			—			1,998			(2,019	)

Net (loss) income	$	(12,128	)	$	(12,128	)	$	23,828		$	1,285		$	(12,985	)	$	(12,128	)

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Comprehensive (Loss) Income
2011

	Parent			Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Eliminations			Company Consolidated

Net (loss) income	$	(12,128	)	$	(12,128	)	$	23,828	$	1,285	$	(12,985	)	$	(12,128	)
Other comprehensive loss, net of tax:
Pension and postretirement benefit plans		(35,839	)		(35,839	)		—		—		35,839			(35,839	)
Cash flow derivatives		(2,019	)		(2,019	)		—		—		2,019			(2,019	)

Other comprehensive loss		(37,858	)		(37,858	)		—		—		37,858			(37,858	)

Comprehensive (loss) income	$	(49,986	)	$	(49,986	)	$	23,828	$	1,285	$	24,873		$	(49,986	)

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Operations
2010

	Parent		Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Company Consolidated

Net sales	$	—	$	1,742,114		$	1,238,365		$	—		$	—		$	2,980,479
Other income		—		37,960			28,046			—			—			66,006

		—		1,780,074			1,266,411			—			—			3,046,485
Costs and expenses:
Costs of merchandise sold		—		1,089,366			770,816			—			—			1,860,182
Selling, general and administrative		—		586,235			392,411			96			(36,082	)		942,660
Depreciation and amortization		—		48,952			41,816			11,434			—			102,202
Amortization of lease-related interests		—		2,474			2,081			—			—			4,555
Impairment charges		—		1,175			563			—			—			1,738

Income (loss) from operations		—		51,872			58,724			(11,530	)		36,082			135,148
Other income (expense):
Intercompany rental and royalty income		—		—			7,694			28,388			(36,082	)		—
Equity in earnings of subsidiaries		22,847		55,505			—			—			(78,352	)		—
Interest expense, net		—		(84,530	)		(11,447	)		(16,324	)		—			(112,301	)

Income before income taxes		22,847		22,847			54,971			534			(78,352	)		22,847
Income tax provision		1,353		1,353			1,007			—			(2,360	)		1,353

Net income	$	21,494	$	21,494		$	53,964		$	534		$	(75,992	)	$	21,494

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Comprehensive Income
2010

	Parent		Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Eliminations			Company Consolidated

Net income	$	21,494	$	21,494	$	53,964	$	534	$	(75,992	)	$	21,494
Other comprehensive income, net of tax:
Pension and postretirement benefit plans		12,824		12,824		—		—		(12,824	)		12,824
Cash flow derivatives		3,590		3,590		—		—		(3,590	)		3,590

Other comprehensive income		16,414		16,414		—		—		(16,414	)		16,414

Comprehensive income	$	37,908	$	37,908	$	53,964	$	534	$	(92,406	)	$	37,908

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Cash Flows
2012

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Company Consolidated

Net cash provided by operating activities	$	6,515		$	52,848		$	15,907		$	7,959		$	(9,959	)	$	73,270

Cash flows from investing activities:
Capital expenditures		—			(55,835	)		(17,935	)		—			—			(73,770	)
Intercompany investing activity		(538	)		(1,867	)		—			—			2,405			—
Proceeds from sale of property, fixtures and equipment		—			31			3			8,234			—			8,268

Net cash (used in) provided by investing activities		(538	)		(57,671	)		(17,932	)		8,234			2,405			(65,502	)

Cash flows from financing activities:
Payments on long-term debt and capital lease obligations		—			(717,119	)		(3,040	)		(13,494	)		—			(733,653	)
Proceeds from issuance of long-term debt		—			750,401			—			—			—			750,401
Intercompany financing activity		—			(4,855	)		—			(2,699	)		7,554			—
Cash dividends paid		(4,855	)		—			—			—			—			(4,855	)
Restricted shares forfeited in lieu of payroll taxes		(1,660	)		—			—			—			—			(1,660	)
Proceeds from stock options exercised		538			—			—			—			—			538
Deferred financing costs paid		—			(1,135	)		—			—			—			(1,135	)
Debt exchange costs paid		—			(6,992	)		—			—			—			(6,992	)
Decrease in book overdraft balances		—			(16,758	)		—			—			—			(16,758	)

Net cash (used in) provided by financing activities		(5,977	)		3,542			(3,040	)		(16,193	)		7,554			(14,114	)

Net decrease in cash and cash equivalents		—			(1,281	)		(5,065	)		—			—			(6,346	)

Cash and cash equivalents at beginning of period		1			4,695			9,576			—			—			14,272

Cash and cash equivalents at end of period	$	1		$	3,414		$	4,511		$	—		$	—		$	7,926

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Cash Flows
2011

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Company Consolidated

Net cash provided by operating activities	$	6,456		$	64,431		$	32,665		$	13,347		$	(17,102	)	$	99,797

Cash flows from investing activities:
Capital expenditures		—			(42,843	)		(24,392	)		—			—			(67,235	)
Intercompany investing activity		(398	)		(13	)		—			—			411			—
Proceeds from sale of property, fixtures and equipment		—			365			2,308			108			—			2,781

Net cash (used in) provided by investing activities		(398	)		(42,491	)		(22,084	)		108			411			(64,454	)

Cash flows from financing activities:
Payments on long-term debt and capital lease obligations		—			(796,564	)		(2,596	)		(6,978	)		—			(806,138	)
Proceeds from issuance of long-term debt		—			773,906			—			—			—			773,906
Intercompany financing activity		—			(2,872	)		(7,342	)		(6,477	)		16,691			—
Cash dividends paid		(2,872	)		—			—			—			—			(2,872	)
Restricted shares forfeited in lieu of payroll taxes		(3,584	)		—			—			—			—			(3,584	)
Proceeds from stock options exercised		398			—			—			—			—			398
Deferred financing costs paid		—			(5,931	)		—			—			—			(5,931	)
Increase in book overdraft balances		—			6,811			—			—			—			6,811

Net cash used in financing activities		(6,058	)		(24,650	)		(9,938	)		(13,455	)		16,691			(37,410	)

Net (decrease) increase in cash and cash equivalents		—			(2,710	)		643			—			—			(2,067	)

Cash and cash equivalents at beginning of period		1			7,405			8,933			—			—			16,339

Cash and cash equivalents at end of period	$	1		$	4,695		$	9,576		$	—		$	—		$	14,272

The Bon-Ton Stores, Inc.
Condensed Consolidating Statement of Cash Flows
2010

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Company Consolidated

Net cash provided by operating activities	$	4,107		$	106,814		$	31,479		$	14,720		$	(15,985	)	$	141,135

Cash flows from investing activities:
Capital expenditures		—			(27,522	)		(18,746	)		—			—			(46,268	)
Intercompany investing activity		—			(35	)		—			—			35			—
Proceeds from sale of property, fixtures and equipment		—			2,570			33			—			—			2,603

Net cash used in investing activities		—			(24,987	)		(18,713	)		—			35			(43,665	)

Cash flows from financing activities:
Payments on long-term debt and capital lease obligations		—			(701,953	)		(2,409	)		(6,509	)		—			(710,871	)
Proceeds from issuance of long-term debt		—			610,375			—			—			—			610,375
Intercompany financing activity		—			—			(7,739	)		(8,211	)		15,950			—
Restricted shares forfeited in lieu of payroll taxes		(4,107	)		—			—			—			—			(4,107	)
Deferred financing costs paid		—			(717	)		—			—			—			(717	)
Increase in book overdraft balances		—			5,267			—			—			—			5,267

Net cash used in financing activities		(4,107	)		(87,028	)		(10,148	)		(14,720	)		15,950			(100,053	)

Net (decrease) increase in cash and cash equivalents		—			(5,201	)		2,618			—			—			(2,583	)

Cash and cash equivalents at beginning of period		1			12,606			6,315			—			—			18,922

Cash and cash equivalents at end of period	$	1		$	7,405		$	8,933		$	—		$	—		$	16,339